Reuters reports today that the Taiwanese government will not consider China Mobile’s planned purchase of a 12 percent stake in local mobile operator Far EasTone until a current ban on Chinese investment in Taiwan’s telecoms industry is lifted. Telecoms is not on the initial list of Taiwanese industries that allow Chinese investment following the recent thawing of relations between Beijing and Taiwan. However, Emile Chang, deputy executive secretary of the Investment Bureau at Taiwan’s Economics Ministry, told Reuters: “If [the category] is open in the future, then we will accept and examine this case if they apply to us for approval.” The report adds that analysts are predicting that the telecoms category could soon be included if the two countries continue to strengthen their relationship.  

China Mobile, the world’s largest mobile operator by subscribers, announced last week that it would buy its stake in Far EasTone for TWD17,773.6 million (US$527 million), and enter into a strategic alliance covering “joint purchases, roaming, data and value-added businesses and network and technology advancement.” Far EasTone chairman Douglas Hsu noted later in the week that he would seek approval for the deal after the company’s annual general meeting next month and is aiming to close the deal by the fourth quarter of the year. Commenting on the ban on Chinese telecoms investment, Hsu argued that China Mobile would purely be an investor in the operator and would not seek to take management control.