By Li Ming, Vision Times
Taiwan is seeking to ensure its semiconductor companies receive preferential treatment under previously negotiated agreements as the United States considers new tariffs on imported chips, potentially linking exemptions to companies that expand manufacturing on American soil.
On Sept. 2, U.S. Commerce Secretary Howard Lutnick said the Trump administration was developing a semiconductor tariff framework under which companies producing chips in the U.S. could qualify for exemptions. The prospect carries particular significance for Taiwan, home to some of the world’s largest semiconductor manufacturers and a critical link in the global technology supply chain.
Taiwan’s Executive Yuan said the self-ruling island has already secured several tariff concessions under an investment memorandum of understanding (MOU) signed with Washington in January. Taipei plans to use existing government-to-government channels to ensure those commitments are honored if the United States introduces semiconductor tariffs under Section 232 of the Trade Expansion Act.
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Preferential treatment for chipmakers
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Executive Yuan spokesperson Michelle Lee Hui-chih said at a post-Cabinet press conference that U.S. investigations relevant to trade and semiconductor policy remain ongoing, with some final findings yet to be announced.
According to Lee, Section 232 tariff concessions covering certain Taiwanese non-semiconductor products have already taken effect. For semiconductor tariffs that have yet to be implemented, Taiwan says its agreement with Washington provides for tariff-free treatment within specified quotas for companies investing in U.S. production, along with the most favorable applicable tariff rate for shipments exceeding those quotas.
Lee said Taipei would continue monitoring U.S. policy developments and work to ensure that previously negotiated concessions are implemented, with the aim of limiting the financial impact on Taiwanese companies. Taiwan has also established a government-to-government, or G2G, mechanism through which officials can negotiate with Washington on behalf of individual companies.
Those discussions could cover company-specific tariff quotas and how eligibility for exemptions or preferential treatment is calculated and determined. The government’s priority, Lee said, is to preserve the treatment already secured for Taiwan’s semiconductor sector while reducing tariff costs for companies expanding production in the United States and restructuring their global operations.
Emphasis on ‘origin laundering’
The tariff negotiations come as Taipei faces a separate challenge over the integrity of its technology supply chains. Taiwanese printed circuit board manufacturer Unimicron Technology is under investigation over allegations that PCBs manufactured in China were brought to Taiwan and relabeled in a potential case of “origin laundering.” Prosecutors and investigators searched the company on Aug. 28.
The claims have renewed concerns on whether Chinese-made goods could be routed through Taiwan and presented as Taiwanese products as global trade barriers increasingly depend on country of origin.
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Vice Minister of Economic Affairs Lai Chien-hsin said global supply chains are increasingly shifting toward what Taiwanese officials describe as “non-Red supply chains,” networks designed to reduce dependence on China, making accurate origin labeling and supply-chain security increasingly important.
Taiwan’s Ministry of Economic Affairs plans to provide companies with guidance on origin rules and supply-chain requirements, while coordinating with the Ministry of Finance to strengthen enforcement and prevent Taiwan from being used as a transshipment point for goods destined for other markets.
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