† HR 4346 EAS2 
‘‘(A) means an industry, industry group, or 
a set of related industries or related industry 
groups— 
‘‘(i) assigned a North American Indus-
try Classification System code beginning 
with 31, 32, or 33; and 
‘‘(ii) for which the applicable industry 
group or groups in the North American In-
dustry Classification System code cumula-
tively— 
‘‘(I) manufacture primary prod-
ucts and parts, the sum of which ac-
count for not less than 5 percent of the 
manufacturing value added by indus-
try gross domestic product of the 
United States; and 
‘‘(II) employ individuals for pri-
mary products and parts manufac-
turing activities that, combined, ac-
count for not less than 5 percent of 
manufacturing employment in the 
United States; and 
‘‘(B) may include any other manufacturing 
industry designated by the Secretary based on 
the relevance of the manufacturing industry to
† HR 4346 EAS2 
the national and economic security of the United 
States, including the impacts of job losses.’’; and 
(4) by inserting after paragraph (6), as so redes-
ignated, the following: 
‘‘(7) The term ‘foreign country of concern’ 
means— 
‘‘(A) a country that is a covered nation (as 
defined in section 4872(d) of title 10 United 
States Code); and 
‘‘(B) any country that the Secretary, in 
consultation with the Secretary of Defense, the 
Secretary of State, and the Director of National 
Intelligence, determines to be engaged in conduct 
that is detrimental to the national security or 
foreign policy of the United States.’’; and 
(5) by inserting after paragraph (9), as so redes-
ignated, the following: 
‘‘(10) The term ‘mature technology node’ has the 
meaning given the term by the Secretary. 
‘‘(11) The term ‘nonprofit entity’ means an enti-
ty described in section 501(c)(3) of the Internal Rev-
enue Code of 1986 and exempt from taxation under 
section 501(a) of such Code.’’. 
(b) SEMICONDUCTOR PROGRAM.—Section 9902 of the 
William M. (Mac) Thornberry National Defense Authoriza-
† HR 4346 EAS2 
tion Act for Fiscal Year 2021 (15 U.S.C. 4652) is amend-
ed— 
(1) in subsection (a)(1)— 
(A) by striking ‘‘for semiconductor fabrica-
tion’’ and inserting ‘‘for the fabrication’’; 
(B) by inserting ‘‘production,’’ before ‘‘or 
research and development’’; and 
(C) by striking the period at the end and 
inserting ‘‘of semiconductors, materials used to 
manufacture semiconductors, or semiconductor 
manufacturing equipment.’’; and 
(2) in subsection (a)(2)— 
(A) in subparagraph (B)(i), by striking ‘‘; 
and’’ at the end; 
(B) in subparagraph (B)(ii)— 
(i) in subclause (III), by striking 
‘‘and’’ at the end; 
(ii) in subclause (IV), by striking the 
period at the end and inserting a semicolon; 
and 
(iii) by adding at the end the fol-
lowing: 
‘‘(V) determined— 
‘‘(aa) the type of semicon-
ductor technology, equipment, ma-
† HR 4346 EAS2 
terials, or research and develop-
ment the covered entity will 
produce at the facility described 
in clause (i); and 
‘‘(bb) the customers, or cat-
egories of customers, to which the 
covered entity plans to sell the 
semiconductor technology, equip-
ment, materials, or research and 
development described in item 
(aa); and 
‘‘(VI) documented, to the extent 
practicable, workforce needs and devel-
oped a strategy to meet such workforce 
needs consistent with the commitments 
described 
in 
subclauses 
(II) 
and 
(III);’’; and 
(C) by inserting after subparagraph (B)(ii) 
the following— 
‘‘(iii) with respect to the project de-
scribed in clause (i), the covered entity has 
an executable plan to identify and mitigate 
relevant semiconductor supply chain secu-
rity risks, such as risks associated with ac-
cess, availability, confidentiality, integrity,
† HR 4346 EAS2 
and a lack of geographic diversification in 
the covered entity’s supply chain; and 
‘‘(iv) with respect to any project for the 
production, assembly, or packaging of semi-
conductors, the covered entity has imple-
