China’s Semiconductor Giant SMIC Under Investigation for Illegal Recruitment in Taiwan
Recently, China’s semiconductor giant Semiconductor Manufacturing International Corporation (SMIC) has come under scrutiny from Taiwanese investigative authorities for allegedly establishing a presence in Taiwan under the guise of a foreign company and illegally poaching Taiwanese semiconductor engineers. This month, authorities conducted extensive searches at multiple locations and interrogated nearly a hundred individuals, indicating not only business competition but also a talent battle in the field of AI chips between the two sides.
SMIC Operating Under the Name of “Samoa Company” in Taiwan
The investigation bureau stated that SMIC set up a foreign company under the name “Samoa” in Taiwan and engaged in large-scale recruitment of Taiwanese chip engineers. According to the law, Chinese enterprises must obtain government permission before engaging in recruitment and business activities in Taiwan. Operating or recruiting without prior approval constitutes a violation of the law.
34 Locations Raided, 90 Individuals Interrogated, Investigation Targets 11 Chinese Tech Companies
This operation is one of the largest since the establishment of the “Task Force Against Illegal Recruitment by Chinese Enterprises” in 2020. Authorities raided 34 locations and interrogated 90 relevant individuals, targeting 11 Chinese background tech companies, including SMIC. Currently, SMIC has not publicly responded to this incident.
High Salary Offers Becoming Routine, Taiwan’s Semiconductor Industry a “Talent Supermarket” for China
In recent years, China has been “madly recruiting” to overcome technological restrictions from the U.S. and Western countries, focusing on Taiwan, which has a solid technological foundation and shared language. Taiwan possesses the world’s most advanced chip manufacturing technology and serves as a designated production base for companies like Apple and NVIDIA.
According to past reports, many Chinese companies set up operations through “front companies” or “fake foreign firms,” offering salaries significantly above Taiwanese market rates to attract engineers to switch jobs.
SMIC Collaborated with Huawei on 7-Nanometer Chips, But Stuck on EUV Equipment Acquisition
In 2023, SMIC gained considerable attention for successfully manufacturing 7-nanometer chips in collaboration with Huawei, marking a milestone in China’s semiconductor autonomy. However, SMIC is currently facing technical upgrades and roadblocks due to the inability to acquire the advanced extreme ultraviolet lithography machines (EUV) from Dutch company ASML, which are necessary for producing chips with advanced processes below 3 nanometers.
Over 100 Cases of Chinese Poaching Investigated Since 2020
The Taiwan Investigation Bureau pointed out that since the establishment of the dedicated task force in 2020, over 100 cases of illegal recruitment by Chinese enterprises have been investigated. This operation is merely the tip of the iceberg, and future efforts will continue to strengthen monitoring of the talent war across the Taiwan Strait.
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