Prevent China from Stealing Technology, Taiwan Increases Protection of Its Semiconductor Secrets

Taiwan’s government on Thursday (17/2) proposed a new law to prevent China from stealing its chip technology. The proposal comes amid growing Taipei concerns that Beijing is stepping up its economic espionage.

Taiwanese technology factories produce the majority of the world’s most advanced semiconductor chips. These chips are used for everything from fighter jets to cell phones. Taiwan’s government has long been concerned about China’s attempts to emulate that success, including through economic espionage, talent hunting and other methods.

Taiwan’s government cabinet said it had proposed a new offense for “economic espionage” under the National Security Act. The law provides for up to 12 years in prison for those who leak Taiwan’s core technology to China or “foreign enemy forces.”

Headquarters of Taiwan Semiconductor Manufacturing Co., Ltd.  (TSMC) in Hsinchu, Taiwan, October 20, 2021. (Photo: AP)

Headquarters of Taiwan Semiconductor Manufacturing Co., Ltd. (TSMC) in Hsinchu, Taiwan, October 20, 2021. (Photo: AP)

Using chip giant TSMC’s most advanced 2-nanometer manufacturing technology as an example, cabinet spokesman Lo Ping-cheng said the technology could be considered critical to Taiwan’s security under the new law. Thus, extra protection is needed regarding this matter in addition to the existing trade secret law.

“Everyone knows that TSMC … has the world’s leading technology,” said Lo. “If their technology is stolen, there will be significant repercussions.”

Jo added a court appointed for the crime of economic espionage would be set up to expedite the trial.

The government has also proposed tightening laws to prevent Chinese companies from illegally poaching Taiwanese talent through companies set up in third countries.

The law also tightens penalties for Chinese investments in Taiwan through illegal methods, which the government says has led to numerous cases of industrial espionage in recent years.

“Infiltration in Taiwan’s industry from the red supply chain has gotten worse in recent years,” Taiwan Prime Minister Su Tseng-chang said in a statement, referring to a Chinese technology supplier.

“They are hunting our nation’s high-tech talent and stealing the nation’s core and key technology.” [ah/rs]