Do not waste your time reading the one-hundred plus pages of the European Union Artificial Intelligence Act (EU AI Act) if you have not read the, “Regulation (EU) 2923/1781 of the European Parliament And of The Council establishing a framework of measures for strengthening Europe’s semiconductor ecosystem and amending Regulation (EU) 2021/684”, also known as the EU Chips Act. There will be no artificial intelligence to regulate without a secure supply of microchips. More importantly, there will be no microchips without a secure supply of semiconductors. According to the EU AI Chips Act, a semiconductor is a raw material, element, or compound that has a modifiable electrical conductivity property. An example of a semiconductor is gallium arsenide, a compound that has a relatively high rate of electron mobility. A property that allows electrons to move through the compound quickly, resulting in faster transistor switching speeds on microchips. This is only one example, but there are various semiconductors that are needed to power the digital products we regularly use.

The EU Chips Act is largely focused on enhancing the domestic supply of EU developed chips by stimulating their internal chip economy. The Chips Act accomplishes this by establishing a legal framework and actively intervening in the domestic supply chain to reorient the nature of their domestic chip supply. The legal framework established creates a European Semiconductor Board composed of representatives of the Member States and chaired by the EU Commission. The European Semiconductor Board advises the Commission on matters concerning the global value chain between the Union and “third countries”, and further when it is necessary to consider the perspectives of external stakeholders such as the, “Industrial Alliance on Processors and Semiconductor Technologies”. The Union will also engage in forms of diplomacy with third countries that have advantages in the semiconductor industry to learn how to strengthen the security of the supply and to address potential supply-chain disruptions of semiconductors. The domestic intervention needed to reinvigorate the Union’s supply side is focussed on giving member states the capacity to build competence centres on semiconductors. These competence centres have access to publicly funded infrastructure, and should be open to the public with academic institutions and small and medium enterprises getting priority. Competence centres will feature tools to facilitate virtual chip design technology to increase the skills among the Union. Ideally, the presence of competence centres throughout the member states will spur innovation among the current and next generation chip designers of the EU.

Protectionism is an apparent theme throughout the EU Chip Act. There are various mentions of “third countries” throughout the Act, largely to reference the over reliance of the EU on foreign economies that play an important role in the supply chain. Although there are also mentions of the EU’s green revolution and the importance of regulating the supply of semiconductors and chips in the EU’s green transition, this Act is meant to protect the EU against failures in the global chip supply chain. Given the current world order, the possibility of disruptions in the global supply chain for microchips seems more likely. Countries that have the capacity to build their own infrastructure should begin to do so. I am not too sure of this beginning a trend amongst other nations, however, it is not a bad idea to begin relying on the internal capacity rather than external. Especially in these pressing times.