text:
Band B 15%
This country is placed in Band B
Taiwan is placed in Band B, with robust controls against corruption across risk areas. Robust frameworks for oversight combine with clear evidence of efforts to ensure a strong ethical culture. Taiwan is placed in Band A for Personnel risks. Operations and Procurement Risk scored in Band C. The role of the recently established Ethics Office is highlighted in the research as is the clear leadership commitment to anti-corruption efforts. The procurement framework is generally robust, though is impacted by Taiwan's difficult international position.The Taiwanese Government completed a government review of the GI 2015 research, which shows a willingness to open dialogue with an international NGO on defence corruption issues.
Strengthening oversight
Taiwan's has high levels of military expenditure compared to many in the region (per capita using SIPRI data); effective oversight over spending is therefore essential. Taiwan scores top marks for the quality of external audit. The management of disposed military property is under layered control and oversight within the MND, and results are published and easy to access. Although there may be some occasional shortcomings in implementation there is good evidence that these are being identified by the Control Yuan. The quality of public debate and oversight is generally high, but more effective Parliamentary scrutiny over the defence budget and procurement decision-making, even if some very specific details are limited to closed door briefing, is particularly important given overall constraints of Taiwan's international position. The Foreign Affairs and Defence Committee in the Legislative Yuan with general support from the Budget Centre is responsible for reviewing the Annual Defence Budget Proposal in the Legislative Yuan, but program details in the Budget Proposal are currently insufficient for the legislators' effective scrutiny and more effective scrutiny over significant secret budgets is also important. There is also some question marks over the power of the Legislative Yuan to influence decision-making in practice. Government efforts to encourage whistleblowing are commendable and we strongly support moves to improve Whistleblower protections.
Increasing public dialogue for good governance
Public debate on defence issues is frequent in academia, and some events are funded by the government of Taiwan but public engagement in defence policy could nonetheless be strengthened. The role of external organisations could play a more catalytic role in the formulation of Taiwan's National Defence Report and Quadrennial Defence Review. The MND consults scholars and legislators on an ad hoc basis, but there was little example of significant two way debate over major issues of defence policy.
Several incidents, including army soldier Hung's death in July 2014 and AH-64E helicopter classified photos in FB in March 2015, indicate an institutional inclination towards cover-up within the military tradition. Although the MND has taken drastic measures to reform, genuine and effective external oversight is also needed to ensure a genuine transparency and restore public confidence in the defence and security sector. Civil society's participation, such as sitting in the MND anti-corruption committee, is recommended.
Strengthening the procurement anti corruption framework
Procurement is characterised by a solid institutional framework and acquisition planning process. The military has a rigorous acquisition planning process, with some very strong oversight mechanisms and peer review processes. They are however all internal, with public information about the planning information limited due to the concerns over the sensitive nature of the force capability buildup and combat readiness. Oversight mechanisms for procurement should also extend to the entire acquisition planning process.
Most of U.S. arms sales to Taipei are processed through Foreign Military Sale (FMS) procedure, under which, the U.S. military bear the project management responsibilities. High levels of single-sourcing are understandable given restricted numbers of willing suppliers. But further steps might be possible to reduce corruption risks. Import Procurement Officers & Foreign Military Sales Liaison Officers have been used to good effect in South Korea to investigate products and prices, to ensure no facilitation payment takes place in the form of over-payment, and ensure competition regulation is enforced. Similarly, current requirements for bidding companies, whether foreign or domestic, appear to impose little in terms of compliance programmes about anti-corruption commitments, although the Government Procurement Act does prohibit the bidding of companies involved in bribery for three years.
Increasing offset regulation
Given the restrictions on options for arms imports, offsets are becoming a priority in Taiwan as the nation seeks to develop its domestic industry. The MND Industrial Cooperation Program aims to obtain 40 percent offset for every foreign arms deal valued above 5 million US dollars, with 60 percent of the offset quota used to bolster local defence industries (direct offset). But mechanisms against corruption risk could be improved.
In theory, Taiwan has an independent Legislative Yuan (LY) to monitor defence policies and approve related programs including arms procurement. In practice legislative scrutiny is not sufficiently strong however, and is somewhat limited by the decision of the Executive branch, since a perception exists that the legislators lack experienced staff in providing professional advice. Only 4 (3 Kuomintang, 1 Democratic Progressive Party) out of 14 legislators members of Committee of Foreign Affairs and National Defence Government have staff who are either military-background or have working experiences in national security-related ministries.
Information is not always sufficiently transparent to enable effective scrutiny, and this is a heightened source of concern on issues relating to sensitive and major foreign arms deals. For example, the details of classified budget are only available to legislators themselves (not including their staff) and civil servants in the LY Budget Research Center during a confined period of time (the session of budget review) and at the assigned location.
Furthermore, the role of the LY is rather inactive. By law, the legislators cannot proactively increase the proposed budget submitted by the executive. The legislators may draft or amend a law, however in practice, the legislation process will often begin after the submission of the counter version from the executive. The amendment of Service Punishment Act currently under legislative review is one example of this.
Response to Government Reviewer:
The Government Reviewer has pointed to concrete evidence of the LY influencing the defence budget, including 27 cases in 2012 and 2013 in which budget proposals with NT$ 1,213 million were frozen or cut by the LY. However legislators can only cut or freeze proposals and have no authority to "amend" the proposals. The total sum of NT 1,213 million dollars cited by the Government Reviewer also represents less than 0.2 percent of MND's proposed budget. In addition, a lack of detailed transparent information covering all aspects of defence policy, including on the budget proposal and intelligence operations, also affects the quality of legislative scrutiny. Finally, legislators need more support from professional staff with relevant experience in order effectively exercise oversight. Score maintained.
National Defence Act, 2000, Article 30, 31. Available at: http://law.moj.gov.tw/LawClass/LawAll.aspx?PCode=F0010030
Law Governing the Legislative Yuan`s Power, Chapter 2, 4, 8, 9, 10.
"In the Wake of Hung Case, Large-scale Emendation the Service Punishment Act Initiated Today," United Daily, May 19, 2014
Taiwan's Ministry of National Defence, &quoute;2013 Quadrennial Defence Review&quoute;, http://qdr.mnd.gov.tw/file/2013QDR-en.pdf
David Shambaugh (1996). &quoute;Taiwan's Security: Maintaining Deterrence Amid Political Accountability&quoute;,
The China Quarterly, 148, pp 1284-1318, esp. pp. 1288-1293
Michael D. Swaine (1999), &quoute;Taiwan's National Security, defence Policy, and Weapons Procurement Processes&quoute;, RAND monograph reports, http://www.rand.org/pubs/monograph_reports/MR1128.html
Comment: The primary objective of Taiwan national defence policies is to build a &quoute;Hard ROC (Republic of China)&quoute; defence force. And, it has clearly stated in the latest National defence Report and 2013 Quadrennial defence Review (QDR). Furthermore, based on the National defence Act, the defence Minister is required to present those reports to the Foreign & defence Affairs Committee of Legislative Yuan (Taiwan Congress) along with several different sub-reports, such as reports on force-planning, combat readiness and the Mainland China's Security threats against Taiwan, etc. Legally, the committee of LY has fully authority to scrutinize and challenge these reports, and, sometimes it could be used as rationales to cut, amend and freeze the MND's defence budget proposal. In 2012 and 2013, a total of 27 cases' budget proposals with NT$ 1,213 million were frozen or cut by the LY.
Comment: Also see: Ching-Pu Chen, 'Defence Policy making and Civilian Roles', in Edmonds, M. and Tsai, M. (eds) &quoute;Taiwan's defence Reform&quoute; (New York: Routledge, 2006)
David Shambaugh (1996). &quoute;Taiwan's Security: Maintaining Deterrence Amid Political Accountability&quoute;, The China Quarterly, 148, pp 1284-1318, esp. pp. 1288-1293
There is Foreign Affairs and Defence Committee in the LY. Some 60 meetings are held in the Committee every year. Currently, 14 legislators are in the Committee. The Budget Centre, a component unit in the LY, provides general governmental budget reviews to legislators. Section 2 in the Budget Centre, staffed by 6 civil servants, is responsible for providing defence-related budget advice. The politicians in the Committee are not always equipped with sufficient professional staff however nor is there any readily available evidence that they try to work with non-governmental organisations in implementing effective scrutiny. There is no readily available evidence of a public hearing being initiated by the Committee in 2013.
In the CY, each office is manned by only 2 staff (excluding one administrative staff) without Budget Centre unit support, and only 4 (3 Kuomintang, 1 Democratic Progressive Party) out of 14 legislators members of Committee of Foreign Affairs and National Defence Government have staff who have either military-background or have work experiences in national security-related ministries. There is though no other evidence to suggest the quality of oversight is lacking, so the score has been increased to 3.
"Organic Law of Committees of the Legislative Yuan," Article 10, 15.
Legislative Yuan website:
http://www.ly.gov.tw/02_introduce/0204_comm/business/businessFolderList.action?comtcd=35&id=5013&itemno=02083500&folderType=C
Control Act, Articles 2, 24, 25, 26, http://www.cy.gov.tw/ct.asp?xItem=3139&ctNode=1734&mp=21
- Enforcement Rules of the Control Act, Article 19, http://www.cy.gov.tw/lp.asp?ctNode=1734&CtUnit=240&BaseDSD=7&mp=21
- Statistics on Exercise of Control Powers, http://www.cy.gov.tw/np.asp?ctNode=871&mp=1
- http://law.moj.gov.tw/LawClass/LawAll.aspx?PCode=A0020058
Ching-Pu Chen, 'Defence Policy making and Civilian Roles', in Edmonds, M. and Tsai, M. (eds) &quoute;Taiwan's defence Reform&quoute; (New York: Routledge, 2006)
Cole, B.D., &quoute;Taiwan's Security: History and prospects&quoute; (New York: Routledge, 2006), pp150-1
Evidence of hearings in 2015:
The China Post, &quoute;defence Ministry still hoping for delivery of US Perry-class frigates&quoute;, October 10, 2015, http://www.chinapost.com.tw/taiwan/national/national-news/2015/10/15/448399/defence-Ministry.htm
Comment: The main responsible parliamentary authorities to exercise oversights on Taiwan defence and security affairs are the Foreign & Defence Affairs Committee of Legislative Yuan (LY) and The Defence & Intelligent Affairs Committee of Control Yuan (CY). In recent years, both committees have improved on their professional and measures to closely monitor all aspects of the government defence and security issues.
References added:
- Control Act, Articles 2, 24, 25, 26, http://www.cy.gov.tw/ct.asp?xItem=3139&ctNode=1734&mp=21
Two defence policy publications are publicly available: the annual National Defence Report and the Quadrennial Defence Review. Many scholars and experts are invited to participate in the drafting of these two publications. The Ministry of National Defence (MND) is also required to submit formal briefings on specific issues for legislative scrutiny. A press conference is held weekly and is publicly accessible from the MND website. Unlike the UK's Strategic Defence Review of 1998 however, the role of external organisations in the formulation of Taiwan's National Defence Report and Quadrennial Defence Review is confined to assessors rather than catalysts of policy debate. The MND may consult scholars and legislators on an ad hoc basis, but, there is no significant public debate over major issues of defence policy. For example, there was no MND-supported conference or forum to publicly debate the introduction of Taiwan's so-called "volunteer service", the biggest defence policy change since 2008. Scholars conclude that the MND prefers to obtain support from legislators, scholars, journalists, and even non-governmental organisations than to debate with them.
Response to reviewers:
Although reviewers provide excellent evidence of the extent of public debate. Evidence of a formal consultation which informs defence policy would be required for a score of 3 to be awarded.
"National Defence Act," Article 30, 31.
Ministry of National Defence website: http://www.mnd.gov.tw/Publish.aspx?cnid=27
York W. Chen, "Examining Taiwan's QDR: Viewpoints from Civil-Military Relations," New Taiwan Society, Issue 27 (2013), pp. 32-41. (Original in Chinese)
Wu I-Nong, "Can the Love of Taiwan Be Able to Defend Taiwan: Thinking Taiwan's Defence Differently," Storm Media, 15 December 2013. http://www.stormmediagroup.com/opencms/review/detail/e23a53c1-7aa6-11e3-8f61-ef2804cba5a1/?uuid=e23a53c1-7aa6-11e3-8f61-ef2804cba5a1 (Original in Chinese)
Yuan-kang Wang, ''Taiwan Public Opinion on Cross-Strait Security Issues Implications for US Foreign Policy'', Strategic Studies Quarterly ♦ Summer 2013.
Jung-Ming Chang, ''Extended Deterrence and Taiwan's Public Opinion'', http://www.gvpt.umd.edu/irconf/papers/chang.pdf;
Brett V. Benson & Emerson M. S. Niou (2005), ''Public Opinion, Foreign Policy, and the Security Balance in the Taiwan Strait'', Security Studies, 14:2;
http://thediplomat.com/2014/05/the-transformation-of-taiwans-sunflower-movement/
Chen, YW and Edmonds, M., ''An overview of Taiwan's defence reform&quoute;, in Edmonds, M. and Tsai, M. (eds) &quoute;Taiwan's defence Reform&quoute; (New York: Routledge, 2006)
Cole, B.D., &quoute;Taiwan's Security: History and prospects&quoute; (New York: Routledge, 2006)
Comment: Both the National Defence Report and Quadrennial Defence Review (QDR) are critical windows on the transparency on defence policies. It not only expounds the regional security situation, defence strategy, force buildup and combat readiness preparations, but also allows the general public to examine and supervise the defence administration. Furthermore, evidence showed that debate on national defence issues among the administration, legislatures and the public are a daily, routine practice. Major defence policy issues are frequently discussed in the Legislative Yuan, media or open forums during the early stage of the decision-making process.
- Administrative Performance Report of the Ministry of National Defence in 2012, http://www.mnd.gov.tw/English/Publish.aspx?cnid=3669&p=60346
- National Defence Report, http://report.mnd.gov.tw/en/m/minister.html
- Quadrennial Defence Review, http://qdr.mnd.gov.tw/
- http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0010030
Comment: Despite limitations in the LY, Taiwan's defence policy is indeed publicly debated in a rather active manner. The impact of democratization and the de-partification of the Army has increased transparency.
Comment: Even if the public ''debate'' concerning national defence policy may be more reactive to critics than inclusive in its inception - as the assessor suggests - there is still a high level of influence exercised on the country's defence policy not only by the legislature, but also by the general public. Indeed, Taiwan has a politically active, passionate civil society that can influence the direction of the security policy through its votes, as it is the case in most democracies.
An example of this is the very fact that the two main political parties in Taiwan, the KMT and the DPP, often centre their campaigns around the most pressing security threat, namely the PRC. Another proof of the Taiwanese political activism is the recent Sunflower movement, a student-led protest concerning further economic integration with the Mainland.
Yuan-kang Wang, ''Taiwan Public Opinion on Cross-Strait Security Issues Implications for US Foreign Policy'', Strategic Studies Quarterly ♦ Summer 2013;
The MND works well with many pro-military non-governmental organisations, such as veteran associations. There were virtually no contacts between the MND and Transparency International Chinese Taipei (TI-CT), the leading anti-corruption civil society organisations before 2012. After 2012, the interaction intensified: 2 formal contacts in 2012; 7 in 2013, 2 before May 2014; 3 in total involving MND policy officials. The purpose of such contacts has gradually evolved from public relation-related to education and training. The MND sent students from military academies to attend TI-CT's youth integrity program and Rui-Bin Art & Character Education Camp. Furthermore, an educational lecture, supported by TC-CT, for senior officials will be conducted in June 2014. Even so, the MND attitude as to the possibility of local civil society participation in internal anti-corruption procedures remains conservative. When members of the local branch of Transparency International proposed to engage with the MND internal anti-corruption measures in the meeting with Minister Yen in September 2013, their proposal was politely rejected.
Response to Government Reviewer Peer Reviewer 1, and TI Chapter Reviewer:
Reviewers provide some excellent evidence demonstrating a change in the MND's approach in several aspects, particularly by the newly created Ethics Office's work with TI-Taiwan and independent academics. The commendable examples given warrant a score change to 3. This work though is still in the early stages and a higher score rests on the degree of scale and institutionalisation. To score a 4, evidence of input by CSOs on national strategy and other government planning would be needed - see for example Questions 3 and 6.
Transparency International Chinese Taipei, &quoute;2009-2013 年事記錄&quoute;
http://www.tict.org.tw/front/bin/ptlist.phtml?Category=100396
Transparency International Chinese Taipei, &quoute;「瑞濱藝術與品格教育營」融入品格及廉潔教育&quoute;. http://www.tict.org.tw/front/bin/ptdetail.phtml?Part=20140205&Rcg=100041
Transparency International Chinese Taipei, &quoute;瑞濱教育營參訪海軍168艦隊 全民國防向下扎根&quoute;, 24 January 2014. https://tw.news.yahoo.com/瑞濱教育營參訪海軍168艦隊-全民國防向下扎根-110600851.html
&quoute;嚴明接見臺灣透明組織協會成員 廣納專業建言&quoute;, Nownews Network, 16 September 2013. http://www.nownews.com/n/2013/09/16/926676
http://mna.gpwb.gov.tw/IndexDetail.aspx?id=66407
http://www.tict.org.tw/front/bin/ptdetail.phtml?Part=20140611&Category=100394
http://www.tict.org.tw/front/bin/ptdetail.phtml?Part=20130924&Rcg=100041
http://ethics.mil.tw/front/MediaList.aspx?menu=3af056026a6&mCate=3af05602754&publicID=139
Comment: After the results of &quoute;2012 Government defence Anti-Corruption Index&quoute; published by the Transparency International - defence Security Programme, Taiwan MND has shown its significant progress in openness towards civil society organizations. Experts or scholars of the TI-Taiwan have been received frequently by the MND in positive manners and been invited to participate in many activities, including to attend the high-level anti-corruption meeting, to engage and provide recommendations on improvement of anti-corruption practices within the defence community. It is not a one-step-leap effort to get rid of conservative attitude and make better engagement with the civil society organizations. Obviously, in pass one and half years, evidences have shown the MND's huge progress in many aspects.
