Taiwan takes aim at China with draft laws on chip sector espionage..

Taiwan has accused Chinese companies of “infiltrating” the island’s chip supply chain, a cornerstone of its economy. © AFP/Jiji

‘Economic espionage’ would carry up to 12-year prison sentence.

TAIPEI — Taiwan is preparing to introduce tougher laws to protect the island’s crown jewel semiconductor industry from Chinese industrial espionage.
The Executive Yuan on Thursday approved draft amendments to the National Security Act that would make it a crime to engage in “economic espionage” or the unapproved use of critical national technologies and trade secrets outside of Taiwan. Sentences would be set at up to 12 years and 10 years in jail, respectively.

In addition, any individuals or organizations that have been entrusted or subsidized by the Taiwanese government to conduct operations involving critical national technologies will have to receive government approval for any trips to China, according to the draft regulations. Failing to do so could incur a fine of between 2 million and 10 million New Taiwan dollars ($71,000 and $358,000).

“High-tech industry is the lifeline of Taiwan. However, the infiltration of the Chinese supply chain into Taiwan has become serious in recent years,” Lo Ping-cheng, minister without portfolio and spokesperson for the Executive Yuan, said at a news conference on Thursday. “They are luring away high-tech talent, stealing national critical technologies, circumventing Taiwan’s regulations, operating in Taiwan without approval and unlawfully investing in Taiwan, which is causing harm to Taiwan’s information technology security as well as the industry’s competitiveness.”

Lo said the administration of President Tsai Ing-wen sees an urgent need to amend the law to establish a more complete national security front line and stop such “unlawful actions.”

The current Trade Secrets Act is not enough, he said, to protect the island’s most advanced technology, such as Taiwan Semiconductor Manufacturing Co.’s 2-nanometer process technology. “We have to raise the protection level and increase the alert to the highest level,” Lo said. “This is a necessary move to protect our national security.”

Full story: https://asia.nikkei.com/Business/Tech/Semiconductors/Taiwan-takes-aim-at-China-with-draft-laws-on-chip-sector-espionage

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