Huawei is hunting for foreign engineers – German and Taiwanese authorities have sounded the alarm

Chinese companies, and primarily Huawei, are actively sending job offers to valuable specialists from large technology companies from Europe, the USA and Taiwan. This activity has already attracted the attention of the intelligence services of these countries, reports The Wall Street Journal.

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Last fall, the management of Zeiss SMT, which produces components used in the production of advanced semiconductors, learned that the HR department of Huawei Technologies was trying to poach its employees. The active actions of the Chinese company attracted the attention of German intelligence services – they were concerned about Huawei’s possible access to the most complex intellectual property; The investigation into this fact has not yet been completed. The incident once again indicated that personnel issues have become particularly important in China’s competition with the West for technological supremacy. Western countries, at the behest of Washington, are restricting China’s access to advanced technologies, forcing Chinese companies to step up efforts to poach top engineers in areas such as semiconductor manufacturing and artificial intelligence.

Chinese companies are focusing their efforts on several global technology centers – parts of Europe, American Silicon Valley and Taiwan. Some of them hide their Chinese origin: they register as local legal entities that simply hire employees and do not attract the attention of local authorities. Beijing’s excessive activity has already been exposed in Taiwan and South Korea, where several cases have been initiated; At the same time, in the USA and Europe the Chinese act much more freely. One of the most important European targets is the Netherlands’ ASML, which produces equipment for the production of advanced semiconductors, and its suppliers, including Germany’s Zeiss. It took ASML decades to master advanced lithography, without which China cannot produce the most productive chips.

Since 2021, Huawei has hired dozens of engineers and other employees from China who worked in optics and lithography for ASML and other Western companies, according to LinkedIn and Chinese staffing platform Maimai. There is a known case where one Chinese engineer, who left ASML ten years ago, established a competing company in China – he had access to some software products. A former ASML employee from Taipei left the company in 2020, and over the next two years he received requests every month from Chinese recruiters – Huawei was especially persistent. The Chinese Foreign Ministry stated that it has no information about the poaching of specialists.

At the same time, Beijing has long made it clear that the personnel issue is a priority: back in 2017, the government’s AI development plan included attracting the most valuable specialists, including leading scientists in the fields of machine learning, autopilot technologies and intelligent robotics. Several governments have already limited academic and business interactions with China or introduced investment screening mechanisms for mergers involving Chinese entities. State funding for Chinese companies allows them to offer valuable talent salaries they can’t get at Western companies—recruiters take a variety of approaches, and engineers often agree, despite the reputational risks and the need to adapt to Chinese corporate culture.

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Authorities in Taiwan, home to the world’s largest semiconductor contractor TSMC, have seen a rise in Chinese recruiters and an increase in trade secret theft incidents since 2015. In 2022, new regulations were approved to prohibit the overseas transfer of technologies critical to Taiwan’s national security and industrial competitiveness – violators face up to 12 years in prison and a fine of the equivalent of $3 million. From 2020 to June 2024, Taiwan Ministry of Justice investigated more than 90 incidents related to poaching of specialists – in most cases it was about the production of semiconductors, electronics and equipment. Several years ago, Taiwanese Liang Mong Song, a former senior engineer at TSMC and Samsung, began working for Chinese semiconductor manufacturer SMIC. He’s been credited with the company’s rapid rise, which last year helped Huawei launch a 7nm chip for its cutting-edge phones.

In the latest operation in Taiwan, local authorities raided 30 addresses and questioned 65 people in four cities. Eight Chinese companies, including a major Chinese chip maker, have been accused of poaching talent. Some firms try to hide their origin by collaborating with recruitment agencies from Singapore and Hong Kong; There are known facts of collusion with Taiwanese citizens, which are registered by local legal entities that hire local engineers.

Germany’s Zeiss SMT supplies critical components, including mirrors, for ASML’s complex EUV systems. Zeiss’ technology is considered so advanced that its headquarters are closed to most visitors and images from its promotional materials are blacked out to prevent trade secrets from being leaked. Employees of the German company promptly reported Huawei’s attempts to lure them away and passed on links to HR profiles to their management. Zeiss SMT reported the incident to the authorities and German intelligence agencies opened an investigation. Huawei also tried to poach employees of German laser equipment maker Trumpf, all of which were reportedly unsuccessful.

Berlin recently passed a law prohibiting telecom operators from using Huawei equipment in critical areas of the network infrastructure in Germany – it largely repeats the theses of the American sanctions imposed against the company in 2020. However, Huawei smartphones and other consumer products are still sold in the country. The Chinese electronics giant has five research centers in Germany, working on optical systems and other areas. And the German authorities do not yet have an understanding of how to further suppress unscrupulous actions on the part of Chinese companies.