- http://mna.gpwb.gov.tw/IndexDetail.aspx?id=66407
- http://www.tict.org.tw/front/bin/ptdetail.phtml?Part=20140611&Category=100394
- http://www.tict.org.tw/front/bin/ptdetail.phtml?Part=20130924&Rcg=100041
- http://ethics.mil.tw/front/MediaList.aspx?menu=3af056026a6&mCate=3af05602754&publicID=139
Government Update March 2015:
Interactions between Taiwan TI and MND are continuously expended to amid corruption fight. Activities have already reflected political strategy of pushing the military to address on anti-corruptions. Evidences have showed that defence community is more open towards the CSOs than it used to be, and, is willing to engage them on corruption issues.
- 台灣透明組織與國防部舉行國軍廉政制度改革會談, http://www.tict.org.tw/front/bin/ptdetail.phtml?Part=20130911&Rcg=100041
- 馬支部-國防部政風室古主任蒞本部實施國軍基層人員廉政巡迴講習, http://navy.mnd.gov.tw/Publish.aspx?cnid=2711&p=63999&Level=3
- 黃埔建軍90年的第一次:國際專家來台推動高階將領廉潔反貪教育, https://zh-tw.facebook.com/239147032797605/photos/a.429221857123454.97665.239147032797605/747203468658623/
- 廉潔軍風 降低國防貪腐風險, 國際透明組織專家指導召開廉潔教育工作坊, http://tict.niceenterprise.com/front/bin/ptdetail.phtml?Part=epaper20140630&PartPage=5
Comment: The turning point of connecting to independent civil society organisation is the creation of the Ethics Office on Jan. 1, 2013. Tawan's Ministry of National Defence (MND) has gradually shown positive attitude towards civil society on anti-corruption issues. Several steps have been taken by the newly established Ethics Office under the MND to work with TI-Taiwan and independent scholars on various occasions in 2013 and 2014.
1. Since the establishment of the MND's Ethics Office in 2013, the office has continuously visited TI-Taiwan on various occasions to exchange views and discuss the public/private partnership. http://tict.niceenterprise.com/front/bin/ptdetail.phtml?Part=20130604&Category=100394
2. Following the soldier Hung's death, the MND has sent senior officials of both the Civil Ethics Office and the Inspector General's Office on Sept. 5, 2013 to meet with TI-Taiwan in discussing the institutional reforms to prevent similar wrongdoings. This meeting was requested by TI-Taiwan in response to TI-DSP's inquiry.
3. Following the above-mentioned meeting, defence Minister Ming Yen met with TI-Taiwan board members and scholars on Sept. 16, 2013 to listen to comments and suggestions from civil society on reforming the military disciplinary system. http://www.tict.org.tw/front/bin/ptdetail.phtml?Part=20130924&Rcg=100041
4. The MND's Ethics Office has taken the initiative to invite Dr. Mark Pyman and Maj. Gen. David Cook of TI-DSP to give a lecture to 27 top generals in the MND on June 11, 2014 . The following day, both Dr. Pyman and Gen. Cook were invited to give a day-long anti-corruption workshop to 160 senior colonels at the National defence University. http://tict.niceenterprise.com/front/bin/ptdetail.phtml?Part=epaper20140630&PartPage=5
5. In 2014, the MND's Civil Ethics Office in partnership with TI-Taiwan has launched a series of workshops in the fields to promote integrity and anti-corruption measures. http://navy.mnd.gov.tw/Publish.aspx?cnid=2711&p=63999&Level=3
Comment: According to the description provided, score 1 is more appropriate.
Taiwan is diplomatically isolated and is not a member state in the UN. Thus, Taiwan is ruled out of becoming an UNCAC signatory. Due to political tensions with China, the situation is likely to remain in flux for the foreseeable future. Yet, the Taiwanese government is willing to comply with the principles of such conventions, such as criminalising/preventing corruption and bribery.
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UNODC website
https://www.unodc.org/unodc/en/treaties/CAC/signatories.html
OECD website
http://www.oecd.org/corruption/oecdantibriberyconvention.htm
Ministry of Justice, http://www.moj.gov.tw/ct.asp?xItem=336833&ctNode=31160&mp=001 and http://www.moj.gov.tw/public/Attachment/432014194535.pdf
http://www.moj.gov.tw/public/Attachment/432014194535.pdf
http://www.aac.moj.gov.tw/lp.asp?ctNode=30812&CtUnit=10788&BaseDSD=7&mp=290
http://english.president.gov.tw/Default.aspx?tabid=491&itemid=18708&rmid=2355
http://english.president.gov.tw/Default.aspx?tabid=1124&itemid=22024&rmid=3048
http://www.aac.moj.gov.tw/mp290.html
http://npl.ly.gov.tw/do/www/newRecord
http://www.loc.gov/lawweb/servlet/lloc_news?disp3_l205402627_text
Comment: Taiwan currently has not being able to participate in any international anti-corruption treaties or conventions due to lack of the UN's membership and the PRC's political interference. However, Taiwan's presidential leadership and government has led and launched its own national integrity mechanism with robust implementation of anti-corruption practices which have probably been all equivalent to the standards of the anti-corruption conventions of the international instruments.
Reference added:
- Ministry of Justice, http://www.moj.gov.tw/ct.asp?xItem=336833&ctNode=31160&mp=001 and http://www.moj.gov.tw/public/Attachment/432014194535.pdf
- http://www.moj.gov.tw/public/Attachment/432014194535.pdf
- http://www.aac.moj.gov.tw/lp.asp?ctNode=30812&CtUnit=10788&BaseDSD=7&mp=290
Public debate on defence issues is frequent in academia, and some events are funded by government. But according to former legislator and defence minister Tsai, debate between government and non-governmental actors or organisations is rare. The Ministry of National Defence keeps contact with individual scholars or option-leaders, though available evidence suggests the relationship does not constitute substantial policy debate.
Response to Government Reviewer and Peer Reviewer 2:
There is a distinction between public debate and public relations activity. Although interactions are regular, the MND could do more to engage the public substantively.
Michael M. Tsai, "The Birth of an Idea," Taiwan defence Affairs, Vol. 1, No. 1 (2000), pp. xxvi-xxxix.
Wang Zhi-Peng, "President Ma Should Instruct Senior Officers to Go to TV Programs," Oncc Media, March 10, 2014 http://tw.on.cc/tw/bkn/cnt/commentary/20140310/bkntw-20140310003028425-0310_04411_001.html Original in Chinese.
Comment: Evidences showed that the public debates on major political and security issues among parliament, media, academia, think-tanks are more and more constant and regular in recent years. The Ministry of National Defence always encourages participation in debates or acts as an official co-sponsor for the forums. In addition, the assess of Facebook account &quoute;Spokesperson of the MND&quoute; has friends surpassing 200 thousand and is getting over 300 thousand hits a week, which now makes it an important channel for communication with the general public on defence issues.
- https://www.facebook.com/MilitarySpokesman
- http://www.ly.gov.tw/02_introduce/0204_comm/business/businessList.action?comtcd=35&itemno=02083500
More relevant references added:
- 東海和平倡議與南海主權維護學術研討會論文集, http://gpwd.mnd.gov.tw/Publish.aspx?cnid=523&p=3455
- http://www.ndmc.ndu.edu.tw/editor_model/u_editor_v1.asp?id=%7BB027B1C5-503D-41D7-821A-741738E75244%7D
- http://ndst.ccit.ndu.edu.tw/bin/home.php
- 台灣國防政策與軍事轉型」研討會, http://cap.nthu.edu.tw/files/14-1891-83944,r4068-1.php
- 國防事務研究中, http://www.rcnda.nccu.edu.tw/
- 總統接見參加「台灣國防政策與軍事戰略的未來展望國際研討會」外國學者, http://www.president.gov.tw/Default.aspx?tabid=131&itemid=3323
Comment: Debates are encouraged by the Government, and the frequency is better described as &quoute;regular, but not always persistent&quoute; rather than &quoute;occasional&quoute;; for instance, there are regular open fora or workshops held at least once a year, as well as media briefings, such as the Defence Security Digest (available online on the MND website).
http://www.mnd.gov.tw/English/Publish.aspx?cnid=436&p=60399
http://www.mnd.gov.tw/UserFiles/File/%E5%9C%8B%E9%98%B2%E6%99%BA%E5%BA%ABPDF%E6%AA%94/defence%20Security%20Brief-Vol3Issue3.PDF
http://www.mnd.gov.tw/UserFiles/File/%E5%9C%8B%E9%98%B2%E6%99%BA%E5%BA%ABPDF%E6%AA%94/defence%20Security%20Brief%20Vol%203%20Issue%204.PDF
There are several strong government-wide anti-corruption policy announcements and initiatives by current administration. Two anti-corruption units, the Office of the Inspector General and the Ethics Office, are established within the Ministry of National Defence. A large-scale bribery investigation in the military was conducted in 2009, where some 50 cases involving 150 military personnel in total were inspected, which resulted in detailed public reports.
Ministry of National Defence website
http://www.mnd.gov.tw/UserFiles/File/MND%20Organization.pdf
http://www.mnd.gov.tw/purge/sec/file/%E8%82%85%E8%B2%AA%E6%9F%A5%E5%BC%8A%E5%B7%A5%E4%BD%9C%E5%9F%B7%E8%A1%8C%E6%A6%82%E6%B3%81.pdf
See also Government Reviewer sources.
Comment: Under the presidential and government's &quoute;promoting integrity and anti-corruption&quoute; policy directives, the Taiwan Ministry of National defence convenes a regular &quoute;Bimonthly Anti-corruption Working Meeting&quoute;, which in convened at each level under the service headquarters. Furthermore, the Ethics Office has been established in 2013 to collaborate with the Inspector General's Office in joint anti-corruption efforts in order to strengthen the armed forces' integrity awareness. Many measures have been launched and implemented to eliminate corruption risks and prevent misconducts of personnel. Please refer to the following websites:
- http://ethics.mnd.gov.tw/front/down.aspx?menu=19c08202947&mCate=19c08202c3f
- http://ethics.mnd.gov.tw/front/down.aspx?menu=44a0750255c&mCate=44a07502674
- http://ethics.mnd.gov.tw/front/down.aspx?menu=6a605802a12&mCate=6a60580280a
- http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0070005
- http://ethics.mnd.gov.tw/front/frontList.aspx?publicID=123&menu=c300800219c&mCate=c300800268b
- http://news.gpwb.gov.tw/news.aspx?ydn=w2u5S9CJZGAXB%2fzPg%2fq7ahBURwZ%2fxCkoH%2bRnvuMETFxx5LOFDmxglri0zs4O%2bUrXKrdr9lH9mjTKsNYFb4yca%2ftXy0GiFWNjmCVcUWPNySw%3d
- http://news.gpwb.gov.tw/news.aspx?ydn=026dTHGgTRNpmRFEgxcbfcCSN9Fhd8KFbqLRgMWauV%2fNv6AS31YmtUFyraUX%2b1xYYBD9lJkxdKxqB8be3FP9FrskGVWoJUolT3h6g7vJy54%3d
- http://news.gpwb.gov.tw/news.aspx?ydn=w2u5S9CJZGAXB%2fzPg%2fq7aiBhMxXcaVV6pLY%2f%2b7Vi64XobskATsI63YQPh59ycIxMzNHk02YC6w%2bn%2b6MyqFfpFdPoJrXgX45zKIgRsyfXPAM%3d
- http://news.gpwb.gov.tw/news.aspx?ydn=w2u5S9CJZGAXB%2fzPg%2fq7aiBhMxXcaVV6pLY%2f%2b7Vi64XobskATsI63YQPh59ycIxMzNHk02YC6w%2bn%2b6MyqFfpFb3M8RCqJS6F6uLO2DTJmoY%3d
- http://news.gpwb.gov.tw/news.aspx?ydn=026dTHGgTRNpmRFEgxcbfbBlvy%2f7DopDATM56oOni4RhFZpOId%2fGlzhPB%2b9%2fMv3iql3c6QZrO693L2VokjcDH%2fWLEv32asV6ePJ97qYEDnY%3d
- http://news.gpwb.gov.tw/news.aspx?ydn=026dTHGgTRNpmRFEgxcbfcCSN9Fhd8KFbqLRgMWauV%2bJ46euCOvzUUdiyw057Xjq0fD2n%2boat71z%2bS9UaP4hs0eZY07hQ70wC5zbmy5sy6w%3d
- http://news.gpwb.gov.tw/news.aspx?ydn=026dTHGgTRNpmRFEgxcbfcCSN9Fhd8KFbqLRgMWauV%2bJ46euCOvzUUdiyw057XjqXAkRWSP%2bK4nZt%2bnSBNZopuCraOWUCVR9MMA11fqyeFU%3d
- http://news.gpwb.gov.tw/news.aspx?ydn=026dTHGgTRNpmRFEgxcbfcCSN9Fhd8KFbqLRgMWauV%2bJ46euCOvzUUdiyw057XjqXAkRWSP%2bK4nZt%2bnSBNZopihq4v3Is36hgAwbo41IzQo%3d
- http://www.aac.moj.gov.tw/ct.asp?xItem=279915&ctNode=30676&mp=289
There are several functional overlapping units, such as the Office of the Inspector General, Ethics Office, Political Warfare Bureau, and Accounting Office, in the military sharing anti-corruption responsibility.
The Ethics Office is the main unit in this realm and is responsible for related policy making, implementation, corruption risk assessment, and specific case investigation. The Office of the Inspector General is supportive and responsible for the oversight of policy implementation in general, including where anti-corruption related.
Both offices are newly-established and have staffing problems (with 78 and 22 staff respectively) due to ministry-wide downsizing initiatives, however their anti-corruption efforts are largely free from the political intervention.
The Political Warfare Bureau and Accounting Office can be conceived as field units: the former is responsible for discipline at every echelon while the latter takes charge of monitoring the budget procedures.
http://www.mnd.gov.tw/Publish.aspx?cnid=3443&p=55948
Comment: In December 2012, the amendment of six defence organisation acts has provided the legal basis for organisational adjustments of the MND which includes the formulation of the Ethics Office and the Office of Inspector General. Both Offices are legitimate and adequately funded and staffed to collaborate in joint anti-corruption efforts. In addition, the Comptroller Bureau also has function for consolidating and internal control mechanism along with effective auditing network to oversee all military units to properly execute defence resources.
- Organization Act of the Ministry of National defence, Articles 8 and 9, http://law.mnd.gov.tw/FLAWDAT0202.asp?lsid=FL005293
- Audit Act, Articles 2, 13, 17 and 69, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=U0010001
- http://law.mnd.gov.tw/scp/Query4A.asp?FullDoc=all&Fcode=A001000020
- http://www.nsb.gov.tw/index01.html
- http://www.mjib.gov.tw/mojnbi.php?pg=newintroduction/newintro-5.html
- http://www.mnd.gov.tw/publish.aspx?cnid=65&p=40132
- http://www.mnd.gov.tw/purge/sec/file/肅貪查弊工作執行概況.pdf
Comment: The Ethics Office within the Ministry of National defence is an newly established anti-corruption unit since 2013. This office is mostly independent in anti-corruption policy and implementation. The parallel support from both current defence minister and the director general of the Agency Against Corruption are two key factors. But the human capital is inefficient to tackle all corruption issues within the military. For example, the Chief of the Ethics Office is inadequately ranked lower than its peers in other cabinet ministries. Also this office's 20 staff by statute is insufficient to deal with the ROC military of 210,000 personnel.
There are no public polls or figures that directly relate to population confidence in the military's anti-corruption efforts. However, there is evidence the public believes that the military's internal judicial system, the last line in fending off corruption, is ineffective and suffers from interference by the military hierarchy. In August 2013, a 200,000 strong civil demonstration was prompted by the case of Corporal Hung Chung-Chiu who was found dead by alleged abuse during detention in the military. Public distrust in the military's judicial independence drastically surged to 75 percent. The incident finally led to the abolition of court martials during peacetime. Before the abolition, the court was responsible for prosecution and judgement of all corruption cases involving active military personnel.
Response to Government and TI Reviewer:
The MND response and the sources provided are credible. The case of Corporal Hung Chung-Chiu also has no direct causality from military corruption. And the evidence from the TI Reviewer is also relevant here.
Score changed from 2 to 3.
Taiwan Think Tank, &quoute;2013 Public Sentiment Survey (series four) press conference after the press release&quoute;, 28 July 2013. http://www.taiwanthinktank.org/chinese/page/2/2410/2684/0
&quoute;The Court Review the Appeal of Hung's Case," BBC News, 26 May 2014 http://www.bbc.co.uk/zhongwen/trad/china/2014/05/140526_taiwan_army_death_appeal.shtml
The Control Yuan Report on Hung's Case, May 2014
http://www.cy.gov.tw/sp.asp?xdUrl=./di/edoc/eDocForm_Read.asp&ctNode=911&AP_Code=eDoc&Func_Code=t02&case_id=103000073
&quoute;ZTE employee taken into custody&quoute;, Apple Daily, July 2015 http://www.appledaily.com.tw/realtimenews/article/new/20150710/645598/
Comment: Public surveys and figures have been undertaken by the Agency Against Corruption, Ministry of Justice, annually and directly relate to public confidence in government's anti-corruption efforts. The results of surveys always place military community in the top-two or top-three in terms of trustworthiness by the general public in dealing with bribery and corruption issues. Evidence has also shown that the trustworthy improvement of the MND gradually allows the public to better understand, continue to support and further take part in the national defence affairs through positive interactions. As to the case of Corporal Hung Chung-Chiu happened last year, the MND indicated that it was an independent incidence and tragedy caused by misconduct of field-leadership and not directly related to bribery or corruption issues.
