Image Source : China Visual
BEIJING, January 20 (TMTPOST) Hon Hai Precision Industry, the parent company of Foxconn, announced on Thursday evening that it had been fined NT $10 million ($329,135) by Taiwan's Investment Review Commission for investing in a mainland Chinese chip firm Unigroup without approval from the commission.
Hon Hai said in the statement that because Unigroup's stake was indirectly invested through Xingwei (Guangzhou) Industrial Investment Partnership (Xingwei Fund), and the fund's investment management and operation were decided by the fund manager instead of Hon Hai, there was no deliberate breach of regulations. Hon Hai also said the fine was only 0.00015 percent of its 2022 revenue, so it would not have a big impact.
Hon Hai had violated Taiwan's regulations on relations between the two sides of the Taiwan Straits by acquiring Unigroup shares through a multi-layered framework without the approval of the Commission, according to a statement issued by Taiwan's Ministry of Economic Affairs on Thursday evening,
Given that Hon Hai took the initiative to dispose of Unigroup's equity on December 16, 2022, and there is no concern about technology outflow, there is a slight impact on the local economy.
In addition, Hon Hai was willing to cooperate during the investigation period and invested NT $20.4 billion ($671 million) and created 7,943 jobs in Taiwan within three years. The company also committed to continuing investment in Taiwan from 2023 to 2024, including an investment of NT $ 6.691 billion ($220 million) to set up a research and development center, an investment of NT $ 4.868 billion ($160 million) in new equipment, and NT $ 3.392 billion ($111 million) in research and development expenses, and 1,515 new hires.
Therefore, Taiwan authorities decided that the fine can be reduced to only NT $ 10 million ($329,135).
On July 11, 2022, Hon Hai announced that its mainland subsidiary Industrial Fulian planned to invest 5.38 billion yuan ($793 million) to indirectly acquire shares of Unigroup Group. Taiwan's economic department then stepped in to review the investment.