mented policies and procedures to combat 
cloning, counterfeiting, and relabeling of 
semiconductors, as applicable.’’; 
(D) in subparagraph (C)— 
(i) in clause (i)— 
(I) in subclause (II), by striking 
‘‘is in the interest of the United 
States’’ and inserting ‘‘is in the eco-
nomic and national security interests 
of the United States’’; and 
(II) in subclause (III), by striking 
‘‘and’’ at the end; 
(ii) in clause (ii)(IV), by striking 
‘‘and’’ at the end; 
(iii) by redesignating clause (iii) as 
clause (v); and 
(iv) by inserting after clause (ii) the 
following: 
‘‘(iii) the Secretary shall consider the 
type of semiconductor technology produced
† HR 4346 EAS2 
by the covered entity and whether that semi-
conductor technology advances the economic 
and national security interests of the 
United States; 
‘‘(iv) the Secretary may not approve 
an application, unless the covered entity 
provides a plan that does not use Federal fi-
nancial assistance to assist efforts to phys-
ically relocate existing facility infrastruc-
ture to another jurisdiction within the 
United States, unless the project is in the 
interest of the United States; and’’; 
(E) by redesignating subparagraph (D) as 
subparagraph (E); and 
(F) by inserting after subparagraph (C) the 
following: 
‘‘(D) PRIORITY.—In awarding Federal fi-
nancial assistance to covered entities under this 
subsection, the Secretary shall— 
‘‘(i) give priority to ensuring that a 
covered entity receiving financial assistance 
will— 
‘‘(I) manufacture semiconductors 
necessary 
to 
address 
gaps 
and 
vulnerabilities in the domestic supply
† HR 4346 EAS2 
chain across a diverse range of tech-
nology and process nodes; and 
‘‘(II) provide a secure supply of 
semiconductors necessary for the na-
tional security, manufacturing, critical 
infrastructure, and technology leader-
ship of the United States and other es-
sential elements of the economy of the 
United States; and 
‘‘(ii) ensure that the assistance is 
awarded to covered entities for both ad-
vanced and mature technology nodes to meet 
the priorities described in clause (i).’’; 
(3) in subsection (a)(4)(A), by striking ‘‘used for 
semiconductors’’ and inserting ‘‘used for the pur-
poses’’; 
(4) in subsection (a)(5)— 
(A) in subparagraph (A), by striking 
‘‘major’’; 
(B) in subparagraph (D), by striking 
‘‘major’’; and 
(C) in subparagraph (E)(i), by striking 
‘‘major’’; 
(5) by inserting after subsection (a)(5) the fol-
lowing:
† HR 4346 EAS2 
‘‘(6) EXPANSION CLAWBACK.— 
‘‘(A) DEFINITION
OF
LEGACY
SEMICON-
DUCTOR.— 
‘‘(i) IN GENERAL.—In this paragraph, 
the term ‘legacy semiconductor’— 
‘‘(I) includes— 
‘‘(aa) a semiconductor tech-
nology that is of the 28 nanometer 
generation or older for logic; 
‘‘(bb) with respect to memory 
technology, 
analog 
technology, 
packaging technology, and any 
other relevant technology, any leg-
acy generation of semiconductor 
technology relative to the genera-
tion described in item (aa), as de-
termined by the Secretary, in con-
sultation with the Secretary of 
Defense and the Director of Na-
tional Intelligence; and 
‘‘(cc) any additional semi-
conductor technology identified by 
the Secretary in a public notice 
issued under clause (ii); and
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‘‘(II) does not include a semicon-
ductor that is critical to national secu-
rity, as determined by the Secretary, 
in consultation with the Secretary of 
Defense and the Director of National 
Intelligence. 
‘‘(ii) UPDATES.—Not later than 2 
years after the date of enactment of the 
CHIPS Act of 2022, and not less frequently 
than once every 2 years thereafter for the 8- 
year period after the last award under this 
section is made, the Secretary, after public 
notice and an opportunity for comment and 
if applicable and necessary, shall issue a 
public notice identifying any additional 
semiconductor technology included in the 
meaning of the term ‘legacy semiconductor’ 
under clause (i). 
