Analysis: Taiwan’s recent developments in trade secret protection

Over the past six months, Taiwan’s trade secret protection regime has drawn significant public attention for its speed and enforcement strength in several criminal cases involving leakage of semiconductor-related trade secrets. These developments reflect the cumulative results of legal reforms in recent years, the key aspects of which are reviewed below.

A landmark development occurred in 2022 when Taiwan amended the National Security Act to protect trade secrets involving “national core key technologies”, specifically when the misappropriation is carried out for foreign entities or with the intent to use such secrets outside Taiwan. As of the end of November 2025, the government had designated 42 items of such trade secrets, approximately one quarter of which relate to semiconductors; for example, integrated circuit manufacturing technologies at process nodes below 14 nanometers. The list is updated on a non-periodic basis.

Although the Trade Secrets Act already provides for criminal liability, the National Security Act imposes substantially heavier penalties for misappropriation of trade secrets involving national core key technologies, some of which reach the threshold for extraterritorial application under Taiwan’s Criminal Code.

In 2023, Taiwan’s Intellectual Property Case Adjudication Act (IPCAA) underwent its most significant amendment since its implementation in 2008. One of the key changes was the centralisation of all trade secret-related criminal proceedings in the Intellectual Property and Commercial Court (the IPC Court). Previously, criminal trade secret cases were handled by various local district courts. Notably, under the amended regime, criminal cases involving trademarks or copyrights remain within the jurisdiction of district courts.

The amendment further provides that criminal cases involving national core key technologies bypass the usual first-instance trial and proceed directly to the second instance (appellate division) of the IPC Court.

Established in 2008, the IPC Court is noted for its efficiency and technical expertise. Its institutional design – close collaboration between judges and in-court experts known as technical examination officers – has proven effective in the adjudication of both criminal and civil trade secret lawsuits.

Since the 2023 amendment took effect, the second-instance division of the IPC Court has, over the past six months, issued multiple search warrants and asset seizure orders against individuals suspected of involvement in trade secret leakage linked to national core key technologies.

The 2023 IPCAA amendments also introduced the ‘verifier’ system in an effort to strike a balance between trade secret protection and fact-finding in civil litigation. Inspired by the Japanese legal system, the amendment allows the court to appoint a neutral technical expert to access a party’s – or even a third party’s – premises and examine relevant documentation to verify another party’s factual claims, such as whether a disputed trade secret is being used at the defendant’s facilities, where such facts would otherwise be difficult to ascertain through conventional evidentiary means.

A party subject to verification may request the civil court to restrict disclosure of the verifier’s report to the litigating parties if the report involves trade secrets. As for general confidentiality orders in IP lawsuits, they have existed under the IPCAA since 2008. These mechanisms are viewed as effective in preventing litigation from being used by competitors as a means to probe or gain access to confidential information.

Moreover, the 2020 amendment to the Trade Secrets Act introduced a confidentiality order mechanism specifically for criminal investigations, aimed at preventing secondary leakage of trade secrets. Such orders may be issued to all persons who have access to sensitive information during criminal investigations, including attorneys and witnesses.

Recent criminal cases indicate that when investigating companies whose employees have improperly obtained a competitor’s trade secrets, prosecutors increasingly focus on whether the company itself has implemented concrete and effective preventive management measures.

Under Taiwan’s Trade Secrets Act, the company may be fined in addition to the employee in such circumstances unless it is proven that the company has exercised best efforts to prevent the misappropriation.

Prosecutors’ recent indictments in semiconductor-related cases show that companies’ general or purely warning-based internal policies are no longer deemed sufficient. Instead, prosecutors look for specific, well-documented evidence of trade secret protection systems and measures. In Taiwan, companies generally adopt measures such as tiered access controls, employee training, security safeguards, onboarding and offboarding procedures, and monitoring mechanisms. Whether future court decisions will raise the standard for this ‘best efforts’ test remains an issue to watch closely.