back to article World's top chipmaking equipment maker claims Chinese rival may infringe IP

The world's top manufacturer of lithography equipment, Dutch company Advanced Semiconductor Materials International (ASML), has warned that it believes a Chinese company may be selling chipmaking equipment that infringes its intellectual property rights. News of the possible Chinese imitation emerged in ASML's 2021 annual …

  1. Anonymous Coward
    Anonymous Coward

    Yeah, good luck with that. Somehow I think they don't care whether they're infringing or not

    1. Anonymous Coward
      Anonymous Coward

      Also, kinda uncomfortable issue: this is presently a suspicion. Until they get hold of machinery and can demonstrate this as fact, it's an assertion. Granted, the likelihood appears to be high, but it is, as yet, not proven.

    2. imanidiot Silver badge

      China needs ASML though. Because a lot of it's current chip production relies on their machines and service. So they have at least some leverage.

    3. Anonymous Coward
      Anonymous Coward

      I have experince with Chinese companies bribing employees to sell them designs and know how that violated the patents. Hundreds of millions of dollars were involved. The proof was undeniable and led to arrests, confessions and convictions of the perps (in the EU where the perps were, not in China). The Chinese civil courts still ruled there was no evidence of patent infringement.

      China is an example of Rule by Law, a favorite of corrupt & authoritarian governments, not Rule of Law, which is fundamentally different.

      1. sreynolds Silver badge

        Yeah, its a Putinocracy. Just like the other red commies, that only prosecute those whose hacks affect their own state.

        1. jgarbo

          You're 30 years late, no more Commies, all capitalists now. Try to keep up.

      2. jgarbo
        Devil

        Outrageous! Only Western companies are allowed to steal IP secrets. Who do they think they are?

  2. Zolko Silver badge

    chicken come home ?

    What did anyone expect : harming and sanctioning Chinese electronics companies (Huawei ...) for made-up reasons, yet still manufacturing all electronics products there, and expecting them not to try to react to it ? Either politicians are stupid, or they have a very clever and hidden agenda.

    Same question for Russia also, actually (sanctions and still buying gas and petrol from them at rising prices).

    1. imanidiot Silver badge

      Re: chicken come home ?

      China's had the goal of becoming "silicon self-sufficient" LONG before the whole Huawei kerfuffle, and long before there was even much talk of harming or sanctioning Chinese companies. And it's been chasing that goal in exactly the same way all that time.

      Stop trying to project recent minor incidents in foreign politics on the long term behaviour of China in these issues. Their impact is more like a large container ship making a small adjustment to it's coarse to correct for wind drift than it is a coarse change for a new destination.

    2. Anonymous Coward
      Anonymous Coward

      Re: chicken come home ?

      That's like excusing bank robbery because "What do you expect if you lock up the money in a vault?"

  3. alain williams Silver badge

    Its all lies they will tell you

    Push them and the Chinese government will claim that it is a lie -- just as they claim for everything else that they do but pretend that they do not.

  4. msknight

    "Chinese authorities have been informed."

    That's like informing the Devil that souls intended for heaven have been stolen.

    The one thing that is baffling me is what China thinks it's going to do. Eventually people outside China aren't going to be buying its products because of its behaviour. Moves are already happening to kick start manufacturing in other countries; some industries say roughly ten years, and started happening a few years ago... but Xi has been a bit of a conundrum; trying to interconnect the world and increase China's influence while also wanting China to be insulated from the rest of the world.

    I can only take the former aim as being tying the world up in so much debt that they have no option other than to implement China's policies in their own countries.

    So, the next few years are going to be very interesting from a number of standpoints, I think.

    1. mark l 2 Silver badge

      Re: "Chinese authorities have been informed."

      China already has a foot hold in South America and Africa and these emerging markets are likely to bring in lots of money for China even if the sales to the US and Europe take a nose dive. Lots of poorer countries will still be buying Chinese tech if the price remain cheaper than those made in the west.

      1. msknight

        Re: "Chinese authorities have been informed."

        That is very true, but some countries like India are shunning Chinese companies (a slow process and Chinese money is still tied up in some areas) and with embargos being against Chinese companies regardless of where they operate, it's not a simple situation.

      2. Anonymous Coward
        Anonymous Coward

        Re: "Chinese authorities have been informed."

        Plus China is trying to make deals to put in deep water Naval bases in the Atlantic in Africa & South America. They are trying to do that to protect Chinese Colonialism, which of course, they don't call it that.

    2. martinusher Silver badge

      Re: "Chinese authorities have been informed."

      >Eventually people outside China aren't going to be buying its products because of its behaviour.

