TAIPEI, Aug 27 (Reuters) - Taiwan prosecutors said on

Wednesday that they indicted three people for theft of trade

secrets from chipmaker TSMC, accusing them of

conspiring to use the information to help Japan's Tokyo Electron ( TOELF )

in competing for TSMC supplier deals for the

2-nanometer process.

The three defendants included a former TSMC

employee, surnamed Chen, who after joining chipmaking tools

supplier Tokyo Electron ( TOELF ) had allegedly solicited help from his

former colleagues for the information on TSMC's technology trade

secret, the prosecutors said.

They said they were recommending a combined 14-year prison

term for Chen for violating Taiwan's trade secrets and national

security laws.

TSMC said in an emailed statement that it had a

zero-tolerance policy toward any actions that compromise the

protection of trade secrets or harm the company's interests and

it was committed to "safeguarding our core competitiveness".

"Such violations are dealt with strictly and pursued to the

fullest extent of the law," it said.

"To ensure this, we will continue to strengthen our internal

management and monitoring systems and will work closely with

relevant regulatory authorities as necessary to protect our

competitive advantage and operational stability."

Tokyo Electron ( TOELF ) did not immediately respond to a request for

comment.

Prosecutors said it was the first case brought under

Taiwan's National Security Law involving the theft of core

technologies.

TSMC's 2-nanometer chip technology is the most advanced

technology in the semiconductor industry in terms of both

density and energy efficiency, according to the company's

website.

On August 5, Taiwanese authorities said they have detained

three people for allegedly stealing technology trade secrets

from TSMC. Tokyo Electron ( TOELF ) later confirmed that a former employee

of its Taiwan subsidiary was involved in the case.