‘‘(iii) 
FUNCTIONS
OF
THE
SEC-
RETARY.—The functions of the Secretary 
under this paragraph shall not be subject to 
sections 551, 553 through 559, and 701 
through 706 of title 5, United States Code. 
‘‘(iv) CONSULTATION.—In carrying out 
clause (ii), the Secretary shall consult with
† HR 4346 EAS2 
the Director of National Intelligence and the 
Secretary of Defense. 
‘‘(v) CONSIDERATIONS.—In carrying 
out clause (ii), the Secretary shall con-
sider— 
‘‘(I) state-of-the-art semiconductor 
technologies in the United States and 
internationally, including in foreign 
countries of concern; and 
‘‘(II) consistency with export con-
trols relating to semiconductors. 
‘‘(B) DEFINITION OF SEMICONDUCTOR MAN-
UFACTURING.—In this paragraph, the term 
‘semiconductor manufacturing’— 
‘‘(i) has the meaning given the term by 
the Secretary, in consultation with the Sec-
retary of Defense and the Director of Na-
tional Intelligence; and 
‘‘(ii) includes front-end semiconductor 
fabrication. 
‘‘(C) REQUIRED AGREEMENT.— 
‘‘(i) IN
GENERAL.—On or before the 
date on which the Secretary awards Federal 
financial assistance to a covered entity 
under this section, the covered entity shall
† HR 4346 EAS2 
‘‘(iii) AFFILIATED
GROUP.—For the 
purpose of applying the requirements in an 
agreement required under clause (i), a cov-
ered entity shall include the covered entity 
receiving financial assistance under this 
section, as well as any member of the cov-
ered entity’s affiliated group under section 
1504(a) of the Internal Revenue Code of 
1986, without regard to section 1504(b)(3) 
of such Code. 
‘‘(D) NOTIFICATION REQUIREMENTS.—Dur-
ing the applicable term of the agreement of a 
covered entity required under subparagraph 
(C)(i), the covered entity shall notify the Sec-
retary of any planned significant transactions of 
the covered entity involving the material expan-
sion of semiconductor manufacturing capacity in 
the People’s Republic of China or any other for-
eign country of concern. 
‘‘(E) VIOLATION OF AGREEMENT.— 
‘‘(i) NOTIFICATION TO COVERED ENTI-
TIES.—Not later than 90 days after the date 
of receipt of a notification described in sub-
paragraph (D) from a covered entity, the 
Secretary, in consultation with the Sec-
† HR 4346 EAS2 
retary of Defense and the Director of Na-
tional Intelligence, shall— 
‘‘(I) determine whether the signifi-
cant transaction described in the noti-
fication would be a violation of the 
agreement of the covered entity re-
quired under subparagraph (C)(i); and 
‘‘(II) notify the covered entity of 
the Secretary’s decision under sub-
clause (I). 
‘‘(ii) OPPORTUNITY
TO
REMEDY.— 
Upon a notification under clause (i)(II) 
that a planned significant transaction of a 
covered entity is a violation of the agree-
ment of the covered entity required under 
subparagraph (C)(i), the Secretary shall— 
‘‘(I) immediately request from the 
covered entity tangible proof that the 
planned significant transaction has 
ceased or been abandoned; and 
‘‘(II) provide the covered entity 45 
days to produce and provide to the 
Secretary the tangible proof described 
in subclause (I).
† HR 4346 EAS2 
‘‘(iii) FAILURE BY THE COVERED ENTI-
TY TO CEASE OR REMEDY THE ACTIVITY.— 
Subject to clause (iv), if a covered entity 
fails to remedy a violation as set forth 
under clause (ii), the Secretary shall recover 
the full amount of the Federal financial as-
sistance provided to the covered entity 
under this section. 
‘‘(iv) MITIGATION.—If the Secretary, 
in consultation with the Secretary of De-
fense and the Director of National Intel-
ligence, determines that a covered entity 
planning a significant transaction that 
would violate the agreement required under 
subparagraph (C)(i) could take measures in 
connection with the transaction to mitigate 
any risk to national security, the Sec-
retary— 
‘‘(I) may negotiate, enter into, 
and enforce any agreement or condi-
tion for the mitigation; and, 
‘‘(II) waive the recovery require-
ment under clause (iii). 
