Taiwan vows to close loophole to keep out Chinese video streaming firms

TAIPEI (CNA) — Taiwan’s government said Thursday it will not sit idly by and allow Chinese-run video streaming services to gain a foothold in the country by circumventing the law.

In a press release, the National Communications Commission (NCC) said Chinese companies in the over-the-top television (OTT TV) industry are not permitted to operate in Taiwan, under the Act Governing Relations between the People of the Taiwan Area and the Mainland Area.

The reported partnerships between such companies and Taiwan enterprises are an attempt to circumvent the law, the NCC said, adding that it will work to “ensure compliance.”

Specifically, the NCC said, it will coordinate with Taiwan’s Mainland Affairs Council, Ministry of Economic Affairs (MOEA) and Ministry of Culture to draft new legislation to close the loopholes being exploited by the Chinese companies.

The NCC’s statement came in the wake of a Liberty Times report the previous day, which said WeTV, a video on demand platform owned by the Chinese conglomerate Tencent, was selling membership deals on Taiwanese shopping websites and buying outdoor advertising in Taipei.

Another Chinese online video platform iQiyi has been offering streaming services via a Taiwanese contractor, the report said, noting that the MOEA in 2013 rejected an application by iQiyi for direct investment in Taiwan.

Also commenting on the issue, Cabinet spokesperson Kolas Yotaka said Thursday that the Chinese firms and Taiwanese contractors were skirting “the edges of the law,” and taking advantage of the free flow of information in democratic countries like Taiwan.

The Taiwan government, however, “will not sit idly by” and allow Chinese companies to enter Taiwan by such means, as that would be a “breach of democracy,” Kolas said.

She said the government is planning to enact or amend legislation to address the issue, while at the same time considering the rights of customers who may have already purchased the OTT TV services.

In an interview in March, acting NCC Commissioner Chen Yao-hsiang (陳耀祥) said legislation to regulate domestic and international OTT TV services was likely be submitted to the Legislature by the end of July.

On Thursday, the NCC said the proposed legislation was still in the planning stages, following consultations with communications experts on Feb. 12.