Japan considers new legislation to back advanced chipmaking

[June 04, 2024]  TOKYO (Reuters) - Japan plans to look into legislation to support the commercial production of advanced semiconductors, a draft of this year's long-term economic policy plan seen by Reuters shows.

The long-term roadmap, which is crafted each year as a key document highlighting the administration's policy priorities, is expected to be finalized around June 21.

An aerial view shows the semiconductor plant by Japan Advanced Semiconductor Manufacturing Company (JASM), a subsidiary of Taiwan Semiconductor Manufacturing Company (TSMC), in Kikuyo town, Kumamoto prefecture, southwestern Japan February 12, 2024, in this photo taken by Kyodo. Mandatory credit Kyodo via REUTERS/File Photo

"In order to strengthen the chip supply chain, we will promote domestic production sites, human resources, research and development in cooperation with countries and regions with the same objectives," the draft said.

"In particular, we will consider necessary legislative measures for the mass production of next-generation semiconductors," it added.

It did not mention any specific chipmaker.

Last week, the industry ministry said Japan would need a new regulatory framework to help chip foundry venture Rapidus start mass production of cutting-edge chips from 2027.

As Tokyo pushes forward with plans to rebuild the country's chip manufacturing base, it has agreed to provide up to 920 billion yen ($5.94 billion) in subsidies to Rapidus.

But the subsidies are for research and development, and Japan would need a new framework such as government guarantees to help attract funds from investors and financial institutions to finance mass production, a government source has said.

Rapidus is headed by industry veterans and is targeting mass production on the northern island of Hokkaido in partnership with IBM and Belgium-based research organization Imec.

($1 = 154.8400 yen)

(Reporting by Takaya Yamaguchi, Ritsuko Shimizu; Writing by Kantaro Komiya and Makiko Yamazaki; Editing by Andrew Heavens and Alexander Smith)

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