The enormous use of new technologies in electronics, automobiles, and communications has driven global expansion of semiconductor demand. Still, increased demand has caused a clear semiconductor shortage.
Reacting to this issue, nations like Japan have sped up initiatives to increase their own chip output. New legislation supporting semiconductor manufacture has been suggested by Japanese prime minister Fumio Kishida.
With our great experience in assisting local and global clients in managing the complexities of IP protection, at Am Badar & Am Badar we are ready to help you with copyrights, patents, and trademarks for semiconductor designs.
Reading this related insight on the Complete Guide of Intellectual Property Law Firms may help you get a more comprehensive direction on IP law.
What are Semiconductor Chips?
Almost all current electronic devices are based on semiconductor chips, often known as integrated circuits. These silicon element chips feature electrical conductivity properties essential for the control of electrical currents.
All things considered, a semiconductor chip is the brain of every electronic gadget as it stores and analyzes data enabling their operation. Present in many products, including cell phones, computers, cars, and household appliances, they are intended to store, process, and transmit data.
Understanding the Semiconductor Shortage
The term semiconductor shortfall or shortage refers to the worldwide supply chain problem influencing chip availability. As said previously, many electrical devices have these as basic parts.
Consequently, the scarcity has caused major delays in the production of consumer electronics, automobiles, and other goods depending on these chips, thereby resulting in major economic effects.
What is Causing the Global Chip Shortage?
The semiconductor shortage is becoming a worldwide problem, influencing many sectors largely dependent on these devices. Beginning in 2020, the COVID-19 epidemic intensified the scarcity by disrupting manufacturing lines worldwide.
Lockdowns raised demand for electronic equipment, which the supply chain failed to provide, resulting in delays and lower production productivity. Furthermore, expected to be ongoing are shortages resulting from high costs and scaling problems in chip manufacture.
With the rise of computers, smartphones, and AI, semiconductor chip consumption has exploded. However, lagging supply has caused production to be postponed and consumer prices to have been increased.
Furthermore influencing this semiconductor shortage are geopolitical concerns arising from trade conflicts between the United States, China, Korea, and Japan. Tariffs and trade restrictions have hindered the procurement of necessary components and resources, therefore increasing the challenge for producers to satisfy demand.
Impact of Chip Shortage on Industry and Business
As an essential component, of course, the semiconductor shortfall has affected several sectors, especially the electronics and automotive ones.
Generally speaking, this problem has seriously affected companies and sectors by upsetting supply chains, slowing down production, and rising costs. Particularly impacted sectors include manufacturing, electronics, and automobiles.
Businesses have been obliged to lower production, postpone product introductions, and even stop running operations. This has led to lost revenue, increased prices for consumers, and a push for reshoring semiconductor production to mitigate future risks.
Semiconductor Chips and Intellectual Property in Indonesia
Preserving design IP becomes increasingly crucial as global demand for these semiconductors increases.
Globally, the Intellectual Property rights of a semiconductor may be asserted by the semiconductor itself, as every one of these components has extremely special qualities alone known by the creator with multiple source codes, circuits, and other information.
Though Indonesia’s legal scene on semiconductor chip intellectual property rights is still developing, it already provided a foundation for protecting these developments. To help you protect your IP in this semiconductor shortage issue, let’s explore the details here:
1. Copyright for Semiconductor Circuit Layout Designs
In Indonesia, the protection of semiconductor circuit layout designs is primarily governed by Law No. 32 of 2000 Regarding the Layout Designs of Integrated Circuits.
This legislation gives original layout designers the right to sell or license their designs. The protection lasts 10 years from the initial commercial usage or application filing date.
The protection of semiconductor circuit layout designs may also follow another regulation by Law No. 31 of 2000 Regarding Industrial Design.
2. Trademark for Chips Blueprints
Along with copyright protection, trademarks protect semiconductor chip designs. The chip design’s brand name, logo, and blueprint characteristics may be trademarked.
In Indonesia, trademarks are governed by Law No. 20 of 2016 Regarding Trademarks and Geographical Indications, which provides protection for distinctive signs that differentiate the products of one entity from those of others.
IP as a Semiconductor Strategic Asset
Though there is a semiconductor shortage issue, as the industry continues to evolve, IP has become a strategic tool of great importance. IP is important in this semiconductor business for the following reasons:
1. Exclusive Rights
IP regulations provide innovators exclusive rights, therefore empowering them to restrict who might utilize or manufacture their semiconductor innovations.
2. Competitive Advantage
Original design and technology protection enable companies to maintain their market competitiveness.
3. Legal Protection
Legal grounds and reasons to act against infringement and illegal usage are offered by registered IP rights.
4. Revenue Generation
For the inventors, licensing intellectual property to other businesses may become a major source of revenue.
Right Step by Japanese PM to Propose Chip Production Legislation
Recently, the Japanese Prime Minister Fumio Kishida has proposed legislation allowing for assistance of indigenous semiconductor manufacturing. It gives businesses large financial incentives and tools to encourage advanced semiconductor manufacture domestically.
For example, Rapidus Corp., supported by Toyota and Sony, is building a factory in Hokkaido to produce 2-nanometer chips by 2027. This strategic action will improve Japan’s technology and lessen reliance on outside chip suppliers.
Furthermore, such laws might create an example for other nations, like Indonesia, to boost their semiconductor sectors by means of comparable government-sponsored projects.
Conclusions and What We Can Learn
The ongoing semiconductor shortage has underlined the need for Intellectual Property in the development of modern technologies. Semiconductor design IP protection has to be reinforced to inspire invention and foreign investment in developing nations like Indonesia.
At Am Badar & Am Badar, we are committed to helping clients protect their intellectual property rights in the semiconductor industry and beyond, especially with our Litigation and Dispute services.
For more information, visit our services and insights page, or just simply contact us. For more insights into copyright protection and international IP litigation, we recommend reading: Things to Know about International Litigation in Intellectual Property.