      People tend to buy products because they work and fulfill a need. Products are also made out of components sourced from numerous manufacturers. That's what all this global trade business is about.

      As for debt, the amount of debt owed to China for products pales behind the overall debt levels manged through western financial hubs. China's interactions with relatively poor countries are benign compared to organizations like the IMF.

    3. Youngone Silver badge

      Re: "Chinese authorities have been informed."

      China's economy is entwined with the economies of the west by design.

      That was done in the 1990's and is not for your benefit, but the benefit of the shareholders both in China and the west.

      Xi has nothing to worry about as long as the money keeps flowing.

  5. Clausewitz 4.0 Bronze badge
    Devil

    No one steals more IP than USA

    With bulk cables tapping, done by NSA and the likes, we only see chinese in the news because it fits an agenda.

    1. llaryllama

      Re: No one steals more IP than USA

      There is plenty of Chinese government funded (CGTN, People's Daily) and neutral news (Al Jazeera) so where are these missing articles proving wide scale theft of Chinese IP by the Americans?

      Plenty of evidence that Chinese companies - usually with backing and/or funding of the CCP - have infiltrated foreign companies to steal years of research and trade secrets.

      Regardless, if you believed that an American entity (including the US government itself) had acted illegally and stole your IP you could safely travel to the US and take action through the American legal system. Try doing that in China.

      1. Aitor 1 Silver badge

        Re: No one steals more IP than USA

        Several colleagues of mine got their laptops cloned at the airport when I worked for a company in Spain that also designed military hardware.

        It was banned to go to the us with a non burner laptop if you worked for the military arm.

        So yes, they do steal if they can.

        1. Tom 7 Silver badge

          Re: No one steals more IP than USA

          SSDs makes it so much quicker for them too!

          1. Aitor 1 Silver badge

            Re: No one steals more IP than USA

            Most of then used to be HDDs back then, a mix of old stuff and stingy company.

    2. martinusher Silver badge

      Re: No one steals more IP than USA

      Many years ago, around 1980, I worked for Sony in the UK. This branch of Sony sold and supported professional video equipment but it also hosted a small R&D team who's job was to make prototype digital video hardware. The original impetus for doing this was that Japan lacked expertise in PAL, the analog TV system in use in Europe, but by the time I got involved the work had morphed from digtizing a composite video signal to digitizing, recording and replying the component video feeds. The result was quite spectacular -- the bandwidth of video in the UK was close to HDTV and the flawless recording and playback of video was far in advance of anything else at the time.

      Since this was distinctly bleeding edge stuff we did get a talk on the need for confidentiality but it was nothing like you'd expect. The technology was openly exhibited, papers were published and so on so they figured that anyone with half a clue about the technology would be able to figure out how to duplicate it. What was truly confidential were the marketing plans (or rather, lack of) -- digital technology wasn't practical in 1980 but it had the potential to knock the bottom out of the analog market before a digital replacement was viable.

      I've since met exactly the same notions in other businesses. Sensitive IP isn't like the movies.

      Incidentally, people voice complaints about the 'one way' traffic in IP when working for a Chinese company. I can assure you that it was exactly the same working for a Japanese company back then -- you got told exactly and only what you needed to know. They wanted to know everything. The only bit of real satisfaction was that half a dozen UK engineers could run rings around a large team of Japanese ones -- they were good, sure, but we were much more creative.

  6. W.S.Gosset Silver badge

    Shocked, etc

    etc

  7. Necrohamster

    Par for the course

    Reminds me of the documentary I saw on Channel 4 over a decade ago - some garden shed inventor invented a widget which could be fitted to air-conditioning units to reduce energy consumption, and wanted to bring it to production. Of course, the manufacturing ability wasn't available in Blighty so (contrary to received advice) he shopped it around brokers and manufacturers in China.

    To the surprise of absolutely nobody, his device was cloned and he saw no money as a result. Good luck fighting a legal battle in Chinese courts.

    1. Tom 7 Silver badge

      Re: Par for the course

      Happens here to. A mate designed a tool for splicing FO cables and got a provisional patent on it. Couldn't get funding for a full patent on reasonable terms and saw his devices hit the market within weeks of the provisional patent expiring.

  8. Abominator

    Chinese company steals intellectual property shocker.

    And in other news, bears...woods etc.

  9. quadibloc2

    As Noted Above

    Given that China is restricted from purchasing ASML's most advanced chip fabrication equipment by export controls, and China regards being able to place as advanced microelectronics as possible in its military hardware as vital to its national security, the chances of enforcement action being taken by Chinese authorities are, of course, minimal.

