ICAO (International Civil Aviation Organization) has definitely stated that an e-passport with a non-working chip must be regarded as a legitimate travel document, and the owner should not be denied entry based on this alone. It was recognised that a small percentage of chips will fail due to natural causes. Most border officials will advise that an e-passport with a failed chip should be replaced as soon as practicable.
However, it also recognised that criminals, finding that they cannot subvert the chip, will destroy it rather than risk being detected. Border officials will therefore check an e-passport with a non-functioning chip very carefully, looking for signs of tampering.
Therefore, bloggers who advocate disabling the chip (for example, by hitting it with a hammer) because of some misguided fear of being tracked or such-like, should take note that this action may lead to some difficulties at borders if the tampering is detected.
For more information, visit the US Electronic Passport Tutorial.
Courtesy the Keesing Journal, 2009