Taiwanese authorities have arrested three former Taiwan Semiconductor Manufacturing Co. (TSMC) employees for allegedly stealing proprietary information on the company’s 2-nanometer chip development and production.
TSMC “detected unauthorized activities during routine monitoring, leading to the discovery of potential trade secret leaks,” according to Nikkei Asia, which first reported the news. The Financial Times now reports the trio have been arrested.
“This case originated when TSMC proactively detected unusual access patterns in the files of a current employee,” the prosecutor’s office tells Nikkei Asia. “Following an internal investigation, TSMC discovered that its national core technology trade secrets had been allegedly illicitly obtained by a former employee in collusion with current employees.”
As Nikkei notes, there are national security implications given that the 2nm process “is currently the most advanced chip manufacturing process globally.” It’s unclear what the employees planned to do with the information.
An investigation is being conducted by the Intellectual Property Branch of Taiwan’s High Prosecutors Office, which is considering violations of Taiwan’s National Security Act of 2022. The law is intended to safeguard sensitive information from foreign adversaries like China, particularly in the semiconductor sector.
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China would be very interested in producing its own version of TSMC’s advanced chips, especially given US sanctions that limit its ability to buy the latest tech.
TSMC produces roughly 90% of the world’s most advanced chips, according to The Wall Street Journal. Its clients include tech heavyweights such as Nvidia, AMD, Intel, and Apple. The vast majority of its production is in Taiwan, although it plans to invest $165 billion in US-based chip plants. It’s urging the Trump administration to exclude it from tariffs on foreign-made chips, but President Trump is reportedly planning to announce new semiconductor tariffs next week.
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About Emily Forlini
Senior Reporter