- Anti-Corruption Survey Reports, Agency Against Corruption, http://www.aac.moj.gov.tw/lp.asp?ctNode=30788&CtUnit=10764&BaseDSD=7&mp=289
- http://gpwd.mnd.gov.tw/english/Publish.aspx?cnid=229
Comment: The military enjoys high ranking of integrity among Taiwan public servants. It was ranked No. 2 after the public hospital medical staff in 2012 and 2013. According to TI-Taiwan's annual survey on public sector's integrity in 2014, the public's confidence (5.60) is significantly lower than previous two years (5.99 in 2012 and 5.88 in 2013). (pp. 49-50 http://www.aac.moj.gov.tw/public/Attachment/51271632632.pdf) The probable cause of the low confidence is the media exposure and public awareness of the soldier Hung's death case in 2013. This single case illustrates public frustration on the military black-box operation on soldier's discipline. Nonetheless, the survey of public perceptions still rank the military No. 5 out of 26 categories of the pubic servants. (p. 92 http://www.aac.moj.gov.tw/public/Attachment/51271632632.pdf)
Comment: According to the 2013 World Values Survey Taiwan's public opinion is marginally positive to the ROC Armed Forces (52.9% of positive responses, 'a great deal' or 'quite a lot' confidence)
20 June 2014, url: http://www.worldvaluessurvey.org/WVSOnline.jsp
http://www.taipeitimes.com/News/taiwan/archives/2013/12/04/2003578282
http://taiwanreports.wordpress.com/articles-in-english/doubts-over-mas-tough-cure-for-corruption/
http://www.economist.com/node/16647375
http://www.soas.ac.uk/taiwanstudies/publications/workingpapers/file24466.pdf
http://eprints.soas.ac.uk/9638/1/PoliticalMediaLiberalization.pdf
http://www.lse.ac.uk/asiaResearchCentre/countries/taiwan/TaiwanProgramme/Journal/JournalContents/TCP1Shih.pdf
Based on readily available information, there is no evidence of a corruption risk assessment being conducted by the responsible unit, Ethics Office, since its formal establishment in 2013. In the anti-corruption report released by the Ministry of National Defence in 2009, there was no evidence of a systematic analysis on structural cause or risk assessment of bribery cases. The military made no significant attempts in analysing the structural cause of the bribery alleged cases. The focus appears to be placed individual behaviour.
The Government Reviewer points to the establishment of an MND Ethics Office and evidence supplied by the Government Reviewer demonstrates that the Office is active. The TI reviewer has also noted that the MND's Ethics Office has taken incremental steps to commission independent scholars to do research on risk assessment (e.g. Yuan Ze University in 2014 undertook an assessment of Taiwan military integrity). These are all very positive steps.
In addition the MND's establishment of the Anti-Corruption Bimonthly Meeting chaired by the Defence Minister does appear to be an important method to take action on areas of corruption risk, particularly as it looks to include input from across relevant areas of the MND (internal control, crime investigations, security clearance and procurement misconduct). External input in the form of the Anti Corruption Agency and Ministry of Justice is also commendable. It is though unclear how systematic and in-depth these assessments are. Score raised to 3.
Government Reviewer Sources below:
Taiwan MND issued the directive of risk management plan,
http://www.mnd.gov.tw/publish.aspx?cnid=65&p=34805
http://www.aac.moj.gov.tw/ct.asp?xItem=253310&ctNode=30690&mp=289
http://www.moj.gov.tw/lp.asp?ctNode=28249&CtUnit=9341&BaseDSD=7&mp=001
http://www.mnd.gov.tw/Print.aspx?cnid=65&p=34805
http://ethics.mnd.gov.tw/front/down.aspx?menu=44a0750255c&mCate=44a07502674
http://www.aac.moj.gov.tw/public/Data/31014135829426.pdf
http://www.dgbas.gov.tw/public/Data/3511416371.doc
More relevant sources added with regard to the Ethics Office's actions.
國防部政風室參加總統府軍事會談報告「國防小革命之八-端正政風確保廉能」專題,確立國防廉潔策進方向, http://ethics.mnd.gov.tw/front/frontList.aspx?publicID=186&menu=c300800219c&mCate=c300800268b
國防部政風專案稽核高風險採購不法情事主動移送偵辦, http://news.ltn.com.tw/news/politics/breakingnews/1211580
https://www.flickr.com/photos/zfs/sets/72157649082921302/
Comment: The MND's establishment of the Anti-Corruption Bimonthly Meeting chaired by the Defence Minister is an important working platform for joint efforts to exchange corruption risk assessments and related information done by different responsible entities, including internal control, crime investigations, security clearance and procurement misconduct, etc. The main objective is to facilitate the responsible entity, the Ethics Office, in developing preliminary and effective measures against corruption for the military community. Furthermore, a close joint effort with external mechanism led by the Anti Corruption Agency, Ministry of Justice, which is in charge of regular corruption risk assessments and making counter corruption proposals for the entire government.
- Taiwan MND issued the directive of risk management plan, http://www.mnd.gov.tw/publish.aspx?cnid=65&p=34805
- http://www.moj.gov.tw/lp.asp?ctNode=28249&CtUnit=9341&BaseDSD=7&mp=001
- http://www.mnd.gov.tw/Print.aspx?cnid=65&p=34805
- http://www.aac.moj.gov.tw/public/Data/31014135829426.pdf
- http://www.dgbas.gov.tw/public/Data/3511416371.doc
- 國防部政風室參加總統府軍事會談報告「國防小革命之八-端正政風確保廉能」專題,確立國防廉潔策進方向, http://ethics.mnd.gov.tw/front/frontList.aspx?publicID=186&menu=c300800219c&mCate=c300800268b
- 國防部政風專案稽核高風險採購不法情事主動移送偵辦, http://news.ltn.com.tw/news/politics/breakingnews/1211580
- https://www.flickr.com/photos/zfs/sets/72157649082921302/
Comment: There is at least one instance which demonstrate the MND's determination to fight military corruption. On Jan. 21, 2015, thirteen suspects were arrested in a army procurement case, which was self-initiated and investigated by the Ethics Office of the MND as early as 2013.
As to the corruption risk assessment, the MND's Ethics Office has taken incremental steps to commission independent scholars to do research on risk assessment. For example, there is a MND's research project undertaken by Prof. Ching-Pu Chen of Yuan Ze University in 2014 on the assessment of Taiwan military integrity. Several members of TI-Taiwan were invited to be in-depth interviewees and discussant of the draft report.
TI-Taiwan encourages the MND to continue this research project on a regular basis so as to identify corruption risk factors/areas within the military for prevention purposes.
http://www.taipeitimes.com/News/front/archives/2015/01/23/2003609887
http://data.gov.tw/node/8798
The military has a rigorous acquisition planning process. However, the oversight mechanism and peer review process is internal and not open to the public. In the planning stage of a major arms acquisition, no parties outsides Ministry of National Defence are able to oversee the acquisition decision-making. There is no readily available evidence of other stakeholders being invited to play a substantial role in the process.
The Government has provided useful clarity over the process. The MND defence acquisition process making clear that in the early stages of planning an acquisition operational requirement and feasibility assessment along with a system analysis report, investment outline plan and working plan are produced. A budget proposal is submitted to the Executive Yuan and Legislative Yuan for review and approval around 4-8 months before the target fiscal year, and the LY has the authority to scrutinise and challenge these budgetary proposals. Then during the procurement phase information is released as part of the &quoute;invitation to tender&quoute; and &quoute;contract award&quoute; on the website of Public Construction Commission, Executive Yuan.
Response to Government Reviewer: Although the process appears well defined, there is still a limited amount of information available to the general public, so a higher score could not be awarded.
"Governmental Procurement Act," chapter 1, 2.
Ravinder Pal Singh (ed.), &quoute;Arms Procurement Decision Making Volume II: Chile, Greece, Malaysia, Poland, South Africa and Taiwan&quoute;, 2007, SIPRI, pp. 191-199
PETER YEN, DIVERSIFICATION AND DEFENCE TRADE OPPS, http://fas.org/irp/world/taiwan/isar0020.htm
Central Government Budget Plans, http://ebas1.ebas.gov.tw/address/gbaagenooutput.asp
National Defence Report, http://report.mnd.gov.tw/m/part27.html
Budget Act, Article 46, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=T0020001&quoute;
Comment: Generally speaking, Taiwan MND's defence acquisition process follows up the &quoute;Planning, Programming, Budgeting and Execution (PPBE)&quoute; System. In the early stages of planning and programming (at least 15 months before target fiscal year), an acquisition operational requirement and feasibility assessment along with a system analysis report, investment outline plan and working plan needs to be completed. Most of the planning information is limited in terms of public release due to the concerns over the sensitive nature of the force capability buildup and combat readiness. During the budgeting stage, the main effort is to acquire applicable budgetary resources from the administrative authorities and congressional process. A budget allocation proposal needs to be submitted to the Executive Yuan and Legislative Yuan for reviews and approval around 4-8 months before target fiscal year. The LY has full authority to scrutinise and challenge these budgetary proposals, and, sometimes it could be cut, amended or frozen.In the last stage, for case or program execution, the Government Procurement ACT and its enforcement rules stipulate all procurement implementation procedures for entire government entities. The MND shall follow all the regulations and observe the principles of protecting public interests, fairness and reasonableness, and shall not accord differential treatment to suppliers without due cause. During this stage, the related information from beginning of &quoute;invitation to tender&quoute; through &quoute;contract awarded&quoute; is all available to the general public on the website of Public Construction Commission, Executive Yuan.
- Central Government Budget Plans, http://ebas1.ebas.gov.tw/address/gbaagenooutput.asp
- Natioanl defence Report, http://report.mnd.gov.tw/m/part27.html
- Budget Act, Article 46, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=T0020001
Very few countries are willing to disclose their internal studies and decision-making analyses regarding defence acquisition process in the early planning and programming stages, since much of the planning information is not fully released to the public due to concerns of sensitive nature. However, during the budgeting and execution stage, on behalf of the general public, the Legislative and Control Yuan's reviews are a required process. The Taiwan LY and CY do have full authority to scrutinize and challenge these defence acquisition proposals.
Comment: Ravinder Pal Singh (ed.), &quoute;Arms Procurement Decision Making Volume II: Chile, Greece, Malaysia, Poland, South Africa and Taiwan&quoute;, 2007, SIPRI, pp. 191-199
The Annual Defence Budget Proposal, including those non-classified items, submitted to Legislative Yuan for approval is not detailed. Legislators are aware of how much money in total the military intends to spend on specified programs but are not provided with specific details. For example, in page 573 of the annual budget proposal 2014, it simply states that the Air Defence Missile Command "outsources the Chungshan Institute of Science and Technology to implement 'the Renovation of Backup Components for Fire Control System of the Sky Bow Missile' planned cost 454.569 million NT Dollars". No further details are provided for such a huge expenditure (equivalent to £9 million GBP) in the budget proposal. This form of budget description is common practice and not the exception. Staff in the defence sector of the Directorate General of Budget, Accounting and Statistics of Executive Yuan are undermanned and incapable of reviewing the details of the Defence Budget Proposal before its submission to Legislative Yuan.
Response to Government Reviewer and Peer Reviewer:
The example cited above - the Sky Bow Missile - is not a secret budget item and yet information is still abridged. Legislators of course might require the MND to provide the details of this budget item, but nonetheless, this evidence points to a lack of transparency. And it is for this reason, that legislators carry out package cuts when they cut the budget, or cuts in the total defence budget rather than against specific items, in order to make clear to the public that they can effectively exercise control over the defence budget, but in practice it's difficult due to the lack of detail provided.
Score maintained.
Annual Defence Budget Proposal, Ministry of National Defence 2014
Defence Industry Daily, &quoute;Taiwan's Force Modernization: The American Side&quoute;, June 4, 2014 url:
http://www.globalsecurity.org/military/world/taiwan/budget.htm accessed June 23, 2014
Global Security, &quoute;Taiwan&quoute; http://www.globalsecurity.org/military/world/taiwan/budget.htm accessed June 23, 2014
Focus Taiwan, &quoute;MND vows to gradually make defence budget more transparent&quoute;, 2013/01/29, http://focustaiwan.tw/news/aipl/201301290029.aspx
Comment: The contents of annual defence budgetary proposal shall include all aspects of expenditures to be carried out in coordination with requirements of the Armed Forces' missions. Among that, information of classified budget is not considered to release to the general public. However, the Legislators of Defence & Foreign Affairs Committee of Legislative Yuan, on behalf of the public, has full scrutiny rights to access the details of classified budget and to request MND for providing more information regarding specific programs. In addition, evidence has shown that the percentage of secret budget is decreasing in a dramatic tread for years.
- http://www.mnd.gov.tw/Publish.aspx?cnid=2250&p=38142
- http://www.mnd.gov.tw/Publish.aspx?cnid=2250&i=0
- http://www.dgbas.gov.tw/public/data/dgbas01/103/103hb/menu.htm
- http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=T0020001
Defence budgetary proposals shall contain all items of expenditures to be carried out for follow up actions. Among that, some classified information is not to be disclosed to the general public. However, the Legislators have full rights to access and scrutinise the details and to request the MND to provide more specific information.
Comment: Taiwan's defence budget is more transparent and publicly available than the description above although in some areas there are still problems. There has been significant improvement in terms of transparency in the last two decades.
Comment: Focus Taiwan, &quoute;MND vows to gradually make defence budget more transparent&quoute;, 2013/01/29, http://focustaiwan.tw/news/aipl/201301290029.aspx
The Foreign Affairs and Defence Committee in the Legislative Yuan with general support from the Budget Centre is responsible for reviewing the Annual Defence Budget Proposal in the Legislative Yuan. But the program details in the Budget Proposal are insufficient for the legislators' effective scrutiny. As the example in the previous question, it is difficult for legislators to know from the Budget Proposal what the purpose of this 454.569 million NT Dollars expenditure is, why the Chungshan Institute of Science and Technology is the outsource contractor, and what kind of "backup components for fire control system" need to be renovated. Without these details, an effective legislative scrutiny on this budget item is unlikely. This budget item is not an exception, though an individual legislator wants to obtain the detailed information, he/she has to ask MND via liaison officers in the Legislative Yuan.
**Response to Government Reviewer and Peer Reviewer 2:
The issue in this question lies on the degree of LY capacity in influencing the decision-making of defence budget. As the MND suggests, "The Legislative Yuan may not propose any increase of expenditures in the budgetary bill proposed by the Executive Yuan, nor can it increase, decrease or shift budget items." There are resolutions, but most of them are made by individual legislators or the Committee are merely suggestions; the MND can choose not to follow unless the few exceptions made by the LY as a whole.
''Budget Act'', Artt. 6, 10, 14, 32, 46, 59, 78, 88
Shirley Kan, &quoute;Taiwan: Major U.S. Arms Sales Since 1990,&quoute; CRS, May 21, 2012, http://www.fas.org/sgp/crs/weapons/RL30957.pdf
Comment: Since budgets are the very foundation of government administration, to examine and decide upon budgetary bills serves as the best way for the Legislative Yuan to oversee government administration. Four months before the beginning of each fiscal year, the Executive Yuan must present the general budgetary bill for the following fiscal year to the Legislative Yuan for examination and approval. The Legislative Yuan must reach a resolution on the general budgetary bill one month before the fiscal year starts. The Legislative Yuan may not propose any increase of expenditures in the budgetary bill proposed by the Executive Yuan, nor can it increase, decrease or shift budget items. The Foreign Affairs and defence Committee of Legislative Yuan is responsible for reviewing and scrutinising the defence budget. All discussion minutes of the budgetary reviewing sessions are available on the LY's website. In recent four years (2011-2014), there were in total of 261 resolutions related to the defence budget reviews made by LY to request the MND for further justification, amendment or shift for budget items.
- Budget Act, Articles 6, 10, 14, 32, 46, 59, 78 and 88, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=T0020001
- Legislative Yuan website, http://www.ly.gov.tw/en/innerIndex.action
References added for more resolutions related to the defence budget reviews made by LY to request the MND to further justify, amend or shift budget items.
- http://lis.ly.gov.tw/lgcgi/lypdftxt?10307301;0084;0085
- http://m1a2444.pixnet.net/blog/post/226577179-%E6%81%A2%E5%BE%A9%E4%B8%AD%E7%A8%8B%E9%A3%9B%E5%BD%88%E9%87%8F%E7%94%A2-%E7%AB%8B%E9%99%A2%E5%BB%BA%E8%AB%8B%E5%9C%8B%E9%98%B2%E9%83%A8%E5%9F%B7%E8%A1%8C%E9%9B%B2%E5%B3%B0
Comment: TI-Taiwan recognizes that there is room to debate Taiwan's score between 2 and 3. According to recent experience of meeting with various members of Legislative Yuan and Control Yuan, the committee members from both ruling party (KMT) as well as the opposition party (DPP) are generally satisfied with the MND's response to their inquires on individual cases and budget review. The DPP legislator, Ms. Bi-Kim Shaw, expresses her agreement with Taiwan's ranking of B in the Government Defence Anti-Corruption Index of 2013. Recent meetings were taken place when TI-DSP Dr. Mark Pyman and Ret. Maj. Gen. David Cook visited Taiwan on June 11, 2014.
http://tict.niceenterprise.com/front/bin/ptdetail.phtml?Part=epaper20140630&PartPage=5
Comment: Regarding the role of the Legislative Yuan, you can also refer to:
Comment: The Foreign Affairs and defence Committee in the Legislative Yuan can exercise effective scrutiny over the proposed expenditures. Should it feel that the level of details provided is not enough, it can request that the government submits reports to it and attends its meetings to provide evidence to support the expense. Should it feel not happy with the provided explanation, the Committee can also cut or freeze the budget, therefore having effective control and influence over decisions made.
