(1)

Semiconductors are essential to the functioning of our modern economy and society. Within the past year, the Union has witnessed unprecedented disruptions in their supply which have entailed serious delays and negative effects on important economic sectors and have led to delays to the repair and maintenance of essential products for critical sectors, such as medical and diagnostic equipment.

(2)

The current semiconductor shortage crisis and its ripple effects therefore render critical sectors such as health, transport, energy, defence, security and space under threat of being affected. The Union’s green and digital transition is at risk of delay.

(3)

Against that background, the Commission Proposal for a Regulation of the European Parliament and the Council establishing a framework of measures for strengthening Europe’s semiconductor ecosystem (Chips Act) (1) aims to address the Union’s resilience to disruptions in the semiconductor supply chain, to foster the development of capacities in advanced manufacturing, design and system integration as well as cutting-edge industrial manufacturing within the Union, to address the acute skills shortage, to increase qualified workforce and to contribute to creating a resilient and dynamic semiconductor ecosystem in the Union. The Union is committed to its strategic goal to reach at least 20 % of world production in value of cutting-edge, innovative and sustainable semiconductors by 2030, as set out in the Digital Decade Policy Programme (2).

(4)

This Recommendation accompanies the proposed Regulation as a tool with immediate effect to enable a rapid and coordinated Union response to the current shortage. To that end, it proposes to set up a coordination mechanism to discuss and decide on timely and proportionate crisis response measures.

(5)

In view of the structural deficiencies of the semiconductor supply chain, it additionally recommends measures to enable coordinated monitoring of the semiconductor value chain, focussing on risks that may disrupt, compromise or negatively affect the supply of semiconductors. Those measures should prepare and enable the permanent mechanism for monitoring of the semiconductor supply chain proposed under the Regulation.

(6)

The Commission has set up the European Semiconductor Expert Group, for the purpose of implementing this Recommendation. The European Semiconductor Expert Group will serve as a platform for coordination between Member States and provide advice and assistance to the Commission in the implementation of the forthcoming Regulation. The tasks of the European Semiconductor Expert Group shall be taken over by the European Semiconductor Board to be established in the Regulation.

(7)

The European Semiconductor Expert Group should facilitate rapid and effective information exchange between the Member States and the Commission on market developments that put Union supplies at tangible risk, and foster a uniform and coordinated crisis response.

(8)

As a first measure, Member States are recommended to request information from representative organisations of undertakings or, if necessary, from individual semiconductor and equipment manufacturers. This would increase the ability of the European Semiconductor Expert Group to identify and tailor potential crisis response measures. The data gathered should concern the production capability, production capacity and current primary disruptions and bottlenecks. Any collection or exchange of information should be in line with applicable rules on data sharing and confidentiality of information and data.

(9)

This Recommendation includes suggestions for crisis response measures that Member States are invited to discuss and consider to implement where relevant and proportionate.

(10)

If the assessment of the crisis at hand so requires, Member States could consider entering into a dialogue asking semiconductor manufacturers established in the Union to prioritise contracts with companies who supply products to critical sectors, with a view to ensure that these sectors continue to operate.

(11)

Furthermore, if relevant and appropriate according to the assessment of the crisis at hand, Member States may consider granting a mandate to the Commission to procure certain products on their behalf, in order to create a leverage effect through its purchasing power and to ensure the supply to critical sectors in the public interest.

(12)

Finally, Member States are encouraged to assess whether the Union should exercise surveillance over certain exports for securing supply to the internal market. If they find such protective measures appropriate, necessary and proportionate, they could discuss and request the Commission to assess whether the conditions for protective measures with regard to exports pursuant to Regulation (EU) 2015/479 of the European Parliament and of the Council (3) are fulfilled.

(13)

The recommended monitoring action should follow the principles of anticipation, coordination and preparedness with a view to establish an early warning system in order to prevent semiconductor crises and to strengthen the Union’s semiconductor ecosystem. To that end, Member States are asked to discuss in the European Semiconductor Expert Group appropriate early warning indicators to anticipate future shortages in the semiconductor supply chain.

(14)

Further in-depth assessment is needed as regards the risks that may disrupt, compromise or negatively affect the value chain, including on the origins and sources of supplies beyond the Union. Therefore, Member States are recommended to gather relevant information and cooperate with a view to enable the Commission to prepare a common risk assessment for the semiconductor value chain in the Union. Factors to be taken into account when preparing the risk assessments should be indicated.

(15)

The Commission sets out in the proposed Regulation a permanent and binding mechanism for a coordinated monitoring and crisis response, which builds upon the measures suggested in this Recommendation. Once the Regulation enters into force, this Recommendation may be repealed.

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