Taiwanese authorities investigate TSMC chip trade secrets leak

Taiwanese authorities have detained three people for allegedly stealing technology trade secrets from Taiwan Semiconductor Manufacturing Co (TSMC), the world’s largest chip foundry, Taiwanese prosecutors said on Tuesday.

The three were detained late last month after TSMC reported that an internal investigation had shown that former and current employees had illegally obtained information from the company, the Taiwan High Prosecutors Office said in a statement. The prosecutor’s office said another two people had been released on bail, and one more had been released.

The three who have been detained – two current staff and one former employee – are suspected of violating Taiwan’s national security law, it added. It did not disclose their identities apart from saying that the former staffer was surnamed Chen.

Earlier on Tuesday, TSMC said it had launched legal proceedings and taken disciplinary action against employees involved in potential trade secret leaks after detecting unauthorised activities during routine monitoring.

It said its “comprehensive and robust monitoring mechanisms” enabled early identification of the issue, leading to internal investigations and measures against the personnel involved.

TSMC said the legal case, which is now under judicial review, prevented it from providing further details.

Nikkei Asia earlier reported that the breach involved several former employees suspected of attempting to obtain critical proprietary information on TSMC’s 2-nanometer chip technology.

There were no immediate details on the suspected motives or whether any information had been passed on, and investigations are ongoing to determine the scope of the leak and whether any others were involved, the Nikkei report said.

Taiwanese media outlet United Daily News said prosecutors and investigators had also searched the offices of Tokyo Electron, without citing where they had obtained the information. Tokyo Electron and the prosecutors’ office declined to comment.

TSMC’s 2-nanometer chip technology is the most advanced technology in the semiconductor industry in terms of both density and energy efficiency, according to the company’s website.

The contract manufacturer, which counts AI industry darling Nvidia, iPhone maker Apple, and Qualcomm among its customers, highlighted its zero-tolerance policy for trade secret violations, and said it would pursue offenders to the full extent of the law.

—Bipasha Dey and Wen-Yee Lee, Reuters

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