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Tom’s Hardware
Tom’s Hardware
Anton Shilov

GlobalFoundries Criticizes German Subsidies to Rival TSMC


GlobalFoundries opposes the German government's plan to subsidize TSMC's new fab near Dresden. The subsidy amounts to up to €5 billion, which GlobalFoundries argues will further strengthen TSMC's already dominant market position. The situation has led to legal concerns, lobbying efforts, and a potential formal complaint to the EU Commission by GlobalFoundries, reports Handelsblatt.

Earlier this month, TSMC, in collaboration with partners Bosch, Infineon, and NXP, unveiled plans to build a 12nm and 16nm-capable fab near Dresden, Germany. The fab is expected to cost €10 billion, and half of the sum will likely come from the German government via various subsidies. GlobalFoundries, which has a fab near Dresden, feels disadvantaged by this move. 

GlobalFoundries is lobbying the German government for similar support. The company argues that it has received far less state aid in its 25 years of Dresden operation than what TSMC is set to receive. GlobalFoundries, which inherited its fab from AMD, sees itself as a co-founder of the technology cluster 'Silicon Saxony' in Dresden and believes it should also be considered for state aid.

Saam Azar, responsible for government and legal affairs at GlobalFoundries, stated that TSMC aims to produce semiconductors that directly compete with products made by GlobalFundries. Moreover, TSMC plans to collaborate with three of GlobalFoundries' biggest customers: Infineon, Bosch, and NXP.

The situation has led Globalfoundries to register its concerns with the EU Commission. The company questions whether the massive subsidy to TSMC aligns with European laws. Saam Azar indicated that a formal complaint might also be filed as soon as the German government and TSMC officially register the project in Brussels.

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