Earlier this month the Biden Administration released its long-anticipated Executive Order on Addressing United States Investments in Certain National Security Technologies and Products in Countries of Concern (“EO”), which imposes (1) prohibitions on certain outbound investments in the semiconductors and microelectronics, quantum information technologies, and artificial intelligence sectors, and (2) mandatory notification requirements for a
Biden Administration Announces Priorities for the Implementation of the CHIPS Act of 2022
On August 25, 2022, President Biden announced a new Executive Order (“EO”) addressing the Implementation of the CHIPS Act of 2022 (“CHIPS Act”). The CHIPS Act was signed by President Biden on August 9, 2022, and, among other things, authorizes $39 billion in funding for new projects to establish semiconductor production facilities within the United
Significant Funding and Tax Credit Opportunities in the CHIPS and Science Act
On August 9, 2022, President Biden signed into law the CHIPS and Science Act—a massive, $280 billion bill to boost public and private sector investments in critical and emerging technologies.
We anticipate significant opportunities and an evolving regulatory landscape for companies, associations, universities, and others who work in various technology sectors, including:
- High performance computing, semiconductors, and advanced computer hardware/software
- Advanced communications technology and immersive technology
- Advanced energy and industrial efficiency technology (including batteries, nuclear)
- Advanced materials science (including composites 2D and next-generation materials)
- Artificial intelligence, machine learning, autonomy, and related advances
- Quantum information science and technology
- Biotechnology, medical technology, genomics, and synthetic biology
- Data storage/management, distributed ledgers, and cybersecurity (including biometrics)
- Natural and anthropogenic disaster prevention or mitigation
- Robotics, automation, and advanced manufacturing
Below is an overview of the legislation and the funding and tax credit opportunities it provides for entities that participate in the research, development, production, education, or transfer of critical and emerging technologies, especially semiconductor manufacturing and research and open-RAN technology.
Overview
Headlining the bill are $54 billion in appropriations to fund the Creating Helpful Incentives to Produce Semiconductors (“CHIPS”) for America Act, which was authorized in 2021. The bill also includes $1.5 billion in appropriations for a wireless supply chain innovation fund under the Utilizing Strategic Allied Telecommunications Act, which was similarly authorized in 2021. Across these two sets of appropriations, over $40 billion are allocated for direct financial assistance in the form of competitive grants for which private companies will be able to apply. The law also authorizes over $200 billion in new programs across the federal government, paving the way for additional grants, public-private partnerships, and technology transfer opportunities.
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Republicans Likely to Push for Decoupling from China
It was a Republican President who inaugurated America’s openness to China 50 years ago, but it is Republicans in Congress who seem poised to begin closing the door. With the likelihood of a Republican takeover of the House and possibly the Senate in November, American businesses should prepare for a raft of anti-China measures that are likely to pass the House in the new Congress.
House Republican Leadership intends to include China decoupling legislation among its top 10 priorities in 2023. Unlike many foreign policy issues on which voters express little interest, this new decoupling fervor is being driven by Republicans’ most enthusiastic voters.
In one recent unpublished poll, almost half of Republican voters agreed that the U.S. government should prohibit American companies from doing business in China, and fewer than one-third disagreed. Three times as many Republican voters strongly agreed with this view than strongly disagreed, demonstrating that voter intensity for decoupling is high.
In a time of heightened partisanship leading into another divisive election, 26 Republican Senators sent a letter supporting Speaker Nancy Pelosi’s trip to Taiwan – despite the fact that Pelosi is anathema to Republican voters. The subtext to the letter was that Republicans’ eagerness for a muscular confrontation with China trumps even election-year partisanship in some circumstances.
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Republicans Are Moving Away from Big Business
Never in our decades of working on and around Capitol Hill and the White House have we seen as much anti-business sentiment among Republican lawmakers as we do today. And the trend shows no sign of abating.
