Sun, Dec 12, 2010 - Page 1 News List

AUO nears approval on investment in Chinese LCD plant

IN A FIX:Officials said they would meet with panel makers next week to discuss how best to respond to price-fixing allegations in Europe

By Shih Hsiu-chuan and Kevin Chen  /  Staff Reporters

Premier Wu Den-yih (吳敦義) said yesterday that a “steering committee” of the Investment Commission under the Ministry of Economic Affairs (MOEA) had agreed to approve AU Optronics Corp’s (AUO, 友達光電) application to invest in a new LCD panel plant in China.

The review procedure for the case is now focusing on the completion of the regular paperwork, Wu told reporters after Hon Hai Group (鴻海集團) chairman Terry Gou (郭台銘) complained on Friday that “the government stands in the way of local flat panel makers’ plans to invest in China.”

“It could be that chairman Gou had been out of the country for a long time so that he did not understand the progress of the case,” Wu said.

However, the ministry’s Investment Commission Executive Secretary Fan Liang-tung (范良棟) said by telephone yesterday that the commission had yet to finalize the review of AU Optronics’ planned US$3 billion investment in a 7.5-generation LCD panel plant in Kunshan, Jiangsu Province.

“I have no comment on the premier’s remark,” Fan told the Taipei Times. “But what is clear now is that the commission will have to organize an inter--ministerial meeting to formally decide on the case.”

The commission usually holds such inter-ministerial meetings once a month and its most recent meeting was held on Nov. 30.

Fan said it was difficult to say when the next such meeting would be held because it involves several government agencies.

AU Optronics, the nation’s second-largest LCD panel maker after Chimei Innolux Corp (奇美電子) by revenue, submitted its China investment proposal to the commission for approval in March, but had to resubmit the proposal later to meet government requirements.

Wu said the company’s revised plan had met the two conditions for the government to decide whether to allow LCD panel makers to invest in China.

The government only allows Taiwanese companies to set up production lines in China when their locally based panel production has more advanced technologies and when they promise not to scale down investments in Taiwan, he said.

“The government did not delay the review of the application,” Wu said.

The premier also dismissed Gou’s criticism that the government did not care about Taiwanese companies being ordered to pay a huge fine by the European Commission.

The fact that Vice Minister of Economic Affairs Hwang Jung-chiou (黃重球) accompanied Guo and Chimei Innolux chairman Frank Liao (廖錦祥) to the European Economic and Trade Office on Friday demonstrated the government was concerned about the matter, Wu said.

The ministry yesterday said it planned to invite local panel makers and government agencies for a meeting next week to study how best to assist companies in response to the European Commission’s price-fixing allegations.

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