Between the state and industrial espionage

Between the state and industrial espionage

Per media reports, a former employee of chemicals maker Lanxess is facing criminal charges for allegedly stealing trade secrets to set up a Chinese copycat chemical reactor. The case underscores fears among German officials and executives about industrial espionage in Europe’s largest manufacturing nation.

Earlier this year German intelligence agency BfV warned companies in its annual report that China could resort to intellectual property theft as it aspires to become an exporter of high-tech products, adding that it is hard to distinguish between state and industrial espionage.

A Chinese-born German national 48-year-old engineer was fired when the company discovered the data theft related to a chemical reactor. Additionally, a 40-year-old German associate, also of Chinese descent allegedly received the trade secrets via email and sought to exploit them in China commercially; he is also being prosecuted.

Lanxess is a 2005 spin-off from German drugs and pesticides maker Bayer. Last year the producer of additives, pesticide ingredients, construction pigments and engineering plastics, derived 28 % of almost 10 billion euros in sales from Asia. The company and the prosecutors’ office declined to disclose the names of the accused, but court filings from the civil lawsuit in Duesseldorf show that the firm accused the defendants of working on a 400 tonne-per-year chemical reactor in China and promoting the copied product globally.

Cross-border theft of confidential business information carries a prison sentence of up to five years in Germany. If convicted, the two face up to four years in prison. A third accomplice was allegedly also involved, but prosecutors do not know his whereabouts.

AM, Verificators

Source: Reuters

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