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Global Technology Executives Agree on Integrated Circuit Trade Issues

The Semiconductor Industry Association (SIA), representing U.S. leadership in semiconductor manufacturing and design, announced that the worldwide semiconductor industry has reached agreement and consensus on a variety of international trade issues during the 16th annual meeting of the World Semiconductor Council (WSC). The WSC is a worldwide body of semiconductor industry leaders and executives from China, Chinese Taipei, Europe, Japan, Korea and the United States that meets annually to work together to address issues of global concern to the semiconductor industry.

"The WSC meeting process is vital to the growth of both the U.S. and global semiconductor industry and by extension the broader technology industry. The issues that our industry discussed today will have a significant impact on technology consumers over the next five to 10 years," said Rich Beyer, chairman of the board, Semiconductor Industry Association and CEO of Freescale Semiconductor. "I am particularly pleased that we were able to solidify the first steps in ensuring free and open markets for increasingly sophisticated and powerful integrated circuits, which have not previously been included in duty-free categories."

Representatives and executives from the semiconductor industry across the six participating regions made significant progress on the following issues: a Multi-component agreement, encryption standards and regulations, export and import regulations, emission reduction goals, and anti-counterfeiting and intellectual property protections.

As consumers demand ever more sophisticated integrated circuit performance in smartphones, laptops, tablets and other devices, semiconductor designers and manufacturers include additional electronic components inside a single package to increase functionality. This is known as a multi-component integrated circuit (MCO). MCOs are currently not included in the duty-free agreements that other semiconductor types enjoy. In order to ensure free and open markets, the WSC has agreed on a common industry proposal for defining MCOs, which could ultimately lead to the elimination of import duties on these products.

The WSC also reiterated best practices in regards to encryption certification and licensing regulations. Encryption capabilities are now part of the foundation of many consumer products, including ATM machines, internet browsers, online banking and e-commerce. In most instances the encryption functionality is provided through the semiconductor in order to prevent data loss, ensure security and data integrity. Through the WSC the industry has agreed to a set of guiding principles to ensure best practices that make it clear that there should be no government regulation of encryption capabilities. Government regulations in this area could slow innovative new security functionality and raise product costs.

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