‘‘(F) SUBMISSION OF RECORDS.—
† HR 4346 EAS2 
‘‘(i) IN GENERAL.—The Secretary may 
request from a covered entity records and 
other necessary information to review the 
compliance of the covered entity with the 
agreement required under subparagraph 
(C)(i). 
‘‘(ii) ELIGIBILITY.—In order to be eli-
gible for Federal financial assistance under 
this section, a covered entity shall agree to 
provide records and other necessary infor-
mation requested by the Secretary under 
clause (i). 
‘‘(G) CONFIDENTIALITY OF RECORDS.— 
‘‘(i) IN
GENERAL.—Subject to clause 
(ii), any information derived from records 
or necessary information disclosed by a cov-
ered entity to the Secretary under this sec-
tion— 
‘‘(I) shall be exempt from disclo-
sure under section 552(b)(3) of title 5, 
United States Code; and 
‘‘(II) shall not be made public. 
‘‘(ii) EXCEPTIONS.—Clause (i) shall 
not prevent the disclosure of any of the fol-
lowing by the Secretary:
† HR 4346 EAS2 
‘‘(I) Information relevant to any 
administrative or judicial action or 
proceeding. 
‘‘(II) Information that a covered 
entity has consented to be disclosed to 
third parties. 
‘‘(III) Information necessary to 
fulfill the requirement of the congres-
sional notification under subparagraph 
(H). 
‘‘(H) CONGRESSIONAL NOTIFICATION.—Not 
later than 60 days after the date on which the 
Secretary finds a violation by a covered entity of 
an agreement required under subparagraph 
(C)(i), and after providing the covered entity 
with an opportunity to provide information in 
response to that finding, the Secretary shall pro-
vide to the appropriate Committees of Con-
gress— 
‘‘(i) a notification of the violation; 
‘‘(ii) a brief description of how the Sec-
retary determined the covered entity to be 
in violation; and
† HR 4346 EAS2 
‘‘(e) ADDITIONAL ASSISTANCE FOR MATURE TECH-
NOLOGY NODES.— 
‘‘(1) IN GENERAL.—The Secretary shall establish 
within the program established under subsection (a) 
an additional program that provides Federal finan-
cial assistance to covered entities to incentivize invest-
ment in facilities and equipment in the United States 
for the fabrication, assembly, testing, or packaging of 
semiconductors at mature technology nodes. 
‘‘(2) 
ELIGIBILITY
AND
REQUIREMENTS.—In 
order for an entity to qualify to receive Federal fi-
nancial assistance under this subsection, the covered 
entity shall agree to— 
‘‘(A) submit an application under sub-
section (a)(2)(A); 
‘‘(B) meet the eligibility requirements under 
subsection (a)(2)(B); 
‘‘(C)(i) provide equipment or materials for 
the fabrication, assembly, testing, or packaging 
of semiconductors at mature technology nodes in 
the United States; or 
‘‘(ii) fabricate, assemble using packaging, or 
test semiconductors at mature technology nodes 
in the United States;
† HR 4346 EAS2 
‘‘(D) commit to using any Federal financial 
assistance received under this section to increase 
the production of semiconductors at mature tech-
nology nodes; and 
‘‘(E) be subject to the considerations de-
scribed in subsection (a)(2)(C). 
‘‘(3) PROCEDURES.—In granting Federal finan-
cial assistance to covered entities under this sub-
section, the Secretary may use the procedures estab-
lished under subsection (a). 
‘‘(4) CONSIDERATIONS.—In addition to the con-
siderations described in subsection (a)(2)(C), in 
granting Federal financial assistance under this sub-
section, the Secretary may consider whether a covered 
entity produces or supplies equipment or materials 
used in the fabrication, assembly, testing, or pack-
aging of semiconductors at mature technology nodes 
that are necessary to support a critical manufac-
turing industry. 
‘‘(5) PRIORITY.—In awarding Federal financial 
assistance to covered entities under this subsection, 
the Secretary shall give priority to covered entities 
that support the resiliency of semiconductor supply 
chains for critical manufacturing industries in the 
United States.
† HR 4346 EAS2 
‘‘(6) AUTHORIZATION
OF
APPROPRIATIONS.— 
There are authorized to be appropriated to the Sec-
retary to carry out this subsection $2,000,000,000, 
which shall remain available until expended. 
