Seoul Invokes “No-Less-Favorable” Clause as U.S. Ties Chip Tariff Relief to Local Investment

This standoff echoes the 1986 U.S.–Japan Semiconductor Agreement, when Washington used punitive duties to force Tokyo’s firms to shift production and share technology—an early salvo in techno-nationalist trade policy. Four decades later, the target is no longer Japan’s DRAMs but Korean memory and Taiwanese foundry capacity, yet the playbook is similar: weaponize market access to force on-shore manufacturing. The episode highlights a long-running trend toward securitizing supply chains—visible in the 2022 CHIPS Act and now in ad-hoc ‘invest-or-pay’ ultimatums. On a century timescale, the question is whether such bilateral, investment-for-access deals accelerate a de-globalized semiconductor map reminiscent of early-20th-century oil concessions, or backfire by driving allies to diversify away from an unpredictable U.S. market. Either way, Seoul’s appeal to a legal clause underscores how even close allies must lawyer up when industrial policy turns zero-sum.