(Bloomberg) -- The White House supports prohibiting semiconductor companies from expanding certain investment in China if they take new subsidies to build plants in the US under legislation the Senate’s set to begin debating Tuesday.
“We continue to support strong guardrails” in the legislation, White House Press Secretary Karine Jean-Pierre said Monday, referring to a provision of the bill that would limit China investments for companies that take some of the $52 billion the measure would dedicate toward US semiconductor manufacturing.
The incentives are intended to “generate more semiconductor investment here in the US, not in China,” Jean-Pierre said. “And guardrails help slow the growth of investment in China. That is why it’s such an important part of the bill. We believe in strong guardrails.”
The China investment restrictions are still under negotiation and are a target of heavy lobbying by the semiconductor industry. Intel Corp. and the industry’s main trade association, the Semiconductor Industry Association, have been lobbying against the restrictions as currently written, Politico reported earlier Monday.
Currently, the legislation would prohibit companies from expanding their semiconductor manufacturing in China for 10 years after they take a grant to build a US plant. Companies could continue to invest in “legacy” chip manufacturing in China, but the definition of that term is unresolved.
Senate Majority Leader Chuck Schumer is set to tee up a procedural vote to start debate on the bill Tuesday.
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