Technology
Taiwan detains TSMC staff for stealing trade secrets
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Three current and former TSMC employees are under investigation for allegedly stealing business secrets related to the company’s most advanced semiconductors.
Three people, including employees of Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest chip manufacturer, were detained for allegedly stealing TSMC trade secrets, prosecutors said Tuesday.
The three were detained last month for “serious suspicions of violating national security laws,” after an internal investigation by TSMC revealed that current and former employees have illegally obtained information from the company, the Taiwan High Prosecutors' Office said in a statement.
The prosecutor's office said another two people were released on bail. It did not disclose their identities apart from that one of the former employees is surnamed Chen.
Taiwanese authorities said they will probe the motives behind the alleged TSMC trade secrets theft and whether proprietary information had been leaked to other parties, the first case of its kind since Taiwan reinforced its national security act to protect its key technologies in 2022.
TSMC said on Tuesday that it had initiated legal proceedings and taken disciplinary action against employees suspected of leaking trade secrets. It said 'comprehensive and robust monitoring mechanisms' enabled early detection of unauthorised activities, leading to internal investigations and measures against the personnel involved.
The company, which manufactures chips for tech giants like Nvidia, Apple, and Qualcomm, highlighted its zero-tolerance policy for trade secret violations and said it would pursue offenders to the full extent of the law.
Several news outlets have earlier reported that TSMC fired several staffers for attempting to obtain critical business secrets related to the manufacturing of the 2-nanometer chip, the most advanced processor in the semiconductor industry.
Taiwanese media outlets said that prosecutors had also searched the offices of Tokyo Electron, a Japanese chipmaking machinery manufacturer, due to a former employee of its Taiwan subsidiary being involved in the case.
Tokyo Electron said in a statement on Thursday that it had dismissed the employee involved and that its internal investigation has found no evidence of confidential information being shared with third parties.
The company said it is also fully cooperating with authorities but declined to disclose further information, citing the case being under judicial review.
Super-advanced semiconductor chips are manufactured by a very limited number of foundries, such as TSMC, Intel, and Samsung, due to the high development costs and level of knowledge required.
The breach of TSMC’s trade secrets, if proven true, could significantly impact not only the chipmaker’s commanding lead in semiconductor technology but also Taiwan’s national security.
TSMC’s dominance in chip manufacturing is a key pillar of Taiwan’s ‘silicon shield’, which serves as a leverage in global diplomacy.
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