TSMC says it has discovered potential trade deal leaks. How will this affect the company?

On Tuesday, Taiwan Semiconductor Manufacturing Co. said it had discovered “unauthorized activities” that led to the disclosure of potential leaks of trade secrets.

The world’s largest semiconductor manufacturer told CNBC that it had taken “stern” disciplinary measures against the staff involved and that it had initiated legal proceedings.

“TSMC maintains a zero-tolerance policy towards any actions that compromise the protection of trade secrets or harm the company’s interests,” the company said.

“Such violations are strictly investigated and prosecuted to the fullest extent of the law. We remain committed to protecting our core competitiveness and the shared interests of all our employees.”

Semiconductors have gained strategic importance in recent years as they have become a key pillar in the boom in artificial intelligence models and applications. Rising geopolitical tensions have put the spotlight on the competitive technological advantages of major firms in the chip supply chain, such as TSMC and other leaders across the sector.

TSMC, based in Taiwan, dominates the world’s most advanced chip manufacturing market and counts major technology giants including Apple and Nvidia as its customers.

Because the case is now under judicial review, TSMC cannot provide further information, the company said.

TSMC identified the problem early thanks to its “comprehensive and robust monitoring mechanisms,” the company said, adding that it had conducted rapid internal investigations.

Nikkei Asia, citing multiple sources familiar with the matter, reported on Tuesday that several former TSMC employees are suspected of trying to obtain critical confidential information about the development and production of 2-nanometer chips while they were still working at the company.

The 2-nanometer chip is among the leading manufacturing processes in the semiconductor industry right now. TSMC said it had no additional information to share when CNBC asked about the Nikkei report.

As the world’s leading chipmaker, TSMC owns a treasure trove of intellectual property. By its own admission, the company has said it has over 200,000 trade secrets registered in its internal system.

This is not the first time TSMC has been the target of potential theft. In 2018, a Taiwanese court charged a former employee with copying trade secrets related to its 28-nanometer manufacturing process with the intention of transferring them to a semiconductor company in mainland China.

In 2023, ASML, which makes machines needed to produce cutting-edge chips, said it had discovered that a former employee in China had stolen data related to its own technology.