Democratic Progressive Party (DPP) lawmakers yesterday proposed amendments to the Trade Secrets Act (營業秘密法) to increase fines and allow for sentences of life in jail for people convicted of industrial espionage as the number of cases climbs.
DPP Legislator Chao Tien-lin (趙天麟) said that industrial espionage has cost the nation’s economy NT$170 billion (US$5.42 billion) since the act’s promulgation in 2013.
“Huge economic losses have resulted from these crimes. We need to protect the development of Taiwan’s industries and safeguard the stability of our economy,” Chao said.
The losses stem from 89 cases handled by the Ministry of Justice’s Investigation Bureau from 2013 to the end of last year, for an average of nearly NT$2 billion per case, he said.
“Ninety percent were carried out by people taking orders from Chinese companies,” Chao said, adding that one involved Kaohsiung-based Dairen Chemical Group (大連化工).
“In the past, most people thought that businesses and industries were not tainted by espionage activities or foreign spies, or that these crimes were committed by companies in the private sector,” he said.
“However, China has been using every means to derive financial benefits for its businesses and industries, and has been hiding behind these crimes in which its agencies or intelligence apparatus provide assistance, or are directly involved. These had a detrimental effect on Taiwan’s overall social and economic development,” he added.
Amid a trade spat between the US and China, it is imperative that the penalties for stealing trade secrets and industrial espionage be increased to have a deterrent effect, Chao said.
The act divides illegally obtaining trade secrets and proprietary technology into domestic and foreign origins. Provisions for domestic origins stipulate a prison term of up to five years and a fine of NT$1 million to NT$10 million.
For cases in which the destination of the obtained secrets is a foreign nation or territory, including China, Hong Kong and Macau, the prison term is up to 10 years with a fine of NT$3 million to NT$50 million.
The proposed amendments call for increased penalties for foreign agents, who are defined as people working for foreign companies or institutions to gather, gain access to and pass on information, files or materials related to trade secrets.
The proposal seeks a prison term of 10 years to life and a fine of NT$3 million to NT$100 million, and calls for imposing the maximum penalty for repeat offenses.
“Besides consideration for our economy and industries, we should view business and industrial espionage cases as infringing upon our national security,” Chao said.
Trying to leak trade secrets to foreign companies or institutions could involve theft and other illegal conduct, in which case the prosecution must apply the appropriate law, he added.
DPP Legislator Ho Chih-wei (何志偉) said he would support the proposal, while DPP Legislator Lai Jui-lung (賴瑞隆) said further assessment is needed to find a balance between fines and prison terms.
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