A special act to systematically support the entire supply chain of the semiconductor industry passed a plenary session of the National Assembly on Jan. 29. The move provides an institutional basis to support the full supply chain, including memory and system chips, design, manufacturing and packaging, and materials, parts and equipment.

It will allow the government to back semiconductor support policies in a comprehensive and permanent way, which had previously been dispersed across individual projects and budgets. The law calls for setting up a presidential Special Committee for Strengthening Semiconductor Industry Competitiveness and establishing a basic plan to boost industry competitiveness. A special account for strengthening semiconductor industry competitiveness will also be created. The committee will have up to 20 members, with the industry minister serving as secretary member.

The Ministry of Trade, Industry and Energy will set up a Semiconductor Innovation Growth Support Group to run the committee. The special semiconductor account will be established for a 10-year term. The basic plan to strengthen semiconductor industry competitiveness will be drawn up on a five-year cycle and finalised after committee deliberation.

It also pushes concentrated support for the semiconductor industry outside the Seoul metropolitan area. Taking balanced regional development into account, the government will designate semiconductor clusters and support the creation and operation of industrial infrastructure. Companies and institutions moving into the clusters are also eligible for support.

The law also includes grounds for various corporate support measures, such as technology development and proof-of-concept centre construction, and fostering ecosystems for materials, parts and equipment as well as foundry and system semiconductors. It also contains support for workforce training and attracting overseas talent, along with special cases for regulation, permits and preliminary feasibility studies.

The act will be promulgated after being sent to the government and approved by a Cabinet meeting. It is expected to take effect as early as the third quarter of this year once subordinate regulations are prepared.

Trade Minister Kim Jung-kwan (김정관) said, "Semiconductors are the country’s largest export industry and a strategic asset that determines national and economic security in the AI era." He said, "With the enactment of this special semiconductor act as momentum, we will quickly prepare subordinate regulations and ensure support that is felt on the ground so that we can maintain and strengthen the super gap of K-semiconductors and secure the initiative in global competition surrounding AI semiconductors."