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Taiwan’s chip giant TSMC is reportedly considering returning grants from the CHIPS Act to the U.S. administration, given their pursuit of equity stakes in beneficiary companies.
**TSMC Could ‘Refund’ $6.6 Billion in CHIPS Act Subsidies if Trump Administration Decides for Equity Stakes**
The Trump administration had considered taking equity stakes in companies like TSMC, Intel, Micron, Samsung, and others under the CHIPS Act. The government sees this as a way to get something from the beneficiaries of the incentive scheme. According to a report by the Wall Street Journal, TSMC executives are contemplating returning these grants to avoid the proposed equity model.
We previously discussed why TSMC is concerned about U.S. officials seeking stakes in the company, especially since it has relied primarily on its internal resources for operations in America. The Taiwanese media has labeled this move as a step toward ‘nationalizing’ TSMC, indicating that the chip giant is under pressure. To avoid this situation, TSMC is considering returning around $6.6 billion in subsidies allocated to its Arizona facility.
Interestingly, the WSJ report notes that U.S. government officials will not seek equity from firms investing in America. Given TSMC’s pledge of “hundreds of billions” to manufacture in the U.S., the likelihood of equity demands is low for now. The ‘subsidy-for-equity’ model seems confined to struggling companies like Intel, which need government interest to revive their brand or forge deals with other tech giants.
It will be intriguing to see how TSMC and the Trump administration resolve this issue, given their recent deepened cooperation and mutual desire to avoid any fallout that could damage their relations.
