The U.S. will apply a 100% tariff to certain chip imports in a bid to encourage domestic semiconductor production.

U.S. President Donald Trump announced the move on Wednesday during a White House event. He was joined by Apple Chief Executive Officer Tim Cook, who revealed that the iPhone maker will invest another $100 billion domestically over the next four years. The initiative is set to see the company launch new manufacturing collaborations with several chipmakers.

“We’ll be putting a tariff of approximately 100% on chips and semiconductors,” Trump stated at the event. “But if you’re building in the United States of America, there’s no charge.”

According to CNBC, a top Taiwanese trade official stated that the tariff won’t apply to Taiwan Semiconductor Manufacturing Co. TSMC, the world’s top contract chipmaker, makes processors for Nvidia Corp., Advanced Micro Devices Inc., Apple and many other tech firms. The tariff exception spares those companies from potentially significant price increases.

Bloomberg reported that Taiwan’s second largest chipmaker, United Microelectronics Corp., “may also reduce” the impact of the new tariff. The company primarily makes chips using legacy processes. Last year, UMC inked a partnership with Intel to produce processors at the latter company’s Arizona fab complex.

Chipmakers in the European Union will also be exempt from the new 100% duty. A spokesperson for the European Commission, the bloc’s executive arm, told the Wall Street Journal that semiconductor tariffs will be capped at 15%. Several U.S. automakers use chips made by Germany-based Infineon Technologies AG in their vehicles.

During the White House event where the tariff was announced, Cook announced a new manufacturing collaboration with Samsung Electronics Co. Ltd. The latter company’s Austin fab will reportedly produce camera sensors for future iPhones. It’s believed that Apple picked Samsung over Sony Corp., the world’s top image sensor supplier, because the latter company doesn’t have any fabs in the U.S.

South Korean officials have reportedly stated that Samsung will be exempt from the new chip tariff. SK Hynix Inc., a South Korean memory manufacturer, likewise won’t have to pay the duty. The latter company recently surpassed Samsung as the world’s top DRAM supplier.

In a note to investors, Bernstein Research observed that there is uncertainty about how the tariff will be implemented. Many companies import chips not on a standalone basis but rather as part of products such as servers. It’s unclear whether the new duty will apply to such devices. The U.S. Commerce Department is expected to share more details later this year. 

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