03.21.2001
Gov’t bans Taiwan investment in companies with 35% China stake

• Taiwan's government yesterday announced a ban on investment in companies that are 35% or more owned by Chinese companies or government bodies. The government said that investors that own shares in companies with a 35% or more Chinese stake will be given a year to sell their stock holdings.

• The new measures are expected to have a limited impact as private investors will still be allowed to remit foreign currencies totaling US$5m a year outside of Taiwan, while the limit for companies remains at US$50m.

• The announcement came just before a 10-member delegation from China's Taiwan Affairs Office of the State Council arrived in Taipei. The visiting officials have urged Taiwan to drop the "no haste, be patient" policy toward China investment. Under current law, a single Taiwanese company is not permitted to invest more than US$50m in China.

• The Investment Commission under the Ministry of Economic Affairs recently shelved China investment applications by Asustek Computer (2357 'Hua Shuo') (to invest US$25m for capital increment in Suzhou) and VIA Technologies (2388 'Wei Sheng') (to invest in a department store). The Commission cited the large size of the investments and a lack of investment details from the applicants as the reasons for the rejection.

IrmakSurenkok@Primasia.com +886-[0]2-2547-8873