Taiwanese prosecutors on Monday indicted a former deputy manager at Taiwan Semiconductor Manufacturing Company (TSMC) for allegedly stealing trade secrets involving technologies designated as national core technologies, with the intent to use them in China.
The defendant, identified by the surname Chen, faces charges under Taiwan’s National Security Act and the Trade Secrets Act. Prosecutors are seeking a seven-year prison sentence.
According to the indictment, Chen conspired with a Hong Kong national between 2023 and 2024 to establish CSMAC, a semiconductor materials analysis company in China. He is accused of copying 21 TSMC documents containing national core technologies and other proprietary trade secrets for use in the new venture.
TSMC, the world’s largest contract chipmaker and a key supplier to companies such as Nvidia and Apple, detected the unauthorized copying through an internal investigation and successfully recovered all duplicated documents. The Hong Kong co-conspirator was not prosecuted because he had died. Chen remains in custody, and Reuters was unable to reach him for comment. TSMC declined to comment on the case.
Prosecutors described this as Taiwan’s first indictment involving the alleged theft of trade secrets related to technologies officially designated as national core technologies for intended use in China.
The case underscores heightened concerns in Taiwan over China’s efforts to recruit Taiwanese semiconductor talent and acquire advanced chip know-how. In response, Taiwan has significantly tightened protections for technologies deemed critical to its economic and national security.
MacDailyNews Take: TSMC clearly plays a central role in the global semiconductor supply chain, making the protection of its intellectual property a matter of strategic importance far beyond Taiwan’s borders.
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