    One can understand that ASML felt that it needed to go through the motions in any case as part of its responsibility to its shareholders or other investors.

    1. martinusher Silver badge

      Re: As Noted Above

      ASML enjoys a monopoly with its product because the barrier to entry for a competitor is too high. The technology is complex and the customer base is just too small for a would be competitor to enter. Politicians don't understand this, they think like movie screen writers where there's some kind of fantastic black box that can be denied to the villain but in reality all their meddling does is rewrite the competition rules. Denying China ASML's products has created a Chinese competitor; certainly not this year, maybe not next but sooner or later one will turn up and the resulting product is likely to be superior to ASML's simply because they can avoid the inevitable mistakes that a development leader is going to make.

      Every country has laws that allow it to skirt commercial IP protections if 'the national interest' is at stake. We've seen this in action recently with vaccines.

      The writing's on the wall if you care to read it. US sanctions, entity lists and what-have-you have not stopped SMIC from having a record year. Curiously enough nobody seems to have drawn a connection with 'supply chain problems' and consequent price inflation and hostile trade policies; maybe its just because like the cannon fodder of old the lives of the little people just don't matter where geopolitics is concerned.

  10. DerekCurrie
    Holmes

    This Is How It Works, In Brief...

    1) 'Communism' kills the creative incentive. If everything mine is your's, why bother.

    2) Therefore, 'communism' immediately collapses into criminality, the crime incentive, the criminal nation.

    3) The communist state therefore uses espionage, these days commonly using hacking (cracking) to obtain creative IP (intellectual property). China: Criminal Nation has been documented to have been doing this since 1998, after the US Clinton administration provided them with Most Favored Nation status. This resulted in The Red Hacker Alliance group, which in later years was integrated directly into the Chinese government. In 2007, the USA at last admitted this was going on after it had been determined that every government Windows PC exposed to the Internet had been found to contain Chinese bot infections. Businesses around the world found themselves to have been hacked as well and their IP exposed to the Internet stolen.

    4) The communist state then trains citizens with higher education in order for them to be able to understand and put to use stolen IP.

    5) The communist state creates and/or controls business within its country in order to integrate stolen IP and put it to work benefitting the state. With a few notable exceptions, this is the foundation of Chinese founded manufacturing. It uses relatively inexpensive labor and production to promote its derivative products over those invented elsewhere.

    6) With time, sufficient IP having been stolen from them and copycat technology being cheaper from the communist state, the creative incentive around the world diminishes. We're at this point right now, thus the incentive to ban communist stolen IP producers and attempts to sue businesses using and selling copycat IP.

    7) Worldwide creativity collapses and becomes stagnant. This is the inevitable outcome of communist espionage if it is allowed to continue. This stagnation is of course good for no one.

    8) Meanwhile, the communist state builds up its military and financial structure, evangelically spreading its influence around the world, creating contention and war. Welcome to the future.

    Immediate solution: STOP GIVING CHINA and other communist states MONEY.

    [And no, the above is not a defense of parasitic, abusive and exploitative forms of capitalism. So skip that diversionary tactic please.]

    1. Tom 7 Silver badge

      Re: This Is How It Works, In Brief...

      "Immediate solution: STOP GIVING CHINA and other communist states MONEY."

      If China doesnt get $s its got more than enough to crash the currency for its own amusement. China is simply too big for the capitalists to do anything about.

      1. DerekCurrie
        Go

        Re: This Is How It Works, In Brief...

        ... So it's hopeless. The world is going to end up in stagnation with China having criminally wrecked the show.

        I suggest you get busy proving yourself wrong. I stand by my post, especially my suggested solution. Come up with a better one yourself.

        And a big "Hi!" to all the Chinese trolls who voted me down. (^_^)/ We know each other well. Stop hurting yourselves! Self-destruction is not a way of life. It's a way of death, obviously.

  11. Tom 7 Silver badge

    Espionage

    Reading patent applications and patents?

  12. Teejay

    The Chinese??

    The Chinese, stealing trade secrets and not giving a toss about anyone else's intellectual property? Never,

    1. Tom 7 Silver badge

      Re: The Chinese??

      We are, of course, assuming the patents being violated are somehow inventive and would stand scrutiny anywhere but East Texas.

  13. sreynolds Silver badge

    I thought it was baked into the Commie boiler plate contract

    Yeah sure you come over here for cheap labour, maybe get to use some moslem slaves, and in return you hand over all IP (we'll call it "Technology Sharing") and in five years time you won't be a going concern.

    How many companies have regretted going to China?

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