Although the Annual Defence Budget Proposal lacks detailed information on substance, it follows the procedural requirement strictly. The Proposal is always submitted to the Legislative Yuan on time. Information is made public (on their website, slightly later than the arrival of paper copies on the Legislative Yuan) except for secret spending. The share of secret spending in total defence budget is decreasing. The public and the media can access the same Proposal as the legislators are presented with, however the opportunity for journalists and those other than legislators to obtain detailed information in the Proposal is virtually non-existent.
The Government Reviewer has provided evidence that there is a legal mechanisms through which citizens, civil society and the media can request information on defence budgets, though public awareness of this may be lacking somewhat. More importantly though, as Question 12 indicates, there is limited information provided even during the budget planning process to legislators so it's unlikely that the Freedom of Government Information Law would help in such instances, if legislators aren't provided with the information.
Directorate General of Budget Accounting and Statistics, Executive Yuan, http://www.dgbas.gov.tw/np.asp?ctNode=41
Comment: In accordance with to the &quoute;Freedom of Government Information Law&quoute;, government information shall be made available to the public actively in accordance with the Law or provided as requested by any person. Thus, all information with regard to the approved annual defence budgets are available to the general public on the website of the Legislative Yuan, the Directorate General of Budget Accounting and Statistics (DGBAS) of Executive Yuan and the Ministry of National Defence.
- Freedom of Government Information Law, Articles 5 and 19, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0020026
- Directorate General of Budget Accounting and Statistics (DGBAS) of Executive Yuan, http://www.dgbas.gov.tw/np.asp?ctNode=41
- 2013 National defence Report, pages 134-137, http://report.mnd.gov.tw/en/m/part26.html
Comment: See also: http://www.dgbas.gov.tw/np.asp?ctNode=41
Following the same pattern as the expenditure section, the income section is listed on Annual Defence Budget Proposal and is short of program details for the legislators' effective scrutiny. There are two major segments in the income section. One is the MND income budget, which is mainly penalty or equipment disposal and is comparatively small in size. Another is for operational income from the MND-owned or -controlled funds. It includes a lot of associated units, such as the Chungshan Institute of Science and Technology, and comprises a larger total amount. The latter forms the focus of the MND income budget.
The transparency standards applied to the MND-owned or -controlled funds are different from those for the MND establishment. For example, employees of civil/military dual-use technology development sector in the MND Production and Service Operation Funds are not under the regulation of national personnel allocation. Though the size of 6751 staff is identified on the Budget Proposal (page. 1-55), payment and some specific rewards remained blank.
**Response to Government Reviewer:
The difference between score 4 and 3 is that "there is likely to be public scrutiny through the publication of sources on a website." While far from perfect, the Government Reviewer's claims about the publication and scrutiny of MND income are still true and reach the standard of score 4.
Directorate General of Budget, Accounting and Statistics of Executive Yuan website
http://www.dgbas.gov.tw/ct.asp?xItem=26269&CtNode=5389&mp=1
MND Production and Service Operation Funds and the Associated Units Budget Detailed Information, 2014
ROC Ministry of National defence, &quoute;2013 Quadrennial defence Review&quoute;, pp. 75-79, http://qdr.mnd.gov.tw/file/2013QDR-en.pdf.
In Taiwan, real estate is also a source of income for the military, regulated as follows:
&quoute;Regulations for Exemption of Commodity Tax on Goods for Military Use&quoute;, http://law.moj.gov.tw/LawClass/LawContent.aspx?PCODE=G0340018
&quoute;Act for Rebuilding Old Quarters for Military Dependents&quoute;, http://law.moj.gov.tw/LawClass/LawAll.aspx?PCode=F0140013
&quoute;Enforcement Rules of the Act for Rebuilding Old Quarters for Military Dependents&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0140014&quoute;
Comment: By law, the MND's income budgetary estimates shall be part of the annual defence budget proposal and subject to the LY's scrutiny. There is only NT$ 4,324,901,000 in total of budgetary estimates in FY 2014. The details of income section are hard to provide for legislative reviews due to specific case's different situation. However, eventually, all annual revenue and expenditures of government in every fiscal year, borrowing and repayment of loans and appropriations from the remaining of annual budget from previous years shall be incorporated into the financial statement; income and expenditures not yet included in the financial statement of preceding year shall be incorporated into separate schedule attached in the financial statement. As to the operational income from the Armed Forces Manufacture and Services Fund is also part of defence budget proposal. It is a government-owned non-profit budgetary resource; the responsible operational entities shall turn over their profits to the National Treasury after the year-end audit. The Comptroller Bureau of MND is in charge of the overall management of the funds. Furthermore, the external auditing is conducted by the National Audit Office, Control Yuan. All related information is available to the general public.
- http://www.dgbas.gov.tw/public/data/dgbas01/103/103Btab/103B歲入來源別歲出政事別預算表及參考表.PDF
- http://www.dgbas.gov.tw/public/data/dgbas01/103/103Btab/103B中央政府各機關歲入來源別科目分析總表.PDF
Comment: See also: ROC Ministry of National defence, &quoute;2013 Quadrennial defence Review&quoute;, pp. 75-79, http://qdr.mnd.gov.tw/file/2013QDR-en.pdf.
There are two-level internal audit controls in the Ministry of National Defence: the Internal Audit Division of the Defence Comptroller Bureau and the Executive Yuan (Directorate General of Budget, Accounting and Statistics) for military expenditure. Personnel skill is not an issue and the findings are publicly available. An Annual Audit Report is released regularly and can be access via the MND website.
While the Annual Audit Report is reviewed by the legislators, there are some shortcomings. A number of issues at the Ministry level stem from independence, as most personnel in the Bureau are military officers and cannot be easily separated from interventions by the military hierarchy. Issues within the Executive Yuan arise meanwhile through lack of trust from the military, which refrains from providing details on the ground of possible leaks of sensitive information.
Ministry of National defence, &quoute;MND Organization&quoute; (organogram). http://www.mnd.gov.tw/English/Publish.aspx?cnid=502. Last updated 28 November 2014.
Ministry of National defence, &quoute;Budget book and Statements&quoute;. http://www.mnd.gov.tw/Publish.aspx?cnid=2250&p=38142
Comment: The Taiwan Armed Forces has more than 200 budget executing units spread all over the country which are supervised under a comprehensive &quoute;internal auditing network&quoute; of the Comptroller Bureau, MND. In practice, the mechanism is created via work simplification, authority decentralization and hierarchical responsibilities to strengthen preventive and continuous auditing, and prevent mistakes from reoccurring.
- Internal Audit Processing Standard, http://law.moj.gov.tw/LawClass/LawAll.aspx?PCode=T0030002
- http://www.dgbas.gov.tw/lp.asp?ctNode=5568&CtUnit=1775&BaseDSD=7
- http://www.audit.gov.tw/files/11-1000-183-1.php
Comment: See also: Liao et alia, &quoute;The Study of Implementing Executive Information Systems on Military Internal Auditing Decision-making - the perspective of strategy management&quoute;, http://edoc.ypu.edu.tw:8080/paper/antai/2003%E5%B9%B4--%E4%B8%AD%E8%8F%AF%E6%B1%BA%E7%AD%96%E7%A7%91%E5%AD%B8%E7%A0%94%E8%A8%8E%E6%9C%83/C14-172.pdf
USA International Business Publications, &quoute;Taiwan National Security And defence Law And Regulations Handbook&quoute;
The National Audit Office under the Control Yuan is an independent unit from the Executive which conducts external auditing of all government agencies. All its findings and results can be accessed by the public. The National Audit Office has many advantages in oversight of governmental expenditure. The Office is manned by skilled personnel and largely free from political intervention. Findings are sent to the Legislative Yuan and the Control Yuan. The latter can initiate case investigation and this may lead to semi-judicial punishment.
In the case of the MND, the NAO has identified shortcomings in auditing process and required correction/refinements in a timely manner.
National Audit Office website
http://www.audit.gov.tw/files/11-1000-111-1.php
Comment: The NAO's mission is to provide high quality audit service and maximize the value of audit function to improve the performance of government facilitate integrity in public sectors. Full disclosure of the audit actions and related reports are available to the general public in details.
- http://www.audit.gov.tw/files/11-1000-97.php and http://www.audit.gov.tw/files/11-1000-98.php
- http://law.moj.gov.tw/LawClass/LawSingle.aspx?Pcode=T0030001&FLNO=32
- http://law.moj.gov.tw/LawClass/LawAll.aspx?PCode=U0010001
Comment: See also the Office's online publications of investigation for Taipei District: http://www.audit.gov.tw/files/15-1000-1525,c90-1.php
The National Defence Act (Article 2 and 14) lists the missions that the armed forces are authorised to do. There are 12:
1. Personnel management and service of the forces.
2. Gathering and analysis of military intelligence.
3. Planning and implementation of the operation plans.
4. Deployment and training of the forces.
5. Preparation and implementation of mobilization of the forces.
6. Formulation of military doctrine and research and development (R&D) of combat activities.
7. Allocation and utilisation of military personnel, equipment and supplies.
8. Planning and implementation of communications, information and electronic warfare.
9. Implementation of political warfare.
10. Supervision over tactics and techniques
11. Implementation of disaster prevention and rescue.
12. Other military affairs related to forces command.
No activities related natural resources exploitation are on the list.
There is no evidence to indicate the Ministry of National Defence has engaged in natural resource exploitation. There would be limited benefit in doing so as there are few natural resources in Taiwan.
"National defence Act," article 2, 14.
National Property Act, Article 3, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=G0370001
Water Act, http://db.lawbank.com.tw/Eng/FLAW/FLAWDAT0201.asp
The Fisheries Act, http://db.lawbank.com.tw/Eng/FLAW/FLAWDAT0201.asp
The Forestry Act, http://www.forest.gov.tw/ct.asp?xItem=21160&CtNode=1870&mp=3
Comment: Reference added:
- National Property Act, Article 3, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=G0370001
&quoute;Water Act&quoute;, http://db.lawbank.com.tw/Eng/FLAW/FLAWDAT0201.asp
&quoute;The Fisheries Act&quoute;, http://db.lawbank.com.tw/Eng/FLAW/FLAWDAT0201.asp
&quoute;The Forestry Act&quoute;, http://www.forest.gov.tw/ct.asp?xItem=21160&CtNode=1870&mp=3
There are isolated examples of low ranking officers and non-commissioned officers having connections with 'gangsters' or organised criminals. Yet there is no evidence as to the plausibility of penetration of organised crime in the military. There is little chance of an organised crime group surviving in an organisation like Taiwan's military since it is based on the grounds of rigorous officer corps selection, closeness of military community, and competitive promotion.
Sources provided by the Government Reviewer and Peer Reviewer 2 are not relevant to this question. To reach score 4, there must be some evidence that the MND is actively working to remain alert to the risk. At present, there is none available.
"Gangsters Penetrate into the Military," Liberty Times, 2 October 2, 2005 http://www.libertytimes.com.tw/2005/new/oct/2/today-fo7.htm
Comment: Assessment of crime risks is also part of joint function of MND's regular Anti-corruption Working Meeting. The Military Police Command and military security staff of the Political Warfare Bureau have a close working relationship with external agencies, such as local policy force and the Investigation Bureau of Ministry of Justice; together constitute a strong crime preventive network. Thus, Organized crime is hard to survive in the military community.
- http://law.moj.gov.tw/LawClass/LawContent.aspx?PCODE=C0000013
References added for more MND's actions to remain alert to the corruption risks.
- http://www.appledaily.com.tw/realtimenews/article/new/20150121/546132/
- http://udn.com/news/story/1/743097-%E5%85%B1%E8%AB%9C%E6%A1%88-%E5%9C%8B%E9%98%B2%E9%83%A8%EF%BC%9A%E8%BB%8D%E6%83%85%E5%B1%80%E4%B8%BB%E5%8B%95%E7%99%BC%E6%8E%98
Comment: See also: Amnesty International, &quoute;Taiwan government must ensure the reform of military criminal procedure legislation lives up to its promise of greater accountability&quoute;, 2014, http://www.amnesty.org/en/library/asset/ASA38/001/2014/en/5c6a95be-d90c-4378-8a6c-d941c2a83cb4/asa380012014en.pdf
&quoute;Hasty changes to Taiwan's Military Criminal Code may backfire&quoute;, 2013, http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20130809000049&cid=1101
The Offices of the Inspector General, the new Ethics Office, and Political Warfare Bureau are responsible for such policing functions. These units largely deter organised crime groups from penetrating the military and developing a corrupt network within the barrack under their various forms of anti-corruption, counter-intelligence, discipline, or ethics oversight. According to the roles and missions assigned to these units, they have internal investigative authorities. The Ethics Office, largely manned by civil servants, is more independent from intervention from military hierarchy than its peer units. Following the abolition of court martial during peacetime, the prosecution and judgement are now under a civil jurisdiction system however.
MND website
http://www.mnd.gov.tw/Publish.aspx?cnid=25
Comment: In December 2012, the amendment of six defence organisation acts has provided the legal basis for organisational adjustments of the MND which includes the formulation of the Ethics Office and the Office of Inspector General. Both Offices are legitimate and adequately funded and staffed to collaborate in joint anti-corruption and counter organised crime activities. Furthermore, assessment of crime risks is also part of joint function of MND's regular Anti-corruption Working Meeting. The Military Police Command and military security staff of the Political Warfare Bureau have a close working relationship with external agencies, such as local policy force and the Investigation Bureau of Ministry of Justice; together constitute a strong crime preventive network.
- http://law.mnd.gov.tw/scp/Newsdetail.asp?NO=1A000000001
- http://law.mnd.gov.tw/scp/Query4.asp?B2=%AAk%B3W%AAu%AD%B2&FNAME=A001000020
- http://ethics.mnd.gov.tw/
- http://www.google.com.tw/url?url=http://ethics.mnd.gov.tw/UFile/down/75_2014042416584801_%25E5%259C%258B%25E9%2598%25B2%25E9%2583%25A8%25E5%25BB%2589%25E6%2594%25BF%25E5%25B7%25A5%25E4%25BD%259C%25E6%259C%2583%25E5%25A0%25B1%25E8%25A8%25AD%25E7%25BD%25AE%25E8%25A6%2581%25E9%25BB%259E%25E4%25BF%25AE%25E6%25AD%25A3%25E5%2585%25A8%25E6%2596%2587-1030116.doc&rct=j&frm=1&q=&esrc=s&sa=U&ei=Q_O5U4LFLY3t8AXowYLoDQ&ved=0CBMQFjAA&usg=AFQjCNFlhIIj0CuSgEDxfLZdFkkB_fO1fA
- http://law.moj.gov.tw/LawClass/LawAll.aspx?PCode=F0010036
No intelligence-specific committee, as following the US example, exists in the Legislative Yuan. But there is evidence that the Legislative Yuan does provide oversight over the intelligence services' policies, administration, and budgets. The Foreign Affairs and National Defence Committee instead takes charge of general scrutiny of intelligence affairs. Budget items for intelligence services are listed on the MND Annual Budget Proposal, though details are lacking.
There are some oversight mechanisms applied to intelligence services in the Ministry of National Defence, though it's difficult to judge how effective these are in practice. The nature of intelligence operations and an ambiguous chain of command make oversight difficult. The National Security Bureau (NSB), which is the equivalent of the US CIA, funds and maintains operational control for all intelligence units in the Ministry of National Defence, which suggests that formal direct oversight mechanisms in the Ministry may be bypassed.
As the Government Reviewer has pointed out, the Defence and Intelligence Affairs Committee of the Control Yuan also exercises oversight on government's intelligence community, and the intelligence operations of the MND are supervised by the defence minister at the same level of manner on all aspects of policies, administration and budgets.
The difference between score 4 and 3 lies on evidence of effective parliamentary oversight of the intelligence policies, administration, and budgets. The score should be maintained at 3 because is not sufficient evidence that the Legislative Yuan is exercising effective, properly resourced and independent oversight. Score maintained.
Annual Defence Budget Proposal, 2004, pp. 585-618.
Chao, Young-chin, &quoute;Transparency and National Security,&quoute; National Policy Foundation, May, 2002,
http://old.npf.org.tw/monthly/00205/theme-154.htm
&quoute;Taiwanese Intelligence Accused of Meddling in Hong Kong&quoute;, The Diplomat, January 2014, http://thediplomat.com/2014/01/taiwanese-intelligence-accused-of-meddling-in-hong-kong/
&quoute;NSB employing 'hackers' for new cybersecurity unit&quoute;, March 2015, http://www.taipeitimes.com/News/front/archives/2015/03/28/2003614569
Comment: References Added:
- Budget Act, Articles 6, 40 and 46, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=T0020001
- The Classified National Security Information Protection Act, Article 22, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0060003
- Control Act, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030199
- http://law.moj.gov.tw/LawClass/LawContent.aspx?pcode=I0060003
- http://law.moj.gov.tw/LawClass/LawContent.aspx?PCODE=A0020058
Beside the LY, there is a responsible parliamentary committee (Defence and Intelligence Affairs Committee of Control Yuan) to exercise oversight on government's intelligence community. Intelligence services are parts of MND's operational functions; they are supervised by the defence minister at the same level of manner on all aspects of policies, administration and budgets.
&quoute;Budget Act&quoute;, art. 46;
&quoute;The Classified National Security Information Protection Act&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0060003
&quoute;Organization Regulations of the Military Intelligence School&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawContent.aspx?pcode=F0000057
There are some objective criteria for promotion set out in Act of Commission for Officers and Non-commissioned Officers of the Armed Forces, and several directives as to the procedures of candidate selection. In practice the assignment of specific posts appears to be a largely subjective choice. According to Article 13 of the Act of Assignment for Officers and Non-commissioned Officers of the Armed Forces, the president holds the final call of the promotion and assignment of senior officers to the level of general, lieutenant general and major general (or their service equivalent) in "key positions". All chiefs of intelligence-related units are considered as key positions. As a result, three senior positions of intelligence-related units (at lieutenant general or vice admiral rank) in the MND are appointed primarily through the Minister or President's personal selection. No common patterns or regulations appear to exist in terms of criteria for selection.
