back to article South Korea warns US: The CHIPS Act leaves a sour taste

The US government's plan to lure more chipmakers to the home of the brave has hit a snag in South Korea. That nation's trade minster is on his way to Washington with a message that some of the program's requirements don't sit well with the likes of Samsung and SK hynix. South Korean minister Ahn Duk-geun told local media he …

  1. prh99

    Money for nothing.

    Translation, just give us free money and we promise we won't waste it on bonuses and building in unrealistic locations for sweet heart tax deals.

    1. tooltalk

      Re: Money for nothing.

      Biden's CHIPS subsidy is for manufacturing in the US; not for revealing their trade secrets.

      1. prh99

        Re: Money for nothing.

        The easiest solution then would be just to not take the money. Government hand outs with few strings are seem to get misappropriated or wasted.

  2. Paul Crawford Silver badge

    You want 'free' money, well it is not that free... "He who pays the piper calls the tunes", etc.

    1. Steelted

      The Brownosing...

      ...has gone too far!

    2. tooltalk

      and I've been telling South Koreans not to give away free subsidies Tesla ($80+M in 2022) and bailout to American companies like GM ($3+B in 2019).

  3. Roger Kynaston
    Coat

    Are they going to patrol the act

    CHiPS Patrol

    Mine is the one with dodgy shades in the pocket

  4. Anonymous Coward
    Anonymous Coward

    And they accuse *China* of spying..

    That's almost certainly a reference to the Notice of Funding Opportunity published on February 28 that spells out the requirements for applying for funding under the CHIPS Act – the US law that proposes tens of billions in subsidies for semiconductor manufacturing on US soil.

    Among the requirements are "a detailed description of the core underlying technology and manufacturing processes to be utilized in the facility or facilities for which CHIPS Incentives are sought."

    As in "tell us how it works so we can copy it locally for free"?

    1. tooltalk

      Re: And they accuse *China* of spying..

      Yes, this is exactly what China used to do to foreign companies wanting to do business in China. Samsung pulled out of China and closed last smartphone factory in 2019, though they still maintain one large NAND flash plant in Xi'an. Wonder what Samsung would do next with their new Texas fab.

      I guess Biden's grand strategy is to out-China China.

      1. doublelayer Silver badge

        Re: And they accuse *China* of spying..

        "Yes, this is exactly what China used to do to foreign companies wanting to do business in China."

        You notice the difference? China: to do business in China. US: to get lots of free money. China was making everyone give up secrets, while the US only asks for information when they're going to give massive subsidies, and if you don't want the subsidies, you can still build there and get other advantages without giving up any information. Maybe they're asking for too much, although a lot of what they're asking doesn't seem all that proprietary, but it's still very different from what China has done.

        1. Ideasource Bronze badge

          Re: And they accuse *China* of spying..

          Oh come on it's the same damn thing.

          Yields the same output.

        2. tooltalk

          Re: And they accuse *China* of spying..

          The only difference in this case is that China uses that as a precondition for approval, so you know what you are getting into before making any investment. In theory, South Koreans can just stop making any investment in the US and not bother with subsidies at all.

          The problem with the CHIPS ACT/IRA that South Koreans already made (or started building) multibillion investment in the US is that most of their investments were made after Biden's visit to South Korea where he promised political support for their US investment. It was likewise no other than Biden himself who announced Hyundai's multibillion dollar EV plants in Georgia, only to take away all their EV subsidies 3 months later. The same goes for Samsung's chip business, Biden's first destination on his South Korea visit was Samsung's new fab at Pyeongtak and encouraged US investment and political support, so this is also now about American gov't credibility as well.

    2. prh99

      Re: And they accuse *China* of spying..

      That's not really going to work. Courts don't care, any company that received trade secrets and other IP from the government and tried to use them would be open to lawsuits in the U.S and abroad.

      Considering how government hand outs tend to disappear in a poof of wasteful spending and misappropriation, I think knowing exactly what they intend to do makes good sense. If they don't like it, it's optional unlike the forced technology transfer China used and requirements to partner with local business.

    3. Anonymous Coward
      Anonymous Coward

      Re: And they accuse *China* of spying..

      As in "tell us how it works so we can copy it locally for free"?

      Meanwhile in a secret Intel bunker:

      "Got the Samsung secret masterplan. They are going to deliver chips to their customers this decade, and sell them for more than they cost"

      "Korean Devils. How could we ever counter that!"

  5. Death Boffin
    Alert

    Say what?

    "China and South Korea are firm allies,"

    1. Anonymous Coward
      Anonymous Coward

      Re: Say what?

      Yeah, that reads somewhat like a mistake to me, as well.... US and SK are allies, from context, surely?

    2. tooltalk

      Re: Say what?

      wonder why anyone would say this? This is like saying India and Pakistan are firm allies; or Poland and Russias are firm allies; etc.

      I do see some reasons why Biden's neocons are frustrated and would want to push this narrative: for instance, South Korea's refusal to get involved in the Ukraine war; or join Biden's chip war against China.

    3. Roland6 Silver badge

      Re: Say what?

      Interesting piece here: https://carnegieendowment.org/2020/10/21/south-korea-is-caught-between-china-and-united-states-pub-83019

      I would not call the tight rope dance that South Korea performs with China as being between allies.

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