U.S. Sets Deadline for TSMC to Hand Over Trade Secrets
China Times, October 1, 2021
In order to address its chip shortage, the United States has requested major semiconductor manufacturers, among others, to hand over their customer lists, inventories and related confidential corporate information within 45 days. In response, Minister of Economic Affairs Wang Mei-hua stated on September 29, 2021 that those companies have their own considerations in deciding what to disclose or not. Chairman Johnny Chiang of the opposition Kuomintang (KMT) questioned that in time of major difficulties the industry might encounter, shouldn't the government be aware of the situation and make an effort to give help as soon as possible? The Taiwan Semiconductor Manufacturing Company (TSMC) has a big heart for Taiwan. In contrast, the response from the Ministry of Economic Affairs (MOEA) was unexpectedly heartless and ungrateful. "For what else do we need this government?”
U.S. Demands Trade Secrets
According to the Reuters and other news outlets, at a semiconductor supply chain meeting convened at the White House on September 23, 2021, Secretary of Commerce Gina Raimondo said the U.S. government requested more information about the supply chain, and the goal was to increase transparency so it could try to identify where the bottlenecks were and then predict challenges. Moreover, the U.S. government asked TSMC, Samsung, and other companies involved in the semiconductor supply chain to "voluntarily share information about inventories, demand, and delivery dynamics before November 8." Some Korean industry players have complained that doing so would be tantamount to the disclosure of their own semiconductor technology standards, while other experts have argued that submitting such information to the U.S. government could affect prices in the semiconductor chip market. Especially, South Korean firms were concerned that if TSMC and Samsung did provide the U.S. government with information, it could be leaked to their American competitors such as Intel.
U.S. Defense Production Act May be Invoked
Raimondo warned if companies do not answer the voluntary request, then the United States has other tools to require submission of data. She hopes that the United States does not get there. But if it has to, it will. The United States might consider invoking the Defense Production Act or using other tools to force their hands if they do not respond.
Minister Wang stated during interpellation at the Legislative Yuan the day before yesterday that companies could weight all factors involved and decide on their own what kind of information can be made public or not; however, the details were not yet given.
Chairman Chiang criticized Minister Wang's response as "regrettable and infuriating". He floated a series of questions about the right of companies to decide whether or not to disclose information when the United States may invoke its Defense Production Act to force related companies to provide information to the United States. She replied, "It's up to you." Chiang accused that the Minister Wang was lying because it is not really up to the companies.
Government Accused as Incapable
Chiang indicated that TSMC is not only a sacred guardian of Taiwan, but also a successful facilitator for purchasing the BioNTech coronavirus (COVID-19) vaccine when the Taiwanese had urgent needs. TSMC had a heart for the people of Taiwan while the government acted to the contrary. As Chiang said the response from the MOEA was heartless and ungrateful. Consequently, all the people of Taiwan would wonder if this government was still capable. Did it know how to protect TSMC, a sacred guardian of Taiwan? If this government could not even say a few words in favor of TSMC, for what else do the people need this government? Chiang questioned.
Chang stressed that if the said American request was not handled properly, it will turn out to be a crisis which could affect Taiwan's competitiveness in the semiconductor industry. "This is the time for Minister Wang and President Tsai Ing-wen to stop dozing and come forward!”
Minister Kung Ming-hsin of the National Development Council (NDC) was present at the Legislative Yuan yesterday for an interpellation. KMT Legislator Tseng Ming-chung asked a question regarding the role of the National Development Fund, a majority shareholder of TSMC. Tseng inquired now that the U.S. was requesting TSMC to hand over "confidential data", should the government make intervention to coordinate with the NDC, a responsible ministerial level council in charge of the NDF, to cope with the U.S.? The interrogation left Chairman Kung speechless.
TSMC Said No Secret of Individual Customer be Revealed
It was understood that Minister Kung, in his capacity as Convener of the NDF, had spoken with TSMC over the telephone later in the evening. No content of this conversation was disclosed. According to a press release issued by the NDF. The case referred to the U.S. Department of Commerce's consultation with the relevant industries to understand the actual situation of the "chip shortage" issue. The U.S. Department of Commerce posted 26 questions on the official website, hoping that all sectors will take the initiative to provide information before November 8, so much so that the U.S. can understand the overall supply chain upstream and downstream situation. The requests were aimed at all companies in the semiconductor supply chain, not just TSMC. Taiwanese manufacturers or TSMC as a single company can "voluntarily" reply, not compulsorily. TSMC stated yesterday that it would not reveal the trade secrets of individual customers.
After Minister Wang was grilled yesterday, the MOEA issued a press release clarifying that it would work closely with the relevant industry players and keep track of the situation to render assistance in a timely manner. TSMC pointed out that the government has long been concerned about the U.S. request and TSMC would respond to the government if there is a need for government assistance.
From: https://www.chinatimes.com/newspapers/20211001000361-260118