Taiwan businesses have called for a law on industrial espionage, especially by China, as growing ties have made it easier for mainland firms to steal secrets, officials and media said Thursday.

K.Y. Lee, chairman of the island's leading flat-panel maker AU Optronics, made the appeal while meeting President Ma Ying-jeou with a group of high-tech entrepreneurs Wednesday.

The proposal was prompted by a spate of cases involving the theft of business secrets from Taiwan's high-tech companies, Lee said, without providing details.

"Taiwan really needs such a law now as it faces mounting competition from mainland China," another official from AU Optronics told AFP.

The idea seemed to be supported by several enterprises, including Taiwan Semiconductor Manufacturing Co (TSMC), the world's leading contract chip maker.

"Such a law will better help Taiwan's industry," TSMC spokeswoman Elizabeth Sun told AFP.

Currently suspects are indicted on charges such as breach of trust and embezzlement but Lee said the punishment for such crimes was not enough.

Taiwan Electrical and Electronic Manufacturers' Association, which groups the island's major electronics firms, also called for a law as early as possible.

TSMC filed a lawsuit against its Chinese rival Semiconductor Manufacturing International Corp (SMIC) in the United States in 2003 alleging SMIC improperly obtained its trade secrets and infringed patents.

In 2005 SMIC agreed to pay TSMC $175 million to settle the case after the Taiwan chip maker filed new evidence of corporate espionage with a US court.

Ties between Taiwan and China have grown closer since Ma took office in 2008 on a platform of boosting trade and tourism with the mainland.

Taiwan envoy to discuss investment with Hu at APEC
Taipei (AFP) Nov 3, 2011 - Taiwan's special envoy to the Asia-Pacific Economic Cooperation (APEC) forum said Thursday he expected to meet Chinese President Hu Jintao to discuss an overdue investment protection agreement.

"I'm looking forward to meeting Hu on the sidelines of the APEC summit," said Lien Chan, the island's former vice-president, who will represent President Ma Ying-jeou at the gathering on Hawaii on November 12 and 13.

"Hopefully we can use the occasion to discuss a wide range of topics like trade and service industry, trade disputes and investment protection."

An agreement on investment protection has been high on China's and Taiwan's bilateral agenda since the two former rivals signed a sweeping trade pact in the middle of last year.

Top envoys from Taiwan and China addressed the issue when they met in the northern Chinese city of Tianjin last month, but without reaching a final agreement.

According to Taiwanese media, the problem is Chinese reluctance to accept a dispute resolution mechanism, fearing that it would imply tacit recognition of Taiwan sovereignty if it were to treat both parties on an equal basis.

Taiwan has been a major investor in China in recent years, providing more than $100 billion in financing, according to some estimates, as well as crucial technological know-how.

Taiwan's leaders are barred from APEC summits due to objections from China, which claims sovereignty over the island, and are represented by senior economic advisers or business leaders instead.

But ties have improved markedly after Ma of the China-friendly Kuomintang party took power in 2008 on a platform of promoting trade and reconciliation with the mainland.