Microelectronics

European Commission: Europe publishes first proposal for new Chips Act 2.0

June 3, 2026. The Chips Act 2.0 aims to strengthen the European semiconductor industry, reduce strategic dependencies, boost demand for chips and promote the development and production of state-of-the-art and mainstream chips in the EU. The first proposal for the “Chips Act 2.0” was published on June 3 and complements other new initiatives, including the draft law on the development of cloud and AI technologies (CADA) and the EU Open Source Strategy, thus contributing to a more competitive, secure and resilient European digital economy.

Symbol image Chips Act 2.0. Photo: Canva AI

Why do we need the Chips Act 2.0?

Semiconductors are part of the EU’s broader efforts to strengthen technological sovereignty. They are key enablers for Europe’s goal of becoming an AI continent and form the basis for the next generation technologies that will determine Europe’s competitiveness: AI applications, cloud infrastructure, drones, connected vehicles, industrial robotics…

The Chips Act 2.0 will complement other new initiatives, including the draft legislation on cloud and AI development and the open source strategy, contributing to a more competitive, secure and resilient European digital economy.

The original Chips Act was the EU’s first coordinated response to critical vulnerabilities in the global semiconductor supply chain. It helped mobilize more than €52 billion in public and private investment, created an estimated 46,000 direct and indirect jobs and strengthened Europe’s semiconductor research and innovation capabilities.

Despite this progress, the EU remains dependent on third countries in key areas such as advanced chip manufacturing or semiconductor design.

The global semiconductor market is also evolving rapidly. A market volume of 1.37 trillion euros is expected by 2030, with AI-related components accounting for around 70% of this growth. The Chips Act 2.0 aims to ensure that Europe captures a greater share of this opportunity while strengthening areas where we are already leading.

Main objectives of the Chips Act 2.0

1. Improving conditions for investment and competitiveness

Strengthening research, innovation and skills development across the semiconductor ecosystem;
Accelerating approval procedures with decisions within a maximum of 12 months;
Introducing “Grand Challenges” to support the industrial development of chips that are critical to the EU, such as AI chips;
Introducing “Grand Challenges” to support the industrial development of chips that are critical to the EU, such as AI chips;
Introducing “Grand Challenges” to support the industrial development of chips that are critical to the EU, such as AI chips. e.g. AI chips;
Strengthening cooperation with international partners through strategic partnerships in the semiconductor sector.

2. Promote demand and industry adoption

Strengthen connections between chipmakers and demand from user industries;
Establish demand accelerators to ensure that new semiconductor products are aligned with industry needs and get to market faster;
Ensuring that public procurement in critical areas focuses on creating EU added value in terms of economic growth, jobs and skills within the Union;
Increasing the use of innovation procurement to boost demand, especially for European-based start-ups and scale-ups and their technologies;
Creating synergies with the Cloud and AI Development Act to benefit from the demand for European chips resulting from the growth of sectors such as data centers, cloud service providers and AI gigafactories.

3. Reinforcing supply-side measures

Enabling state aid for “first-of-a-kind” projects that do not yet exist in the Union, for the entire semiconductor value chain, from raw materials to packaging;
Designate strategic projects to unlock EU funding and co-invest with Member States and industry in projects of strategic importance and EU added value;
Create the framework conditions at regional level to attract investment in semiconductors and promote the regions that do so through a new “Semiconductor Regions of Excellence” label;

4. Strengthen resilience and reduce dependencies

Establish a business-to-business platform for the semiconductor supply chain to help our industry proactively improve its resilience to supply disruptions;
Enhance support for sectors that are repeatedly exposed to risks through guidance on conducting risk assessments and mitigation measures;
Reduce over-reliance on external suppliers for critical semiconductor technologies.

Proposal for the Chips Act 2.0

The Commission has adopted a proposal for the “Chips Act 2.0”, which sets out new measures to further strengthen the chip industry, reduce strategic dependencies and support advanced chip manufacturing in the EU.

The EU remains dependent on third countries in key areas such as advanced chip manufacturing or semiconductor design. Securing a stable chip supply is necessary to ensure that critical infrastructure and technologies remain secure, resilient and in line with European values.

The “Chips Act 2.0” builds on the progress of the original “Chips Act” and will both reinforce current European strengths (including mainstream chips) and build capacity in cutting-edge semiconductor technologies. This will allow the EU to maintain its position as an indispensable player in the value chain, while strengthening its resilience and reducing strategic dependencies and supply chain vulnerabilities.

Silicon Saxony Podcast “What’s chippening”

Would you like to learn more about the Chips Act 2.0 or would you like a classification of this new package of measures? Then listen to the “What’s chippening”-podcast from Silicon Saxony.

👉 Zum Podcast

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