Earlier, THSRC called a provisional meeting of its shareholders, in which the board's seats went up for election despite of the fact that the tenure of the incumbent board directors will not expire until August 2010.

The election was called because the company has been in serious financial straits, which drew the government to intervene in its management. The election was aimed at justifying the government's right to help the company improve its shaky financial structure, THSRC officials said.

The new board is made up of 15 directors and two supervisors, including three independent directors. Out of the total 17 seats on the board, 10 seats were filled by incumbents.

According to the election results, the state-owned China Aviation Development Foundation that runs Taiwan's largest air carrier China Airlines kept its seat on the board, as did the state-run Taiwan Sugar Corp. and CTCI Foundation. CTCI Foundation, formerly known as China Technical Consultants, Inc., is a government-funded organization dedicated in developing technological talents for Taiwan thereby facilitates Taiwan's economic development and assists Taiwan's manufacturing industries to upgrade their productivity.

New faces on the board include the Kaohsiung-based China Steel Corp., in which the government has a stake, and the Executive Yuan-run National Development Fund, which gained two seats.

The three independent directors are former Minister of Finance Lin Cheng-kuo, former Vice Minister of Transportation and Communications George Chen and Waterland Financial Holdings Chairman Victor Liu.

Among the six new directors that represent private funds, THSRC's five original principal shareholders -- Continental Engineering Corp., Pacific Electric Wire & Cable, Teco Electric and Machinery, the Evergreen Group and Fubon Financial Holding Co. -- all managed to retain their seats. The Tung Ho Steel Enterprise won the sixth seat as a new board member.

The High Speed Rail connects northern Taiwan with southern Taiwan, allowing travelers to travel between the capital Taipei in the north to the country's second largest city Kaohsiung in the south within just about two hours.

THSRC, a private company that built the 345-kilometer high-speed railway and operated the line under a build-operate-transfer (BOT) contract with the government, has lost money since the railway began operating in January 2007.

In the two and a half years since the end of June 2009, it has accumulated losses of over NT$70 billion (US$2.16 billion) -- about 66 percent of its paid-in capital of NT$105.3 billion -- and total debts of NT$400 billion.

On Tuesday, THSRC Chairman Ou Chin-der said the company can stop losing money only when its average transport volume reaches 145,000 people a day.

The current daily transport volume is at some 90,000 people, he added, predicting the figure will climb to 120,000 by the end of next year.

Transport incomes have accounted for over 96 percent of the company's total revenues, according to THSRC.

(By Wang Shu-fen & Elizabeth Hsu)