Chip makers funded by U.S. face 10-year ban on foreign equipment

What it does

This bill amends federal semiconductor funding rules to prohibit U.S. companies receiving federal grants or loans from purchasing advanced semiconductor manufacturing equipment made, assembled, or refurbished by foreign entities deemed a national security concern (or their subsidiaries). The ban applies to equipment like chip-making machines, etching tools, and testing systems, and lasts 10 years. The Secretary of Commerce can waive the ban if equivalent U.S. or allied equipment isn't available, or if national security requires it.

Why we flagged it

The bill's operative mechanism is a procurement restriction tied to federal funding, designed to favor domestic and allied semiconductor equipment suppliers over foreign competitors deemed security risks. It is fundamentally a supply-chain security measure with protectionist economic effects.

What the text implies

• The 10-year ban creates a long-term captive market for U.S. and allied equipment makers, potentially reducing price competition and innovation incentives for federally-funded chip manufacturers.
• The waiver mechanism (insufficient U.S. supply, national security interest) is discretionary and opaque; Commerce Secretary and DNI determinations are not subject to public notice-and-comment, creating potential for inconsistent or politically-influenced enforcement.
• The definition of 'foreign entity of concern' is cross-referenced to section 9907 (not provided in text); without that definition, the scope of the ban is unclear and may expand or contract based on executive designation.
• Federally-funded chip makers may pass equipment costs to consumers or reduce R&D spending, indirectly affecting chip prices and availability for non-defense applications.
• The bill does not address refurbished equipment clearly: a machine made by a U.S. company but refurbished by a foreign entity of concern is waivable, but the text does not specify whether partial refurbishment or component replacement triggers the ban.

Section numbers refer to the bill text the analysis read — linked under Primary records below.

Who it affects

The bill protects U.S. semiconductor supply-chain independence and domestic manufacturing capacity, which benefits consumers through reduced supply-chain risk and potential long-term cost stability. However, the 10-year equipment ban may raise costs for federally-funded chip makers in the near term if foreign alternatives are cheaper or more advanced, potentially delaying innovation or raising prices for consumers dependent on those chips.

Who stands to gain

• U.S. semiconductor equipment manufacturers
• Allied-country semiconductor equipment suppliers
• Domestic chip fabricators receiving federal funding

Named in the bill

U.S. Department of Commerce, Director of National Intelligence, Secretary of Defense, William M. Thornberry National Defense Authorization Act for Fiscal Year 2021, Export Administration Regulations, Export Control Reform Act of 2018, Foreign entities of concern (undefined in provided text)

Where it stands

11 cosponsors: 8 Republicans, 3 Democrats.

• Nov 20, 2025 — Introduced · Congress.gov: “Introduced in House”
• Nov 20, 2025 — Referred to House Committee on Science, Space, and Technology and House Committee on Energy and Commerce · Congress.gov: “Referred to the Committee on Energy and Commerce, and in addition to the Committee on Science, Space, and…”
• Sep 1, 2026 — Markup held in committee · Congress.gov: “Subcommittee Consideration and Mark-up Session Held”
• Sep 16, 2026 — Reported out of committee · Congress.gov: “Ordered to be Reported by the Yeas and Nays: 39 - 0”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.

Money around this bill

9 lobbying clients named this bill on 13 disclosure filings across 2 quarters, Dec 2025 to Jun 2026. Those filings disclosed $6,140,000 in lobbying spend. A filing names 8 bills on average, so that figure is what each filing reported, not a share belonging to this bill.

More lobbying clients named this bill than 89% of bills with at least one filing.

Zoe Lofgren, the sponsor, reported $462,479 in PAC receipts in the 2026 cycle. $5,500 of that came from 2 PACs tied to these lobbying clients.

• National Association of Manufacturers — $2,030,000 on 1 filing
• Taiwan Semiconductor Manufacturing Company (tsmc) — $970,000 on 1 filing
• Semiconductor Industry Association — $880,000 on 2 filings
• Intel Corporation — $700,000 on 1 filing
• Lenovo (united States) Inc. — $570,000 on 1 filing

Lobbying Disclosure Act filings through Jul 20, 2026. A filing shows who paid to lobby on a bill it names, not what changed.