For many years, intellectual property strategy focused on protection, monetization, and dispute resolution. In boardrooms, IP was discussed alongside licensing revenue, freedom-to-operate concerns, and litigation exposure. That framing no longer captures the full risk profile faced by large enterprises.
In both Japan and Korea, intellectual property is increasingly discussed in the context of national security and strategic technological competition. This change is not rhetorical. It is shaping legislative initiatives, regulatory expectations, and the evaluation of corporate IP governance.
Having advised companies operating in Japan, Korea, and across international markets, I see this shift influencing both public policy and private decision-making.
Japan’s Policy Direction and Its Meaning for Corporations
Japan already has established trade secret protections. However, the government has acknowledged that existing frameworks are not designed to address foreign-linked information theft tied to strategic technologies.
Prime Minister Sanae Takaichi’s announcement that Japan has begun drafting legislation to prevent overseas information theft reflects this recognition. The issue is no longer framed as a matter of individual corporate harm. It is approached as a question of protecting technological capabilities that support industrial competitiveness and national resilience.
Coverage by industry media confirms that this discussion is now firmly on the agenda for policymakers and IP professionals alike.
For large corporations, this signals a shift in how authorities may assess IP risk in the future.
Cases That Illustrate the Strategic Risk
1. TSMC 2nm Trade Secrets and Tokyo Electron Incident
In 2025, Taiwan Semiconductor Manufacturing Company (TSMC) uncovered unauthorized access and a possible leak of confidential 2nm process technology, one of the most advanced semiconductor process nodes. Investigations led to the arrest of multiple individuals, including former and current engineers, on allegations of trade secret theft. Prosecutors also searched Tokyo Electron Taiwan’s offices. In late 2025, Taiwan’s authorities formally indicted Tokyo Electron’s Taiwan unit, alleging violations of both the Trade Secrets Act and national security laws due to insufficient internal controls.
This case illustrates how IP issues in core technology sectors, such as semiconductors, are treated not just as commercial disputes but also as national security concerns with cross-border implications for suppliers and equipment partners.
2. Astellas Pharma Espionage Case in China
In another high-profile example, a Japanese employee of pharmaceutical company Astellas Pharma was detained in China in 2023 and later convicted on espionage charges, receiving a multiyear prison sentence in 2025. Chinese authorities cited national security laws in prosecuting the case, which strained bilateral business relations and raised alarm among foreign businesses about operating risks in China.
While this case has a specific geopolitical context, it demonstrates that employees and corporate activities can be subject to host-country national security frameworks, with significant legal and reputational consequences.
Why Traditional IP Tools Are No Longer Sufficient
Japan’s and Korea’s industrial strengths often rest on knowledge not fully captured by patents. In sectors such as semiconductors, advanced manufacturing, batteries, and precision equipment, value resides in process know-how, engineering judgment, and incremental innovations developed over time.
This type of knowledge is typically shared internally across global teams and externally through research partnerships. Traditional enforcement mechanisms address misappropriation after the fact, but they do not address strategic loss at the capability level.
From a policy standpoint, this creates a gap. From a corporate standpoint, it creates unmanaged risk.
How This Is Changing Expectations for Large Enterprises
In practice, the national security framing affects how corporate behavior is evaluated.
First, companies are expected to demonstrate internal awareness of what constitutes sensitive know-how. An informal understanding is no longer sufficient; organizations need clear internal definitions and inventories of their critical knowledge assets.
Second, access management is becoming central. Authorities focus increasingly on who accesses sensitive information, how access is granted, and how transfers between teams and jurisdictions are controlled.
Third, collaboration models are evaluated not only for commercial benefit but also for strategic exposure, including joint research, academic partnerships, and cross-border engineering arrangements.
These expectations go beyond legal compliance and touch the design of governance itself.
Trade Secrets as Core Strategic Assets
In this environment, trade secrets take on increased importance. They protect knowledge intentionally kept out of the public domain and are often the most difficult assets to replace once lost.
Effective trade secret governance requires operational discipline beyond contractual protections. This includes:
- Mapping sensitive know-how across the organization,
- Limiting access based on role and risk level,
- Documenting procedural controls,
- Aligning legal, IT, and physical security measures,
- Training employees on strategic risk awareness and compliance.
Companies that cannot clearly explain how they protect their most critical know-how face heightened risk as regulatory scrutiny increases.
Practical Insights from IP Practice in Japan and Korea
Across discussions with corporate IP leaders and legal teams in Japan and Korea, several consistent observations emerge:
- Decentralized R&D creates blind spots.
Organizations with highly dispersed research functions often lack visibility into where sensitive knowledge resides, making reactive corrections difficult. - IP governance is too often siloed.
Treating IP governance solely as a legal function limits its effectiveness. Effective governance requires cross-functional coordination between legal, R&D, HR, risk, and security teams. - Reactive approaches are no longer sufficient.
Authorities signal that prevention and governance design matter as much as enforcement outcomes.
These insights reflect real operational challenges faced by large multinationals competing in technology-intensive markets.
What Corporate Leaders Should Do Next
Executives responsible for IP, R&D, and risk management should consider the following concrete and actionable steps:
1) Establish a Strategic IP Risk Framework
- Develop a classification system for trade secrets and sensitive know-how.
- Perform enterprise-wide inventories of critical capabilities.
- Integrate IP risk into broader enterprise risk management (ERM)
2) Strengthen Access and Control Mechanisms
- Implement role-based access control (RBAC) for sensitive knowledge.
- Use zero-trust principles for both internal and remote access.
- Regularly track and audit access patterns to detect anomalies early.
3) Reassess Cross-Border Collaborations
- Evaluate collaboration agreements with strategic risk criteria, not just commercial terms.
- Perform IP risk due diligence before entering joint ventures or research partnerships.
- Establish clear governance and exit protocols in multi-jurisdictional R&D.
4) Build Governance Transparency for External Stakeholders
- Prepare documentation that clearly explains IP governance frameworks to regulators and partners.
- Engage proactively with policymakers to demonstrate governance maturity.
- Participate in industry forums on national technology security and standards.
5) Foster a Risk-Aware Culture
- Provide regular training and awareness programs on IP risk and national security implications.
- Encourage employees to report suspicious activities through safe internal channels.
- Incentivize compliance behavior by tying KPIs to governance outcomes.
These steps do not require new legislation to be in force but reflect prudent preparation for a regulatory environment that is already evolving.
Closing Perspective: Implications for Japan, Korea, and Beyond
Japan’s move toward frameworks addressing foreign espionage reflects a broader shift in how intellectual property is valued and protected. IP is increasingly treated as a strategic resource with implications beyond individual companies.
Korea, with its leading semiconductor, battery, and advanced materials sectors, faces parallel pressures to strengthen IP risk governance amid geopolitical competition and supply chain resilience.
For large corporations operating across borders, this requires a more disciplined, transparent approach to IP governance that integrates strategic risk and national security considerations with cross-functional decision-making.
While Japan provides a clear reference point, the implications apply far more widely — including in Korea and the broader Asia-Pacific region — as governments and industries jointly seek to safeguard technological leadership amid intensifying global competition.
