Next Media Group’s (壹傳媒集團) deal to sell its media outlets in Taiwan may run aground after the Financial Supervisory Commission (FSC) yesterday voiced its strong objection to financial holding firms controlling media companies.
Jeffrey Koo Jr (辜仲諒), the eldest son of Chinatrust Financial Holding Co (中信金控) founder and chairman Jeffery Koo (辜濂松), and related parties of Chinatrust Financial, cannot have control over companies in both sectors, said Jean Chiu (邱淑貞), deputy director-general of the commission’s Banking Bureau, citing the principle of “separation of banking and commerce.”
“Koo Jr and family will have to reach a decision very soon detailing how they intend to uphold the principle,” Chiu said by telephone.
Last month, Koo Jr inked a memorandum of understanding with Next Media Group to buy the Hong Kong-listed firm’s Chinese-language Apple Daily, Taiwan Sharp Daily, Next Magazine and Next TV for NT$17.5 billion (US$600 million).
The financial regulator made known its stance after Koo Jr, chairman of the Chinatrust Charity Foundation, paid a visit to the commission earlier yesterday to resolve potential regulatory resistance.
Koo Jr, who has teamed up with Formosa Plastics Group (台塑集團) chairman William Wong (王文淵) and a Singapore-based private equity fund in the buyout attempt, is expected to hold an investment meeting today and is scheduled to sign a definitive agreement, as well as all other necessary legal documentation, with Next Media on Saturday.
“The commission will adopt a strict reading of the laws governing financial holding companies and qualifications for major shareholders to uphold the principle of separation [of banking and commerce] and prevent a concentration of power,” Chiu said.
While Koo Jr and his father own only 7 percent of Chinatrust Financial, lower than the 10 percent regulatory threshold to be classified as “major shareholders,” the Koo family and its related parties actually have majority control of the conglomerate’s boardroom, Chiu said.
It is therefore inappropriate if the same parties also control, operate, or represent media firms because it would render the nation’s financial stability vulnerable in the event of a scandal or cyclical volatility, she said.
“The Koo family must address those concerns,” Chiu said. “Assurance by Chinatrust Financial that it will not provide funding to Koo Jr is not enough.”
The commission will not turn a blind eye if the Koo family seeks to circumvent the separation rule through other means, Chiu said, adding that Koo Jr had promised to brief the public on the matter in the next few days.
The anti-media monopoly alliance raised similar concerns yesterday, saying that Koo Jr had been involved in financial scandals and was unfit to run a media corporation.
One of the financial scandals in which Koo was involved was Chinatrust Financial’s flawed bid for rival Mega Financial Holdings Co (兆豐金控) in 2006 — known as the Red Fire Case (紅火案), after the name of the offshore company used to conduct the illegal transaction. He had evaded an arrest warrant and hid in Japan for two years before returning to Taiwan in 2008. He was the vice chairman of Chinatrust Financial at the time.
Chen Hsiao-yi (陳曉宜), organizer of the alliance, said Koo Jr was not fit to run a media business because he had been sentenced to nine years in jail by the Taipei District Court in 2010 for the illegal takeover bid for Mega Financial in violation of the Securities Exchange Act (證券交易法) and the Banking Act (銀行法).
Koo’s case is under appeal.
The paramount chief of a volcanic island in Vanuatu yesterday said that he was “very impressed” by a UN court’s declaration that countries must tackle climate change. Vanuatu spearheaded the legal case at the International Court of Justice in The Hague, Netherlands, which on Wednesday ruled that countries have a duty to protect against the threat of a warming planet. “I’m very impressed,” George Bumseng, the top chief of the Pacific archipelago’s island of Ambrym, told reporters in the capital, Port Vila. “We have been waiting for this decision for a long time because we have been victims of this climate change for
MASSIVE LOSS: If the next recall votes also fail, it would signal that the administration of President William Lai would continue to face strong resistance within the legislature The results of recall votes yesterday dealt a blow to the Democratic Progressive Party’s (DPP) efforts to overturn the opposition-controlled legislature, as all 24 Chinese Nationalist Party (KMT) lawmakers survived the recall bids. Backed by President William Lai’s (賴清德) DPP, civic groups led the recall drive, seeking to remove 31 out of 39 KMT lawmakers from the 113-seat legislature, in which the KMT and the Taiwan People’s Party (TPP) together hold a majority with 62 seats, while the DPP holds 51 seats. The scale of the recall elections was unprecedented, with another seven KMT lawmakers facing similar votes on Aug. 23. For a
Taiwan must invest in artificial intelligence (AI) and robotics to keep abreast of the next technological leap toward automation, Vice President Hsiao Bi-khim (蕭美琴) said at the luanch ceremony of Taiwan AI and Robots Alliance yesterday. The world is on the cusp of a new industrial revolution centered on AI and robotics, which would likely lead to a thorough transformation of human society, she told an event marking the establishment of a national AI and robotics alliance in Taipei. The arrival of the next industrial revolution could be a matter of years, she said. The pace of automation in the global economy can
All 24 lawmakers of the main opposition Chinese Nationalists Party (KMT) on Saturday survived historical nationwide recall elections, ensuring that the KMT along with Taiwan People’s Party (TPP) lawmakers will maintain opposition control of the legislature. Recall votes against all 24 KMT lawmakers as well as Hsinchu Mayor Ann Kao (高虹安) and KMT legislative caucus whip Fu Kun-chi (傅崐萁) failed to pass, according to Central Election Commission (CEC) figures. In only six of the 24 recall votes did the ballots cast in favor of the recall even meet the threshold of 25 percent of eligible voters needed for the recall to pass,
RSS