Taiwan Cracks down on Chip Leaks, Hands out Heavy Sentences in TSMC Case

Reuters, AlJazeera, the Wall Street Journal, and Bloomberg contributed to this report.

A Taiwanese court just made an example out of one of the island’s biggest tech leak cases – and the message is clear.

Judges hit the local arm of Tokyo Electron with a $5 million fine and sent five people to jail over stolen trade secrets tied to TSMC, the world’s top contract chipmaker.

At the center of it all is Chen Li-ming, who drew the harshest punishment: 10 years behind bars. Prosecutors said he helped obtain sensitive chip technology, allegedly aiming to give Tokyo Electron an edge in winning equipment orders from TSMC.

Others didn’t walk away lightly either. Three former TSMC employees were handed sentences ranging from two to six years, while another ex-Tokyo Electron staffer received a 10-month term, suspended for three years.

The case, prosecuted under Taiwan’s National Security Act, has been closely watched. It goes straight to the heart of the island’s most valuable asset – its semiconductor know-how, which underpins everything from smartphones to AI systems.

Authorities have been tightening the screws on intellectual property leaks, especially as global competition for advanced chips heats up. This ruling shows they’re willing to go further than fines or warnings when core technology is involved.

Neither company rushed to comment. But the verdict itself speaks loudly enough.