Asian Tech Press (Nov 08) -- According to media reports, the Japanese government will establish a legal framework to subsidize new advanced semiconductor plants in the country, and TSMC's new Japanese plant will likely be the first recipient.

As countries worldwide increasingly view chips as a national security issue, to increase domestic supply, the government plans to submit legislative amendments to parliament as early as December and set clear rules for subsidizing the construction of new facilities. The government will update the terms currently applied to companies developing 5G wireless technology, designate semiconductors as a new priority area, and allocate hundreds of billions of yen in this year's supplemental budget to create a subsidy fund under Japan's New Energy Industry Technology Development Organization (NEDO).

It is reported that eligible companies that need to maintain stable production, investment and technology development and increase chip production in times of supply shortage will be eligible for this subsidy.

TSMC recently announced an investment in constructing a semiconductor plant in Kumamoto, Japan, which is expected to become the first beneficiary of the framework. Sources said that the Japanese government expressed full support for this and may provide up to half of the subsidy. The new plant will begin construction in 2022 and is not expected to be ready for production until 2024.