The next phase of Europe’s Semiconductor strategy - EC presents Chips Act 2.0 proposal
With the publication of the proposed Chips Act 2.0, the European Commission seeks to build on the foundations laid by the 2022 European Chips Act while addressing a number of persistent challenges that continue to limit Europe's position in the global semiconductor landscape. The proposal acknowledges that although the first Chips Act successfully mobilised investments, established pilot lines, Competence Centres and coordination mechanisms, Europe remains dependent on third countries for critical semiconductor technologies, particularly advanced logic, AI accelerators and cutting-edge manufacturing capabilities. Furthermore, the evaluation of the current framework highlights the need to strengthen industrial deployment, improve coordination across the value chain, and enhance preparedness against future supply chain disruptions.
The revised framework maintains the three-pillar structure of the original Chips Act but introduces significant new measures aimed at accelerating industrialisation, reinforcing security of supply, and improving crisis preparedness.
Pillar 1 – Chips for Europe Initiative 2.0
The most substantial changes are introduced under Pillar 1, which evolves from a research and capacity-building instrument into a broader industrial deployment framework. While maintaining support for pilot lines, design platforms, Competence Centres and skills initiatives, the proposal introduces several new mechanisms intended to bridge the gap between research excellence and commercial deployment.
A major innovation is the introduction of Grand Challenges, Demand Accelerators, and Demand Forums, designed to stimulate market uptake of semiconductor technologies in strategic sectors such as artificial intelligence, automotive, healthcare, energy, aerospace and telecommunications. These instruments seek to address one of the key shortcomings identified in the evaluation of the first Chips Act: the limited connection between semiconductor supply-side investments and industrial demand).
The revised Initiative also expands support to emerging technology domains, including photonics and photonic integrated circuits, advanced AI-oriented semiconductor technologies, quantum chips, advanced packaging and chiplet integration. Particular attention is given to improving access to finance through the reinforcement of the Chips Fund and the creation of more structured pathways for start-ups, scale-ups and SMEs to access pilot infrastructure and industrial deployment opportunities.
The proposal also strengthens the role of Competence Centres and semiconductor skills initiatives, recognising workforce shortages as one of the most significant constraints to future growth. Additional emphasis is placed on skills intelligence, specialised training programmes and coordination across Member States.
Pillar 2 – Security of supply and resilience
Under Pillar 2, the Commission significantly broadens the scope of industrial support. Whereas the first Chips Act largely focused on semiconductor fabrication facilities through the concepts of Integrated Production Facilities and Open EU Foundries, the new proposal introduces the notion of Strategic Projects. These projects may cover a much wider portion of the semiconductor value chain, including semiconductor design, advanced packaging, materials, manufacturing equipment, photonics technologies and other strategically important activities.
The Strategic Projects framework is intended to facilitate investment through accelerated permitting procedures, improved coordination among Member States, and enhanced access to public support mechanisms. The Commission explicitly identifies the need to move beyond manufacturing alone and support critical enabling technologies that determine Europe's overall competitiveness.
A further novelty is the introduction of a European Semiconductor Region of Excellence label, intended to recognise and support regions demonstrating strong semiconductor ecosystems, investment strategies and alignment with European priorities. This measure aims to strengthen regional clusters and improve the geographic distribution of semiconductor capabilities across Europe.
The proposal also places stronger emphasis on advanced manufacturing technologies. Particular attention is given to the development of leading-edge production capabilities, advanced packaging facilities and chiplet integration platforms, which are recognised as critical technologies for future AI, high-performance computing and edge computing applications.
Pillar 3 – Monitoring and crisis responses
The most visible changes under Pillar 3 concern the strengthening of monitoring and intelligence capabilities. The Commission concludes that while the current monitoring framework has improved information exchange among Member States, Europe still lacks sufficient visibility over semiconductor supply chain dependencies and vulnerabilities.
To address this gap, the proposal introduces a Business-to-Business Semiconductor Supply Chain Platform, effectively functioning as a digital representation of the European semiconductor ecosystem. The platform will collect information across different stages of the value chain, enabling improved risk identification, dependency mapping and early warning capabilities.
The proposal also foresees the development of a dedicated EU Semiconductor Crisis Management Blueprint by 2027, defining operational procedures, responsibilities and coordination mechanisms in the event of future disruptions. Additional provisions strengthen information sharing among Member States and improve the capacity of the European Semiconductor Board to coordinate crisis responses and monitor strategic dependencies.
Beyond crisis management, the Commission increasingly views monitoring as a strategic capability supporting industrial policy. Supply chain intelligence, demand forecasting and market monitoring are therefore integrated more closely into the governance framework of the Act.
In the coming months, the Industrial Alliance for Processors and Semiconductor Technologies will play a key role in shaping the discussion and providing industry feedback into this new milestone document. As part of this process, all Alliance Members are invited to participate in our upcoming in person event “From Chips Act 2.0 to Impact: The Next Chapter for Europe’s Semiconductor Ecosystem” to broaden the discussion and dialogue with policy makers. The objective? Setting the stage for this new phase in the European semiconductor industry.
If you are a Member, register here to save your spot.
The event will take place on 26 June 2026 at SPARKS Meeting - Brussels (Belgium).
This event is exclusively reserved for members of the European Industrial Alliance for Processors and Semiconductor Technologies.