Response to Government Reviewer and Peer Reviewers 1 and 2:
Score changed from 1 to 2 and all sources added. NB: The source provided by the MND examines general suitability for security clearances rather than specific selection criteria for senior appointments, and the Peer Reviewer 2 raises evidence as to why a higher score is not justified.
National Intelligence Work Act, February 5, 2005
National Security Bureau Organic Act, 1994
National Security Bureau, http://www.nsb.gov.tw/index01.html. Accessed June 24, 2014
Ministry of National Defence, &quoute;肅貪查弊工作執行概況&quoute;. http://www.mnd.gov.tw/purge/sec/file/肅貪查弊工作執行概況.pdf
Ministry of National Defence, &quoute;Act of Commission for Officers and Noncommissioned Officers of the Armed Forces&quoute;, last amended 22 May 2013 (民國102 年05 月22 日). http://law.mnd.gov.tw/FLAWDAT0202.asp?lsid=FL005419
Ministry of National Defence, &quoute;Act of Assignment for Officers and Noncommissioned Officers of the Armed Forces&quoute;, last amended 29 May 2013 (民國102 年05 月29 日).http://law.mnd.gov.tw/FLAWDAT0202.asp?lsid=FL005421
Ministry of National Defence, &quoute;Regulations of Personnel Security Investigation for Participants in the National Defence Security Program&quoute;, last amended 15 March 2013. http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0010036
Lu Chao-lung, &quoute;Taiwan's Military Intelligence Bureau to be reorganized&quoute;, http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20130103000087&cid=1101
Comment: The selections of all key assignments in military entities as well as intelligence community are regulated by same laws and related regulations. A certain position needs to fulfil certain requirements except very few political appointments.
- The Regulations of Personel Security Investigation for Participants in the National Defence Security Program, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0010036
Comment: Based on the answer score 2 is more suitable. In addition, it should be noted that the National Security Bureau, which is also involved in military intelligence, has clear and competitive recruitment processes. The CVs of senior leaders are publicly available and they are answerable to the executive, albeit with limited LY oversight over their recruitment.
National Security Bureau website, url: http://www.nsb.gov.tw/index01.html accessed June 24, 2014
Act of National Intelligence Work, February 5, 2005
NSB Organic Act, 1994
Comment: There have been news coverage of problems within Taiwan's intelligence services, such as the alleged political affiliation related to Ma's administration (http://www.bbc.co.uk/news/world-asia-16398253) or discrimination and human rights violation (http://www.independent.co.uk/news/uk/home-news/taiwanese-intelligence-officer-emily-mei-yeh-faces-long-prison-term-in-taiwan-after-being-refused-asylum-in-uk-9052130.html) ans so on and so forth.
However, until a proverbial &quoute;smoking gun&quoute; is found, it should be noted that the law outlines some clear requirements to allocate positions in the intelligence services, despite being at times too flexible. Besides, there are rumors that the services are undergoing a review process. See: Lu Chao-lung, &quoute;Taiwan's Military Intelligence Bureau to be reorganized&quoute;, http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20130103000087&cid=1101
Taiwan is diplomatically isolated and is not a member state in the UN. However, the Taiwanese government is willing to comply with the principles sanctioned in arms control related treaties.
Under Article 5 of the Regulations as to Production Transaction of MND Technological and Industrial Units, which replaced the Arms Articles Export Regulation in 2002, all arms exports need the authorization of the MND or even the Executive Yuan. Although the Chungshan Institute of Science and Technology has expressed the intention to export civil/military dual-use products, media reports indicate military authorities have shown some significant hesitation.
[score 3 given in 2013]
UNODA website
http://disarmament.un.org/treaties/t/att
Regulations as to Import/Export Management of Military Organizations
Regulations as to Production Transaction of MND Technological and Industrial Units
"Taiwan's Chungshan Institute of Science and Technology Attends International Arms Exhibition and Intend to Export," Dajiyuan Media, June 13, 2006, http://www.epochtimes.com/b5/6/6/13/n1348944.htm
- Foreign Trade Act, Article 6, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=J0090004
- Regulations Governing Export And Import Of Strategic High-tech Commodities, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=J0090013
Comment: See also: &quoute;Taiwan National Security And defence Law And Regulations Handbook&quoute;, pp. 206-241
Two funds, the Military Dependants' Housing Reconstruction Fund and the Military Barrack and Facility Fund, manage the disposal of military-held real estate. They are subject to legislators' scrutiny, available in Annual Defence Budget Proposal, and oversight by audit units within Ministry of National Defence, Executive Yuan, and Control Yuan.
There are considerable shortcomings in regulating the disposal of items other than real estate, such as intellectual property of dual-use technologies developed by military R&D units. According to a recent investigation report (June, 2013) of the Control Yuan, "The MND and the associated logistical units do not have assured accounting about its military articles stockpile. The accounting record is confusing. The stores are exposed. The volume of stock which is required to send to field units is large but without proper consignment. Even though supply requests are recorded, the items are not delivered to the units in a timely way so become expired. Expired articles are large in number and not properly disposed of. The MND has insufficient knowledge about products and their substitutes so duplicative purchases happen. Field units are obligated to deliver the repaired or expired items but fail to do so. The management of MND is lazy and inactive."
The MND response does contradict the assessor's main doubts on items other than real estate, such as intellectual property of dual-use technologies that were developed by military R&D units.
Directorate General of Budget, Accounting and Statistics website http://win.dgbas.gov.tw
The Control Yuan website
Comment: Reference is made to the National Property Act and its regulations for enforcement which cover all of the acquisition, management, utilization, revenue and disposition of government property. It is a mandatory action for all government entities to disclose required information to the general public and make necessary reports to the Legislative Yuan and National Audit Office of Control Yuan for reviews. The asset management in Taiwan government is conducted through well-organised legislation, comprehensive measurement and public availability in practice. Furthermore, on the pros and cons of government real estate bidding, information is all available on the official website.
- National Property Act and Regulations for the Enforcement of National Property Act, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=G0370001, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=G0370002
- Regulations Governing Disposal and Sales through Open Tender of the Old Quarters for Military Dependents and National Land Not Fitting the Used of Military Camps, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0140016
- http://armamentsbureau.mnd.gov.tw/6.%E7%87%9F%E7%94%A2%E7%9B%B8%E9%97%9C%E6%B3%95%E8%A6%8F%E8%A6%8F/%E8%B2%A1%E6%94%BF%E9%83%A8/%E5%9C%8B%E8%BB%8D%E8%B2%A1%E7%94%A2%E7%AE%A1%E7%90%86%E4%BD%9C%E6%A5%AD%E8%A6%8F%E5%AE%9A.htm
- http://armamentsbureau.mnd.gov.tw/6.%E7%87%9F%E7%94%A2%E7%9B%B8%E9%97%9C%E6%B3%95%E8%A6%8F%E8%A6%8F/%E5%9C%8B%E9%98%B2%E9%83%A8/%E5%9C%8B%E8%BB%8D%E7%87%9F%E5%9C%B0%E7%A7%BB%E7%AE%A1%E5%8F%8A%E9%87%8B%E5%87%BA%E5%AF%A9%E6%9F%A5%E4%BD%9C%E6%A5%AD%E8%A6%8F%E5%AE%9A.htm
&quoute;Regulations of Managing and Using the Fund of Production and Services for Military Personnel&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0110019;
&quoute;Regulations Governing Disposal and Sales through Open Tender of the Old Quarters for Military Dependents and National Land Not Fitting the Used of Military Camps&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0140016;
The management of disposed military property, as with the procedures of the defence budget, is under layered control and oversight within the MND. The results can be found in public released reports and are easy to access. However, the implementation still suffers from shortcomings. According to the reports of the Control Yuan, there are five rectification cases in 2013 concerning mismanagement of veteran community property.
Control Yuan, &quoute;監察成果 - 糾正案文&quoute;.
http://www.cy.gov.tw/sp.asp?xdUrl=.%2FDI%2Fedoc%2Fdb2.asp&ctNode=911&edoc_no=2&doQuery=1&intYear=&mm=&intYearEnd=&mmEnd=&input_edoc_no=&case_pty=&input_edoc_unit=%E5%9C%8B%E9%98%B2%E9%83%A8&keyword=%E7%9C%B7%E6%9D%91&submit=%E6%9F%A5%E8%A9%A2
National Property Act and Regulations for the Enforcement of National Property Act, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=G0370001,
http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=G0370002
Regulations Governing Disposal and Sales through Open Tender of the Old Quarters for Military Dependents and National Land Not Fitting the Used of Military Camps, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0140016
http://www.pcc.gov.tw/pccap2/TMPLfronted/ChtIndex.do?site=002
http://law.moj.gov.tw/LawClass/LawAll.aspx?PCode=U0010001
http://law.moj.gov.tw/LawClass/LawAll.aspx?PCode=T0030002
http://law.mnd.gov.tw/scp/NewsDetail.asp?no=1A009717002
http://www.fnp.gov.tw/Edict.php?page=RuleInfo&TRE_ID=485
Comment: It is a mandatory action for all government entities to disclose required information to the general public and make necessary reports to the Legislative Yuan and National Audit Office of Control Yuan for reviews. The asset management of Taiwan MND is conducted with well-organised legislation, comprehensive measurements and public availability in practice. Furthermore, on the pros and cons of government real estate bidding information is all available on the official website.
- http://www.pcc.gov.tw/pccap2/TMPLfronted/ChtIndex.do?site=002
- http://law.moj.gov.tw/LawClass/LawAll.aspx?PCode=T0030002
- http://www.fnp.gov.tw/Edict.php?page=RuleInfo&TRE_ID=485
According to the most recent National Defence Report, the percentage of secret budget in the overall defence budget has been reduced from 18.94 % in 2004 to 5.39% in 2014. There is no publicly available information detailing what this secret expenditure relates to.
Ministry of National defence, 2013 National defence Report. http://2013mndreport.mnd.gov.tw/en/pdf/all.pdf
Ministry of National defence, 2014 Annual Budget Proposal.
Comment: The percentage of classified portion of the annual defence budget is 5.39% in fiscal year 2014. Recent years, the MND has made its best efforts to draw a clear line between un-classified and confidential budgets based on the principle of minimizing the scope of classified and maximizing information disclosure.
All secret items are included on a limited-distribution, classified budget book which is printed separately from the Annual Defence Budget Proposal. Reviews are held under closed procedure: only legislators are allowed to attend. There is a varied standard for providing legislators detailed accounts of secret items.
There isn't sufficient recent evidence that the Government provides extensive information on all spending on secret items, which includes detailed, line item descriptions of all expenditures. The video clip and the LY Committee report provided by the MND provide insufficient evidence for a score of 4. Score raised to 3.
Chao, Chin-yang, &quoute;National Security and Transparency,&quoute; National Policy Foundation, May, 2002
http://tw.myblog.yahoo.com/lin-yufang/article?mid=3351&sc=1
Media clips from the Legislative Yuan, http://media.ly.gov.tw/page.jsp?id=11087 & http://media.ly.gov.tw/page.jsp?id=279537
LY Committee Reports http://www.ly.gov.tw/01_lyinfo/0109_meeting/meetingView.action?id=54466&atcid=54466 & http://www.ly.gov.tw/03_leg/0301_main/leg_news/newsView.action?id=27583&lgno=00054&stage=6
Comment: The contents of annual defence budgetary proposal includes all aspects of expenditures to be carried out in coordination with requirements of the Armed Forces' missions. Among that, information on the classified budget is not considered releasble to the general public. However, the Legislators of Defence & Foreign Affairs Committee of Legislative Yuan, on behalf of the public, has full scrutiny rights to access the details of classified budget and to request MND for providing more information regarding specific programs.
- http://media.ly.gov.tw/page.jsp?id=11087
- http://media.ly.gov.tw/page.jsp?id=279537
- http://www.ly.gov.tw/01_lyinfo/0109_meeting/meetingView.action?id=54466&atcid=54466
- http://www.ly.gov.tw/03_leg/0301_main/leg_news/newsView.action?id=27583&lgno=00054&stage=6
Legislators normally receive audit report reports of secret items, however these reports are not very useful in assisting oversight of the secret budget. The reports only examine technical audit issues such as whether the budget is spent as planned or in regulated forms. In addition, the form of these reports are not the same as the Budget Proposal, making it challenging to draw comparisons and trace the actual results of the planned budget. Issues which are crucial to meaningful debate in the Legislative Yuan, such as justification of expenditure by the Ministry or examination of whether the secret budget is properly programmed, are not addressed in these reports. Legislators also spend limited time reviewing the audit accounting report.
The standard for score 4 is that reports are subject to "comprehensive parliamentary consideration and debate". More evidence is required that audit reports are subject to such a standard in the case of secret budget items.
Lu, Shiou-yen, A Study of National Security and the Legislative Yuan's Classified Budget System, Master Thesis, Tamkang University, 2004.
Ministry of National defence, &quoute;主計局/國防部所屬單位決算/國防部所屬101年決算報告公開部分&quoute;. http://www.mnd.gov.tw/UserFiles/File/主計局/國防部所屬單位決算/國防部所屬101年決算報告公開部分.pdf
Comment: Pursuant to the Financial Statement Act, the National Audit Office of Control Yuan shall provide their auditing reports on all the government entities, including classified reports, to the Legislative Yuan for deliberation. During reviews of auditing reports, the Auditor General shall attend the Committee and prepare to answer questions or provide more information to the legislators.
- Financial Statement Act, Article 27, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=T0020005
- http://www.ly.gov.tw/03_leg/0301_main/interrogate/interView.action?id=11141&lgno=00084&stage=7&atcid=11141
Historically, off-budget expenditure in Taiwan was largely used for foreign lobbying efforts or overseas secret operations and mainly by the Ministry of Foreign Affairs or National Security Bureau. The money was usually kept in bank accounts of individual or private firms. Since the early 2000s, off-budget defence or security expenditures is no longer acceptable to the administration.
National Audit Office, NAO Report 1997. http://www.audit.gov.tw/Public/Doc/44/20061002100106006D24q.HTM
&quoute;Budget Act&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=T0020001
At present, off-budget issues in the MND appear mainly related to surplus money from arms procurement, which are caused by changes of exchange rate or the postponement and cancellation of planned programs. The MND uses this surplus to purchase other articles or services that are not in the original programs. Though the MND should perhaps not bear all the blame for this off-budget issue, the Control Yuan's report in 2009 indicates the ministry has made little improvement in correcting this.
The Government Reviewer's argument the case raised above is not an off-budget expenditure example is reasonable. There is no evidence after 2013 that any off-budget expenditure exists.
Score changed from 3 to N/A.
&quoute;20 billion NT Dollars Surplus of Arms Procurement Money,&quoute; Liberty Times, 14 October, 2005
http://www.libertytimes.com.tw/2005/new/oct/14/today-p12.htm
Control Yuan, &quoute;Arms Procurement Plan - corrected text (published version)&quoute;, 2009. http://www.cy.gov.tw/AP_HOME/Op_Upload/eDoc/糾正案/102/102000125102000125軍購案-糾正案文(公布版)-0624.pdf
Comment: There is no off-budget military spending existed. All the MND's expenditures have to be included in the official defence budgets and annual financial statements. As to the surplus money from defence procurement, it is a difference between budgetary allocation and practical program execution (i.e. planning vs. executing). Normally, those remains shall return back to the national treasury while the program or case is closed. In practice, the utilisation of the remaining money from such programs or cases is still restricted by the MND's PPBE system and related regulations. If the Services need to use the surplus money to acquire extra items which are not included in the original program, respectively, they are required to follow regulations and the MND's internal process for approval in order to make additional changes to the program. The Control Yuan's corrective measures on few specific cases have pointed out the services' mistakes for not to follow the above-mentioned legal procedures for amendment to the programs.
The case raised by the assessor is not an off-budget expenditure example. It is an example of the Control Yuan's corrective measures on a few specific FMS cases of the services' poor management over amendments to the programs. It needs to be stated that there is no off-budget military spending existed. All the MND's expenditures have to be included in the official defence budgets and annual financial statements.
Stålenheim, P., Fruchart, D., Omitoogun, W. and Perdomo, C., &quoute;Military expenditure&quoute;, SIPRI Yearbook 2006, p. 319
The Classified National Security Information Protection Act clearly sanctions the levels of authorities in determining and declassifying three respective protection levels (state secret, confidential, and secret). For example, only the president, premier, and related ministers have the authorities to assign specific information as "state secret" in peacetime. The relevant law surrounding classification for budget items is the &quoute;Budget Act&quoute;, art. 40.
Policy officials have significant authority in defining classified information, and they appear to prefer to extend definitions in order to preserve their freedom of action and to loosen legislative oversight. For example, few National Security Council actions are known to the public. Unlike the UK, Taiwan's NSC has no public website, and it has not published a public report since its 2008 National Security Report. The head of NSC has also repeatedly refused to be questioned by legislators even though the law requires this.
The Government Reviewer's points do contradict the assessment.
Classified National Security Information Protection Act, Chapters 2-4, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0060003
The Organisation Act of National Security Council
The Enforcement Rules of the Classified National Security Information Protection Act, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0060005;
The Management Regulations for Classified Archives, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030126
Comment: The classification of information with regard to the national security is well regulated and these legal protection measurements and requirements are upheld in practice.
- The Classified National Security Information Protection Act, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0060003
- The Enforcement Rules of the Classified National Security Information Protection Act, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0060005
- The Guideline for categories, scopes and levels of military secrets and defence secrets, http://law.mnd.gov.tw/FLAWDAT0202.asp?lsid=FL005401
Comment: The relevant law surrounding classification for budget items is the &quoute;Budget Act&quoute;, art. 40 (http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=T0020001).
