COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT REPORT Accompanying the document Proposal for a Regulation of the European Parliament and of the Council on a framework of measures for strengthening Europe's semiconductor ecosystem repealing Regulation (EU) 2023/1782 (Chips Act 2.0)
Date: 2026-06-03
Institutions: Directorate-General for Communications Networks, Content and Technology, European Commission
Subjects: EU industrial policy, advanced technology industry, competitiveness, crisis management, digital technology, economic independence, electronic component, security of supply, supply chain, technological independence

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   EUROPEAN COMMISSION  Brussels, 3.6.2026  SWD(2026) 505 final  COMMISSION STAFF WORKING DOCUMENT  EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT REPORT  Accompanying the document Proposal for a Regulation of the European Parliament and of the Council   on a framework of measures for strengthening Europe's semiconductor ecosystem repealing Regulation (EU) 2023/1782 (Chips Act 2.0)  {COM(2026) 504 final} - {SEC(2026) 504 final} - {SWD(2026) 504 final}  
 
 
Identification of the problem and EU-level dimension 

Semiconductors  are  a  strategic  enabling  technology  for  the  Union’s  digital  transformation, 
industrial competitiveness, defence and economic security. The Draghi report highlighted the 
need  for  investment  in  strategic  technologies  such  as  semiconductors  for  the  EU’s 
competitiveness and called for a comprehensive EU Semiconductor Strategy. The Evaluation 
of the first Chips Act and the problem analysis of the Impact assessment of the Chips Act 2.0 
demonstrate that, despite significant progress via the first Chips Act, the EU continues to face 
structural  vulnerabilities  across  the  semiconductor  value  chain.  These  vulnerabilities  stem 
from  overdependence  on  a  limited  number  of  third  country  suppliers  for  semiconductor 
design and manufacturing. As a result, EU-based production accounts for around one fifth of 
its  consumption  and  key  downstream  industries  remain  exposed  to  external  supply  shocks. 
Secondly,  the  EU’s  capacity  to  anticipate,  monitor  and  respond  to  semiconductor  supply 
disruptions  remains  insufficient,  resulting  in  insufficient  crisis  preparedness.  Existing 
mechanisms  of the Chips Act  rely  on voluntary information-sharing outside crisis  situations 
and  have  not  generated  the  depth  and  timeliness  of  supply-chain  intelligence  required  for 
effective crisis preparedness. 

The  semiconductor  sector  is  characterised  by  high  capital  intensity,  long-term  investments, 
high  technological  risk  and  strong  network  effects,  resulting  in  structural  market  failures. 
These  include  underinvestment  in  manufacturing  facilities,  limited  demand-side  pull  for 
advanced  technologies,  and  insufficient  supply  chain  intelligence  to  anticipate  and  manage 
disruptions. Fragmented national measures hinder effectiveness of public intervention. 

Given  the  cross-border  nature  of  semiconductor  supply  chains,  Union-wide  potential 
disruptions and the scale of investment required to compete with major third country public 
support  programmes,  problems  have  a  clear  EU-level  dimension  and  cannot  be  effectively 
addressed by Member States acting alone. 

Aim of the initiative 

The objective of Chips Act 2.0 is to increase the competitiveness of the European ecosystem 
to  strengthen  technological  sovereignty  and  resilience  and  enhance  crisis  preparedness  to 
ensure the EU’s security of supply and economic security. Building on the first Chips Act, the 
initiative aims to address these weaknesses and challenges with the objectives of: 

•  Enhancing  the  EU’s  capacity  and  security  of  supply  in  mainstream  and  advanced 

semiconductors, including AI chips; 

•  Developing a strong user market across key industry sectors; 
• 

Increasing intelligence capabilities for crisis preparedness and response. 

Options evaluated and preferred option 

The  impact  assessment  evaluates  a  baseline  scenario  and  increasingly  ambitious  policy 
options  reflecting  different  degrees  of  EU  intervention.  The  options  range  from  measures 
focused  on  improving  framework  conditions,  to  a  more  comprehensive  and  strategic 
approach. 

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The  preferred  option  (“Strategic  sovereignty”)  would  reinforce  the  existing  Chips  Act  by 
combining  both  horizontal  and  more  targeted  vertical  instruments.  Horizontal  measures 
include  the  increase  of  R&D&I  support,  clarification  of  the  first-of-a-kind  framework,  fast-
tracking permitting, measures increasing the attractiveness of semiconductor regions through 
a ‘Semiconductor Regions of Excellence” label, the set-up of a Business-to-business platform 
to  enhance  transparency  and  resilience,  information  requests  outside  of  crisis  stages  and 
increased  investment  in  skills.  More  vertical  measures  are  EU-level  Strategic  Projects  and 
demand-side  measures  such  as  innovation  procurement,  lab-to-fab  accelerators  and  the 
incentivising of domestic chips or equivalent in public procurement.  

