A former employee of a major Korean chipmaker, identified only as A, received 460 billion won ($320 million) from a Chinese provincial government in 2020, set up a semiconductor company there and completed a DRAM plant the following year. The company succeeded in producing trial 20-nanometer DRAM wafers in April 2022. But A and others were sent to trial in Korea on charges of using more than 700 process technologies related to DRAM production — designated national core technologies held by a Korean company — without authorization. The technologies are designated as national core technologies under the Industrial Technology Protection Act, and A and others were indicted on charges of illegally obtaining and using them and leaking them abroad.
The case appears in a report on overseas leaks of industrial technology in 2026 that the Ministry of Trade, Industry and Energy recently submitted to the National Assembly. According to the ministry on the 21st, the National Intelligence Service detected 107 cases of industrial technology being leaked abroad over the five years from 2021 through 2025, an average of more than 20 a year.
The government designates and protects technologies deemed nationally important under laws including the Industrial Technology Protection Act and the Act on Special Measures for Strengthening the Competitiveness of National Advanced Strategic Industries. At present, 79 technologies across 13 fields, including semiconductors and displays, are designated as national core technologies, and 19 technologies across six fields are designated as national advanced strategic technologies. Companies holding them are required to take a range of protective steps, such as setting up restricted zones, controlling access, managing specialist personnel and providing security training. The problem is that while the government itself sets the criteria for designating and protecting the technologies, the management of the core personnel who handle them is left largely to companies to handle voluntarily.
Under a system for designating specialists in advanced strategic technologies, introduced by the government in 2022, a company that applies for and wins approval to designate core personnel can sign contracts with those employees covering restrictions on moving to overseas competitors, confidentiality and the provision of information on re-employment after leaving the company. If legal requirements such as concerns over technology leaks are met, the company can also apply for access to the employees' entry and exit records.
In practice, however, not a single specialist has been designated since the system was introduced. Major conglomerates with advanced technology, including Samsung Electronics (005930.KS) and SK hynix (000660.KS), have been lukewarm toward the program. These companies manage core personnel through their own security systems and non-compete agreements, and when signs of a technology leak emerge they conduct internal investigations before reporting to investigative agencies or taking legal action. Applying to the government for specialist designation could expose the identities and related information of core personnel, and companies also worry about pushback from employees and labor unions over restrictions on changing jobs.
But companies' own security management and non-compete agreements have limits in preventing technology leaks that occur when core personnel move to jobs abroad. In particular, unless an employee is designated as a specialist in advanced strategic technologies, a company cannot use the entry-and-exit information system provided under the advanced strategic industries law, leaving it constrained in tracking the overseas movements of core personnel. Even when an employee is designated, the company can obtain such records only if legal requirements are met, such as the employee's consent or serious concerns about a technology leak.
It is also difficult to stop core personnel from leaving for higher pay and better research environments abroad. An analysis of publicly available career records on platforms such as LinkedIn by the office of Rep. Choi Soo-jin of the People Power Party, a member of the National Assembly's Science, ICT, Broadcasting and Communications Committee, found that 27 semiconductor engineers who had worked an average of 15.4 years at Samsung Electronics and SK hynix moved to Chinese memory chipmaker ChangXin Memory Technologies. Recruitment offers from the Chinese company included not only higher salaries but also benefits such as housing and children's education support, according to the analysis.
To address the problem, there are growing calls within industry for a shift beyond the current approach of imposing protection obligations on companies and punishing technology leak crimes, toward stronger incentive-based support that encourages core researchers to stay in Korea and continue their research and development. An official who took part in discussions when the system was created said concerns were strong at the time that a design centered on regulation without incentives would prove ineffective, even though the government's will to protect technology was firm because overseas leaks of core personnel were severe. "If everything consists of regulation, the personnel involved may feel resistant, so the government should not only impose restrictions but also prepare policies that treat them favorably," the official said.
China, by contrast, runs sweeping financial rewards and settlement support programs to secure core personnel in advanced industries. The city of Quanzhou in China's Fujian province this year began providing additional home-purchase subsidies of up to 200,000 yuan to senior semiconductor talent, along with education benefits for their children. Shanghai's Pudong New Area runs a program that gives young overseas science and technology talent a lump sum of 500,000 yuan plus 3,000 yuan a month in housing support for up to three years. The aim is not merely to attract skilled workers but to encourage them to settle and stay for the long term. Taiwan offers deferred taxation on up to 5 million New Taiwan dollars a year in stock compensation that companies pay employees, with further tax benefits for those who hold the shares and stay more than two years.
The government, too, has come to recognize that the specialist designation system has proved ineffective, having produced not a single designation since its introduction, and it agrees on the need for incentives. It is now exploring support measures and system improvements to prevent core personnel from leaving for jobs abroad. Baek Man-ki, former chair of the private-sector side of the Presidential Council on Intellectual Property, said a system cannot work properly in the market if it consists only of regulation and leaves companies struggling. "Many companies feel the need for this system, so the government should design incentives well — such as giving extra points on R&D projects or offering preferential treatment to retirees — to make it more effective," Baek said.