Ensuring Compliance With the U.S. CHIPS Act: Identifying the Source of Electronic Components

Estimated reading time: 1 minute

The U.S. CHIPS Act aims to strengthen domestic semiconductor manufacturing and enhance supply chain security. As part of this initiative, manufacturers must ensure compliance with specific regulations regarding the sourcing of electronic components. This white paper provides an overview of the compliance requirements, relevant laws and standards, and introduces innovative technological solutions to verify the provenance of electronic components. Moreover, it highlights the importance of comprehensive verification that extends beyond sourcing to include the production stage, finished goods, and semi-finished products. By ensuring that all components are original and have not been tampered with at any point in the supply chain, manufacturers can maintain product integrity and uphold regulatory compliance.

1.        Compliance Requirements and Relevant Laws

The CHIPS Act emphasizes the importance of transparency and traceability in the semiconductor supply chain. Essential compliance requirements include:

• Documentation of origin: Companies must maintain detailed records documenting the origin of all electronic components used in production.
• Verification processes: Manufacturers are required to implement processes that ensure the authenticity of the source of their components, reducing reliance on potentially fraudulent documentation.
• Adherence to standards: Compliance with industry standards such as IPC-1752A (Material Declaration Management) and ISO 9001 (Quality Management Systems) is essential for ensuring quality and traceability.

2.        Current Solutions: A Trust-Based Approach

Despite the clear regulations, current solutions predominantly rely on trust. Manufacturers depend on paper reports and documentation provided by the supply chain to verify the sources of their components. This approach has significant drawbacks:

• Lack of ground truth: Existing methods do not provide a technological means to obtain ground truth regarding the origins of components. Verification is limited to the accuracy of documents and trust in suppliers.
• Increased risk: The reliance on paperwork increases the risk of fraud and misrepresentation, which can lead to non-compliance and reputational damage.

To continue reading this article, which originally appeared in the January 2025 SMT007 Magazine, click here.