VZCZCXYZ0004
PP RUEHWEB

DE RUEHIN #1142/01 2180515
ZNR UUUUU ZZH
P 050515Z AUG 08
FM AIT TAIPEI
TO RUEHC/SECSTATE WASHDC PRIORITY 9662
RHMFIUU/USCBP WASHINGTON DC PRIORITY
RHEBAAA/DEPT OF ENERGY WASHINGTON DC

UNCLAS AIT TAIPEI 001142 
 
SENSITIVE 
SIPDIS 
 
STATE FOR ISN/ECC - YWONG, ACHURCH, AND ROWEN 
STAE ALSO FOR EAP/TC - SBREMNER 
CBP/INA FOR DKING 
DOE FOR ENERGY/NNSA FOR TPERRY AND SJONES 
 
E.O. 12958: N/A 
TAGS: ETTC MNUC PARM PREL KSTC KNNP TW
SUBJECT: EXBS: TAIWAN MONTHLY REPORTING CABLE - JULY 2008 
 
¶I.  BROAD ITEMS OF INTEREST TO ADVISORS AND AGENCY MANAGERS: 
 
¶A. (SBU) Transfer of Intangible Technology Legislation:  On July 20, 
the Advisor learned that the Executive Yuan (EY) withdrew twelve 
bills submitted by the former administration, including the proposed 
Sensitive Technologies Protection Law. 
 
(SBU) According to an official from the National Science Council 
(NSC), the withdrawn technology transfer bill is the one that was 
originally proposed six years ago and revised several times since 
then.  The NSC was notified by the EY of its intent to withdraw the 
bill before the public announcement in July.  The official stated 
that withdrawal of pending legislation is standard procedure when a 
new administration takes office. 
 
(SBU) The official explained that, for several months, the NSC has 
been working closely with the Legislative Yuan (LY) to draft new 
legislation which will be reviewed and approved by relevant agencies 
such as the Ministry of Economic Affairs (MOEA) prior to being 
submitted to the LY for passage. 
 
The NSC official did not give a timeframe for submitting the 
legislation but predicted that the process for passage would be 
smoother this time around. 
 
¶B. (SBU) In late June and early July, several newspapers reported 
that Taiwan would consider allowing 12-inch wafer fabrication 
investment by Taiwan companies in China.  The newspapers reported 
that the relaxation of investment restrictions would occur in the 
fall.  The Advisor contacted the Bureau of Foreign Trade (BOFT) and 
the Industrial Development Bureau (IDB) of MOEA, and the NSC to 
confirm the news reports.  Officials from all three offices stated 
that the news reports were premature and that Taiwan officials have 
not had interagency meetings to discuss the issue.  In fact, IDB 
official stated that his office held one intra-office meeting to 
date to discuss increasing the wafer fabrication investment in 
China.  The IDB official did indicate that Taiwan is moving in that 
direction.  He explained that "core technology" would remain in 
Taiwan; that the move will increase Taiwan companies' 
competitiveness in China; and that the relaxation would follow the 
international trend in semiconductor manufacturing while adhering to 
Wassenaar Arrangement controls of dual-use items. 
 
(SBU) None of the officials were willing to provide information on 
specific implementation plans or a timeline. They all stated that 
the process has several bureaucratic layers it must go through 
before reaching the EY, and that the process has not yet begun. 
Also, the officials stated that any change related to wafer 
fabrication investment would require LY approval. 
 
II. COMPLETED ACTIONS FOR THE REPORTING PERIOD. 
 
¶A.  SITE ASSESSMENTS AND MEETINGS DURING REPORTING PERIOD: 
 
(SBU) On July 31, the Advisor attended the Keelung Field Practice on 
International Ship and Port Facility Security Disaster Prevention 
organized by the Keelung Harbor Police.  Sixteen offices 
participated in the exercise including the Customs, the Harbor 
Police, the Harbor Bureau, the National Police, the Coast Guard, and 
the Ministry of National Defense.  The half-day exercise simulated 
land, sea, and air rescue of a hostage situation, decontamination of 
hazardous material, and controlled detonation of explosives detected 
through mobile VACIS scanner.  The observations from this exercise 
will be used to customize an upcoming EXBS HAZMAT Response training 
program. 
 
¶B.  BLUE LANTERN: 
 
No checks were conducted by the Advisor during the reporting period. 
 
 
III. TRAINING CONDUCTED DURING REPORTING PERIOD: 
 
¶A. (SBU) From July 8-10, the Advisor participated as a technical 
expert in an EXBS-funded U.S.-Vietnam program on Strategic Trade 
Control Licensing.  Vietnam is beginning to develop a system to 
control exports of strategic items.  Due to its growing investment 
in Vietnam, Taiwan is interested in sharing its export control 
systems development experience with Vietnam, especially in the area 
of industry outreach, as Vietnam is developing its own system. 
 
¶B. (U) From July 23-24, the EXBS held an Industry-Government 
Outreach Program in Taipei.  Forty-five industry and 15 Taiwan 
official representatives attended the training.  The attendees had 
an opportunity to view the internal control program (ICP) baseline 
software and get an update on Taiwan-specific ICP software 
development by BOFT and CTP, the State Department contractor that is 
leading the software development.  The ICP was enthusiastically 
received by company representatives.  Currently, Taiwan-specific 
software development is expected to be completed by December 2008. 
The software will be internet-based and hosted by BOFT on its 
website. 
 
III. UPCOMING TRAINING: 
 
¶A. (SBU) From August 6-7, along with an official from ISN/CTR, the 
Adviso 
r will provide an update to Singapore  interagency officials 
on changes to the Wassenaar Arrangement control list and U.S. 
implementation of those changes.  This is the same update provided 
to Taiwan officials in March.  Also, Taiwan is looking for 
opportunities to engage Singapore so that Taiwan can have a better 
understanding of how Singapore implements transit and transshipment 
controls of strategic items.  Transit and transshipment controls is 
an area of export controls that Taiwan is continuing to develop. 
 
¶B. (SBU) On August 18, the EXBS Advisor will review South Korea's 
Yestrade, an internet-based license processing and internal control 
system, along with a State Department official from ISN/ECC.  Since 
South Korea is a few steps ahead of Taiwan in setting up internal 
controls for companies and industry-government relations, Taiwan is 
interested in learning about Korea's experience in working with 
companies to set up internal controls. 
 
¶V. UPCOMING MEETINGS: 
 
(SBU) The Advisor is in the process of setting up meetings with 
officials from the Taiwan External Trade Development Council 
(TAITRA) to discuss Taiwan's trade missions to North Korea and 
Burma. 
 
VI. RED FLAG ISSUES: 
 
None. 
 
POC for this report is Mi-Yong Kim, EXBS Advisor.  Telephone +886 2 
2162 2347. 
 
YOUNG