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New Delhi: Taiwanese chip giant TSMC is facing a serious internal breach after authorities arrested several employees accused of stealing sensitive data tied to its next-gen 2-nanometer chip process. This same chip process is expected to power Apple’s A20 processor for the iPhone 18 series next year.
The case has now reached Taiwan’s top legal body, the Supreme Prosecutors Office, highlighting the scale and potential damage of the alleged leak. Reports suggest this may be the first time the country’s core chip-making secrets have been targeted under the National Security Act.
According to Taiwan’s Central News Agency, two engineers, one currently employed and one former staffer, were arrested along with three others. All are suspected of trying to steal what TSMC has described as “core national trade secrets.”
The issue came to light when the company’s internal systems flagged “unusual access patterns” related to critical 2nm chip development files. After digging deeper, TSMC found enough evidence to escalate the matter legally.
Officials moved swiftly. The Intellectual Property Division of the Supreme Prosecutors Office filed charges under the National Security Act. If found guilty, the accused face up to 12 years in jail and fines as high as 3.3 million US dollars (around ₹28.7 crore).
TSMC is not just any chip maker. The company controls about 70% of the global foundry market and plays a central role in Taiwan’s economy, contributing nearly 8% to its GDP. Apple, AMD, Nvidia, and Intel are all among its biggest clients.
Its upcoming 2nm chip process is considered one of the biggest breakthroughs in recent years. It replaces the current FinFET architecture with nanosheet transistors, promising either 10% to 15% more speed or 25% to 30% less power use compared to 3nm chips.
This means smaller chips with more power and better efficiency, exactly what tech giants need to boost AI workloads, smartphone battery life, and gaming performance.
Apple is expected to use this 2nm node for its A20 chip, which will likely power the iPhone 18 series. That gives the stolen information even higher value, as the race to dominate the next wave of mobile processors heats up.
In the world of advanced chip design, even the tiniest leak can fast-track a competitor’s development. If stolen data lands in the hands of a rival company or government-backed outfit, it could take years to measure the real impact.
Experts believe that the accused might have been trying to sell or pass the information to external players, but no names have been revealed yet.
So far, TSMC has not made a public statement beyond confirming the security breach. However, the company acted fast, first conducting an internal probe and then alerting authorities.
As per local media, this might be the first officially confirmed case of an attempt to “illegally obtain the country’s core key technology trade secrets.” More investigations are likely to follow.
