Taiwanese chip giant United Microelectronics Corp (UMC, 聯電) vowed yesterday to appeal a court ruling that upheld a fine imposed on the company for making an unauthorized investment in China.
UMC, currently the world’s second-biggest contract chipmaker by revenue, was hit with the fine in 2006, prior to a recent warming of ties with China that has led to a relaxation of investment restrictions.
The Taipei High Administrative Court on Wednesday upheld the economic ministry’s 2006 decision to fine UMC NT$5 million (US$156,000) for investing in China’s He Jian Technology (和艦科技) without regulatory approval.
Responding yesterday to the ruling, a spokeswoman for UMC said: “We will continue to appeal according to legal procedure.”
UMC manufactures cutting-edge microchips used in a wide range of electronic goods, including computers, mobile phones, televisions and cars.
According to the ministry, HeJian agreed to give UMC a 15 percent stake worth about US$110 million on condition that technological know-how would be provided by UMC’s then-chief, Robert Tsao, and other executives.
UMC said it had informed the government about the transaction, but the ministry said the investment broke the law because it was made without prior authorization.
Tsao is also the subject of an ongoing trial in relation to the same investment on charges of breach of trust and violating accounting rules. UMC has described Tsao’s case as being of a “purely political nature,” caused by the rising tensions at the time between Taiwan and China.
Ties have improved since the Beijing-friendly government of President Ma Ying-jeou (馬英九) came to power in 2008 and has since relaxed controls, including on high-tech firms and investment in China.
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