Ministry hails new deal with toll firm

Controversy over the freeway electronic toll collection (ETC) system temporarily subsided yesterday as the Ministry of Transportation and Communications (MOTC) announced that it would amend its contract with Far Eastern Electronic Toll Collection Co and allow the company to continue to operate the build-operate-transfer project.

MOTC Minister Kuo Yao-chi (郭瑤琪) said that both sides have agreed that the price for the onboard units (OBUs) would now be set at NT$680 (US$20.81) each, and that the service charge would stay the same.

Far Eastern will also have to obtain the approval of the Taiwan National Area Freeway Bureau if it wants to raise the price for OBUs, she said at a press conference last night at the ministry.

She added that motorists would get refunds for the purchase price of their OBUs if they buy one during the first year and manage to use it 100 times within the next two years, adding that the number had been determined with the nation's 600,000 motorists in mind and was the equivalent of a motorist driving from Taipei to Hsinchu once every month.

The contract with Far Eastern will also be renewed every year, the minister added.

Kuo said that her ministry would begin updating the contract with Far Eastern within seven working days and promised to re-evaluate it as soon as verdicts are delivered in the relevant pending lawsuits.

She added that updating the contract would not cost the government anything.

When pressed about why the ministry decided to let Far Eastern continue operations instead of taking over the system itself, Kuo said that the decision was simply a more stable one.

"It would not necessarily be to the government's advantage if it decides to take over the system, because the ETC project still faces a lot of uncertainty," Kuo said.

For one, the ministry would have to decide whether to keep the infrared system or switch to the microwave system.

Kuo said that the ministry has asked Far Eastern to improve its service quality, including the reduction of deposits for OBU cards from NT$200 to NT$100 and providing a one-stop installation service.

As to when these new services will be available to motorists, Kuo said that the ministry would make a formal announcement once the contract has been updated.

The announcement was unexpected, because Kuo had told reporters yesterday morning that late-night negotiations with Far Eastern had generated no concrete agreement.

Far Eastern's chairman Douglas Hsu (徐旭東) has been under tremendous pressure from major stockholders, who were disgruntled over the government's constantly changing policy regarding the ETC system, she said.

Kuo added that the Ministry also has to uphold the public interest.

She said the ministry would never agree to raise the service charge, because the requirement was already listed in the notices sent to all potential bidders.

It would be unfair to potential bidders if the ministry decided to change the fare at this point, she said.

Officials of Far Eastern last night showed their long-lost smiles at a press conference while announcing that they would continue the ETC operations.

"We have reached a consensus with the Ministry of Transportation and Communications," said Lin Li-ling (林麗玲), a company spokeswoman.

Vice chairman Champion Lee (李冠軍) welcomed the result, but refused to detail the extent of the possible losses incurred from concessions the company made with the government.