ASML Defends Chinese Government Following Espionage Accusations

Credit: Emmanuel Dunland/Contributor/Getty ImagesCredit: Emmanuel Dunland/Contributor/Getty ImagesASML, the largest maker of lithography systems said on Thursday that it was a victim of corporate espionage in 2015, involving employees from both China and South Korea. The company rejected the idea that the Chinese government had any relation with the espionage operations.

ASML Admits to Being Victim of Corporate Espionage

According to Reuters, ASML said attackers stole ”large files” via USB sticks from its Silicon Valley software subsidiary, which develops software for machine optimization. The company said it has since taken action to prevent this type of theft in the future.

The Dutch daily newspaper Financieele Dagblad (FD) originally published the story on the ASML theft, labeling it as “Chinese espionage.” ASML CEO Peter Wennink, however, in a statement ASML released on Thursday, denied that there was any "national conspiracy" to steal information from his company.

“We resent any suggestion that this event should have any implication for ASML conducting business in China. Some of the individuals happened to be Chinese nationals, but individuals from other nations were also involved. We do protect our proprietary knowledge carefully and are very sensitive to information security. We believe we can serve all our customers, including our Chinese customers, and help them build their businesses. We are encouraged by the recent constructive talks and agreements between the European Union and China that China will step up its efforts to respect and protect corporate intellectual property of non-Chinese companies, including effective enforcement actions. We will be even more encouraged when we see these materialize in Chinese law and jurisprudence,” Wennink said.

The ASML CEO welcomed the new deal made by the European Union with China, in which China promised not to coerce companies to share sensitive intellectual property anymore if they want to develop their businesses in the Asian country.

ASML’s sales in China more than doubled to 1.8 billion euros ($2 billion) in 2018, which now account for about one-sixth of the company’s global sales, Reuters reported. 

California Case Involving ASML Theft

The Dutch paper's story was based on both ASML sources, as well as documents from a California Superior Court case that revealed that six former ASML employees with Chinese names shared sensitive information with XTAL Inc. The Dutch FD reported that XTAL is a subsidiary of a China-based company called Dongfang Jingyuan. The parent company is said to have ties to the Chinese Ministry of Science and Technology.

In the lawsuit, ASML said XTAL's funding came from both China and South Korea and that the stolen data was supposed to be handed over to one of ASML's main customers, which includes Samsung, TSMC and Intel. 

Over the past few years, the Dutch intelligence agency AIVD has issued warnings that the Chinese government is targeting Dutch companies through espionage operations but refused to comment on this particular case.