Concern over Tech Leakage
Concerns over technology leakage are rising in the South Korean semiconductor industry as the Ministry of Employment & Labor is likely to disclose Samsung Electronics’ work environment reports on April 19 in relation to its semiconductor manufacturing facilities. Samsung Electronics asked the Suwon District Court to ban the disclosure, and the court made no ruling at the first trial on April 13. The second trial is scheduled for this week.
An expert committee of the Ministry of Trade, Industry & Energy holds a meeting on April 16 to determine the appropriateness of the disclosure, but its final decision may take more time. Its decision is not legally binding but can be referred to by the other organizations. On April 17, the Central Administrative Appeals Commission of the Anti-Corruption & Civil Rights Commission makes its determination in response to Samsung Electronics’ request for an administrative appeal. The commission is unlikely to rule in favor of the company in that it is an organization that puts workers’ human rights first. Under the circumstances, concerns are mounting over the possibility that the reports containing Samsung Electronics’ trade secrets will be opened to rival companies unless the court accepts Samsung Electronics’ injunction application on April 19 or before.
The Ministry of Employment & Labor told Samsung Electronics to disclose the work environment reports related to its Gumi and Onyang Plants on March 19 and those related to its Giheung, Hwaseong and Pyeongtaek Plants on March 20. According to the Official Information Disclosure Act, the reports should be disclosed on April 19 and 20 after a grade period of 30 days, respectively.
At the first trial on April 13, the Suwon District Court heard the claims of Samsung Electronics and the Ministry of Employment & Labor and said that it would make a ruling after additional data submission by April 16. The second trial and the final ruling are scheduled for April 18 or before.
Once the expert committee of the Ministry of Trade, Industry & Energy determines on April 16 that the reports contain South Korea’s national key technology, Samsung Electronics is going to inform the court of the fact immediately. At present, Samsung Electronics’ semiconductor manufacturing facilities in Giheung, Hwaseong and Pyeongtaek are producing 64-layer NAND flash memory chips and DRAM using 30-nm class technology and below, which are national key technology designated by the Ministry of Trade, Industry & Energy.
As mentioned above, the expert committee may not make its final decision that day. This is because of a sharp conflict of opinions between those against any leakage of the technology currently constituting the largest portion of South Korea’s exports and those advocating the people’s right to life. Minister of Trade, Industry & Energy Paik Un-gyu said on April 12 that disclosure of key information such as semiconductor manufacturing facility arrangement should be avoided.
In February this year, the Daejeon High Court ruled that the report related to the Onyang Plant should be disclosed to the bereaved family members of deceased Samsung Electronics employees. Based on the ruling, the Ministry of Employment & Labor revised its administrative guidelines so that the reports can be disclosed even to disinterested third parties if the disclosure is to prove the occurrence of an industrial accident. Although the ministry explained that it would deliberate on the appropriateness of disclosure for each request, experts’ consensus is that the reports are likely to be disclosed in the near future.
They also point out that Samsung Electronics’ confidential business information and key techniques can be easily figured out even from the names of chemicals and process diagrams in the reports alone and that South Korean companies will have to face a serious damage once the information and technologies end up in the hands of Chinese companies, which are planning to invest more than 200 trillion won (US$180 billion) in the semiconductor industry for five years to come with the Chinese government.
In the meantime, the Korea Employers Federation said on April 15 that the scope of the disclosure should be limited to relevant employees and bereaved families and sensitive process information irrelevant to the confirmation of the occurrence of an industrial accident should not be disclosed in any case.