French magistrates issued preliminary charges against two Chinese people and two French citizens in conjunction with an investigation on Omnic. Advanced technology from the corporation in Paris, which is thought to have potential military uses, is reportedly being smuggled to China and Russia while avoiding sanctions and export regulations.
The French national prosecution office, which specializes in crimes involving weapons proliferation, has initiated an inquiry into Ommic, a semiconductor firm that is now owned by Americans. Magistrates are directly responsible for the investigation, focusing on possible offenses, including forgery and unlawful exports, according to AP News.
Four people, two of Chinese nationality and two of French nationality have been formally under investigation since March, according to a French judicial official who spoke anonymously because of the restrictions governing magistrates' investigations. The magistrates need additional time to conduct a complete inquiry because they sense there is strong evidence of possible criminal activity.
Two of the four defendants are first charged with sharing privileged knowledge with a foreign power. The prosecution agency, which also specializes in terrorist cases, and the court official have chosen not to provide any further information regarding the continuing inquiry.
Chinese Businessman Attempted to Smuggle Tech
According to Le Parisien, the newspaper that broke the story first, investigators have discovered potential technology exports worth about 12 million euros (more than $13 million).
Ommic's French boss is under scrutiny because he reportedly physically delivered chips to Russian customers. Additionally, it has been claimed that goods were shipped to Chinese arms producers using fraudulent documentation.
The article revealed that in 2018, a Beijing-based Chinese investor with connections to China's military sector bought the bulk of Ommic and took over management. According to concerns held by France's counterintelligence service, the Chinese investor may have intended to transfer French knowledge to China, especially in the semiconductor manufacturing process that the electronics company excels.
Ommic was purchased by Lowell, Massachusetts-based Macom Technology Solutions Holdings Inc. for 38.5 million euros ($42.8 million) in February, as per a report published by ABC News. According to Le Parisien, French legal officials dispossessed Ommic's Chinese investor of his interest and temporarily took over business management before the final sale.
China Finding Ways to Overcome Sanctions
Macom stated its goal to strengthen its presence in the telecommunications, industrial, aerospace, and military industries while underscoring the value of Ommic's chip portfolio and design expertise.
Technology exports are under more intense international scrutiny due to China's acquisition of cutting-edge semiconductors.
The Biden administration has restricted China's access to supercomputing and AI processors. But according to sources, prohibited Chinese companies have obtained chips via smuggling and cloud-based rentals, according to a Foreign Policy article. Low-level suppliers have also been the target of smuggling activities, highlighting the necessity for the US Bureau of Industry and Security's (BIS) export control enforcement to be more innovative.
Related Article: China Appeals to Japan: Avoid Disrupting Semiconductor Industry Amid Export Limits