‘‘(f) CONSTRUCTION PROJECTS.—Section 602 of the 
Public Works and Economic Development Act of 1965 (42 
U.S.C. 3212) shall apply to a construction project that re-
ceives financial assistance from the Secretary under this 
section. 
‘‘(g) LOANS AND LOAN GUARANTEES.— 
‘‘(1) IN GENERAL.—Subject to the requirements 
of subsection (a) and this subsection, the Secretary 
may make or guarantee loans to covered entities as 
financial assistance under this section. 
‘‘(2) CONDITIONS.—The Secretary may select eli-
gible projects to receive loans or loan guarantees 
under this subsection if the Secretary determines 
that— 
‘‘(A) the covered entity— 
‘‘(i) has a reasonable prospect of re-
paying the principal and interest on the 
loan; and 
‘‘(ii) has met such other criteria as 
may be established and published by the 
Secretary; and
† HR 4346 EAS2 
‘‘(B) the amount of the loan (when com-
bined with amounts available to the loan recipi-
ent from other sources) will be sufficient to carry 
out the project. 
‘‘(3) REASONABLE PROSPECT OF REPAYMENT.— 
The Secretary shall base a determination of whether 
there is a reasonable prospect of repayment of the 
principal and interest on a loan under paragraph 
(2)(A)(i) on a comprehensive evaluation of whether 
the covered entity has a reasonable prospect of repay-
ing the principal and interest, including, as applica-
ble, an evaluation of— 
‘‘(A) the strength of the contractual terms of 
the project the covered entity plans to perform (if 
commercially reasonably available); 
‘‘(B) the forecast of noncontractual cash 
flows supported by market projections from rep-
utable sources, as determined by the Secretary; 
‘‘(C) cash sweeps and other structure en-
hancements; 
‘‘(D) the projected financial strength of the 
covered entity— 
‘‘(i) at the time of loan close; and 
‘‘(ii) throughout the loan term after the 
project is completed;
† HR 4346 EAS2 
‘‘(E) the financial strength of the investors 
and strategic partners of the covered entity, if 
applicable; 
‘‘(F) other financial metrics and analyses 
that the private lending community and nation-
ally recognized credit rating agencies rely on, as 
determined appropriate by the Secretary; and 
‘‘(G) such other criteria the Secretary may 
determine relevant. 
‘‘(4) RATES, 
TERMS, 
AND
REPAYMENTS
OF 
LOANS.—A loan provided under this subsection— 
‘‘(A) shall have an interest rate that does 
not exceed a level that the Secretary determines 
appropriate, taking into account, as of the date 
on which the loan is made, the cost of funds to 
the Department of the Treasury for obligations of 
comparable maturity; and 
‘‘(B) shall have a term of not more than 25 
years. 
‘‘(5) ADDITIONAL TERMS.—A loan or guarantee 
provided under this subsection may include any other 
terms and conditions that the Secretary determines to 
be appropriate.
† HR 4346 EAS2 
‘‘(6) RESPONSIBLE LENDER.—No loan may be 
guaranteed under this subsection, unless the Secretary 
determines that— 
‘‘(A) the lender is responsible; and 
‘‘(B) adequate provision is made for serv-
icing the loan on reasonable terms and pro-
tecting the financial interest of the United 
States. 
‘‘(7) 
ADVANCED
BUDGET
AUTHORITY.—New 
loans may not be obligated and new loan guarantees 
may not be committed to under this subsection, unless 
appropriations of budget authority to cover the costs 
of such loans and loan guarantees are made in ad-
vance in accordance with section 504(b) of the Fed-
eral Credit Reform Act of 1990 (2 U.S.C. 661c(b)). 
‘‘(8) CONTINUED OVERSIGHT.—The loan agree-
ment for a loan guaranteed under this subsection 
shall provide that no provision of the loan agreement 
may be amended of waived without the consent of the 
Secretary. 
‘‘(h) OVERSIGHT.—Not later than 4 years after dis-
bursement of the first financial award under subsection (a), 
the Inspector General of the Department of Commerce shall 
audit the program under this section to assess—