VZCZCXRO9554
RR RUEHCN
DE RUEHIN #0596/02 0580942
ZNR UUUUU ZZH
R 270942Z FEB 06
FM AIT TAIPEI
TO RUEHC/SECSTATE WASHDC 8712
INFO RUEHBJ/AMEMBASSY BEIJING 4730
RUEHUL/AMEMBASSY SEOUL 7622
RUEHKO/AMEMBASSY TOKYO 7454
RUEHCN/AMCONSUL CHENGDU 1066
RUEHGZ/AMCONSUL GUANGZHOU 9001
RUEHHK/AMCONSUL HONG KONG 5925
RUESLE/AMCONSUL SHANGHAI 8398
RUEHSH/AMCONSUL SHENYANG 4986
RUCPDOC/DEPT OF COMMERCE WASHDC

UNCLAS SECTION 02 OF 03 TAIPEI 000596 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR EAP/RSP/TC AND EB/CIP, STATE PASS USTR FOR 
WINELAND, WINTERS AND STRATFORD, USDOC FOR 
4431/ITA/MAC/AP/OPB/TAIWAN/MBMORGAN 
 
E.O. 12958: N/A 
TAGS: ETRD ECPS TW
SUBJECT: NCC UP, BUT CAN IT RUN? 
 
 
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* Missing Section 001 * 
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TAIPEI 00000596  002 OF 003 
 
 
for concern is that of the four originally nominated 
commissioners with telecom expertise, three have resigned, 
leaving TSU-nominated Hsieh Jin-nan as the only remaining 
commissioner with a telecom industry background.  Press 
accounts suggest Hsieh has been under some pressure to resign 
as a sign of solidarity with his Pan-Green colleagues, but he 
has thus far refused to do so. 
 
¶6.  On February 22, the Commission had its first official 
meeting, unanimously choosing KMT-nominated Su Yeong-chin as 
Chairman.  DPP-nominated Shi Shi-hao and PFP-nominated Liu 
Zong-de were unanimously selected as vice-chairman.  Su 
denied accusations that there was a pre-arranged deal to 
allow each group a leadership role and in a nod to critics of 
the nomination process, said the NCC's most important task 
was to first establish its credibility.  Su reaffirmed his 
desire to see the NCC operate independent of political 
pressures but estimated that it could take more than a year 
for the NCC to become an effective independent regulatory 
body. 
 
¶7.  The NCC will oversee the operations of the Directorate 
General of Telecoms (DGT) and sections of the Government 
Information Office (GIO) responsible for broadcast 
regulations and licensing.  However, it is still unclear how 
the lines of authority will be drawn and there are certain to 
be difficulties in melding the work cultures of these two 
very different offices.  According to DGT, there are plans to 
house all NCC staff in one building, but there are 
disagreements over the location and layout of the future 
office. 
 
============================================ 
The Grand Justices Still Hold the Trump Card 
============================================ 
 
¶8.  The Council of Grand Justices was expected to rule on the 
constitutionality of the NCC as early as February 17 but 
Judicial Yuan officials speaking to the press refused to 
predict when a decision might be forthcoming.  The officials 
pointed to the potential impact of the interpretation and 
suggested the issue needed further study and discussion 
before the Justices would be make any decision.  If the Grand 
Justices rule that the NCC law violates the power of the 
Executive Yuan to appoint commissioners, the current NCC 
would become invalid and the LY would presumably have to 
reconsider the nomination and review process. 
 
================================= 
Local Business Grasping at Straws 
================================= 
 
¶9.  Despite the political uncertainty and questions about the 
NCC's credibility, many in the local broadcast community 
expect that the Commission will have a quick and positive 
impact on the clarity of broadcast and telecom regulations 
and the operating environment in Taiwan.  At an 
AmCham-sponsored seminar on digital convergence February 22, 
comments from cable operators and content providers were 
almost uniformly positive expressions of confidence and 
optimism.  "No matter what, it has to be better than GIO," 
said one media company executive.  Telecom experts were more 
cautious in their assessments, noting the political battles 
that surrounded the establishment of the Commission concerned 
media issues and that most commissioners with telecom 
expertise have already resigned.  Both groups expected the 
Council of Grand Justices would try to find a way to stay out 
of the controversy as much as possible, even if that meant 
delaying a ruling on the constitutionality of the law 
indefinitely. 
 
==================================== 
Comment: Unclear future is no future 
==================================== 
 
¶10.  The establishment of the NCC has been torn by political 
infighting from the beginning.  Given the advantages of the 
Pan-Blue parties in appointing commissioners and the 
subsequent resignation of most of the ruling-party nominated 
commissioners, it is hard to see how this body will be able 
 
TAIPEI 00000596  003 OF 003 
 
 
to establish its credibility as an independent and 
non-partisan regulator in the near future.  The resignation 
of most of the commission's telecom expertise is also a 
worrying sign for the telecom industry as they face digital 
convergence and competition from cable operators.  Finally, 
the Council of Grand Justices continues to hold the sword of 
Damocles over the head of the newly formed commission by 
delaying a decision on the NCC's constitutionality.  This 
continued uncertainty will not help the NCC's efforts to 
establish its legitimacy and will make it more difficult for 
local industry to move ahead with long-term plans to prepare 
for digital convergence.  End Comment. 
KEEGAN