Semiconductors, Core to Technology Security... Mountains of Challenges in Intellectual Property Protection

Among the 7 Major Industries, Semiconductor Ranks 2nd in Technology Leakage Cases
Continued Leakage of National Core Technologies
"Need for Legal and Institutional Improvements and Additional Measures to Prevent Talent Drain"

Semiconductor image / Source=Pixabay

[Asia Economy Reporter Kim Pyeonghwa] As the global competition for technological supremacy intensifies, there are growing calls for urgent measures to secure technology in the semiconductor sector. This is due to the frequent cases of core semiconductor technologies and personnel being leaked, which directly impact national competitiveness and economic security.

According to the semiconductor industry, the National Intelligence Service, Statistics Korea, and the Federation of Korean Industries on the 4th, cases of technology leakage in the semiconductor field have become prominent, leading to intellectual property rights infringements. Intellectual property rights encompass all property rights arising from intellectual activities, including technology patents in the industrial sector.

The National Intelligence Service’s review of domestic technologies leaked overseas, including to China, from 2017 to February this year found that out of 99 cases, 17 occurred in the semiconductor sector. Among the seven major industries such as electrical electronics, display, and automotive, semiconductor leakage was the second highest after display (19 cases).

In particular, for national core technologies that, if leaked overseas, severely harm national security and economic development, 6 out of 34 total cases involved the semiconductor sector, ranking second after shipbuilding (7 cases). Most of these leaks occurred from large corporations.

An official from the Korean Intellectual Property Office (KIPO) stated, "Since these statistics are based on cases detected by the National Intelligence Service, the actual number of technology leak cases could be higher if undetected cases are included."

Such technology leaks mainly occur through the poaching of key personnel. There have also been cases of technology leakage disguised as mergers and acquisitions (M&A), use of partner companies, or joint research. Industrial espionage and cyber hacking are also on the rise. As the importance of semiconductors as an economic security asset grows, it is expected that such technology theft will become more rampant.

Kwon Tae-shin, Vice Chairman of the Federation of Korean Industries, emphasized at the seminar titled "How to Protect Advanced Technology in the Era of Economic Security" held on the 30th of last month, "Private companies’ annual R&D expenditure reaches 73.6 trillion won. We must strengthen legal and institutional protections to prevent the technologies and talents painstakingly developed by our companies from leaking overseas."

The semiconductor industry stressed that while the government is promoting various support measures to enhance the competitiveness of the semiconductor industry, a national strategic asset, efforts to prevent technology leakage must also be strengthened. They explained that judicial supplementation is needed alongside institutional improvements to protect core semiconductor technologies.

The Ministry of Trade, Industry and Energy designates national core technologies by industry every year to protect them. As of last year, 11 semiconductor technologies were included in the list. According to the ministry, there will be no additional updates to semiconductor technologies in this year’s national core technology announcement scheduled for next month. Given the rapid development of semiconductor technology, detailed institutional measures are advised.

While technology leakage cases are becoming more sophisticated, the lack of guaranteed expertise in investigations and trials is also pointed out as a challenge. Due to the nature of the semiconductor sector, a high level of technical understanding is required, but there is a shortage of specialized personnel or departments, and legal procedures often take several years. In August, KIPO announced plans to strengthen the investigative system through cooperation between investigative and intelligence agencies and to consider concentrating jurisdiction in specialized courts in consultation with related ministries.

In particular, finding solutions related to personnel leakage is the most urgent issue. KIPO operates examiners at the grade equivalent to level 5 who utilize the expertise of retired semiconductor industry professionals in patent examinations. Recently, they also announced improvements to appoint skilled technicians as industrial field instructors to provide technical advice to small and medium-sized enterprises. The semiconductor industry explains that the government should consider additional measures alongside these efforts.

An industry insider said, "When personnel leak, technology naturally leaks as it is embedded in people. The government’s attempt to retain personnel by appointing examiners is positive, but since there can be a large salary gap with the private sector, it is necessary to expand the selection of technology masters to confer honor or consider additional alternatives."

This content was produced with the assistance of AI translation services.