Taiwan Raids Super Micro Offices in AI Chip Smuggling Probe

Raids Target Three Companies in Export Control Investigation

Taiwan's Keelung District Prosecutors Office conducted raids Monday at the Taiwan offices of Super Micro Computer and two other technology firms, marking a significant escalation in an investigation into alleged illegal shipments of Nvidia AI chips to China. The operation spanned 12 locations, including six private residences and offices of Super Micro, Albatron Technology, and Chief Telecom, according to head prosecutor Huang Sheng speaking to AFP.

The number of individuals under investigation has tripled from three to nine. All three companies stated they are cooperating with authorities.

Allegations Center on Server Exports

Investigators allege the suspects falsified documentation to enable unauthorized shipment of approximately 50 Super Micro servers equipped with advanced Nvidia chips to China, deliberately circumventing U.S. export controls. Bloomberg reported that at least some of these servers cleared Taiwan customs inspection before being routed to China via Japan.

The investigation began in May, when prosecutors announced they were examining exports of high-end AI servers destined for China, Macau, and Hong Kong.

Super Micro Computer stock dropped 8% in U.S. trading following the news. Shares of Albatron Technology fell 10% in Taipei, while Chief Telecom declined more than 2%.

Why it matters

This represents Taiwan's first publicly acknowledged enforcement action targeting AI chip diversion to China—a critical gap in U.S. export control strategy that Washington has pressed Taiwan to address. The legal vacuum has allowed sophisticated chips to reach Chinese buyers despite American restrictions designed to limit Beijing's AI capabilities. Without specific laws criminalizing such exports, Taiwanese authorities must rely on statutes not designed for this purpose, complicating prosecution efforts.

Legislative Response in Development

Taiwanese law currently contains no provision specifically criminalizing AI chip sales to China, forcing authorities to construct cases using other legal frameworks. To address this gap, DPP legislator Chung Chia-pin is drafting an amendment to the Foreign Trade Act that would establish a dedicated "mainland China semiconductor chip clause" banning such shipments outright.

Chris McGuire, a Council on Foreign Relations specialist who served on the National Security Council, characterized chip diversion through Taiwan and Southeast Asia as a "really significant problem" at a Taipei forum earlier this month. He emphasized the need for Taiwan to criminalize AI chip exports to China under its own law.

Connection to U.S. Case Remains Unclear

The Taiwan investigation is separate from, though potentially related to, a U.S. case involving Super Micro leadership. Federal authorities charged Super Micro co-founder Yih-Shyan "Wally" Liaw and two others in March with diverting approximately $2.5 billion in Nvidia-equipped servers to China through a Southeast Asian intermediary. A Bangkok-based firm called OBON Corp was later identified as the alleged middleman in that scheme.

Taiwanese prosecutors cautioned against drawing conclusions, stating they have not yet established any connection between their investigation and the U.S. proceedings.

Super Micro issued a statement affirming its commitment to ensuring its technology reaches only lawful end users, noting that its products have "continued to be targeted in these matters" and that the company is working with authorities in Taiwan and elsewhere.

These details were first reported by Quartz.