SARATOGA SPRINGS, NY — Representatives and executives from the semiconductor industry across the six participating regions made significant progress on issues ranging from multi-component agreements to encryption standards to piracy and IP protection at their annual meeting last week.

The representatives came together as part of the 16th annual meeting of the World Semiconductor Council featured industry leaders and executives from China, Chinese Taipei, Europe, Japan, Korea and the US. The group meets annually to jointly address issues of global concern to the semiconductor industry.

As consumers demand ever more sophisticated integrated circuit performance in smartphones, laptops, tablets and other devices, semiconductor designers and manufacturers include additional electronic components inside a single package to increase functionality. This is known as a multi-component integrated circuit (MCO). MCOs are currently not included in the duty-free agreements that other semiconductor types enjoy. In order to ensure free and open markets, the WSC has agreed on a common industry proposal for defining MCOs, which could ultimately lead to the elimination of import duties on these products.

The WSC also reiterated best practices in regards to encryption certification and licensing regulations. Encryption capabilities are now part of the foundation of many consumer products, including ATM machines, internet browsers, online banking and e-commerce. In most instances the encryption functionality is provided through the semiconductor in order to prevent data loss, ensure security and data integrity. Through the WSC the industry has agreed to a set of guiding principles to ensure best practices that make it clear that there should be no government regulation of encryption capabilities. Government regulations in this area could slow innovative new security functionality and raise product costs.

Industry leaders also made progress on a number of other significant issues, including:

• Affirming that the competitiveness of companies and their products, not the intervention of governments and authorities, should be the principal determinant of industrial success and international trade;

• Citing the need for strong intellectual property protection and cooperative semiconductor anticounterfeiting measures;

• Encouraging governments to adopt updated and streamlined import and export regulations; and

• Building on the industry’s 2011 announcement that it had reduced emissions of a class of greenhouse gases (GHGs) by 32% over a 10-year period, the industry announced progress toward its new goal to implement best practices expected to result in a reduction in emissions of these gases by 30% on a normalized basis by 2020.

“The WSC meeting process is vital to the growth of both the US and global semiconductor industry and by extension the broader technology industry. The issues that our industry discussed will have a significant impact on technology consumers over the next five to 10 years,” said Rich Beyer, SIA chairman and CEO of Freescale Semiconductor. “I am particularly pleased that we were able to solidify the first steps in ensuring free and open markets for increasingly sophisticated and powerful integrated circuits, which have not previously been included in duty-free categories.”

Industry representatives from the six regions will deliver these recommendations to an annual meeting of their governments, called the Governments and Authorities Meeting on Semiconductors (GAMS), which will be held in September in Berlin, Germany. The GAMS meeting represents an opportunity for industry to partner with governments on the implementation of these recommendations, especially as it concerns the elimination of tariffs and the streamlining of import and export regulations.

“The semiconductor industry is vital to our economy. Semiconductors are one of the top exports of the United States and we continue to lead the world in semiconductor manufacturing and design.  We must work proactively and collaboratively with our international counterparts to ensure we have fair, open, and transparent access to international markets.” said Brian Toohey, president, Semiconductor Industry Association. “The remarkable progress made by the WSC today will bear fruit for many years to come by fostering future innovations.”

Download the full 2012 WSC Joint Statement.