This option provides the most effective and proportionate response to the identified problems, 
while respecting subsidiarity and minimising administrative burden. It responds to evaluation 
findings  calling  for  stronger  integration  between  R&I  and  industrial  deployment  activities, 
faster industrialisation pathways and more effective supply chain intelligence mechanisms. 

Stakeholders’ support 

Consultations  indicate  broad  support  for  a  strengthened  EU-level  approach.  Stakeholders 
across  all  groups  regard  the  Chips  Act  as  a  timely  and  necessary  response,  while 
reinforcement  remains  necessary.  Semiconductor  manufacturers,  equipment  and  materials 
suppliers, and fabless design companies support stronger coordination and improved access to 
shared infrastructures. SMEs, start-ups and scaleups highlight the importance of demand-side 
measures. 

Member  States  feedback  supports  strengthening  coordination  and  emphasises  the  need  for 
improved supply chain security and crisis preparedness. Stakeholders also underline the need 
for a clear EU strategy for maintaining openness in international cooperation. 

Benefits and costs of the preferred option 

The  preferred  option  is  expected  to  generate  economic,  technological  and  strategic  benefits 
relative  to  the  baseline,  notably  by  making  available  the  instruments  necessary  to  invest  in 
advanced semiconductors manufacturing and design ecosystem and packaging in Europe, and 
to pursue the investment in innovative mainstream semiconductors. These include increased 
private  investment  leverage,  reduced  public  investment  and  utilisation  risk  for  advanced 
facilities,  accelerated  innovation-to-market  pathways,  strengthened  EU  manufacturing  and 
design,  and  improved  resilience  of  supply  chains.  The  Evaluation  confirms  that  Chips  Act 
investments  have mobilised substantial  private capital  and improved  the EU’s  attractiveness 
as an investment location. 

Public costs primarily relate to increased EU and national funding commitments for Strategic 
Projects,  R&D&I  support  and  governance  structures.  Private  sector  costs  mainly  arise  from 
participation  requirements  and  information  sharing  obligations,  which  are  designed  to  be 
proportionate  and  largely  exempt  SMEs.  Overall,  the  expected  benefits  in  competitiveness, 
resilience and security of supply outweigh the costs over the medium to long term. 

Impact on SMEs and competitiveness 

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The  preferred  option  is  expected  to  have  a  positive  impact  on  SMEs,  as  the  semiconductor 
industry  relies  on  a  network  of  highly  specialised  SMEs  across  the  value  chain.  Increased 
R&D&I  cooperation,  Strategic  Projects,  innovation  procurement,  and  incentives  for 
procurement of domestic chips, create demand, particularly benefiting fabless design SMEs.  

From a competitiveness  perspective, Chips Act 2.0 strengthens the EU semiconductor value 
chain. By reducing dependencies and fostering industrial scale-up, the initiative enhances the 
EU’s  ability  to  compete  while  supporting  downstream  competitiveness.  The  Evaluation 
confirms  that  EU  intervention  remains  essential  for  SMEs  to  compete  in  a  capital-intensive 
and globalised sector. 

Other significant impacts 

Environmental impacts are linked to increased manufacturing capacity and resource use. The 
technologies  and  sustainable 
initiative  supports 
manufacturing processes, contributing to the EU’s climate and sustainability objectives. 

the  deployment  of  energy-efficient 

Social  impacts  include  the  creation  of  high-skilled  jobs,  strengthened  regional  innovation 
ecosystems  and  increased  demand  for  advanced  skills.  Enhanced  supply  security  benefits 
critical  sectors  such  as  automotive,  industrial  automation,  telecommunications,  healthcare, 
aerospace, security, defence and AI infrastructure, contributing to EU societal resilience. 

Chips  Act  2.0  includes  simplification  measures  aiming  to  reduce  administrative  burden, 
increase  predictability  and  accelerate  implementation.  Stakeholders  and  evaluation  findings 
highlighted  procedural  complexity,  lengthy  timelines  and  administrative  burden  as  major 
constraints  on  effectiveness  and  competitiveness.  These  include  time-limited  permitting 
procedures  for  manufacturing  facilities,  more  legal  certainty  on  scope  and  better-aligned 
procedures for First-of-a-kind and Strategic Project designation. 

Follow-up 

The  Commission  should  carry  out  an  evaluation  within  four  to  six  years  after  the  date  of 
application  of  the  initiative.  Where  necessary,  the  evaluation  should  be  accompanied  by 
proposals to adapt or reinforce the framework considering new technological and geopolitical 
developments. 

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