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Previously, the mainland officially issued policies to subsidize LED equipment, resulting in a large number of new capacity, resulting in overcapacity, imbalance between supply and demand; the most costly LED chip factory is the MOCVD machine, but after the subsidy of the central government, the equipment is almost no money, resulting in Unfair competition.
The State Council recently issued a red-headed document entitled "Notice of the State Council on Clearing Tax Regulations and Regulating Taxes and Other Preferential Policies." The text clearly states that the mainland promotes regional economic development, and some regions implement preferential policies for taxation, non-taxation, and fiscal expenditures, although promoting investment and promoting industry. Gathering, but also disrupting market order, affecting the effects of macro-control policies, and even violating external commitments, triggering trade frictions. Therefore, provincial governments should report the clean-up of various projects to the Ministry of Finance before March next year.
Li Bingjie, chairman of Jingdian, said that some LED factories may rush to expand production by March next year and strive for the final subsidy opportunity. The industry also pointed out that after the subsidy is cancelled, the mainland large-scale expansion plan will be implemented soon. And the period before March next year will be the peak of expansion.
LED senior analysts revealed that Sanan Optoelectronics said that the signed contracts will continue to be implemented, but the new subsidy projects in the future may not be there, but in fact this can reduce potential newcomers and help ease the current price competition. .
After the central government canceled the subsidy, many LED factories immediately broke the government's financial aid. The market will naturally eliminate the poor technology companies. The local LED chip factory is afraid of a bankruptcy, and the cross-strait LED industry will return to fair competition. 
The mainland cancels LED subsidies and returns to fair competition between the two sides
The mainland recently issued a red-headed document requesting local governments not to continue to subsidize MOCVD machines. This move is expected to alleviate the oversupply of mainland LED chip capacity. The LED industry believes that the cancellation of subsidies in the mainland will help balance the supply and demand of LEDs.