Taiwan arrests six engineers suspected of leaking BASF technology to China

Bloomberg

Taiwan arrested six current and former BASF SE engineers accused of accepting bribes and sharing the German company’s technology with Jiangyin Jianghua Microelectronics Materials Co., in one of the more elaborate cases involving alleged Chinese intellectual property theft.
Jianghua offered them $5.8 million in return for help building a new factory in the eastern Chinese province of Jiangsu, Criminal Investigation Bureau official Lu Sung-hao told reporters at a briefing. The mainland company had already wired $1.3 million to two accounts in Samoa controlled by the group, he added.
American and Taiwanese officials have long accused Chinese companies of purloining intellectual property in a quest to climb the technology ladder, something Beijing’s consistently denied. Such leaks, which American officials say include the forced transfer of technology, are a key complaint of Washington’s as the world’s two largest economies open talks to avert a damaging trade war.
The amount involved in the case is unusually large. Taiwanese officials have in the past accused mainland corporations of appropriating trade secrets by poaching talent, but Lu said Jianghua offered direct payment in return for proprietary technology. Calls to Jianghua’s main line and an email to a corporate address went unanswered.
BASF Chief Executive Officer Martin Brudermueller, who took the helm in May, has made expansion in China a central pillar of his strategy. Two months into his tenure, he announced BASF plans to build a second chemical complex in the country, at a cost of up to $10 billion.
BASF’s losses from the alleged theft could top out at $114 million per year, Lu said. A representative of BASF said the company doesn’t provide an estimate on losses and the amount can’t be confirmed by the company.
According to police, only one of the six accused was a current employee, though the others formerly worked for BASF. The German chemicals maker said it suspended the employee and has taken steps to support the investigation and protect its intellectual property.