“Details such as yield and operation rate must be provided”
When a competitor leaked, it was a fatal blow before receiving orders
The industry struggles ahead of the start of application on the 31st
“It will be adjusted through negotiations during the screening process”
Confusion in the field is growing as the U.S. demands additional information corresponding to business secrets of companies as a condition of subsidy offered as a card to attract foreign countries in the semiconductor supply chain. Subsidy applications are scheduled to begin on the 31st, but there is a possibility that companies may postpone their applications due to excessive demands from the US government.
On the 27th (local time), the US Department of Commerce released detailed guidelines and examples for applying for subsidies under the Semiconductor Act, demanding that profitability indicators include production capacity and yield forecasts by wafer type. Yield is a key indicator of semiconductor manufacturing competitiveness, so companies keep the yield of certain facilities a secret.
“Detailed financial inputs are key to a comprehensive review of the project’s financial strength,” the Commerce Department said.
In particular, it was specified that the profitability index should include all production capacity, operation rate, yield, sales unit price, and profit forecast for each type of wafer to be manufactured at the semiconductor plant on a quarterly basis. In the cost index, it presented best practices that include not only materials, consumables, and chemicals used to produce semiconductors, but also labor costs, utility bills, and R&D costs required for plant operation. In the case of material and parts costs, costs are separately calculated for each material such as silicon wafer and nitrogen, and the number of employees by type of employee, such as engineers, technicians, and managers, is also disclosed.
In effect, he was asked to submit all detailed information for semiconductor plant operation. Concerns and controversies over the possibility of leaking secrets are likely to continue as semiconductor companies include even yields, which are kept as core secrets, in the scope of disclosure.
For semiconductor companies, if the yield and operation rate of each wafer, which are key information, are disclosed to competitors, it could be fatal in the weeks ahead. Materials, consumables, and types and costs of chemical products are also included in contracts with suppliers, and cannot be disclosed. The U.S. government has demanded an annual output forecast in addition to calculating excess profits, and it has become a situation where companies are virtually forced to present their entire mid- to long-term management strategy. The problem is that if such sensitive information is provided to the US government, there is no guarantee that it will not be leaked to local competitors.
The U.S. Department of Commerce added a proviso, however, that “the document provides guidance only and applicants are under no obligation to follow these suggestions.” Even at the time of the automobile semiconductor crisis in 2021, the Ministry of Commerce requested specific data on 26 items, such as semiconductor inventory and customer information, from semiconductor companies such as Samsung Electronics and SK Hynix. At the time, semiconductor companies did not submit sensitive information.
However, unlike two years ago, when the nature of the request for business cooperation was strong, there are considerable concerns that it will not be easy to reject the guidelines of the Ministry of Commerce as hundreds of millions of dollars in subsidies were involved. The Department of Commerce warned in its detailed guidance that “applications lacking detailed information may request additional information, which may delay the (grant payment) review process.”
The semiconductor industry is in the position that the submission will be adjusted through negotiations in the future application process, as it is the detailed information presented as a draft by the US government at the request of companies to “ask for detailed requirements.” An industry insider said, “It is certain that the information requested by the current standard is classified as trade secret. Now that the subsidy application process has begun in earnest, we will continue negotiations in the future application and screening process to the extent that each company can accept it.”
Washington =
Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.