[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 4585 Introduced in Senate (IS)]
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118th CONGRESS
2d Session
S. 4585
To prohibit covered entities that receive financial assistance relating
to semiconductors from purchasing certain semiconductor manufacturing
equipment from foreign entities of concern or subsidiaries of foreign
entities of concern, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
June 18, 2024
Mr. Kelly (for himself and Mrs. Blackburn) introduced the following
bill; which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To prohibit covered entities that receive financial assistance relating
to semiconductors from purchasing certain semiconductor manufacturing
equipment from foreign entities of concern or subsidiaries of foreign
entities of concern, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``The Chip Equipment Quality,
Usefulness, and Integrity Protection Act of 2024'' or the ``Chip EQUIP
Act of 2024''.
SEC. 2. PURCHASES OF SEMICONDUCTOR MANUFACTURING EQUIPMENT.
(a) Definitions.--Section 9901 of the William M. (Mac) Thornberry
National Defense Authorization Act for Fiscal Year 2021 (15 U.S.C.
4651) is amended--
(1) by redesignating paragraphs (2), (3), (4), (5), (6),
(7), (8), (9), (10), (11), (12), and (13) as paragraphs (3),
(4), (6), (7), (8), (9), (10), (11), (12), (13), (14), and
(15), respectively;
(2) by inserting after paragraph (1) the following:
``(2) The term `completed, fully assembled' means the state
in which all (or substantially all) necessary parts, chambers,
subsystems, and subcomponents have been put together, resulting
in a ready-to-use or ready-to-install item to be directly
purchased from an entity.'';
(3) in subparagraph (A) of paragraph (4), as so
redesignated, by striking ``paragraph (2)'' and inserting
``paragraph (3)''; and
(4) by inserting after paragraph (4), as so redesignated,
the following:
``(5) The term `ineligible equipment'--
``(A) means completed, fully assembled
semiconductor manufacturing equipment that is
manufactured or assembled by a foreign entity of
concern or subsidiary of a foreign entity of concern
and used in the fabrication, assembly, testing,
advanced packaging, production, or research and
development of semiconductors;
``(B) includes--
``(i) deposition equipment;
``(ii) etching equipment;
``(iii) lithography equipment;
``(iv) inspection and measuring equipment;
``(v) wafer slicing equipment;
``(vi) wafer dicing equipment;
``(vii) wire bonders;
``(viii) ion implantation equipment;
``(ix) chemical mechanical polishing; and
``(x) diffusion or oxidation furnaces; and
``(C) does not include any part, chamber,
subsystem, or subcomponent that enables or is
incorporated into such equipment.''.
(b) Ineligible Use of Funds.--Section 9902 of the William M. (Mac)
Thornberry National Defense Authorization Act for Fiscal Year 2021 (15
U.S.C. 4652) is amended by adding at the end the following:
``(j) Ineligible Use of Funds.--
``(1) In general.--Subject to paragraph (2), the Secretary
shall include in the terms of each agreement with a covered
entity for the award of Federal financial assistance under this
section prohibitions with respect to a project relating to the
procurement, installation, or use of ineligible equipment.
``(2) Waiver.--The Secretary may waive the prohibitions
described in paragraph (1) if--
``(A) the ineligible equipment to be purchased by
the applicable covered entity is not produced in the
United States or an allied or partner country in
sufficient and reasonably available quantities or of a
satisfactory quality to support established or expected
production capabilities; or
``(B)(i) the use of the ineligible equipment
complies with the requirements set forth in the Export
Administration Regulations, as defined in section 1742
of the Export Control Reform Act of 2018 (50 U.S.C.
4801); and
``(ii) the Secretary, in consultation with the
Director of National Intelligence or the Secretary of
Defense, determines the waiver is in the national
security interest of the United States.
``(3) Foreign entities of concern.--Nothing in this
subsection shall be construed to waive the application of
section 9907.''.
(c) Conforming Amendments.--
(1) Section 48D(c)(1) of the Internal Revenue Code of 1986
is amended by striking ``section 9901(6) of the William M.
(Mac) Thornberry National Defense Authorization Act for Fiscal
Year 2021'' and inserting ``section 9901 of the William M.
(Mac) Thornberry National Defense Authorization Act for Fiscal
Year 2021 (15 U.S.C. 4651)''.
(2) Section 50(a)(6)(D)(i) of the Internal Revenue Code of
1986 is amended by striking ``section 9901(7) of the William M.
(Mac) Thornberry National Defense Authorization Act for Fiscal
Year 2021'' and inserting ``section 9901 of the William M.
(Mac) Thornberry National Defense Authorization Act for Fiscal
Year 2021 (15 U.S.C. 4651)''.
(3) Section 5949(j)(5) division E of James M. Inhofe
National Defense Authorization Act for Fiscal Year 2023 (41
U.S.C. 4713 note; Public Law 117-263) is amended by striking
``paragraph (7) of section 9901 of the William M. (Mac)
Thornberry National Defense Authorization Act for Fiscal Year
2021 (15 U.S.C. 4651), as added by section 103(a)(4) of the
CHIPS Act of 2022 (division A of Public Law 117-167)'' and
inserting ``section 9901 of the William M. (Mac) Thornberry
National Defense Authorization Act for Fiscal Year 2021 (15
U.S.C. 4651)''.
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