To obtain a general better picture of classified information issues in Taiwan see also:
&quoute;The Classified National Security Information Protection Act&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0060003;
&quoute;The Enforcement Rules of the Classified National Security Information Protection Act&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0060005;
&quoute;The Management Regulations for Classified Archives&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030126
The MND operates fewer funds compared with other ministries. Among three MND "non-beneficial special funds", the Military Manufacturing and Services Fund is the only one with business implications and expects to create 2,166 million NT Dollars income in 2014 (less than 1 % of total defence expenditures of 294,850 million). The Armament Bureau holds the greatest share of the fund, with an estimated income of 1,277 million NT Dollars. The Military Manufacturing and Services Fund is not for profit and the budget is submitted to the LY for review and approval, along with Annual Defence Budget Proposal. Funds are scrutinised by the Legislative Yuan along with defence budget proposal and reviewed by the National Audit Office of Control Yuan.
There is however wide-spread criticism concerning government-operated funds for their lack of transparency. The government is reducing the number of funds in response.
http://www.mnd.gov.tw/UserFiles/File/主計局/103年度國防所屬單位預算/3.1歲入項目說明提要表.pdf
The Directorate General of Budget, Accounting and Statistics of Executive Yuan website
http://www.nta.gov.tw/_admin/_upload/ContentB/225/file/103%e5%b9%b4%e5%ba%a6%e9%9d%9e%e7%87%9f%e6%a5%ad%e5%9f%ba%e9%87%91%e9%ab%94%e7%b3%bb%e6%a7%8b%e6%88%90%e5%9c%96.pdf
Wei Duan, "The Management of Non-Beneficial Special Funds," National Policy Foundation, Nov, 2007
http://www.npf.org.tw/post/3/3310
Comment: Please also refer to the Commerce Industrial Services Portal (http://gcis.nat.gov.tw/main/English/Index.jsp) of the Department of Commerce, Ministry of Economic Affairs. There is no related registration information in the database to indicate that the MND owns any business entities. As to the business operated by the military Manufacture and Services Funds, it is a non-profit nature with main mission to provide the armed forces with Indigenous defence weapon system, personal protection equipment and proper health & medical cares. Furthermore, in practice, the funds are also fully scrutinized by the Legislative Yuan along with defence budget proposal and closely reviewed by the National Audit Office of Control Yuan.
The operation of the Military Manufacturing and Services Fund receives the same audit and oversight procedures as the annual defence budget: two-level internal audit controls in the executive (the Internal Audit Division of the Defence Comptroller Bureau in MND and the Directorate General of Budget, Accounting and Statistics in EY) plus the National Audit Office in the Control Yuan as an external control entity. The results are not as good as the annual defence budget however. The volume of the fund operations in Annual Defence Budget Proposal is disproportionally thin by comparison and details are omitted, making effective legislative scrutiny difficult.
The reviewers' argument is convincing since the Chung-Shan Institute of Science and Technology (CSIST) is now not in the MND organisation chart.
Comment: As per the comment provided for the Question 30, there is no evidence indicated that the MND owns any business entities. As to the business operated by the military Manufacture and Services Funds, it is a non-profit nature with main mission to provide the armed forces with Indigenous defence weapon system, personal protection equipment and proper health & medical cares. In practice, the funds are also fully scrutinized by the Legislative Yuan with defence budget proposal and closely reviewed by the National Audit Office of Control Yuan.
Comment: The reason why few details about military-owned businesses are provided is that, in fact, the MND does not own any commercial business. The aforementioned Military Manufacturing and Services Fund cannot be considered market-driven commercial funds, hence the description of grade 4 in the scale is more accurate. Besides, the fund is also subject to the same rigorous scrutiny that the assessor mentioned.
The MND has an administrative directive for prohibiting active service personnel to take other work, even part-time or after hours. This directive is very tight in that even direct selling of commodities is not allowed. There are a few exceptions (formal authorisation procedures are still required) applied in hospital service, military academies, and technological research/development units.
The MND allows a few authorised private business to operate in the barracks. Most of them are chain retailer selling points and under the operational control of the Military Manufacturing and Services Fund.
There is still some evidence of some unauthorised business operated by individual soldiers and employees against the regulations. [no evidence]
http://law.mnd.gov.tw/scp/Query4A.asp?FullDoc=all&Fcode=A003714019
The National defence Medical Bureau website http://mab.mnd.gov.tw/index.php?module=NewsInfo&action=news1_show&sn=7
In September 2013, the incumbent Defence Minister Ming Yen received the delegate of Transparency International Chinese Taipei and clearly stated the MND's anti-corruption determination. Though the MND's position and measures continue, this is the only report of Minister Yen's anti-corruption statement that can be readily found on internet (little media coverage, only reported in military papers). Compared with high-volume anti-corruption public announcements in 2009, the frequencies of such commitments by MND policy officials and senior officers have significantly decreased in recent years.
To achieve score 4, the military leadership must make strong enough statements in the public arena. Evidence provided by various reviewers amounts to this.
Score increased from 3 to 4.
Transparency International Chinese Taipei website:
National Security Bureau, http://www.nsb.gov.tw/index01.html accessed June 24, 2014
Also see sources in Government Reviewer comment.
Comment: Pursuant to the President Ma's proclamation and discipline against corruption as well as government's &quoute;promoting integrity and anti-corruption&quoute; policy directives, the Taiwan Ministry of National Defence convenes a regular anti-corruption working meeting form 2009, which in convened at each level under the service headquarters. In addition, the Ethics Office has been established in 2013 to collaborate with the Inspector General's Office in joint anti-corruption efforts in order to strengthen the armed forces' integrity awareness. Many measures have been launched and implemented to eliminate corruption risks and prevent misconducts of personnel.
- http://www.president.gov.tw/Default.aspx?tabid=131&itemid=21988&rmid=514
- Related news http://n.yam.com/gpwb/life/20140610/20140610347206.html and http://n.yam.com/gpwb/life/20140611/20140611349819.html
- The Ethics Office of Ministry of National defence, http://ethics.mnd.gov.tw/
References added.
- http://www.mnd.gov.tw/UserFiles/File/%E5%9C%8B%E9%98%B2%E9%83%A8%E5%BB%89%E6%94%BF%E5%B7%A5%E4%BD%9C%E6%9C%83%E5%A0%B1/103%E5%B9%B41%E6%9C%88%E7%AC%AC38%E6%AC%A1%E5%BB%89%E6%94%BF%E6%9C%83%E5%A0%B1%E6%91%98%E9%8C%84%E8%B3%87%E6%96%99.pdf
- http://ethics.mnd.gov.tw/UFile/files/103%E5%B9%B46%E6%9C%88%E7%AC%AC40%E6%AC%A1%E5%BB%89%E6%94%BF%E6%9C%83%E5%A0%B1%E6%91%98%E9%8C%84%E8%B3%87%E6%96%99.pdf
- http://www.mnd.gov.tw/UserFiles/File/%E5%9C%8B%E9%98%B2%E9%83%A8%E5%BB%89%E6%94%BF%E5%B7%A5%E4%BD%9C%E6%9C%83%E5%A0%B1/103%E5%B9%B410%E6%9C%88%E7%AC%AC42%E6%AC%A1%E5%BB%89%E6%94%BF%E6%9C%83%E5%A0%B1%E6%91%98%E9%8C%84%E8%B3%87%E6%96%99.pdf
Comment: The Defence Minister Ming Yen not just received delegation from TI-Taiwan in 2013 but also invited TI-DSP Director Mark Pyman and British retired Maj. Gen. David Cook to visit the Ministry of National Defence in June 2014. During their stay in Taiwan, Dr. Pyman gave an two-hour lecture on defence corruption to 27 top generals in the bi-monthly anti-corruption meeting of the MND, which is chaired by Minister Yen. The following day, both Dr. Pyman and Gen. Cook were invited to National Defence University to offer a day-long anti-corruption workshop to 160 senior colonels. The President of the National defence University, Gen. Kuo-Cheng Chiu, participated throughout the workshop.
http://www.nownews.com/n/2013/09/16/926676
Comment: The National Security Bureau also frequently expresses in public its anti-corruption commitment.
National Security Bureau, url: http://www.nsb.gov.tw/index01.html accessed June 24, 2014
Comment: Despite little volume of public statements on anti-corruption issues, strict regulations are still out there to prevent that such a phenomenon may occur within the civil service, in general. See for instance:
&quoute;Anti-Corruption Act&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=C0000007;
&quoute;Regulations Governing the Establishment of the Control Yuan Committee on Anti-Corruption&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0010077;
&quoute;The Anti-Corruption Informant Rewards and Protection Regulation&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0070003
There is a special section on the EY website for government-wide anti-corruption codes, measures, standard operational procedures, and performance index, but not explicitly on the MND website. At the peak of anti-corruption activity during 2009 to 2010, 13 military personnel, including 6 general-level officers, were prosecuted on charges of bribery or corruption.
There is a National Security Personnel Security Clearance Regulation in place allowing MND Political Warfare Bureau (note: not Office of the Inspector General or Ethics Office) to check the financial status of MND personnel involved in sensitive affairs, not specifically suspicious targets. The regulation has its own shortcomings as it deals more with counter-intelligence than anti-corruption and the jurisdiction of Political Warfare Bureau is problematic.
The difference between score 4 and 3 lies on the degree of effectiveness and consistency. Significant changes have occurred in the last five years, as noted by the Government Reviewer, particularly in terms of focus. But institutionalisation of anti-corruption activity will likely take time, as alluded to by Peer Reviewer 2. More work is needed to raise standards and adapt efforts to tackle more complex corruption challenges (i.e. beyond bribe-paying.)
EY website:
http://www.ey.gov.tw/Content_List.aspx?n=9E57026FB421F554
MND website:
Comment: Bribery and corruption activities are considering as serious crimes in Taiwan government entities. The overall government anti-corruption mechanism is to carry out the various measures embodied in the U.N. Convention against Corruption and demonstrate the government's determination to bash corruption in response to the public's aspiration, on July 20, 2010, President Ma announced the establishment of the Agency Against Corruption under the Ministry of Justice to take charge of formulation and enforcement of the government's corruption-eradication policy. The establishment of Agency Against Corruption was on July 20, 2011, marking a milestone in the Taiwan's history of clean politics. Many evidences on prosecutions of government personnel on charges for bribery and corruption manners can be found at the ACC's website.
- The Ethics Office of MND, http://ethics.mnd.gov.tw/
References added for more MND's recent actions to remain alert on the corruption risks.
Comment: The fact that corruption-bribery cases are mainly exposed by the media, rather than the relevant bodies, is particularly indicative of the difficulties in fighting systemic corruption in some East Asian countries; Taiwan with this respect is no exception. For reference, see also:
Herbert Smith, &quoute;Guide to Anti-corruption Regulation in Asia&quoute;, 2012/13, pp. 66-72 http://www.herbertsmithfreehills.com/-/media/HS/HKBESHBAJSI21021214.pdf;
&quoute;Anti-corruption Informant Rewards and Protection Regulation&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0070003
There is a Witness Protection Act in Taiwan and the articles apply to corruption cases, however the legal definition of a witness is distinct from a whistleblower and there is no law that specifically protects whistleblowers. Witness protection is authorised by judges or public prosecutors where the witness obligates to testify during the investigation or court procedures. The Anti-corruption Rewards and Protection Regulation, does though state that an &quoute;informant needs to be protected and his or her safety needs to be ensured&quoute;.
According to the website of the Ethics Office, MND, the Ministry of Justice is now considering legislation extending protection to whistleblowers. The draft of Taiwan's whistle-blowing protection law is being discussed by the review committee of the Ministry of Justice. The draft legislation was sent to the Executive Yuan in early 2015 pending for further revision before submitting to the Legislative Yuan.
The ministry also launched several initiatives to encourage whistleblowing in fighting against corruption. And the MND anti-corruption units have made clear commitments in front of local members of TI-CT that they would take serious measures to protect whistleblowers from undue intervention and retaliation. However, there are difficulties in practice. As the military is a closed system and effective whistleblowing may come from those taking some part in suspicious activity, the identities of whistleblowers can be easily compromised.
Some scholars suggest the government should accept reports from anonymous whistleblowers, however this idea has not been widely accepted.
The fact that the Whistleblower Protection Act is still in the planning stage demonstrates in itself the lack of adequate legal protection.
Witness Protection Act, article 2, 3.
Article 1, The Anti-corruption Rewards and Protection Regulation.
Department of Justice, &quoute;Press Release: Independent Focus Forum - Protecting Whistleblowers&quoute;, 14 April 2013. http://www.ey.gov.tw/Upload/RelFile/39/697824/廉政焦點論壇-從『揭弊者保護談起』.pdf
Ethics Office, MND website
http://ethics.mnd.gov.tw/front/front.aspx?menu=e76054023af&mCate=e76054026ab
&quoute;Whistle-blower protection draft bill unveiled by KMT lawmaker&quoute;, The China Post, January 5, 2014 accessed June 24, 2014
Agency Against Corruption Website, http://www.aac.moj.gov.tw/mp289.html accessed June 24, 2014
Comment: The government's whistle-blower policy is in place legally and in practice. The Witness Protection Act and the Anti-Corruption Informant Rewards and Protection Regulation were enacted to encourage whistleblowing and to ensure whistleblowers are afforded proper protection. The same standards and measures have been taken by the MND for the purpose of maintaining integrity and protecting personnel in the military community. Currently, the Ministry of Justice is planning to make further legislative actions on the "Whistleblower Protection Act".
- Witness Protection Act, Articles 1, 4, 8 and 11-21, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030161
- News on legislative actions for "Whistleblower Protection Act, http://www.rootlaw.com.tw/NewsContent.aspx?ID=25134
- The Anti-Corruption Informant Rewards and Protection Regulation, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=I0070003
- http://www.moj.gov.tw/ct.asp?xItem=80590&ctNode=27518&mp=001
- http://law.moj.gov.tw/Law/LawSearchResult.aspx?p=A&t=A1A2E1F1&k1=%E6%AA%A2%E8%88%89
- http://news.rti.org.tw/news/detail/?recordId=106300
- http://www.tict.org.tw/front/bin/ptdetail.phtml?Part=epaper201208&Rcg=100040&PartPage=10
Comment: Whistle-blowing protection is a contentious issue in the military as well as with civil servants in Taiwan. There is no law regulating whistle-blowing in either the public or private sector. Witness protection law has existed for many years but has not adequately addressed the urgent need to protect whistle-blowers. The draft of Taiwan's whistle-blowing protection law is been discussed intensively by the review committee of the Ministry of Justice, in which TI-Taiwan was invited to sit as one of outside representatives in 2014. The draft legislation was sent to the Executive Yuan in early 2015 pending for further revision before being submitted to the Legislative Yuan.
Thanks to the consolidated democracy and vibrant free press in Taiwan, local news media actively expose the corruption and unjustifiable case in the military. But the protection of whistle-blowers remains a concern.
Comment: The KMT government is preparing new legislation on whistle-blowers protection.
Comment: Notwithstanding President Ma's 2009 announcement of his determination to fight corruption, coupled with a MND-MOJ press release in April 2009 to encourage whistle-blowing (through, e.g., a bounty of NTD$ 10 million), the situation has not changed much, and the climate within ministries and public offices seems to be remaining in the &quoute;let's-not-expose&quoute; camp.
Even the protection provided based on the Witness Protection Act seems to be insufficient to encourage massive come-outs.
See for reference:
China Times, &quoute;Does Presidential Anger Spell Hope for Anti-Corruption?&quoute;, April 10, 2009, http://www.kmt.org.tw/english/page.aspx?type=article&mnum=113&anum=6113;
Jerome F. Keating, &quoute;No Progress in Anti-Corruption Under Ma Ying-jeou. Diane Lee's Case Contributes?&quoute;, November 2011, http://www.jeromekeating.com/writing-2011-q4/111111.html;
Jon S.T. Quah, &quoute;Taiwan's anti-corruption strategy: suggestions for reform&quoute;, Maryland series in contemporary Asian studies, No 2, 2010, http://digitalcommons.law.umaryland.edu/cgi/viewcontent.cgi?article=1200&context=mscas
There are some objective criteria set out in the Act of Commission for Officers and Non-commissioned Officers of the Armed Forces, Act of Assignment for Officers and Non-commissioned Officers of the Armed Forces and their associated regulations in order to ensure the fairness of candidate selection. By law the president, minister, and chiefs of services hold greater authorisation in determining the choice though. A large-scale investigation in the military was conducted in 2009, in which some 50 cases involving 150 military personnel in total were inspected, resulting in detailed public reports. Though none of these case proved that promotion had occurred through bribery, the Control Yuan's report identifies procedural flaws as a source of corruption risk. The MND has consequently taken more serious steps in refining and complying the related regulations.
**Response to Government Reviewer**
The Government Reviewer has commented on mechanisms selection and oversight of particular military assignments demonstrating there is recognition by the government that certain positions may be more open to corruption opportunities. But it's exactly how these work in practice - for example over the appointment mentioned in the final source - is somewhat unclear,
Act of Commission for Officers and Noncommissioned Officers of the Armed Forces
Act of Assignment for Officers and Noncommissioned Officers of the Armed Forces
The MND website
http://www.cy.gov.tw/AP_HOME/Op_Upload/eDoc/糾正案/99/099000169內外網買賣官990819定版糾正案文990819%20-%20複製.pdf
http://news.ltn.com.tw/news/politics/breakingnews/1399783
Comment: The MND's selection and oversight of important and sensitive military assignments, including officials in commanding general, defence procurement and financial management, have been set up as a meritocratic mechanism with comprehensive measurements for personnel promotions, transfers and new assignments, Overall reviewing criteria associated with not only at &quoute;work performance evaluations&quoute; and &quoute;previous service satisfaction surveys&quoute; but &quoute;special security clearance for personal career records&quoute;, &quoute;personal and his/her family members' property declarations&quoute; and &quoute;personal concerns related to the Act on Recusal of Public Servants Due to Conflicts of Interest&quoute;, etc.
