The TSMC leak case continues to escalate, with prosecutors indicting Tokyo Electron and seeking a penalty of 120 million NTD.

TSMC (TSMC) reported a suspected leak of its 2nm process technology this year, triggering a large-scale investigation by Taiwanese prosecutors. The case, which initially involved individuals, gradually expanded to question whether Tokyo Electron (Tokyo Electron) had failed in its management responsibilities. Taiwanese authorities have now announced that Tokyo Electron’s Taiwan subsidiary has been indicted under the Trade Secrets Act and the National Security Act, with prosecutors seeking a fine of NT$120 million.

TSMC Reports Confidential Leak, Authorities Launch In-Depth Investigation

Earlier this year, TSMC notified the government of a suspected leak of its 2nm technology, prompting an official investigation. It was discovered that a former TSMC engineer surnamed Chen, who later joined Tokyo Electron, allegedly exploited past connections to request highly sensitive 2nm process data from former colleagues, posing a risk of advanced technology being transferred abroad.

Since the requested information involved core wafer process technology, the investigation was expanded to determine whether cross-border use and national security issues were involved.

Alleged Assistance With Japanese Equipment Certification, Escalating to National Security

In August, prosecutors formally indicted three individuals involved in the case. Investigations revealed that the defendant, Chen, while employed at both TSMC and Tokyo Electron, repeatedly attempted to obtain advanced process-related information and allegedly intended to use the acquired data to help Tokyo Electron improve its etching equipment, aiming to pass TSMC’s 2nm process certification.

Prosecutors also pointed out that the three suspects intended to take TSMC’s proprietary technology overseas, elevating the case from simple trade secret theft to a national security issue.

Formal Indictment of Tokyo Electron, NT$120 Million Fine Sought

By the end of 2025, the case reached a critical stage, with Taiwanese prosecutors formally indicting Tokyo Electron’s Taiwan subsidiary. Authorities determined that the company failed to adequately control employee behavior and protect trade secrets, and did not effectively prevent the implicated engineer from stealing technology.

Prosecutors emphasized that they found no evidence that Tokyo Electron used or benefited from TSMC’s confidential information, but still sought an NT$120 million fine for “failure to fulfill preventive obligations.”

Tokyo Electron responded that the relevant employees have been terminated, the company is clarifying details and fully cooperating with the investigation, and reiterated that no data had been leaked to third parties. TSMC also stated that it will continue to strengthen internal controls and cooperate with regulators to ensure its competitive advantage is not compromised by external interference.

This article, “TSMC Confidential Leak Case Intensifies: Prosecutors Indict Tokyo Electron, Seek NT$120 Million Fine,” first appeared on Chain News ABMedia.