Taipei - Taiwan's Investment Commission has demanded that Chinese internet giant Alibaba withdraw from the island before Aug. 24 after local officials discovered the company registered its Taiwan branch as a Singaporean entity rather than a Chinese one.
The commission said the Chinese e-commerce giant will need to reapply for investment approval as a mainland entity, should it wish to maintain operations in Taiwan. Chinese companies face stricter regulations than other multinationals when investing in Taiwan due to the island's security concerns.
While Alibaba officials have said they complied with all local regulations when setting up its Taiwan unit in 2008, founder Jack Ma Yun said in a lecture to local students in Taipei on Tuesday that the group had not communicated well enough with local officials. He said the company will follow the rules if it needs to reapply to invest on the island.
Alibaba has also run into trouble with the authorities in China and the US over counterfeits sold on its websites, including Taobao, the Chinese version of eBay. In a white paper published online on Jan. 28, China's State Administration for Industry and Commerce said it held meetings with Alibaba officials to discuss the counterfeit issue last July.
SAIC said the discussions were held behind closed doors so as to not affect Alibaba's IPO in Sept. The white paper, however, was taken off the agency's website later.
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