There are three separate figures which indicate the size of Taiwan's armed forces. The first is drawn form the budget, and the number of personnel on the pay roll. The Budget Proposal 2014 (p. 669) specifies the budget allocated number is 219,365 (regular forces, 217,474), although this number is likely to be overestimated in order to avoid underfunding. The second figure is the organisational billet number of personnel that related laws or acts allow. Previously, the billets in the MND and its sub-units, such as General Staff Headquarters, the Armament Bureau, Political Warfare Bureau, Comptroller Bureau, and Military Medical Bureau, were known by the sanctions of related acts. The articles regarding authorised billets have been deleted in the 2012 amendment. The last figure is the actual number of personnel, which is fluid as personnel are recruited in and retire out of the military. The Taiwanese military claims to be 215,000 strong on its National Defence Report without specifying which number is the basis. The National Defence Report 2013 also does not disclose the number of uniform personnel in the MND or in the military overall. In practice no one is likely to know the actual number beyond for a few specific staff at the J-1 level.
**Response to Government Reviewer and Peer Reviewers 1 & 2:
The MND counter-argument is valid. The force size is not actual because of constant turnover and there are no illicit motives.
Score changed from 3 to 4 and all sources added.
Organisation Act of the Ministry of National Defence
Organisation Act of the General Staff Headquarter
National Defence Report, 2013, p. 191.
National Defence Act, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0010030
Annual Defence Budget Proposal, 2014
Ministry of National Defence, 2013 National Defence Report. http://report.mnd.gov.tw/m/appendix01.html, accessed June 24, 2014
Ministry of National Defence, &quoute;2013 Quadrennial Defence Review&quoute;, Chapter 4. http://qdr.mnd.gov.tw/file/2013QDR-en.pdf
Cole, Michael, &quoute;Is Taiwan's Military Becoming Too Small to Fight?&quoute;, The Diplomat, March 19, 2014 http://thediplomat.com/2014/03/is-taiwans-military-becoming-too-small-to-fight/ accessed June 24, 2014
US-Taiwan Business Council, &quoute;Taiwan Ministry of National defence (MND) Reports&quoute;. http://www.ustaiwandefence.com/taiwan-ministry-of-national-defence-reports/, accessed June 24, 2014
Comment: A well-functioning personnel and payroll accounting management system exists and is applied throughout the MND and its units. All the jobs' ranks and pay rates are clearly stipulated. However, the exact number of military personnel of the services' units is regulated by an individual and classified &quoute;manning and equipment list&quoute;. Furthermore, due to constant turnover of the people, figures are variable all the time. The information available for the general public is considered an accurate figure.
Comment: The audit system in the military is effective and actual in overseeing the personnel expenditures. In turn, the expenditure exposes the actual number of military personnel although there is constant fluctuation of number due to constitutional compulsory obligation for men to serve in the military in Taiwan. Besides, there is no ghost soldiers in Taiwan. Therefore, TI-Taiwan suggests score 4.
Comment: The size of Taiwan's Army is available and publicly debated, despite some shortcomings which do not appear intentional. The 2013 report in its part 3 and Appendix (附錄) contains information on civilian and military personnel. Information on the former is more detailed than the latter.
2013 National defence Report, online version http://report.mnd.gov.tw/m/appendix01.html accessed June 24, 2014
Collection of Taiwan's National defence Reports http://www.ustaiwandefence.com/taiwan-ministry-of-national-defence-reports/ accessed June 24, 2014
Comment: The differences in declared figures seem to be minimal and quite understandable due to the nature of the change that Taiwan's military is undergoing. The Executive Yuan plans to amend the current regulations for military's organization; however, it remains true that even though the rough number of military personnel is known, further details concerning the exact number or greater de-aggregation should be made available.
&quoute;National defence Act&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0010030;
&quoute;Organization Act of the Ministry of National defence&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0000001;
MND, &quoute;2013 Quadrennial defence Review&quoute;, esp. ch. 4, http://qdr.mnd.gov.tw/file/2013QDR-en.pdf
There are laws and administrative directives that regulate the pay rate of civilian officials and military officers. The information of basic pay is openly published. However, the professional allowances for military officers vary considerably and are not so clearly stated.
The Government Reviewer has provided several excellent references giving more detailed sources on this question. But the sources provided by the Government Reviewer do not appear to contain openly published information about allowances.
"Pay Act of the Armed Forces," article 2, 3, 4, 5.
"Pay Act of Civil Service," article 2, 3, 4, 5, 6, 7.
Examination Yuan Website:
http://weblaw.exam.gov.tw/LawArticle.aspx?LawID=J060041019
Comment: The laws and regulations of pay rates for entire central government are well formulated. The information of pay rates and allowances of all levels' government personnel are published and available to the general public on related websites. In addition, from 2012, for any individual military personnel having consolidated income tax shall be levied on his income derived from sources in Taiwan. The taxation of payment covers special disbursement, allowance in kind or cash in lieu thereof and housing allowances received from the government by public servants, teachers, military personnel, policemen and laborers; and that portion included in the uniform-scale salary received by employees of state-run organizations representing allowance in kind and housing allowance.
- Pay Act of the Armed Forces and attachment, http://www.rootlaw.com.tw/en/LawContent.aspx?LawID=A040060070002100-0970116 and http://law.mnd.gov.tw/scp/Query1B.asp?no=1A0030000324
- Income Tax Act, Article 4, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=G0340003
- http://blog.udn.com/Generalxen/2959339
- 全國軍公教員工待遇支給要點及附表, http://weblaw.exam.gov.tw/LawArticle.aspx?LawID=J060041012
- http://www.dgpa.gov.tw/lp.asp?ctNode=561&CtUnit=314&BaseDSD=7
- http://host.cc.ntu.edu.tw/sec/all_law/5/5-24.pdf
- https://anntw.com/articles/20150210-3QMc
- http://ethics.mnd.gov.tw/front/front.aspx?menu=19c08202947&mCate=19c08202c3f
- https://tw.news.yahoo.com/%E5%9C%8B%E9%98%B2%E9%83%A8%E5%85%AC%E9%96%8B%E6%8A%BD%E5%87%BA103%E5%B9%B4%E8%B2%A1%E7%94%A2%E7%94%B3%E5%A0%B1%E5%AF%A6%E8%B3%AA%E5%AF%A9%E6%9F%A5%E4%BA%BA%E5%93%A1-092400952.html
All indications show that civil servants and military officers receive their pay on time and that payment systems are well-established. In the military, the Personnel Office in the MND is responsible for the payment of civil servants while the Office of Deputy of General Staff for Personnel is responsible for paying military officers. The Comptroller Bureau in the MND manages the payment and teller details. Four financial centers spread across Taiwan and are responsible for transferring the payment. Payment problems are rare and could be complained about via formal channels.
Pay Act of the Armed Forces, article 17.
Pay Act of Civil Service, article 24.
http://www.mnd.gov.tw/Publish.aspx?cnid=328
全國軍公教員工待遇支給要點, http://weblaw.exam.gov.tw/LawArticle.aspx?LawID=J060041012;
&quoute;Organization Act of the Comptroller Bureau of the Ministry of National Defence&quoute;, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0000077
There are laws and regulations concerning rank promotion and position assignment in the military. The MND also sets up a quantitative index of performances and appointment review committees for a more objective selection process. As in other militaries, middle- and senior-ranking officers' promotions and assignments are not only determined by their professional performance, seniority, education, but also by trust from their commanders. This can lead some of those that lose out to question whether there is also an element of corruption in the process.
In 2009-2010, incumbent President Ma indicated he believed that many senior officers had obtained their promotions through bribery during 2000-2008 and initiated the investigation of alleged bribery cases in the military in 2009. In one year some 4000 personnel were questioned, including over 900 ranking officers. Some were questioned simply because of journalists' conjectures and whistleblowers' speculations which were not based upon concrete facts. Though some 124 cases were criticised by the Control Yuan for not complying strictly with the administrative regulations, no alleged bribery cases were upheld, except one case of failed bribery (Yuan Xiaolong's case, bribery without getting promotion) being prosecuted. In April 2010, President Ma made a formal apology to those questioned during a press conference.
This case may be counterproductive to anti-corruption efforts in Taiwan as it has placed previous anti-corruption investigations in a conflicting situation of either the public perception being wrong or the military deliberately covering over an alleged scandal.
The standard of score 3 or above requires the use of objective job descriptions and assessment processes for appointments, and oversight of this process by independent personnel. None of these three conditions function well at present.
Promotion and assignment is a challenging task for J-1 staff and leaders. There have been improvements in recent years, but the fact that there are so many exceptional cases show there is still a long way to go to reach the standard for score 3.
Act of Military Service for Officers and Noncommissioned Officers of the Armed Forces, article 5, 6, 11, 19.
Act of Assignment for Officers And Noncommissioned Officers of the Armed Forces, article 3, 6, 7.
Taiwan's system of office promotion has long been regarded as in need of reform.
Cole, Bernard D, &quoute;Taiwan's security: History and prospects&quoute; (New York: Routledge, 2006) p175
Comment: The MND's selection of at middle and top level appointments for personnel promotions, transfers and new assignments have been regulated by a meritocratic mechanism with comprehensive measurements. Overall reviewing criteria associated with work performance evaluations, previous service satisfaction surveys, special security clearance for personal career records, personal and his/her family members' property declarations as well as personal concerns related to the Act on Recusal of Public Servants Due to Conflicts of Interest, etc. As to the mentioned full-scaled investigations on exceptional promotion cases happened during 2000-2008, it has been accomplished and proved none alleged bribery case stood being prosecuted. Furthermore, evidences have shown that more and more military personnel with required expertise and professional skills have been promoted and assigned to proper positions in recent years.
Comment: Taiwan's system of office promotion has long been regarded as in need of reform.
As the case of 2009-2010 illustrates, alleged corruption cases have revolved around personnel promotion or assignment detail. For this reason, the MND has refined its procedures and now stresses the presence of selection review boards. An objective quantitative index is used, though the commander's judgement is still a crucial element and inevitably subjective. External oversight rests on the Control Yuan and members of the Control Yuan can conduct investigations into allegations of inappropriate promotion or assignment. MND is obliged to answer these investigations.
The Government Reviewer has provided a useful description of the process. But as mentioned above, an objective, quantitative index is not the only condition for personal promotion and the commander's judgement can have a significant influence. And while the 2009 case revealed no evidence of corruption, it did nonetheless reveal significant internal debate questioning how meritocratic the overall system was. So without further evidence of how this formal processes works in practice, or the existence of independent scrutiny, it's difficult to award a higher score for this question.
National defence Report, 2009, pp. 136-138.
http://air.mnd.gov.tw/Publish.aspx?cnid=1732&p=34060&Level=1
Comment: The MND's personnel system for promotions has been regulated by a meritocratic mechanism with comprehensive measurement. The personnel evaluation committee is set up from the MND level down to the battalion or company levels. Overall assessment criteria is linked to work performance, education, awards, service satisfaction surveys and security clearance, etc. As to the investigation on exceptional promotion cases during 2000-2008 and mentioned above - no corruption case was prosecuted. Furthermore, evidence has shown that more and more military personnel with required expertise and professional skills have been promoted and assigned to proper positions in recent years.
Taiwan's compulsory conscription system is highly regarded in terms of fairness and transparency. Further, the Punishment Act for Violation to Military System acts as a deterrent to bribery. Over 50 years of conscription practice has created a cultural norm in the population to condemn such avoiding behaviours, which largely occur via prolonging school education or staying abroad. Politicians' children and young pop stars have come under particular media scrutiny. For example, Vice Defence Minister Shieh was criticised on the eve of his formal appointment for allegations that his child was avoiding conscription.
Incentives for such avoiding behaviour are further reduced since the term of conscription has been shortened in recent years (4 months only for those born after 1994).This is part of wider transition to a full volunteer force, which was originally supposed to happen by Jan. 1, 2015, though the timetable has been delayed.
"Act of Military Service System," article 46.
"Punishment Act for Violation to Military Service System," article 18, 19, 20, 21, 22.
"End Avoiding Service, Shieh's Son Returns and Joins Service," Liberty Time, March 18, 2014
http://news.ltn.com.tw/news/politics/paper/763019
&quoute;Last conscripts to enter military by end-2015&quoute;, March 2015, http://www.chinapost.com.tw/taiwan/national/national-news/2015/03/11/430776/Last-conscripts.htm
Selection procedures are considered to be the backbone of Taiwan's compulsory conscription system, so strict procedures are in place to ensure fairness and transparency. At the end of training boot camp, a public lottery draw is held to decide draftees' future service units. Some special units (for example, military police or intelligence units) will come to boot camp to select draftees. Such selection is based upon required professional skills. And draftees may refuse to be selected (since these units are considered the toughest ones) and join the lottery draw once more.
After entering active service, postings cannot be easily changed (to a different service or unit). Senior officers may be put under some pressure to treat certain draftees better, but there isn't a lot they can do in practice, and those (politicians in particular) who have the power to influence are under significant media scrutiny.
National Conscription Agency, Ministry of the Interior website:
http://www.nca.gov.tw/web/pg-d-15.asp
Ministry of the Interior website: http://www.moi.gov.tw/outline/tw-06.html accessed June 24, 2014
Enforcement Statute for Alternative Service
Comment: There is also a transparent decision-making process for alternative conscription.
The existence of "ghost soldiers" in the MND is virtually impossible since the computerised payment system is networked with others (such as healthcare and income tax). Military identification must be established before receiving payment and the system is long-established in Taiwan. There are layered control mechanisms in the MND and Ministry of the Interior in charge of identification issues.
"Regulation of Military Identification," article 2, 3, 4. http://law.mnd.gov.tw/scp/Query4B.asp?FullDoc=所有條文&Lcode=A003000024
The chain of command has no authority to intervene in pay procedures. The Comptroller Bureau in the MND is under the personnel and operational command of the Directorate General of Budget, Accounting and Statistics of Executive Yuan and is free from political intervention from respective ministries. Military payment is now largely computerized, with the exception of rewards, and no other individuals or institutions stand in the way of paying procedures.
"Regulation of Establishment and Management of Comptroller Institution and Personnel," chapter 3.
&quoute;Organization Act of the Ministry of National Defence&quoute;, art. 6
The MND has set up a code of conduct to fight against corruption and bribery since 2008 and it can be easily accessed through the website of the newly established Ethics Office. These codes are comprehensive and clear. For example, Code for Clean Ethics of Uniform Personnel, which was last updated in March 2014 clearly identifies the distinction between a courteous gift and bribery. Rules established in these codes are feasible and unambiguous to help military personnel not to cross the line; for example a gift over NT$3000 value is considered to be a bribe. The Ethics Office takes oversight responsibility.
Ministry of National defence, Military Discipline and Ethics Division website, http://ethics.mnd.gov.tw/front/down.aspx?menu=6a605802a12&mCate=6a60580280a
Comment: See also, as a background reading:
Oliver Cover and Saad Mustafa, &quoute;Identifying Corruption Risks in Defence and Security&quoute;, Paper Submitted for the 17th Annual International Conference on Economics and Security SIPRI, Stockholm, 14–15 June 2013, http://www.sipri.org/research/armaments/milex/ICES2013/papers/archive/cover-mustafa-identifying-corruption-risks-in-defence-and-security
Violations of the codes of conduct result in internal ethics or discipline investigations, but the details of these investigations are not necessarily made publicly accessible. Improper behaviour is defined well enough in these codes to enable them to work effectively however. Given the intensive promotion competition within Taiwan's military, such behaviour is also very likely to leak to the media and negatively affect individual promotion. For example, in 2011, the former Commander of Air Force General Lay was accused of directing his subordinates to assist his daughter's wedding party. Although General Lay was finally found not guilty, he received no further promotion.
Ethics Office website
http://ethics.mnd.gov.tw/front/down.aspx?menu=6a605802a12&mCate=6a60580280a
"Commander Lay was discharged," Apple Daily, 7 January 2011
http://www.appledaily.com.tw/appledaily/article/property/20110107/33093842
Comment: A more recent case is that of the death of private Hung Chung-Chiu following abuse by officers. Eighteen officers were persecuted and the Minister of Defence resigned as a result of public outrage with Hung's death.
Linda van der Horst, &quoute;The veil of secrecy: abuse in the Taiwanese military&quoute;, OpenDeocracy website: http://www.opendemocracy.net/linda-van-der-horst/veil-of-secrecy-abuse-in-taiwanese-military accessed June 24, 2014
''Criminal Code of the Armed Forces'', Artt. 5-8
Anti-corruption education and training has been integrated well into the Taiwanese military. All details of MND anti-corruption efforts are accessible on the websites of the Ethics Office and TI-CT. Codes of Conducts are published and distributed to all personnel in the military. Training or educational television programs form part of weekly political warfare courses. The programs are military wide and all service personnel are obliged to engage.
Civilian scholars, though unable to participate in MND internal anti-corruption measures, are invited frequently to lecture in public events for education purposes. For example, TI-CT hosts several anti-corruption training events annually, such as its youth integrity program and Rui-Bin Art & Character Education Camp. The MND send young students to participate in these events.
http://www.mnd.gov.tw/Publish.aspx?cnid=3313
https://tw.news.yahoo.com/%E7%91%9E%E6%BF%B1%E6%95%99%E8%82%B2%E7%87%9F%E5%8F%83%E8%A8%AA%E6%B5%B7%E8%BB%8D168%E8%89%A6%E9%9A%8A-%E5%85%A8%E6%B0%91%E5%9C%8B%E9%98%B2%E5%90%91%E4%B8%8B%E6%89%8E%E6%A0%B9-110600851.html
Comment: The MND's Ethics Office plays a pivotal role in bridging the gap between the military and the civil society in Taiwan. In addition to plan and implement anti-corruption policy within the military, the Ethics Office coordinates the National Defence University to dispatch young cadets as volunteers, in partnership with TI-Taiwan and National Taiwan University of Arts, to serve in the Rui-Bin Arts & Character Education Camp and Bo-Chang Arts & Character Education Camp in New Taipei City since 2013 on a regular base. This innovative service-learning program in winter and summer breaks enables the young professional military personnel to integrate their discipline into integrity education for underprivileged pupils.
