Thu, Jul 05, 2007 - Page 1 News List

Cabinet suspends BCC approval

VIOLATIONS Minister without Portfolio Hsu Chih-hsiung called the deal 'illegal' and said five members of the nation's media watchdog would be referred to the judiciary

By Jimmy Chuang and Shelley Shan  /  STAFF REPORTERS

The Cabinet yesterday suspended the National Communications Commission's (NCC) approval of the Broadcasting Corporation of China's (BCC) application to transfer its shares to companies allegedly owned by former UFO Radio chairman Jaw Shaw-kong (趙少康).

"The deal was illegal. It is obvious that some NCC members allegedly made the decision in favor of Jaw," Minister without Portfolio Hsu Chih-hsiung (許志雄) said.

"We will also refer five NCC members to the judiciary," he said.

The five NCC members Hsu referred to are Chairman Su Yeong-ching (蘇永欽), spokesman Howard Shyr (石世豪) and members Liu Zong-de (劉宗德), Lin Tung-tai (林東泰) and Hsieh Chin-nan (謝進男).

Hsu made his remarks during a press conference yesterday.

Hsu said that the deal violated the Broadcasting and Television Law (廣播電視法), because although the BCC transferred and sold its shares to four companies, Jaw was the owner of the four companies and the law stipulates that an individual is not allowed to hold a majority of a radio station's shares.

In addition, the four companies spent just NT$100 million (US$3 million) to acquire 90 percent of BCC's shares, but the shares were estimated to be worth at least NT$3.2 billion, Hsu said.

"We believe this is a breach of trust," he said. "Obviously, there is something wrong with this deal, so we have decided to suspend it and refer it to the judiciary," he said.

Cabinet Spokesman Shieh Jhy-wey (謝志偉) said that because the deal was suspended, Jaw is still the owner of the BCC, but his title and legal status would not be recognized by the government.

The government also suspended the company's licenses for its "Formosa Network" and "Music Network," two radio frequencies first given to the BCC to broadcast anti-communist propaganda.

The case has aroused controversy since June 26, when the NCC approved the share transfer. The NCC also approved the BCC's application to change the chairman of its board, a change that enabled Jaw to become chairman of the station.

The BCC was sold by the Chinese Nationalist Party (KMT) on Dec. 24 to China Times Group subsidiary Jungli Investment in a NT$9.3 billion deal that included China Television and Central Motion Picture Corp.

Jaw then bought the BCC shares from Hua Hsia Investment Holding, which has been alleged to manage assets for the KMT.

The NCC issued a ruling before the Lunar New Year holiday this year to ask Jaw to fulfill several requirements before the two applications could be approved, including returning the radio frequencies.

Responding to the Executive Yuan's ruling, Su said that the NCC would petition for a constitutional interpretation on the administrative authority of an independent organization.

Meanwhile, the NCC would ask the Grand Council of Justices to review the constitutionality of the Executive Yuan's operational guidelines for dealing with independent organizations, he said.

Su said that the commission would also officially notify the Executive Yuan that the NCC's ruling on the BCC case remained valid.

Su said that the commission had tried every means possible to investigate the BCC transaction, but emphasized that the commission was not authorized to look into other aspects of the deal.

"The commission only asked whether overseas investors were involved and if political parties, the government or the military had any part in the transaction," he said.

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