After OBI Pharma last week issued a statement apologizing for failing to register sales of shares by one of its major shareholders as required, people are wondering if other companies listed on the local bourse have also broken the law and should come under scrutiny.
OBI Pharma on Wednesday said that senior finance manager Chang Sui-fen (張穗芬) had failed to register stock trading activities by Alpha Corporate Holdings Ltd, after investigators found the British Virgin Islands-registered company sold OBI Pharma shares worth several hundred million New Taiwan dollars in October last year, which Chang allegedly concealed.
This violated the declaration procedure for publicly listed companies in Taiwan regarding their shareholding changes, and OBI Pharma is likely to face a fine of between NT$240,000 and NT$2.4 million (US$7,423 and US$74,234) under the Securities and Exchange Act (證交法).
OBI Pharma shares have gone into free-fall since Feb. 21, when the firm announced that second and third-phase clinical trial results of a new breast cancer vaccine showed “no statistical significance,” followed by insider-trading allegations involving a number of high-ranking executives and Academia Sinica President Wong Chi-huey (翁啟惠).
The firm said it would begin an internal investigation and take appropriate action in a bid to limit the fallout, but that has not been enough to stave off criticism after media outlets reported that OBI Pharma chairman Michael Chang (張念慈) was a key figure in Alpha Corporate Holdings.
Investigators are still trying to clarify if the British Virgin Islands entity is a shell company set up by Michael Chang to hide his investment profits and whether Chang Sui-fen was under pressure from her superiors to conceal the change in the company’s shareholding structure.
However, questions have also been raised about whether regulators have turned a blind eye to an increasing number of local businesses that have sought shelters from tax laws in places such as the British Virgin Islands, the Cayman Islands and other tax havens.
Samoa and Mauritius are also on the “best” tax haven-list for Taiwanese to register offshore companies. Interestingly, another of OBI’s major shareholders is a Taiwanese company registered in Samoa whose representative is Yang Shih-chien (楊世緘), a national policy adviser to President Ma Ying-jeou (馬英九).
Not all Taiwanese companies registered overseas engage in illegal activities. Many Taiwanese businesses set up overseas-registered entities when the government relaxed restrictions on business investments in China, a move that was aimed at helping them contain the risk of those investments affecting their home market operations. Nowadays, many individuals and companies set up offshore entities to enjoy lower tax rates on capital gains, while a few firms use overseas registries or shell companies to hide assets from tax authorities, help launder the proceeds of criminal activities or conceal misappropriated wealth.
In the case of OBI Pharma, financial authorities and investigators need to find out if high-ranking executives or major shareholders used offshore entities to avoid taxation and financial oversight. However, what was once a single company’s problems are seemingly growing into a regulatory issue and more than just an insider-trading scandal.
If the government does not act swiftly to fix shortcomings in the taxation system and cannot move forcefully enough against the illegal use of offshore companies based in tax havens, it will invite suspicion that Taiwan is supporting income inequality, tax evasion, money laundering and other irregular activities.
Taiwan stands at the epicenter of a seismic shift that will determine the Indo-Pacific’s future security architecture. Whether deterrence prevails or collapses will reverberate far beyond the Taiwan Strait, fundamentally reshaping global power dynamics. The stakes could not be higher. Today, Taipei confronts an unprecedented convergence of threats from an increasingly muscular China that has intensified its multidimensional pressure campaign. Beijing’s strategy is comprehensive: military intimidation, diplomatic isolation, economic coercion, and sophisticated influence operations designed to fracture Taiwan’s democratic society from within. This challenge is magnified by Taiwan’s internal political divisions, which extend to fundamental questions about the island’s identity and future
The narrative surrounding Indian Prime Minister Narendra Modi’s attendance at last week’s Shanghai Cooperation Organization (SCO) summit — where he held hands with Russian President Vladimir Putin and chatted amiably with Chinese President Xi Jinping (習近平) — was widely framed as a signal of Modi distancing himself from the US and edging closer to regional autocrats. It was depicted as Modi reacting to the levying of high US tariffs, burying the hatchet over border disputes with China, and heralding less engagement with the Quadrilateral Security dialogue (Quad) composed of the US, India, Japan and Australia. With Modi in China for the
The Chinese Nationalist Party (KMT) has postponed its chairperson candidate registration for two weeks, and so far, nine people have announced their intention to run for chairperson, the most on record, with more expected to announce their campaign in the final days. On the evening of Aug. 23, shortly after seven KMT lawmakers survived recall votes, KMT Chairman Eric Chu (朱立倫) announced he would step down and urged Taichung Mayor Lu Shiow-yen (盧秀燕) to step in and lead the party back to power. Lu immediately ruled herself out the following day, leaving the subject in question. In the days that followed, several
The Jamestown Foundation last week published an article exposing Beijing’s oil rigs and other potential dual-use platforms in waters near Pratas Island (Dongsha Island, 東沙島). China’s activities there resembled what they did in the East China Sea, inside the exclusive economic zones of Japan and South Korea, as well as with other South China Sea claimants. However, the most surprising element of the report was that the authors’ government contacts and Jamestown’s own evinced little awareness of China’s activities. That Beijing’s testing of Taiwanese (and its allies) situational awareness seemingly went unnoticed strongly suggests the need for more intelligence. Taiwan’s naval
RSS