ET Report
Taiwanese chip giant United Microelectronics Corp (UMC) vowed today to appeal a court ruling that upheld a fine imposed on the company for making an unauthorised investment in China.
UMC, currently the world's second biggest contract chip maker by revenue, was hit with the fine in 2006, prior to a recent warming of ties with China that has led to a relaxation of investment restrictions. The Taipei High Administrative Court on Wednesday upheld the economic ministry's 2006 decision to fine UMC five million Taiwan dollars (156,000 US) for investing in China's HeJian Technology without regulatory approval.
Responding on Thursday to the ruling, a spokeswoman for UMC said: "We will continue to appeal according to the legal procedures".
UMC manufactures cutting-edge microchips used in a wide range of electronic goods, including computers, mobile phones, televisions and cars.
According to the ministry, HeJian agreed to give UMC a 15 per cent stake worth about 110 million US dollars in condition that technological know-how would be provided by UMC's then- chief, Robert Tsao, and other executives.
UMC said it had informed the government about the transaction, but the ministry insisted the investment broke the law because it was made without prior authorisation.
Tsao is also the subject of an ongoing trial in relation to the same investment on charges of breach of trust and violating accounting rules.
UMC has described Tsao's case as being of a "purely political nature", caused by the rising tensions at the time between Taiwan and China.
Ties have improved since the island's Beijing-friendly government came to power in 2008 and has since relaxed controls, including on high-tech firms, on investment in China.