The European Commission has launched a €525 million initiative to expand European chip design by providing start-ups and small businesses with grants, software tools and fabrication access. Announced on Wednesday, the European Chip Design Platform aims to help early-stage firms build local processors and create commercial semiconductor demand across the continent.
Key points
- The European Commission launched a €525 million platform offering semiconductor start-ups design tools, fabrication access and grants between €100,000 and €16 million.
- European firms generate less than 1% of global chip design revenues, threatening the commercial viability of planned domestic manufacturing plants.
- Belgian research centre imec leads the operating consortium, which has already enrolled 20 start-ups preparing hardware for market entry.
- Funding combines €285 million from the EU budget with €240 million from participating member states.
How much funding can chip start-ups apply for?
The new initiative allocates €440 million directly to grants for businesses developing semiconductor hardware, while the remaining €85 million will pay to operate the platform. Financing is split between €285 million drawn from the EU budget and €240 million contributed by participating member countries.
Early-stage businesses can apply for prototype grants of up to €100,000 to construct their initial test chips. Companies with more mature designs can secure up to €16 million to help cover the capital required to move a processor into commercial production and bring it to market.
In addition to cash grants, the European Chip Design Platform provides engineers with cloud-based access to commercial chip design software. Participants also receive intellectual property blocks, which are ready-made circuit blueprints that developers can reuse when building custom processors.
The facility provides technical design support and access to external semiconductor manufacturing capacity. The Commission noted that design tools and fabrication slots represent the most expensive and difficult resources for young hardware businesses to secure independently.
Belgian research centre imec heads the group of partners managing the platform. Preparatory work began in 2025 when imec started coordinating the consortium, and 20 start-ups have already joined a market preparation programme run through the organisation.
Why is Europe lagging in semiconductor design?
European officials created the platform to tackle a severe structural imbalance in the microelectronics sector. European companies currently earn less than 1% of global revenues from chip design, leaving the continent heavily dependent on foreign processor architectures.
Chip design represents a core stage of the semiconductor value chain and is where much of the industry’s innovation emerges. Henna Virkkunen, the European Commission’s executive vice-president for tech sovereignty, security and democracy, presented the investment plan on Wednesday.
“The European Design Platform gives our chip start-ups and SMEs the support they need to overcome the barriers to turn their innovative ideas into silicon,” Virkkunen said. She framed the funding as proof that Europe is acting on its technology sovereignty targets through financial investment rather than policy declarations alone.
Virkkunen emphasised that hardware sovereignty requires strength across both design and fabrication. “We know that Europe can’t strengthen our position in the global semiconductor industry if we don’t succeed in chip design,” Virkkunen said, according to Reuters.
Foundry supply and the Chips Act targets
The platform forms a core pillar of the EU Chips Act, operating through the Chips Joint Undertaking. The legislation established five strategic goals, including building and expanding European design capacity for advanced microchips while reducing reliance on foreign supply chains.
The broader Chips Act aimed to double the bloc’s share of global semiconductor production from around 9% in 2020 to 20% by 2030. However, a 2025 report from the European Court of Auditors concluded that the EU is very unlikely to achieve that 20% production target within the decade.
Despite that assessment, Commission officials argue the legislation reversed two decades of industrial decline and laid a strong base for regional expansion. Supporters contend that addressing chip design strengthens the foundation of the European semiconductor ecosystem rather than focusing entirely on factory subsidies.
Global semiconductor fabrication is concentrated among a small number of Asian manufacturers. Taiwanese contract foundry TSMC builds roughly seven out of every ten chips produced for external companies worldwide. The most advanced microprocessors, which run artificial intelligence workloads and modern smartphones, are manufactured almost exclusively in Taiwan and South Korea.
Those geographic bottlenecks have driven the United States, Japan and the EU to commit public money to domestic foundries. However, EU officials warned that newly constructed European wafer plants will only be sustainable if they secure steady commercial demand from regional chip design companies.
National programmes and platform access
The EU platform complements existing domestic programmes run across member states. For instance, Germany and the Netherlands launched a joint €40 million competition focused on applying artificial intelligence tools to the design of dedicated AI processors.
Start-ups and small and medium-sized enterprises that design their own silicon can apply for funding, software licences and manufacturing slots through the European Chip Design Platform.
