Although maintaining a competitive edge over China is high on the government's agenda for cross-strait economic policy, a draft bill aimed at preventing the outflow of technology has been stalled for the past four years.
The Sensitive Scientific Technology Protection draft bill (
However, the legislature has failed to reach consensus on even the basic question of whether it is necessary to have such a law in the first place.
There are six versions of the bill pending review, with the differences between them lying in their definition of sensitive technology, the items subject to regulation, the composition of a review committee and its screening process, and penalties, among other factors.
When the bills were preliminarily reviewed early this month, Chinese Nationalist Party (KMT) caucus whip Tseng Yung-chuan (
Lee, a sponsor of one version cosigned by other KMT legislators, is in favor of the legislation, saying that it could make the rules for regulating technology as clear as possible.
Lee said that she "had no choice but to dismiss the meeting [upon Tseng's unexpected arrival]," with the result that the legislators couldn't even reach common ground on the first article of the draft bills.
As Tseng doubles as the executive director of the KMT's policy coordination department charged with ensuring that the party's policy stances are obeyed by its legislators, his move was interpreted as demonstrating the KMT's stance on the legislation.
The KMT's stance on the matter reflects those of representatives from both the Taipei Computer Association (TCA) and Taiwan Electrical and Electronic Manufacturers Association (TEEMA), Democratic Progressive Party (DPP) Legislator Wang To-far (王塗發) said.
TEEMA deputy secretary-general Luo Huai-jia (
"A possible consequence of the legislation is to discourage people from investing or working in Taiwan, as they wouldn't want to stay in a place where there are restrictions on their freedom," Luo said.
Luo said that enacting such a law might run counter to the government's desire to ensure the nation's continued competitiveness.
"It would be unfavorable to the nation's development if investors and high-tech talents stay away from Taiwan," he said.
Given the close economic relationship with China, a situation in which technology transfer from Taiwan to that country is on the increase, it is obvious that the bills are mainly targeted at China.
This fact has disturbed businessmen who have investments in China. Huang I-feng (
"We shall all support the legislation if it is aimed at preventing economic espionage. But if it is targeted at regulating cross-strait economic exchanges, it might reduce the willingness of local businesses to increase R&D [research and development] in Taiwan," Huang said.
"About 70 percent to 80 percent of information technology products are manufactured in overseas markets, mainly China. The draft bills might increase the risk of investing capital in R&D as companies might be prohibited from exporting the products of that research," he added.
However, not all business associations are against the draft bills.
"In order to prevent the loss of the nation's sensitive technology, it is necessary to make the regulations clear and definite," said Tsai Hung-ming (
Citing a report produced by the Ministry of Economic Affairs last year, Tsai said that more than 86 percent of advanced technological items that Taiwanese businesses used in their overseas factories were sourced from Taiwan.
The government currently regulates the transfer of technology and technology-related products in accordance with a control list based on the international Wassenaar Agreement and the Foreign Trade Act (貿易法).
Whereas those rules were drawn up by the government to suit its needs, Tsai said it was more important to make it possible for local businesses to be proactive in protecting their own sensitive technology.
Ben Chang (
"With civil exchanges with China on the increase, Taiwan desperately needs its high-tech industries to be protected. Regardless of the cross-strait economic policy, having a law to follow is better than having none," he said.
Chang said that the most difficult hurdle facing the legislation was identifying the items and manufacturing processes that were in need of protection.
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