The Ministry of Justice Investigation Bureau is investigating whether China’s leading chipmaker Semiconductor Manufacturing International Corp (SMIC, 中芯) illegally poached local engineers as part of an effort to access Taiwan’s cutting-edge chip technology.
SMIC set up a branch in Taiwan posing as a Samoa-based company and tried to hire local talent, prosecutors from the bureau said in a statement yesterday.
Local investigators this month raided 34 locations and questioned 90 people as part of a large-scale probe into 11 Chinese technology companies, including SMIC, the bureau said.
Photo courtesy of the Ministry of Justice Investigation Bureau
A SMIC representative did not respond to requests for comment.
SMIC rose to global fame in 2023 when it worked with Huawei Technologies Co (華為) to produce an advanced 7-nanometer chip despite facing a myriad of US-led curbs that continue to prevent Chinese companies from securing the most advanced chipmaking equipment.
However, the two companies have now hit a snag with technology development as they cannot secure ASML Holding NV’s extreme ultraviolet lithography systems required to make the most cutting-edge chips.
As China faces growing restrictions on its access to advanced foreign technologies, it has aggressively tried to obtain know-how in cutting-edge segments including semiconductors by ramping up efforts to recruit engineers from Taiwan and elsewhere.
Taiwan has become a favorite talent farm for China as the two sides share the same language, and Taiwan has the best chipmaking technologies in the world.
Taiwan Semiconductor Manufacturing Co (台積電) is the go-to chipmaker for Apple Inc and Nvidia Corp, producing the majority of the world’s artificial intelligence accelerators.
Taiwan does not allow Chinese companies to conduct business activities including hiring locally without formal government approval. However, there have been many cases of Chinese technology companies setting up operations in Taiwan and posing as foreign or local firms.
The bureau said it has opened more than 100 investigations into Chinese companies illegally hiring Taiwanese engineers since it formed a task force for such probes in 2020.
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