In recent years, as global geopolitics evolve rapidly and technological competition intensifies, the definition of chip origin has emerged as a strategic issue in the semiconductor industry. As a highly globalized and technology-intensive field, any policy adjustment within this sector can trigger ripple effects across the entire supply chain—from raw material procurement to end-user applications.
Policy Shift: China Redefines Chip Origin Based on Wafer Fabrication
In April 2025, the China Semiconductor Industry Association (CSIA) introduced a new regulation for determining the origin of chips. Under this policy, the chip's country of origin is based on where the wafer is fabricated, rather than where it is packaged or tested.
This change holds considerable strategic value. Amid ongoing U.S.-China trade tensions, it directly impacts how imported chips from American companies are treated. For instance, major U.S. players such as Qualcomm and AMD rely heavily on Taiwan's TSMC to manufacture their chips. According to the new rules, these chips are classified as "Made in Taiwan," potentially allowing them to bypass China's 84% tariff imposed on U.S.-made semiconductor goods. The move is viewed as a technically neutral yet politically strategic approach by China to stabilize imports while encouraging advanced manufacturing partnerships.
U.S. and EU Scrutiny: China's Rise in Legacy Nodes Raises Concern
While much of the global focus has been on leading-edge process nodes, legacy chips (e.g., 28nm and above) remain critical for automotive, home appliance, and industrial applications. China's rapid capacity buildup in this segment has raised alarms in the West.
The U.S. Department of Commerce has launched an investigation into the potential risks of China's dominance in legacy chip production. Simultaneously, the European Union has expressed concern that its own semiconductor firms may lose market share in China, particularly in microcontrollers (MCUs) and analog chips. Analysts suggest that if China becomes self-sufficient in these chips, it could exert significant influence over global pricing and supply stability.
Supply Chain Adaptation: Global Firms Rethink Localization and Traceability
As the redefinition of chip origin reshapes global trade dynamics, multinational semiconductor firms are re-evaluating their production strategies. German chipmaker Infineon, for example, has announced local production in China for its standardized components, aiming to reduce lead times and costs.
Companies are also strengthening traceability protocols, enhancing BOM (bill of materials) optimization, and investing in digital tracking systems to align with varying regulatory standards across different regions. These measures help increase supply chain resilience in the face of policy uncertainty.
Strategic Outlook: Chip Origin May Become the Next Key Battleground
The classification of chip origin is quickly emerging as the next competitive arena in the semiconductor landscape—following the race for leading-edge nodes and AI hardware. On one hand, it directly impacts taxation, compliance, and trade policies; on the other, it redefines the boundaries of “technological sovereignty” and “manufacturing sovereignty.”
For global distributors, understanding origin policies is no longer optional. It’s a critical capability in anticipating trade trends, optimizing procurement, and offering value-added services. Companies like Futuretech Components, which focus on diverse, high-quality chip distribution services, must remain agile in adapting to these shifts. Mastery over chip origin classification is becoming a competitive advantage in this evolving environment. 
RFQs/beställning (0)
