A former govt at Samsung Electronics has been arrested and indicted in South Korea for allegedly stealing the main chipmaker’s expertise with a purpose to construct a copycat plant in China.
The indictment of the 65-year-old Korean nationwide, who had additionally served as a vice-president at rival Korean chipmaker SK Hynix, comes as South Korea makes an attempt to beef up its defences in opposition to a concerted marketing campaign by Chinese language firms to amass cutting-edge Korean applied sciences.
In accordance with a press release launched by Korean prosecutors on Monday, the previous Samsung vice-president, who has not been named, illegally acquired info wanted to construct superior chipmaking amenities.
His plan, mentioned prosecutors, was to duplicate a semiconductor manufacturing unit simply 1.5km away from Samsung’s reminiscence chip plant in Xi’an in western China.
“This isn’t a easy semiconductor tech leak however an try to repeat a complete chip plant,” the Suwon District Prosecutors’ Workplace mentioned in a press release.
“The scope of the crime and injury are incomparable to earlier particular person tech leak instances,” the assertion added. “If the home plant have been copied and related high quality of merchandise have been mass-produced in China, it might have prompted irrecoverable losses to the [Korean] semiconductor trade.”
The previous govt employed about 200 staff from Samsung and SK Hynix for a corporation he established in Chengdu in China’s Sichuan province. They have been allegedly tasked with buying commerce secrets and techniques from their former employers, costing Samsung an estimated $230mn, in response to the indictment.
“Samsung strictly forbids outsiders from coming into its chip vegetation as a result of the manufacturing unit design and its tools structure are carefully associated to productiveness and product high quality,” mentioned Lee Dong-hwan, a former state investigator now working as a patent legal professional at WeFocus, a Seoul-based legislation agency.
“However there is no such thing as a method for the corporate, regardless of its robust safety programs, to stop tech leaks if a senior govt with good entry to broad and high-quality info deliberately provides it out to Chinese language opponents,” he added.
Samsung Electronics and SK Hynix, two of the world’s main reminiscence chipmakers, each have vegetation in China. Their applied sciences are regarded by trade specialists as extra superior than these of their main Chinese language opponents.
Final yr, the US authorities gave the Korean firms a one-year reprieve from export controls that have been designed to cut back China’s potential to develop high-end chips. The FT reported final month that Washington had signalled it might prolong permission for them to ship US chipmaking instruments to China for not less than one other yr.
Among the many commerce secrets and techniques the previous govt is alleged to have stolen was info referring to protecting impurities out of superior chip vegetation, and the ground plans and dimensions mandatory for a number of processes in superior chipmaking applied sciences.
However his plan fell aside after he didn’t safe a $6.2bn funding allegedly promised by an unnamed Taiwanese firm for a corporation he established in Singapore.
As a substitute, he raised simply over $350mn from Chinese language buyers to provide trial merchandise from a plant in Chengdu. In accordance with prosecutors, the Chengdu plant’s building was additionally based mostly on expertise stolen from Samsung.
Beneficial
Six different folks have been additionally indicted on Monday as a part of the identical case, together with the worker of a Samsung subcontractor and 5 staff of the manager’s Chinese language chipmaking firm.
As tech competitors between the US and China intensifies, Chinese language firms have stepped up efforts to amass Korean experience in important applied sciences starting from semiconductors to electrical automobile batteries and in industries together with shows and shipbuilding.
In February, seven folks, together with former staff of Semes, a subsidiary of Samsung Electronics specialising within the manufacturing of wafer cleansing tools, got jail sentences for transferring stolen applied sciences to a Chinese language firm.
The South Korea authorities has additionally established a number of new investigatory our bodies to fight the leaks, handed laws to toughen punishments and made it simpler to report suspected violations.
