Cross-strait invest pact effective by year-end: official
The China PostBy Camaron Kao--Vice Economics Minister Bill Cho (卓士昭) stated that a cross-Taiwan Strait investment protection pact is expected to take effect by the end of this year after ratification in the Legislative Yuan.
August 4, 2012, 12:11 am TWN
The pact is to be signed on Aug. 9, Mainland Affairs Council (MAC) head Lai Shin-yuan (賴幸媛) said.
According to Lai, the pact will provide new channels for settling disputes and assure Taiwanese investors' personal safety when doing business in China.
Lai said the agreement will be a big help to Taiwanese businesspeople, who have been vulnerable in disputes with Chinese companies or the mainland government because they can only seek arbitration in line with China's judicial procedures.
In the future, she said, the new mechanism will enable person-to-person disputes, between private Taiwanese and Chinese companies, for example, to seek arbitration in either Taiwan or a third country agreed upon at the time a contract is signed.
Though the inclusion of a person-to-person arbitration mechanism is not common in similar international investment agreements, it is significant for Taiwan because about 65 percent of business disputes between Taiwan and China fall into the category, according to the MAC.
The mechanism gets around one of the main stumbling blocks that was holding up the agreement, which was Beijing's refusal to accept the use of an international arbitrator to settle disputes because that would tacitly acknowledge Taiwan's sovereignty.
As for commercial disputes between private businesses and governments (P2G), the investment pact will outline multiple remedies with different levels of mediation, it said.
A government-to-government (G2G) settlement, meanwhile, will be dealt with based on the existing Economic Cooperation Framework Agreement (ECFA), council officials said.
Lai said the investment pact will also cover personal safety, another concern of Taiwanese businesspeople operating across the Taiwan Strait.
Under the new plan, if Taiwanese investors are arrested in China, their family members are to be notified of their whereabouts within 24 hours of their arrest.
Some exceptions exist, however, as China's newly amended criminal litigation law stipulates that authorities do not need to inform family members of arrests of suspects involved in national security issues and terrorist acts.
The investment pact, along with a cross-strait customs cooperation agreement, will be signed during the eighth meeting between Straits Exchange Foundation (SEF) Chairman Chiang Pin-kung and his Chinese counterpart, Chen Yunlin, president of the Beijing-based Association for Relations Across the Taiwan Straits.
Originally scheduled to take place in the first half of this year, the meeting was postponed, as a consensus on the investment pact had not yet been reached.