The National Communications Commission (NCC) said yesterday that neither Chunghwa Telecom Co (中華電信) nor any of the nation’s telecom companies could invest in First International Telecom Corp (大眾電信).
The telecommunications regulator’s remarks came after the Chinese-language Economic Daily News said Chunghwa Telecom might offer financial support to First International Telecom following a meeting with the company’s founder, Chien Ming-jen (簡明仁), on Tuesday.
First International Telecom was one of the six operators that acquired the World Interoperability for Microwave Access (WiMAX) license after winning a public bid last year and is in the process of establishing the appropriate facilities.
While the company has run the personal handy phone service for about a decade, it has not launched the WiMAX service yet.
Andy Shieh (謝煥乾), deputy director of the NCC’s legal department, said that licenses and radio frequencies granted to a telecom operator could not be legally used as collateral or transferred to other operators unless specifically stated in the license terms.
The regulation is meant to ensure fairness for all candidates who originally bid for the licenses and to prevent any telecom company from acquiring a license through false or exaggerated plans of operation.
Once First International Telecom launches WiMAX services, it is entitled to attract interested investors or business partners, Shieh said.
On Tuesday, First International Telecom chairman Charlie Wu (吳清源) confirmed that the company had bounced NT$86 million (US$2.7 million) in checks to credit banks, telecom equipment suppliers and handset retailers.
The amount does not include the money it owes the NCC — more than NT$40 million.
The newspaper report also said that Chunghwa Telecom, which lost its bid for a WiMAX license last year, wanted to tap into the WiMAX market by controlling First International Telecom.
Earlier this year, First International tried to establish a subsidiary company to operate WiMAX services. The commission rejected its application, citing the same regulation as above.
In March, the commission rejected Chunghwa Telecom’s application to invest in the Global Mobile Corp (全球一動), one of the WiMAX license holders.
The commission said Chunghwa Telecom made the lowest bid during the competition. It would be unfair to other competitors if it entered the playing field now by investing in a WiMAX license holder, it said.
Chunghwa Telecom yesterday dismissed the speculation that it would bankroll the financially troubled First International by subscribing to preferential shares.
Chunghwa Telecom had not discussed the matter with First International or evaluated any potential investment, the company said in a filing to the Taiwan Stock Exchange yesterday.
First International Telecom hopes to raise NT$1 billion by selling 200 million preferential shares next month. The company has accumulated around NT$3 billion in losses over the past years.
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