{"id":2201347,"date":"2023-06-13T08:00:55","date_gmt":"2023-06-12T23:00:55","guid":{"rendered":"https:\/\/koreapro.org\/?p=2201347"},"modified":"2023-06-12T15:48:16","modified_gmt":"2023-06-12T06:48:16","slug":"233-million-loss-samsung-hit-hard-by-former-executives-alleged-tech-theft","status":"publish","type":"post","link":"https:\/\/koreapro.org\/2023\/06\/233-million-loss-samsung-hit-hard-by-former-executives-alleged-tech-theft\/","title":{"rendered":"$233 million loss: Samsung hit hard by former executive\u2019s alleged tech theft"},"content":{"rendered":"
A former Samsung Electronics executive, identified only as \u201cA,\u201d has been arrested and charged with attempting to replicate Samsung Electronics\u2019 semiconductor factory in China. The Suwon Prosecutors\u2019 Office <\/span>announced<\/span><\/a> that they had arrested \u201cA,\u201d five Chinese semiconductor manufacturing company employees and one Samsung Electronics subcontractor. They have been charged without detention for stealing factory design blueprints and violations of the <\/span>Industrial Technology Protection Act<\/span><\/a> and the <\/span>Unfair Competition Prevention Act<\/span><\/a>. These charges involve illicitly obtained trade secrets, such as Samsung\u2019s Basic Engineering Data (BED), process layouts and factory design drawings.<\/span><\/p>\n \u201cA\u201d was believed to be planning to establish a semiconductor factory in Xian, China. Despite recruiting over 200 people from the domestic semiconductor industry, the plan to build the \u201ccopycat\u201d factory did not materialize due to the alleged failure of an investment agreement with a Taiwanese electronics manufacturer. Nevertheless, prosecutors stated that \u201cA\u2019s\u201d company still possesses the stolen factory design blueprints and has even completed the construction of an R&D building, producing semiconductor prototypes using Samsung\u2019s technology.<\/span><\/p>\n The prosecution is preparing to expand the investigation into the specific circumstances of the technology leak and potential additional crimes by \u201cA\u201d and his associates. While \u201cA,\u201d who allegedly held executive positions at Samsung Electronics and SK Hynix, denies all charges, some indicted employees confessed to ROK law enforcement authorities. The incident is estimated to have caused Samsung at least $233 million (300 billion won) in damages.<\/span><\/p>\n Dear readers,<\/span><\/i><\/p>\n At KOREA PRO, we are committed to providing engaging and informative content tailored to our discerning audience. Recognizing the significance of your perspectives in enriching our offerings, we cordially extend an invitation for your participation in a brief <\/span><\/i>5-minute survey<\/span><\/i><\/a>. This opportunity allows us to capture your invaluable feedback and insights, which we greatly appreciate and consider integral to our ongoing commitment to service excellence.<\/span><\/i><\/p>\n Why It Matters<\/b><\/p>\n This case of alleged industrial espionage is a significant development as South Korea, a key player in the semiconductor industry, has been increasingly worried about <\/span>technology theft<\/span><\/a>. If not adequately addressed, the situation reflects a potential security loophole that could jeopardize South Korea\u2019s tech industry\u2019s competitiveness.<\/span><\/p>\n Additionally, this case comes amid intensifying global competition in the semiconductor market, which President Yoon Suk-yeol described last week as an \u201c<\/span>industrial war<\/span><\/a>.\u201d South Korea has already been grappling with its semiconductor industry <\/span>lagging behind<\/span><\/a> Taiwan\u2019s, specifically Taiwan Semiconductor Manufacturing Company (TSMC). An incident as massive as this technology theft exacerbates these concerns as it could potentially aid competitors with stolen technology and know-how, further widening the technology gap.<\/span><\/p>\n This incident also has ramifications in the context of the U.S. CHIPS and Science Act, aimed at bolstering its domestic semiconductor production. South Korea fears being <\/span>sidelined<\/span><\/a> in the global semiconductor landscape due to this law. The leakage of its technology to China, an emerging semiconductor player, adds another layer of complexity to these apprehensions.<\/span><\/p>\n The situation also feeds into the <\/span>growing diplomatic animosity<\/span><\/a> between South Korea and China, potentially leading to increased tensions. With South Korea\u2019s technology potentially being used to bolster China\u2019s semiconductor ambitions, this case could further strain their bilateral ties.<\/span><\/p>\n