China's Top Chipmaker SMIC Accused Of Poaching Taiwan's Engineers Via Samoan Front Company

Taiwanese authorities are investigating whether China's largest chipmaker, Semiconductor Manufacturing International Corp. (SMIC), used a shell company posing as a Samoan company to lure tech talent from the island's semiconductor sector.

What Happened: Taiwan's Ministry of Justice Investigation Bureau said on Friday that SMIC had allegedly established a subsidiary in Hsinchu County—home to leading chipmaker Taiwan Semiconductor Manufacturing Company TSM—under the guise of being registered in Samoa, reported Reuters.

Authorities say the covert operation was part of a broader effort by Chinese firms to poach Taiwanese engineers and acquire advanced chipmaking know-how.

According to the bureau, SMIC was one of several firms targeted in a major crackdown earlier this month.

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Investigators deployed 180 agents to raid 11 companies suspected of illegal recruitment practices, searching 34 premises and questioning 90 individuals.

Since launching a task force in 2020, the bureau says it has investigated over 100 cases related to talent poaching.

"The high-tech industry is the lifeblood of our nation's economy," the bureau said in a statement. "Companies with semiconductor technology and the related industrial chain are the ‘mountains protecting the country' to maintain our economic strength."

Why It's Important: The investigation into SMIC comes amid heightened tensions between Taiwan and China.

Earlier this month, it was reported that Taiwan is considering issuing travel advisories for its citizens visiting countries closely aligned with China, such as Laos and Cambodia, in response to Beijing’s crackdown on Taiwan independence supporters.

Last month, China accused Taiwan of attempting to surrender its semiconductor industry to the U.S. for political support.

Meanwhile, TSMC's $165 billion U.S. expansion, driven by geopolitical pressure and supply chain security, has raised concerns in Taiwan about the potential risks of over-reliance on foreign markets.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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