US-China Tech War: South Korean companies on high alert for leaks amid mounting sanctions on China 

The United States has been mounting a lot of pressure on China by placing a wide variety of sanctions on Chinese tech companies, and by getting some of China’s biggest trading partners to impose similar sanctions. As a result, South Korea, one of China’s largest trading partners is now worried that certain companies may leak trade secrets to the Chinese.   After getting Japan and the Netherlands to impose certain trade restrictions on the country, particularly those that would not allow tech companies based in these countries to sell technology or machinery that would allow the Chinese to develop the latest generation of semiconductors, the US is now going after China’s trade with South Korea. **Also read: US, Netherlands and Japan enter into agreement for chip sanctions on China** South Korea’s worries In the latest intellectual property (IP) theft case to rock South Korea, the Suwon District Prosecutor’s Office last month accused five suspects, including a researcher from SEMES Company of sending confidential information related to semiconductor cleaning equipment to China. According to Korean specialists, as US’ efforts to deny China access to chip innovations increase, South Korea is on the lookout for technical knowledge and guides being leaked to China.   In a separate but similar incident as that of SEMES, six individuals from three South Korean tech companies will go on trial, according to a statement made last month by the Daejeon District Prosecutor’s Office and the Korean Intellectual Property Office, for allegedly passing key chip manufacturing knowledge to China. The lawsuits come as Washington is pressuring its allies, including South Korea, to assist limit China’s ability to develop cutting-edge semiconductor technology. According to reports, the US has agreements with Japan and the Netherlands to limit the supply of sophisticated semiconductor equipment to China.   South Korea to join the Chip 4 alliance? Seoul is being urged by Washington to join the Chip 4 Alliance, which already includes Tokyo and Taipei, but Beijing views the organisation as a US scheme to diminish China’s influence in the world’s chip supply chain. In light of the tightening US restrictions, Son Seung-woo, president of the Korea Institute of Intellectual Property, claimed that China is looking for alternate ways to acquire semiconductor technology, such as mergers, the purchase of foreign assets, and the poaching of foreign talent in addition to domestic innovation. **Also read: Chips down on India: From Foxconn to TSMC, semiconductor giants are betting big on India** Son stated, “China is trying to obtain technology from other nations with more sophisticated levels in order to improve its industry. “Washington’s chip control measures on China caused a shortage of [advanced] semiconductors, which pushed Beijing to seek South Korean chip technology.” China’s history of corporate and industrial espionage Allegations of industrial espionage have never been accepted by the Chinese government. When news of a further SEMES IP theft case broke in May 2022, Chinese official media The Global Times connected it to US President Joe Biden’s visit to Seoul at the time, saying the incident demonstrated Seoul’s hatred of China.   Over the years, China has obtained semiconductor technology in part by stealing engineers from competitors. For instance, experts from Japan, Taiwan, and South Korea who were lured to mainland China with alluring wage and compensation packages contributed to China’s recent improvements in DRAM chip technology. Semiconductors, displays, and secondary cells are among the 71 “essential national technologies” that Seoul has designated. According to South Korean criminal legislation, leaking such knowledge to a foreign country carries a sentence of more than three years in jail.y **Also read: China's biggest chip maker SMIC saw profits fall by over 25% YoY** A total of 112 incidents of foreign IP theft were recorded in South Korea between 2016 and 2021, with 36 of those cases being “essential national technology." Impact on South Korea’s economy The Global Times cited Zhan Debin, a researcher on Korean issues at the Shanghai University of International Business and Economics, as stating that Korea was planning to tighten monitoring of international technology transfers independent of efforts to target China. “South Korea was heavily dependent on exports of high-tech goods to China, but it had its first-ever trade deficit with China last year,” said Son from the Korea Institute of Intellectual Property. It indicates that China’s technology has advanced considerably. As a result, according to Park Ki-soon, a senior consultant at Dentons Lee Law Firm, Seoul is on high alert for the leaking of cutting-edge technologies to China that might impair the nation’s competitiveness in the global semiconductor market. According to Park, who’s an expert on the Chinese economy, “South Korea would lose the China market for such items if China acquires that technology.” “The Chinese enterprises that obtained that technology would be more competitive in the market, reducing the market share held by South Korean corporations,” said Park. **Also read: Foxconn faces hefty fines from Taiwanese government for unauthorised investment in Chinese chip makers** South Korea’s biggest tech companies in a conundrum Choo Jae-woo, a professor of China studies at Kyung Hee University in Seoul, declared that “it’s all about money.” To stop these leaks, South Korean businesses must do well in providing job stability and improved care of their workers. According to the South Korean Ministry of Trade, Industry, and Energy, South Korea’s exports of chips to the world totalled $6 billion in January, a decrease of 44.5% from the same month the previous year. Chip shipments from the nation to China decreased by 46.6% in January. Since there is presently less demand for semiconductors, businesses like Samsung Electronics have seen their sales suffer. Samsung Electronics reported a more than 90% decline in fourth-quarter profit for its chip division. Read all the  Latest News ,  Trending News ,  Cricket News ,  Bollywood News , India News  and  Entertainment News  here. Follow us on  Facebook,  Twitter and  Instagram.