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Cablegate: Taiwan Telecom: Ncc Crisis Averted?

VZCZCXRO5909
RR RUEHCN RUEHGH RUEHVC
DE RUEHIN #0099/01 0181010
ZNR UUUUU ZZH
R 181010Z JAN 08
FM AIT TAIPEI
TO RUEHC/SECSTATE WASHDC 7955
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC

UNCLAS SECTION 01 OF 02 TAIPEI 000099

SIPDIS

SENSITIVE
SIPDIS

STATE FOR EAP/RSP/TC AND EEB
STATE PASS TO AIT/W FOR RICK RUZICKA
STATE PASS TO USTR FOR DAVID KATZ AND CHRIS WILSON
COMMERCE FOR ITA/OPB BRENDA CARTER-NIXON

E.O. 12958: N/A
TAGS: ETRD ECON ECPS TW
SUBJECT: Taiwan Telecom: NCC Crisis Averted?

Reftel: 2007 Taipei 2370

Summary
-------

1. (SBU) On December 20, 2007--the day before the end of the
Legislative Yuan (LY) session--the LY reached a compromise between
KMT and DPP legislators and passed an amendment to the National
Communications Commission (NCC) Organization Law. The amendment
provides a legal basis for the authorities to appoint new
Commissioners if the current seven Commissioners resign from office
at the end of January. Encouraged by the amendments and the new,
larger KMT majority in the LY, the seven current NCC Commissioners
are now considering staying on until their terms expire in December
2008. End summary.

Background
----------

2. (SBU) The National Communications Commission (NCC) is an
independent body established in February 2006 to regulate the
telecommunications and broadcasting industries. It is modeled after
the U.S. Federal Communications Commission. Shortly after it was
established, however, the future of the Commission was put in doubt
as political bickering ensued over how much control the Executive
Yuan (EY) would have to appoint Commissioners. As originally
structured, Taiwan's main political parties nominated candidates for
the 13 NCC Commissioner spots in approximate proportion to each
party's respective seats in the LY, and candidates were then
confirmed by a panel whose members were also chosen by the LY
(reftel). As the bickering continued, four Commissioners either quit
or refused to take office, and in April 2007 the EY suspended two
Commissioners for alleged improprieties. There are currently only
seven serving Commissioners, the minimum needed to make
legally-binding decisions.

3. (SBU) Further complicating matters, in July 2006, Taiwan's
highest court ruled that the current Commissioner-selection process
was unconstitutional, since the EY has the exclusive authority under
Taiwan's constitution to appoint personnel in all administrative
agencies. To give the authorities time to amend the NCC
Organization Law, however, the court rules the current NCC
Commissioners could stay on with full powers until the end of their
three-year term on December 31, 2008. The seven serving
Commissioners--concerned about their ambiguous constitutional
mandate--collectively decided that they would resign at the end of
January 2008.

Public and Industry Pressure Spurs Compromise
---------------------------------------------

4. (SBU) Over the next year and a half, there was little progress
on the matter. Industry grew concerned that a lame-duck NCC could
halt television and radio license approvals and hamstring plans to
begin or expand satellite and wireless broadcasting in Taiwan.
Responding to these concerns, in December 2007, the speaker of the
KMT-controlled LY, Wang Jin-pyng, arranged negotiations between the
DPP and KMT, and on December 20, both sides reached a compromise for
amending the NCC Organization Law. Under the compromise, the
Premier would put forward nominations that the LY would then review
and approve.

Size Reduced to Seven, Term Raised to Four Years
--------------------------------------------- ---

5. (SBU) Under the amended Law, which will take effect on February
1, the number of Commissioners will be reduced from 13 to seven, and
Commissioners' terms in office will be extended from three years to
four, though the first group of Commissioners to be chosen under the
amended Law will have two-year terms. In addition, the Law
stipulates that Commissioners from the same political party cannot
hold more than three seats, and also allows serving Commissioners to
stay in office until successor Commissioners can be nominated and
approved under the aforementioned procedures.

Commissioners May Decide to Finish Terms
----------------------------------------

6. (SBU) The NCC could face a gap in operations if current
Commissioners resign as planned at the end of January 2008, since
the EY and LY will need at least several weeks to appoint new
Commissioners after the LY returns to work on February 1--although
if the new, KMT-dominated LY will not consider nominations by the
expiring Chen administration, this gap could last for the entire
three-month period until the new presidential administration takes
office. To avoid disruptions, LY Speaker Wang asked current

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Commissioners to stay on until new Commissioners are appointed. NCC
Commissioner and Vice Chairman Howard Shyr recently told econoff
that the seven current Commissioners are now considering this
request.

Comment
-------

7. (SBU) Although the debate over the selection of NCC Commissioners
has been highly partisan, the current Commissioners have worked
together in a relatively collegial manner. Industry, though, has
been highly critical of the NCC, charging at various times that the
Commission unfairly targets foreign firms and limits consumer choice
by capping cable TV rates. Despite this, we see it as a success
that both political parties found a way to move forward on this
issue, which if unsolved would have halted or delayed spectrum
allocation decisions and license approvals for importing or
upgrading broadcasting equipment (reftel). We will continue to stay
in close contact with current NCC Commissioners as they decide
whether to resign this month as planned or stay on until
end-December. End comment.

© Scoop Media

 
 
 
 
 
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