Taiwanese giant slapped with fines over mainland regulatory violations, Xinhua says
- Far Eastern Group subsidiaries in Shanghai and four provinces punished over issues ranging from environmental protection to staff and fire safety rules
- The conglomerate, a major election donor, funded a mayoral campaign for one of three top Taiwan officials on Beijing’s ‘separatist’ blacklist
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Far Eastern-invested polyester and textile, and cement companies in Shanghai and the provinces of Jiangsu, Jiangxi, Hubei and Sichuan were penalised over violations related to environmental protection, land use, employee occupational health, production safety and fire protection, taxation and product quality, Xinhua reported on Monday.
The punishments ranged from fines, orders to pay tax arrears or rectify the issues concerned within a set time frame, to warnings that idle construction land would be taken back by the state.
The companies involved had admitted the charges, and investigations were still in progress, Xinhua said.
A spokesman for Far Eastern Group in Taiwan said they were still trying to understand the situation.
Three top Taiwanese officials – Premier Su Tseng-chang, Legislative Yuan president Yu Shyi-kun and Foreign Minister Joseph Wu – were named on the blacklist released by Beijing on November 12 for “vigorously inciting cross-strait confrontation and malicious attacks against the mainland”.
It had also said sponsors of those on the blacklist, such as those who fund their election campaigns, would be banned from doing business on the mainland.
The Xinhua report did not mention if there was a link between the punishment meted out to mainland arms of the Far Eastern Group and its political stance.
The economy minister of Taiwan, Wang Mei-hua, said the company had been punished on the mainland because of environmental protection rules, the island’s United Daily News reported.
But she could not say whether it was a case of Taiwanese companies being suppressed, as she did not have the details, the report said.
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However, in response to reporters’ queries on whether the blacklist and the punishments were linked, the Taiwan Affairs Office in Beijing said affiliated companies and financial supporters of “diehard” Taiwan independence forces must be punished severely in accordance with the law.
Taiwanese compatriots and enterprises were still welcome and would receive support to invest and develop in the mainland, with their legitimate rights and interests still protected, office spokeswoman Zhu Fenglian said.
“But we will never allow those who support ‘Taiwan independence’ and undermine cross-strait relations to make money on the mainland,” she asserted.
Zhu also warned Taiwanese businessmen and enterprises to “clearly distinguish between right and wrong”, to “draw a clear line” with Taiwan independence forces, and to take concrete action to maintain the peaceful development of cross-strait relations.
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In a notice filed to the Taiwan stock exchange on Monday, Far Eastern New Century, the group’s textiles arm, said its mainland subsidiaries were inspected by authorities in the second quarter. Flaws were found in environmental protection, fire safety and taxation compliance and the firms were fined 36.5 million yuan (US$5.7 million).
Rectification work was subsequently undertaken and 98 per cent of targets were achieved, the company said.
Asia Cement, another Far Eastern unit with mainland subsidiaries, said it was also inspected during the second quarter and notified of similar flaws. Though its fine of 52.12 million yuan was much higher, the financial situation of the company was not affected, a statement said.
Taiwanese media reports suggest Far Eastern had been the largest donor in the three legislative elections since 2012. Its total political donations were estimated at NT$133.4 million (US$4.8 million), and it was also the top donor in last year’s legislative elections with NT$58 million.
Far Eastern was also reported to have sponsored Premier Su in his 2018 election campaign for mayor of New Taipei City.
The group has extensive investments in the polyester, petrochemicals, cement production and retail sectors in mainland China.
Regular sorties by large numbers of People’s Liberation Army warplanes into the island’s air defence identification zone in recent weeks have sparked concern.
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However, mainland observers said Beijing was not in a hurry to seek reunification by force, but would use legal and economic means to get its message across.
“It is intolerable that these enterprises gained a lot of profit in the mainland while supporting Taiwan independence, and they are now panicking and have to stop,” said Wang Jianmin, a Taiwan issues specialist at Minnan Normal University in Fujian province.
Additional reporting by Lawrence Chung