There was a time when American corporations could count on unequivocal Republican support. To be a Republican was virtually synonymous with supporting free market principles, capitalism and business. Republican President Calvin Coolidge once said, “the chief business of the American people is business.” Today, however, many Republicans scoff when they’re told that big business’ trade associations are for x or against y. They believe many companies have abandoned their trust in market forces for a “crony capitalism” that protects favored industries. Industries that profit from government programs are viewed with particular suspicion.
Conservatives say that it is not they who have moved away from business, but rather business which has moved away from them. Many Republicans see corporate America as lining up with the Progressive agenda on climate, ESG, mandatory vaccinations, sexual orientation and gender issues, voter ID laws, gun rights, speech restrictions, policing and abortion, leading them to believe that Wall Street is adverse not just to traditional values but also to conservative economic and constitutional principles. Social media companies have gained special opprobrium from Republicans for their content moderation policies, which they believe favor Progressives and suppress conservative content.
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SECTION 230 IN A REPUBLICAN CONGRESS
Most observers expect the Republicans to take control of the House of Representatives, and possibly the Senate, in the upcoming midterm elections. While both Democrats and Republicans are likely to keep their attention on the actions of so-called “Big Tech,” this political shift should bring a renewed focus on amending Section 230 of the Communications Decency Act. Section 230, which provides platforms with immunity from liability for third-party content and content-moderation decisions, has been a target for lawmakers seeking to limit the power of large technology companies. Republicans have generally focused more on modifying Section 230, versus Democrats, who have spent more energy on using antitrust legislation to regulate those platforms.
Looking ahead, now is the time to consider policies and plans in light of a Republican-controlled Congress taking on potentially divisive issues through the lens of Section 230.
Republicans, Conservatives, and Section 230
Two trends will guide Republicans’ approach to Section 230 in the next Congress. First, as in many areas, Republicans will seek to address what they see as “woke capitalism.” New York Times columnist Ross Douthat coined the term in 2018 and defined it as a “certain kind of virtue-signaling on progressive social causes, a certain degree of performative wokeness, [that] is offered to liberalism and the activist left pre-emptively, in hopes that having corporate America take their side in the culture wars will blunt efforts to tax or regulate our new monopolies too heavily.”
Republicans are already planning a variety of legislative and oversight maneuvers meant to address corporations taking certain positions on cultural issues. Technology companies may very well be at the top of Republicans’ list.
Second, conservatives increasingly view liberals as having abandoned their commitment to free speech. For example, Republicans view the Hunter Biden laptop controversy, campus speech codes, and social media content moderation as part of a broader effort to silence and marginalize conservatives. Simply put, conservatives believe that they are now the defenders of free speech.
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Looking Ahead on Tech and Intellectual Property Issues
Technology policy is a growing issue for the Congress, especially since it is to the economy and to our national security what oil was 20 years. Congress has a love-hate relationship with tech: love them for their innovation, jobs, and international competitiveness, and hate them for their size, bias and perceived hubris.
Enter antitrust: a
Stronger patents dominate IP agenda in 115th Congress
Patents have been mainstay of the Judiciary Committee agenda in both chambers for more than a decade, but never before has the debate seemed so firmly focused on strengthening patent rights. Significant patent bills are pending in both chambers, and the House and Senate Judiciary Committees have summoned Andrei Iancu, the new director of the
Senators Introduce VENUE Act as Last Stand on Patent Legislation This Congress
As Congress becomes further embroiled in election-year politics, especially a high-stakes standoff between the White House and the Senate Judiciary Committee over the President’s nomination to the Supreme Court, it appears ever more likely that 114th Congress will end in December 2016 without passing comprehensive patent legislation. With the House and Senate patent bills on
Appropriations 2016: The Tough Road Ahead for Speaker Ryan
On his way out the door, then-Speaker Boehner did his best to “clean up the barn” for incoming Speaker Paul Ryan. Notably, he negotiated a budget deal with President Obama that, among other things, raised the top-line budget number for the FY 2016 appropriations process. The deal represented a compromise between Republican defense hawks who