The Commission’s voluntary surveys of the chip industry and major chip-users comes as tensions have been rising between Brussels and Beijing. The EU is looking to protect various industries from Chinese competition and has already imposed provisional tariffs of up to 37.6% on Chinese electric vehicles.
Chinese industry is investing heavily in expanding production of legacy chips, due in part to US trade restrictions limiting its access to advanced computer chips, and now governments in the West are concerned that in the longer-term this could result in the potential oversupply of these chips.
For equipment suppliers such as ASML, China's expansion of legacy chip production is an important source of revenue, but for chipmakers, such as Infineon and Infineon, while they do a lot of business with China, increased Chinese competition in terms of legacy chips could prove challenging, especially if prices are slashed.
Many of Europe's firms are said to be reluctant at disclosing their use of Chinese legacy chips and in truth many are uncertain where the chipsets are actually made, despite efforts to shift production away from China in recent years.
Back in April the Commission released a report on the support it says the Chinese government provides its domestic firms and there is now a growing belief that Brussels is set to open more cases looking at ‘unfair’ competition.
