Transportation minister denies conflict of interest
Taiwan News, Staff Writer
2014-01-15 03:56 PM
TAIPEI (Taiwan News) – Transportation Minister Yeh Kuang-shih denied allegations Wednesday that Senao International Co., Ltd. had paid for an expensive birthday dinner for him in connection with a stock transaction.

. Kuomintang lawmaker Alex Tsai accused the minister of conflict of interest. Yeh had first ordered Chunghwa Telecom to buy shares in the mobile handset distributor, but when that did not happen, he forced the telecom operator’s chairman, Lee Yen-sung, to resign last December, Tsai said.

As a result, Senao President Lin Pao-yung threw a lavish birthday dinner for the minister at a private location on January 5, the lawmaker alleged in a statement on his Facebook page.

Tsai accused the ministry of maintaining relations with private business that were too close, while also hinting that Chunghwa Telecom was unable to make any moves in the cell phone sector without first obtaining Lin’s approval. While other cell phone system operators could sell handsets, Chunghwa Telecom had to go through Senao.

Responding to the lawmaker’s claims, Yeh said that earlier this month he had been walking in the mountains north of Taipei with friends before they decided to invite him to have dinner at a local tourist farm run by Lin. He had not been aware of the event beforehand, and the occasion had not been lavish, the minister said, adding that he was not in the habit of celebrating birthdays.

Yeh explained that he had wanted Chunghwa Telecom to raise its stake in Senao because at present, the latter had distribution rights which prevented the telecom group from making more money selling handsets. He said he had called a meeting between the interested parties to discuss the case. The talks reached the conclusion that Chunghwa Telecom should buy more shares in Senao, but not at an inflated price, Yeh told reporters.

Tsai said that Yeh called Lee to his office last July 10 and told him to draw up a plan within two weeks to double Chunghwa Telecom’s holding in Senao to more than 50 percent. However, after several meetings, the Chunghwa Telecom chief still did not reach a decision because of the high amount of money involved and because of questions surrounding the deal, Tsai said.

A meeting with Lin on July 24 still did not result in a breakthrough, but the fact that the potential buyer of shares had to call a meeting with the potential seller showed how far the Senao president’s influence reached, according to Tsai.

When no progress had been made by last December, Yeh told Lee to retire, the lawmaker said.

The minister hinted that the allegations against him might be related to the recent controversial appointment of former Taiwan Semiconductor Manufacturing Co., Ltd. CEO Rick Tsai as the new chairman of Chunghwa Telecom.

The new accusations came as the ministry was embroiled in the controversy surrounding the eTag electronic freeway toll collection system amid accusations of overcharging. President Ma Ying-jeou even ordered the ministry to apologize for the system’s problems.

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