China chal­lenges US on trade se­crets case

Viet Nam News - - ASIA BUSINESS -

US At­tor­ney Gen­eral Jeff Ses­sions ac­cused the com­pa­nies on Thurs­day of steal­ing an es­ti­mated $8.75 bil­lion worth of know-how from semi­con­duc­tor gi­ant Mi­cron.

WASH­ING­TON/TAIPEI/ BEI­JING — China chal­lenged the United States Fri­day to show ev­i­dence to sup­port charges that Bei­jing backed a scheme by Chi­nese and Tai­wanese com­pa­nies to steal trade se­crets from a US-based semi­con­duc­tor firm.

US At­tor­ney Gen­eral Jeff Ses­sions ac­cused the com­pa­nies on Thurs­day of steal­ing an es­ti­mated $8.75 bil­lion worth of know-how from semi­con­duc­tor gi­ant Mi­cron.

The Jus­tice Depart­ment un­veiled crim­i­nal charges against Chi­nese state-owned Fu­jian Jin­hua In­te­grated Cir­cuit Co., and United Mi­cro­elec­tron­ics Cor­po­ra­tion (UMC) of Tai­wan, along with three UMC of­fi­cials.

It said they con­spired to steal US-based Mi­cron’s ad­vanced de­signs to turn Fu­jian Jin­hua into a ma­jor player in the global com­puter chip mar­ket.

“If the US side is re­ally con­cerned, they should pro­vide con­crete ex­am­ples that can with­stand the test of ev­i­dence and facts,” Chi­nese for­eign min­istry spokesman Lu Kang told a reg­u­lar press brief­ing.

The charges were the lat­est in a series of cases tar­get­ing what Wash­ing­ton calls an on­go­ing Bei­jing pro­gramme to steal valu­able US in­dus­trial and com­mer­cial se­crets in or­der to ad­vance the Chi­nese econ­omy.

“Taken to­gether, these cases and many oth­ers like them paint a grim pic­ture of a coun­try bent on steal­ing its way up the lad­der of eco­nomic de­vel­op­ment and do­ing so at Amer­i­can ex­pense,” Ses­sions said.

“This be­hav­iour is il­le­gal. It is wrong. It is a threat to our na­tional se­cu­rity. And it must stop.”

US Pres­i­dent Don­ald Trump has cited China’s al­leged theft of US tech­no­log­i­cal know-how among a litany of griev­ances in his trade war with the Asian power.

Trump and Xi spoke on the phone about trade and other is­sues hours af­ter the charges were an­nounced, and the US leader tweeted that the pair had a “very good” con­ver­sa­tion.

Xi said he was “very happy” to talk to Trump again and that he would like to see him at the G20 sum­mit in Buenos Aires later this month, adding that the two coun­tries should “push for a mu­tu­ally ac­cept­able so­lu­tion to China-US eco­nomic and trade is­sues”, ac­cord­ing to state me­dia.

Chip de­signs

The in­dict­ment re­leased in the US dis­trict court in San Jose, Cal­i­for­nia al­leges that three for­mer Mi­cron em­ploy­ees in Tai­wan — Stephen Chen Zhengkun, He Jiant­ing and Kenny Wang Yung­ming — joined UMC in 2015 and 2016 with the ex­press plan to hand over to the com­pany Mi­cron’s de­sign and man­u­fac­tur­ing pro­cesses for spe­cific dy­namic ran­dom ac­cess mem­ory (DRAM) semi­con­duc­tors.

Those would then be trans­ferred to Fu­jian Jin­hua un­der an con­tract set by Chen.

Prior to the plot, US pros­e­cu­tors said, nei­ther the Chi­nese nor the Tai­wanese com­pany had any DRAM pro­duc­tion ca­pa­bil­ity.

But China had set out the goal of ac­quir­ing DRAM ca­pa­bil­ity in its cur­rent strate­gic econ­omy plan.

Chen was orig­i­nally a top ex­ec­u­tive at Mi­cron’s Tai­wan op­er­a­tion. He moved in 2015 to lead UMC, a con­tract chip man­u­fac­turer listed on the New York Stock Ex­change, and sub­se­quently be­came pres­i­dent of Fu­jian Jin­hua.

The theft posed a ma­jor threat to Mi­cron, a com­pany val­ued at around $100 bil­lion and which con­trols 20-25 per cent of the global mar­ket for DRAM chips.

The in­dict­ment came four months af­ter Fu­jian Jin­hua won a patent dis­pute with Mi­cron in a Chi­nese court, gain­ing an or­der for the US com­pany to stop sales in China of more than a dozen solid-state drives, mem­ory sticks and chips.

In re­tal­i­a­tion, the US Com­merce Depart­ment on Mon­day placed heavy re­stric­tions on Fu­jian Jin­hua’s abil­ity to buy US ma­chin­ery and ma­te­ri­als for its fac­to­ries that would boost its DRAM pro­duc­tion ca­pa­bil­i­ties.

In ad­di­tion to the crim­i­nal charges an­nounced Thurs­day, the Jus­tice Depart­ment filed a civil law­suit to block im­ports of any UMC and Fu­jian Jin­hua prod­ucts us­ing stolen Mi­cron tech­nol­ogy.

In re­cent years Wash­ing­ton has stepped up its fight against China’s al­leged on­go­ing eco­nomic es­pi­onage pro­gramme to ob­tain all sorts of ad­vanced tech­nolo­gies, from agri­cul­ture to heavy man­u­fac­tur­ing.

“China is prob­a­bly, over the long term, the big­gest chal­lenge, na­tional se­cu­rity chal­lenge that faces our coun­try,” Sec­re­tary of State Mike Pom­peo said Wed­nes­day in an in­ter­view with Fox News’ Laura In­gra­ham.

“Where the semi­con­duc­tor piece fits in is, it’s part of a mo­saic of our strate­gic ef­fort to push back against this con­tin­ued Chi­nese ef­fort.” — AFP

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