Taiwan Semiconductor Manufacturing Co., the world’s largest contract chipmaker, has dismissed several employees after internal monitoring detected unauthorised attempts to obtain proprietary information on its next-generation 2-nanometre manufacturing process. The company said it has begun civil and criminal proceedings against those involved and reiterated its ‘zero-tolerance’ policy toward trade-secret breaches. Taiwan’s Intellectual Property branch of the High Court Prosecutors Office subsequently arrested two former TSMC engineers and a third suspect on suspicion of violating the National Security Act, the first investigation under amendments that protect key semiconductor technologies. Prosecutors also searched the local premises of Japanese chip-equipment maker Tokyo Electron as part of the inquiry. Officials are still determining whether confidential data were transferred outside the company. The case comes as TSMC prepares to start volume production of 2-nm chips later this year and underscores the strategic importance of the technology, which underpins products for clients such as Apple and Nvidia and accounts for the bulk of the world’s most advanced semiconductor output.