The 2006 sale of the Chinese Nationalist Party’s (KMT) former headquarters to the Chang Jung-fa Foundation is to be the focus of the next inquiry by the Ill-gotten Party Assets Settlement Committee, sources said yesterday.
The committee would enlist the assistance of the transitional justice promotion committee, which is to become operational next month, they said.
In March 2006, then-KMT chairman Ma Ying-jeou (馬英九) oversaw the sale of the building on Taipei’s Zhongshan S Road, facing the Presidential Office Building, to the Chang Jung-fa Foundation for NT$2.3 billion (US$78.7 million at the current exchange rate).
The assets committee believes that the KMT might have illegally profited from its use and ownership of the property, including by illegally squatting on land, underpaying the government for its use and buying it for less than market value before finally selling it for a profit, the sources said.
A public inquiry into the property’s sale is be conducted soon and accountability for the illegal proceeds from the transaction is to be a key issue, sources from the asset committee said.
The committee has been investigating the case for some time, and it has found the official records of the property’s ownership and sale at the National Property Administration, and in other state archives, sources said.
According to the records, the land now owned by the foundation originally belonged to the Japanese Red Cross Society’s Taiwan branch, which the Republic of China government claimed after World War II.
In 1949, the KMT moved into the property and began using the structure as its party headquarters, without paying the public or the government any rent for the privilege, they said.
The KMT kept using the property for 35 years until 1984, when it started to pay a “symbolic” rent of NT$300 per ping (3.3m2), which was far beneath the market price, they said.
The KMT had concluded the use agreement with the government via the KMT Central Committee, which as a private foundation or association lacked the legal competency to sign a valid contract of that kind, they said.
In June 1990, the then-KMT government sold the property to Gao Ming-hui (高銘輝) and two other KMT members without holding any competitive bidding, sources said, adding that at the time, Gao and the other members claimed that the government should give the KMT preferential treatment as a buyer, as the party was the property’s current tenant.
Although the property’s market value was estimated at NT$4.5 billion, the KMT obtained it for NT$374 million, after the National Property Administration undervalued it by using obsolete land value assessments from the previous year, sources said.
The committee suspects this to have been an act of criminal collusion between former administration officials and the KMT, and its investigation would open a line of inquiry on the transaction, sources said.
To skirt regulations that protected the 80-year-old building then occupying the property as historical heritage, the KMT knocked down the structure in the deep of night on April 11, 1994, sources said, adding that it then built the existing structure on the site, which the KMT eventually sold to the foundation.
Committee spokeswoman Shih Chin-fang (施錦芳) yesterday said that the KMT headquarters’ sale was “a classic case of the KMT’s methods of capitalizing on illegally obtained assets.”
The next series of committee hearings would focus on the KMT’s expropriation of the property, the demolition of a heritage site and possible illicit profits that the party made through the sale, Shih said.
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