The Legislative Yuan’s Economics and Energy Committee on May 6 conditionally passed the first reading of a draft amendment to the Factory Management Act (工廠管理輔導法) regarding unregistered factories built on farmland. It is to be the second revision to the act since 2010, when it was amended to allow unregistered factories to apply for temporary registrations so that the government could regulate factories that were illegally operating on farmland.
According to Council of Agriculture statistics, there are about 45,000 illegal factories on about 14,000 hectares of farmland. Over the past decade, only 7,421 of them have been granted a temporary license and only 10 have met the conditions to gain legal status, while 40 were moved to industrial zones with the government’s help.
With the deadline for temporary licenses to expire in June next year, while the number of unregistered factories on farmland keeps increasing, the amendment is a bid to address the long-standing issue by striking a balance between environmental protection and economic development.
In 2017, then-premier Lin Chuan (林全) said that the government would initially demolish illegal factories built after May 20, 2016, followed by those built earlier. Last year, then-premier William Lai (賴清德) said that the government would seek ways to help unregistered factories — most of them small or medium-sized — gain legal status, rather than extending the deadline. The draft amendment approved by Premier Su Tseng-chang (蘇貞昌) has devised mechanisms to regulate unregistered factories built before May 20, 2016, while denying leniency to those built after that.
The latest amendment aims to allow unregistered factories built before May 20, 2016, to continue operating past next year’s deadline, provided that they meet environmental and safety standards, and pay for land restoration and restitution for any pollution they caused.
The issue has existed for several decades. Unfortunately, the government has a poor track record addressing the issue, regardless of which party was in power. The problem continued because those who built the factories took a chance that the authorities would not find out.
However, this new amendment faces a fundamental problem: To ensure the interests of local industries, protect the livelihood of workers at unregistered factories and maintain economic growth, the government is creating a back door to assist unregistered operations to become legitimate. Creating this back door risks exacerbating the problem, especially if the lax enforcement and poor execution of the past persists. Instead of curbing unregistered factories, the proposed rule changes would encourage illegal factories to occupy farmland and make them less likely to use industrial zones.
Next year’s presidential and legislative elections make it difficult for the government to maintain a strict stance on unregistered factories, but those in power need to keep in mind that they are given power by the people to provide the greatest benefit to the nation as a whole. So, while the government is aiming to legitimize unlicensed establishments by giving them standards to meet, it still needs to include sunset provisions that would require less-polluting unregistered factories to gain a license and high-polluting ones to move to industrial zones within a certain timeframe or face being demolished.
Regulating unregistered factories is important for the economy, but the issue also needs to take into account social fairness and justice, the nation’s agriculture, people’s health and the environment.
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