What It Covers?
- According to Reuters, the company could be fined up to T$25 million (US$813,749).
- Foxconn disclosed in July it was a shareholder in Chinese chip conglomerate Tsinghua Unigroup and said it would sell the stake on Friday.
- Tsinghua Unigroup holds a considerable hold on the stock market. It is listed on the Shenzhen Stock Exchange.
Taiwan and the US are the watchdogs in China’s domination of the global semiconductor industry by flouting the rules.
For rule-flouters, the best recourse action would be to tighten the noose of their operations. If the intent is killed in the process, it is not a total loss. The rules become stringent in this context.
Foxconn Technology Group is the largest electronics contract manufacturer- but recently, they came into the crosshairs with the Government of Taiwan. As a result, this conglomeration faces a heavy penalty for unauthorized investment in a Chinese chip maker.
Foxconn wants to acquire chip plants globally as a worldwide semiconductor shortage rattles producers of goods from cars to electronics. In addition, it is keen to make car chips as it expands into the electric vehicle market. This firm is also a famous Apple supplier and iPhone maker.
The Taiwan Government issued a statement saying that it would likely fine Foxconn. This government requires or expects approval for all the ‘outbound’ investments.
This step was amiss in the above matter.
The deal was not reached.
Taiwanese law states the government can prohibit investment in China “based on the consideration of national security and industry development.” Violators of the law can be fined repeatedly until corrections are made.
Taipei City restrains companies from building their most advanced chip foundries in China to ensure they do not site their best technology offshore.
Some sources may have been offended when they mentioned that Taiwan’s relations with China suffered a fracture.