Fri, Feb 18, 2005 - Page 1 News List

TSU says leaked memos prove UMC allegations

By Ko Shu-ling  /  STAFF REPORTER

Taiwan Solidarity Union (TSU) lawmakers yesterday made public what they said was new evidence to help prosecutors investigate the world's No. 2 custom chipmaker, United Mocroelectronics Corp (UMC, 聯電) and its ties with the Chinese semiconductor firm He Jian Technology (Suzhou) Co (和艦).

Producing copies of what were described as internal confidential memos from He Jian, TSU caucus whip Lo Chih-ming (羅志明) said that high-level Taiwanese officials at He Jian were told by their superiors that they could allow their Taiwanese employees to get access to UMC's database during business hours via a particular IP address.

"That's why 199 of UMC's patented items are used by He Jian, and we're afraid that the improper behavior has jeopardized the rights of UMC shareholders and has contributed to the fall of its shares," Lo said.

The probes of UMC's investments in China weighed heavily on UMC's share price Wednesday. The company's shares fell nearly 1 percent to NT$20.8 on the Taiwan Stock Exchange and plunged to NT$19.9 yesterday.

Acting on tip-offs, over 100 Hsinchu and Taipei prosecutors Tuesday raided nine offices and residences relating to the case, including UMC's offices, and the residences of UMC vice chairman John Hsuan (宣明智) and another UMC employee.

Lo also lambasted the government's economic strategy of "active opening and effective management" for investments in China.

"The policy has become the biggest lie ever," Lo said. "We're asking prosecutors to thoroughly investigate whether He Jian executive Hsu Chien-hwa (徐建華), a former UMC employee, was attempting to empty out Taiwan's technological resources and channel them to China."

Another TSU lawmaker, Huang Shih-cho (黃適卓), echoed Lo's opinion.

"We thought the government has been doing a poor job in executing the `effective management' policy," he said.

In addition to calling on the government, national security authorities and prosecutors to thoroughly investigate the case as well as the entire high-tech industry, Huang requested that the government mete out punishment to civil servants failing to fulfill their duties in carrying out the "effective management" strategy.

Lo also requested the government map out foreign investment guidelines for the high-tech industry to follow, and pledged to enact a law to protect high-tech knowhow.

The Executive Yuan sent a draft national technology protection law (國家科技保護法) to the legislature for review in February 2003, but the bill has been bogged down in legislative procedures. Opposition lawmakers, who control the legislature, called the bill "technological martial law."

Branding prosecutors' large-scale raid as "inappropriate," Democratic Progressive Party (DPP) Legislator Ker Chien-ming (柯建銘) said that he believed UMC, a listed company, would not "deliberately break the law."

"I'd like to believe that UMC and He Jian are simply two friendly companies striving to cooperate with each other in a highly competitive industry and to take the lead in the Chinese market," he said.

Earlier yesterday morning, Ker used a stronger and more controversial tone to describe the raid as "confiscating the property and exterminating the family."

Ker also called on the public to trust the judicial system and stop politicizing the matter. Some commentators have said that the raid on UMC occurred because of Hsuan's criticism of the DPP government.

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