EU approves funding for GlobalFoundries in Dresden

The measures will contribute to strengthening the EU's autonomy and technological leadership in semiconductor technologies by supporting the construction of a unique semiconductor fab in line with the objectives of the Communication on the European Chip Law and the Commission's policy guidelines for the period 2024-2029.

Germany has notified the Commission of its plan to support the "SPRINT" project of GlobalFoundries, a pure-play semiconductor manufacturer specializing in the production of semiconductor devices exclusively for other companies. The project involves the creation of new production capacity for 300 mm wafers by adapting and expanding the company's existing site in Dresden.

The technologies produced in the facility were developed as part of the IPCEI "Microelectronics and Communication Technologies" project, but are now being adapted for dual use, particularly for the aerospace, defense and critical infrastructure markets. This requires the addition of specific safety and reliability features to the technologies and a fully European manufacturing process to meet the requirements of customers in these markets. This is the first time that these technologies will be manufactured on a large scale in Europe and the manufacturing process will be unique in the EU.

As part of the measures, GlobalFoundries has agreed the following:

• ensure that the project has a broader impact with a positive impact on the EU semiconductor value chain
• continue its innovation efforts to make concrete progress in semiconductor technology and prepare for next generation technologies
• in the event of a supply shortage, execute priority orders in accordance with the European Chip Act
• develop and implement training and skills development programs to increase the pool of skilled and competent workers.

GlobalFoundries is committed to applying for recognition of its Dresden facilities as open EU foundries under the European Chip Act. This process is independent of the state aid assessment.

• The Commission's assessment

The Commission has assessed the German measures under EU state aid rules, in particular under Article 107(3)(c) of the Treaty on the Functioning of the European Union (TFEU), which allows Member States to grant aid to facilitate the development of certain economic activities, subject to certain conditions and on the basis of the principles set out in the Communication on the European Chip Act.

• Background

In November 2024, Germany published a call for proposals for innovative investment projects in the European semiconductor value chain, including semiconductor manufacturing, advanced packaging and assembly, manufacturing equipment and raw materials.

On February 8, 2022, the Commission adopted the Communication on the European Chips Act. It is part of a comprehensive package of chip legislation, including the European Chip Law, which entered into force on September 21, 2023.

In the Communication on the European Chips Law, the Commission recalled that investment in new advanced manufacturing equipment in the semiconductor sector is important to ensure the security of supply and resilience of EU supply chains, while having a significant positive impact on the overall economy. The Commission recognized several factors that are directly relevant for a case-by-case assessment under Article 107(3)(c) TFEU.