France investigating company suspected of smuggling chip tech to China, Russia

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French magistrates have filed preliminary charges against two Chinese citizens and two other people from France in an investigation of a leading chip supplier whose advanced technology with possible military uses was reportedly smuggled to China and Russia, allegedly skirting sanctions and export controls.

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The probe of Ommic, a Paris-region semiconductor manufacturer now in American hands, was launched by France’s national prosecution service that specializes in cases involving arms proliferation.

The probe is now being led by magistrates investigating suspected illegal exports, forgery and other suspected crimes, according to a French judicial official who spoke on condition of anonymity because of secrecy laws that cover magistrates’ probes.

The official said four people — two French, two Chinese — have been placed under formal investigation since March. That means magistrates believe there is considerable evidence of potential crimes but want more time to investigate.

Two of the four people face preliminary charges of handing over protected know-how to a foreign power, the judicial official said. The official and the prosecution service, which also specializes in terrorism cases, refused to go into greater detail about the investigation.

The newspaper Le Parisien first reported on the case. It said investigators have uncovered nearly more than $13 million (€12 euro) worth of suspected exports of technology.

It said the company’s French manager is suspected of having personally delivered chips to Russian clients. It said products were also exported to Chinese armament manufacturers with the help of forged paperwork.

The newspaper said a Beijing-based Chinese businessman with ties to China’s defense industry bought a majority stake and took control of Ommic in 2018.

France’s counter-espionage agency suspects the Chinese investor was seeking to transfer French technology to China, notably a semiconductor manufacturing process that Ommic specializes in, the newspaper said.

Macom Technology Solutions Holdings Inc., a semiconductor supplier based in Lowell, Massachusetts, announced in February that it was acquiring Ommic for $42.8 million (€ 38.5 million). Le Parisien reported that French judicial authorities stripped Ommic’s Chinese investor of his stake and temporarily placed the company under state control before its sale.

Macom said Ommic’s portfolio of chips and its design know-how would strengthen its position in telecommunications, industrial, aerospace and defense markets.

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