Bill seen easing way for Starlink's entry passes Legislative Yuan

Taipei, July 21 (CNA) An amendment to the Telecommunications Management Act passed by the Legislative Yuan on Tuesday will ease restrictions on foreign ownership of certain telecommunications service providers, potentially paving the way for U.S.-based satellite communications provider Starlink to enter the Taiwan market.

The amendment cleared its third reading without a vote after lawmakers from the ruling Democratic Progressive Party (DPP), the main opposition Kuomintang (KMT), and the Taiwan People's Party (TPP) reached a consensus. Under Taiwan's legislative procedures, the bill was read aloud on the legislative floor to formally mark its passage.

The revised rules state that applicants seeking to establish telecommunications network operators using satellite communications technology will be exempt from existing foreign ownership limits and the requirement that the company's chairperson be a Republic of China (Taiwan) national.

Article 36 of the Act currently prohibits foreign investors from directly owning more than 40 percent, or indirectly owning more than 60 percent, of a telecommunications service provider. It also requires the company's chairperson to be a national of the Republic of China.

The amended law allows foreign satellite-based telecommunications operators to be exempt from those restrictions under certain circumstances, including when such exemptions would not pose a threat to national security and would promote industrial development and market competition.

The Legislative Yuan also adopted a supplementary resolution requiring the competent authorities to treat the installation of satellite ground receiving stations and onshore data localization as key considerations when implementing the new rules.

Local media have reported that the relaxation of the foreign ownership rules is intended to facilitate the entry of Starlink, the satellite internet service operated by Elon Musk's SpaceX.

KMT lawmaker Huang Chien-hao (黃健豪) said Taiwan relies heavily on submarine cables for international communications, while domestic communications depend primarily on terrestrial base stations and fiber-optic networks.

Introducing a low Earth orbit (LEO) satellite communications system would complement the existing communications infrastructure and help ensure secure and reliable communications during emergencies, Huang said.

DPP lawmaker Lin Chun-hsien (林俊憲) said the current law has made it difficult for international companies with mature satellite technologies to enter the Taiwan market.

The restrictions on foreign ownership have limited the diversification of Taiwan's communications infrastructure and undermined the country's national resilience, Lin added.

However, Minister of Digital Affairs Lin Yi-jing (林宜敬) said last week that to his knowledge, Starlink has not been actively pursuing the Taiwan market because the company believes Taiwan's 4G and 5G population coverage has already reached 99.9 percent, limiting commercial opportunities.