The European Commission proposed on Tuesday a set of measures aimed at building security of supply and technical leadership in semiconductor technologies and applications, Kallanish reports.

The so-called European Chips Act is designed to tackle the ongoing semiconductors shortages and boost Europe’s competitiveness and resilience. It will be key to helping the region achieving the planned digital and green transition.

If approved by the European Parliament and member states, the regulation will become legal and directly applicable across the EU. It should mobilise over €43 billion ($49 billion) of public and private investments, with €11 billion public funding made available for further research and development, plus pilot lines for prototyping, testing and experimenting, the EC says.

Other measures include the creation of the Chips Fund to facilitate access to finance for start-ups, and a coordination mechanism between member states and the EC to monitor and forecast market fundamentals.

According to the EC, the recent global chip shortage led EU car production to decline by one third last year.

“This made more evident the extreme global dependency of the semiconductor value chain on a very limited number of actors in a complex geopolitical context. But it also illustrated the importance of semiconductors for the entire European industry and society,” it adds.

The EU wants to double its current semiconductors market share to 20% in 2030.