President Ma initiated an investigation into alleged bribery cases in the military in 2009. Ma believed that many senior officers obtained their promotions through bribery during 2000-2008. The investigation was effective and far-reaching in its scope - in one year, some 4000 personnel including 900 plus ranking officers were questioned. The investigation was also inadvertently transparent in that some case details were illegally leaked to the media when investigations were still processing. The investigation results finally entered the public domain in April 2010. Excepting one case of failed bribery (Yuan Xiaolong's case, bribery without getting promotion) being prosecuted, none of the alleged bribery cases stood. President Ma made an apology for those being questioned during the press conference.
**Response to Peer Reviewer 1:
Peer Reviewer 1 makes a good point.
Office of the President website
http://www.president.gov.tw/Default.aspx?tabid=131&itemid=20975&rmid=514&sd=2010/04/09&ed=2010/04/10
&quoute;Military Bribery Case Yuan Xiaolong Sentenced to 10 years&quoute;, Liberty Times, 3 September 2009, http://www.libertytimes.com.tw/2009/new/sep/3/today-p5.htm
Jens Kastner, ''Doubts over Ma's tough cure for corruption'', Asia Times, http://www.atimes.com/atimes/China/LH26Ad01.html;
Michael Richardson, ''Ma Ying-jeou's unpopularity at all-time high in wake of KMT corruption scandal'', http://www.examiner.com/article/ma-ying-jeou-s-unpopularity-at-all-time-high-wake-of-kmt-corruption-scandal;
Jon S. T. Quah, ''Curbing Corruption in Asian Countries: An Impossible Dream?'', 2011
UTC by defence Industry Daily staff, ''Taiwan's Frigate Corruption Investigation: Can they Collect?'', http://www.defenceindustrydaily.com/full-steam-ahead-for-taiwan-frigate-corruption-investigation-01546/
Comment: It seems that the rhetoric employed by President Ma may be exaggerated, compared to the reality of the actions. Indeed, a number of corruption related crimes have not been reported after 2009, despite Ma's stated anti-corruption effort. Information that was made public depended mainly on the work of news agencies, rather than direct government or military source - testifying some unwillingness to be transparent.
Accepting facilitation payments is illegal for officials in Taiwan and sanctioned in Article 11 of the Anti-Corruption Act. Such payment is legally considered as bribery. Civil servants, including military personnel, can be charged with sentences of up to 3 years in prison. Since facilitation payment can occur in other forms than actual monetary payment, such as gifts or meals, there are also several directives in this regard. The Code for Clean Ethics of Uniformed Personnel and other related procedures are in place to fight against small corruption at local level. According to these regulations the behaviours of receiving gifts from and dining with task-related persons are not allowed, for example, and need to be reported immediately. Receiving gifts from task-unrelated persons but over NT$3000 in value must also be reported to ethics units immediately. These regulations and procedures apply strictly to all military personnel.
Violations are punished or even prosecuted and cases can be seen on the Ethics Office website.
Anti-Corruption Act, article 11.
Ministry of National defence, Military Discipline and Ethics Division website.
''Anti-corruption Act'', art. 4,5,11
All officially-published doctrines in Taiwan's armed forces are confidential and unaccessible to the public. Political warfare officers that are assigned to field units should bear the responsibilities for preventing corruption, although it is unclear whether the General Political Warfare Bureau provides clear, practical guidelines for corruption prevention during operations. If this question is extended to consider the mainstream military thinking about the proper ways to conduct operations (not necessarily sanctioned in authorised publications), all military personnel are likely to recognise that corruption will affect military or civil operation negatively.
Response to Government and TI Reviewer comment;
The key issue here is whether there is military doctrine which specifically addresses corruption issues during both peace and conflict. For example, the TI report on Corruption & Peacekeeping (http://ti-defence.org/publications/20-category-publications/publications-dsp/128-dsp-pubs-corruption-pk.html) includes a section on mission operations that discusses a range of mission-specific risks, including theft, bribery, field procurement and exploitation of local staff.
Although the doctrine described may apply to these types of events (if applied correctly), there is insufficient evidence that the strategic risks of corruption on operations have been directly examined.
Ministry of National Defence, General Political Warfare Bureau website http://gpwd.mnd.gov.tw/Publish.aspx?cnid=143
Comment: Taiwan's presidential leadership has led and established a comprehensive mechanism with robust implementation guidelines to deal with the entire government's anti-corruption practices. The armed forces' address in corruption issues has also been delivered to each service's headquarters through the minister-hosted meeting regularly. In addition, since military personnel are part of the civil service, the Anti-corruption Act and related regulations, directives, guidelines or so call &quoute;doctrine&quoute; have already prescribed very comprehensive details, clearly definitions and should be all applied to the armed forces on all circumstance during operations.
- The Ethics Office of MND, http://ethics.mnd.gov.tw/front/down.aspx?menu=44a0750255c&mCate=44a07502674
- http://ethics.mnd.gov.tw/front/front.aspx?menu=e76054023af&mCate=e76054026ab
The defence community address on corruption issues has been delivered to each service's headquarters through the minister-hosted meeting regularly. The Anti-corruption Act and related regulations, directives, and guidelines have also already prescribed very comprehensive details, clear definitions and should be all applied to the armed forces at all circumstances.
Comment: Since the establishment of the Ethics Office within the MND in 2013, this civilian-staffed anti-corruption unit has dedicated to strengthen the prevention, awareness, and investigation on military corruption. This office establishes close contact with TI-Taiwan and corruption-study scholars. The beauty of this civilian unit within the military is not just to foster the civilian-military relationship but also to &quoute;clarify and streamline&quoute; anti-corruption doctrines & practices, which are oftentimes unnecessary and over-elaborate formalities from civil servant's point of view. Nonetheless, one shortcoming exits. The statistics of violations of anti-corruption doctrines is not public accessible.
http://ethics.mnd.gov.tw/front/frontList.aspx?publicID=155&menu=c300800219c&=c300800268b
Although regulations are in place and due anti-corruption procedures are distributed, no significant related training activities for field commanders are recorded on the websites of the Ethics Office, Office of the Inspector General or the General Political Warfare Bureau. Field commanders are perhaps more concerned with operational efficiency during drills, exercises or overseas port calls than corruption prevention.
The Ethics Office sources do not provide sufficient evidence to increase the score. Some sources show the military has engaged in anti-corruption events organised by NGOs. Some sources recorded the president's presence on cadre training event. None relate to regular anti-corruption field training activities. Although the responsible units in the MND do well in formulating anti-corruption SOPs and distributing these to all ranks, this is likely to require further reinforcement through training to make them relevant in practice.
Ministry of National Defence, &quoute;Military Discipline and Ethics Division - Independent work policy&quoute;
Ministry of National Defence, &quoute;Office of the Inspector General&quoute;. http://www.mnd.gov.tw/Publish.aspx?cnid=3303
Ministry of National Defence, &quoute;General Political Warfare Bureau&quoute;. http://gpwd.mnd.gov.tw/Publish.aspx?cnid=143
Comment: The training of integrity to military personnel is always the basic course requirements in all levels. For field commanders, the Commander-in-Chief of service should chair an anti-corruption working meeting bimonthly in accordance with the MND's guidelines. Furthermore, the National Defence University has already allocated the integrity training as a required lecture at all service Command and Staff Colleges and War College for those future field commanders.
- Military News Agency, http://mna.gpwb.gov.tw/IndexDetail.aspx?id=66419
- https://tw.news.yahoo.com/國際透明組織學者蒞訪國防大學-分享廉潔教育-092700735.html
- National defence University, Training materials, http://www.ndu.edu.tw/releaseRedirect.do?unitID=183&pageID=3783
- http://udn.com/NEWS/BREAKINGNEWS/BREAKINGNEWS1/8729614.shtml
- http://history.n.yam.com/gpwb/life/20130808/20130809671589.html
- 持志廉潔風氣形塑優質軍風,http://gpwd.mnd.gov.tw/Publish.aspx?cnid=513&p=3413
- http://navy.mnd.gov.tw/Publish.aspx?cnid=2711&p=63999&Level=3
-國際透明組織專家指導廉潔教育, http://www.tict.org.tw/front/bin/partprint.phtml?Part=epaper20140630&Style=3&PartPage=5
- 國際專家來台推動高階將領廉潔反貪教育, http://www.tict.org.tw/front/bin/ptdetail.phtml?Part=20140611&Rcg=100041
- https://tw.news.yahoo.com/%E5%9C%8B%E8%BB%8D%E5%BC%B7%E5%8C%96%E6%96%BD%E6%94%BF%E9%80%8F%E6%98%8E%E8%88%87%E5%BB%89%E6%BD%94%E9%9D%A9%E6%96%B0-%E5%B0%88%E5%AE%B6%E5%AD%B8%E8%80%85%E8%82%AF%E5%AE%9A-113000732.html
Comment: There is no overnight magic in changing the isolated sub-culture within the military. However, the Ethics Office does launch several pilot programs in training the field commanders on anti-corruption issues. For example, following the workshop for 160 senior colonels (who are future candidates of general) at the National defence University (NDU) on June 12, 2013 held by TI-DSP Dr. Mark Pymand and Ret. Maj. Gen. David Cook , the Ethics Office arranges a follow-up lecture given by Director General of the Agency Against Corruption to the NUD on Aug. 8, 2014. The Ethics Office takes initiatives to persuade the NDU to integrate the anti-corruption policy and practices into regular commander-training program. Some positive feedback has happened. For example, some field commanders have made inquiries on graft or corruption issues by talking to the Ethics Office.
http://ethics.mnd.gov.tw/front/frontList.aspx?publicID=155&menu=c300800219c&mCate=c300800268b
Comment: I believe that due to the rare (if not complete absence) of ROC Armed Forces deployments far from the Taiwan Strait it is hard to judge whether military's commanders are or are not trained in corruption issues, not to mention their application of such knowledge from them in the field.
The assessor him/herself stated that ''regulations are in place and due anti-corruption procedures are distributed''; perhaps, then, it should be either given a higher grade to this question, or judge the ''absence of known related training activities for commanders'' and lack of evidence for their implementation as a N/A.
Taiwan's armed forces have rarely been deployed on overseas missions, however if domestic disaster relief operations are considered to be &quoute;in the field&quoute; for the purposes of this question, then the political warfare officers assigned to all company-level units are responsible for anti-corruption in the field. According to their website they &quoute;establish policies for the following categories: supervisory personnel, military discipline, graft and bribery handling, graft and bribery prevention, case investigation, supervision on investigation, and property declaration.&quoute; In practice political warfare officers in field units have too many responsibilities, ranging from troop morale to counter-intelligence, to necessarily be effective in monitoring corruption risk however. As no systematic anti-corruption training activities are evident in field units, the anti-corruption performances of political warfare officers is open to debate.
General Political Warfare Bureau website
http://gpwd.mnd.gov.tw/Publish.aspx?cnid=3
Comment: Since the Taiwan Armed Forces never have any chance to deploy overseas operational or peacekeeping missions, it is requested to adjust scores of question 54 and 55 to N/A.
Since Taiwan's military rarely deploys overseas, the only possible corruption targets are military representative units or personnel stationed in foreign countries, such as the United States, France, or Japan. The military representative section in the United States is the biggest one among these. This section is not only responsible for liaison or diplomatic missions but also very large-scale weapon procurements. There are considerable corruption risks since although procurement personnel are equipped with sufficient knowledge about U.S. codes of arms procurement (Armament Bureau has regular overseas training programs for this task), the political warfare officers assigned to oversee their operations do not. The section is also unlikely to have effective monitoring simply because there are too many sub-units or personnel spread across the U.S.
Response to Government Reviewer Peer Reviewer 1:
Agreed, and considering the additional information provided, score changed from 1 to 2.
"The Ethics Guidance for Procurement Personnel," article 7. 8. 9. 12.
"MND Disclose the Training and Management of Procurement Personnel," NowNews, 13, June 2010, http://www.nownews.com/n/2010/07/13/676800
Comment: The Taiwan Armed Forces never have a chance to deploy overseas operational or peacekeeping missions. The military procurement representatives stationed in the United States and France is dealing with contracting affairs on behalf of the MND and Tri-services in accordance with the Government Procurement Act and related regulations. They are all well-trained with required government procurement certificates.
Since the Taiwan Armed Forces never have any chance to deploy overseas operational or peacekeeping missions, it is requested to adjust scores of question 54 and 55 to N/A.
Comment: There is no peacekeeping nor deployment for Taiwan's military due to lack of UN membership. Military attache and procurement personnel in overseas assignments are different issues from the deployment. TI-Taiwan suggests N/A as the answer.
Comment: According to the answer Taiwan has only military representatives abroad who receive relevant training both at home (see indicator 53) and in the country were they are stationed. Score 2 is closer to the description offered.
Private military contractors are not allowed by law as a legitimate body in conducting military operations. Under the National Defence Act, military force is confined to the three military services and, in wartime, other "legalized armed units" (that is, a coastal guard or police force) granted by the Executive Yuan.
Response to Peer Reviewer:
As far as the assessor could ascertain, at present, private military contractors are not employed to any significant extent. It is correct to say that some military hospitals hire private security personnel. But the number is very very small. And their responsibilities are mainly e.g. traffic control. Security guards in most Taiwan's embassy are hired by Ministry of Foreign Affairs, not MND.
"National Defence Act," article 4.
Comment: I suggest to further investigate the presence of operational staff from PMCs in military environments in a broader sense, meaning also their involvement in non-combat duties (such as security/surveillance or logistics, for instance).
Given both the growing relevance of the PMC industry and the growing problems that Taiwan is experiencing with its military, zero involvement of PMC seems unlikely - although I could not find any specific source.
The Government Procurement Act regulates all government procurement, however, the exception to this regulation applies to special military procurement, which is subject to a directive issued by the MND. No specific anti-corruption measures related to arms deal are stipulated in the Directive for Application and Management of Special Military Procurement.
Given its diplomatic difficulties, Taiwan's arms deals are mainly single-sourced (that is from the U.S.). Most of U.S. arms sales to Taipei are processed through Foreign Military Sale (FMS) procedure. Under FMS procedures, the U.S. military bear the project management responsibilities, including preventing corrupt behaviour of U.S. defence contractors.
The standard for a score of 4 is whether exempt procurements (article 104 and 105 of the Government Procurement Act) are subject to other forms of independent scrutiny and this legislation has clauses specific to corruption risks. Unfortunately, the Regulations for Coverage and Handling of Special Military Procurement do not have clauses covering corruption risks. While the MND reasonably argue the numbers of such exempt cases are few, the value of these cases is considerable.
The exempt cases are subject to other forms of independent scrutiny such as the LY. The effectiveness of the legislative scrutiny is of course another issue.
"Government Procurement Act," article 104
"Directive for Application and Management of Special Military Procurement," article 5.
Comment: Taiwan's Government Procurement Act was enacted in 1998 with all compliance to the WTO's Agreement on Government Procurement (GPA) (note: the WTO Government Procurement Committee has adopted Taiwan's accession to the GPA on December 9, 2008). And, it is needed to clarify that the Act applies to all the government entities with no exception of defence or security procurements. Thus, military procurement is part of government procurements. Management of such procurements must abide by the overall government policy of openness, transparency and fairness. Procurement of defence requirements for articles, services and/or facility constructions should be all in accordance with the rules stipulated in the Government Procurement Act and its related regulations. As to the Article 104 of Government Procurement Act and its Regulations for Coverage and Handling of Special Military Procurement, procurement conducted by military entities follows the provisions of the Act except where procurement is for weapons, ammunition, war supplies, or related to national security or national defence and has one of the following situations:
1. where this nation is confronted with a war, in mobilisation for a war, or in a war, this Act may not apply;
2. where the procurement is a confidential or strictly confidential one, Articles 27, 45 and 61 hereof may not apply;
3. where there is an emergency which may jeopardise an important military mission, Articles 26, 28, and 36 may not apply; or
4. where there is only one supplier invited for tendering, the first sentence of paragraph 3 of Articles 26 may not apply;
Thus, the above-mentioned exception only applied in few provisions of the Act (such as Articles 26-28, 36 and 45). The coverage of such procurements has been prescribed and legalised as a sub-regulation by the Legislative Yuan in May, 1999.
Comment: The Government Procurement Act applies to all public sector's procurement, including the military. The law requires certain degree of transparency and disclosure on the Public Construction Council's website. In some instances, Foreign Military Sale (FMS) dominates the weaponry procurement between Taiwan and the USA. These sale cases are subject to Legislative Yuan's scrutiny and budget appropriation process. Local news media is another useful tool to scrutinize the procurement process thanks to the freedom of press and vibrant democracy in Taiwan.
Comment: According to article 104 of the Government Procurement Act: t
&quoute;Procurement conducted by military entities shall follow the provisions of this Act except where procurement is for weapons, ammunition, war supplies, or related to national security or national defence and has one of the following situations:
1. where this nation is confronted with a war, in mobilization for a war, or in a war, this Act may not apply;
3. where there is an emergency which may jeopardize an important military mission, Articles 26, 28, and 36 may not apply; or
The coverage of procurement referred to in the preceding paragraph and the regulations thereof shall be prescribed jointly by the responsible entity and the Ministry of National Defence, and be sent to the Legislative Yuan for reviewing.&quoute;
The Regulations for Coverage and Handling of Special Military Procurement explain in detail when such exceptions may occur. Also, in the aforementioned well-delineated exceptions Legislative scrutiny is secured.
Government Procurement Act: https://www.pcc.gov.tw/pccap2/BIZSfront/EngMenuContent.do?site=004&bid=BIZS_C00000022
Regulations for Coverage and Handling of Special Military Procurement: http://lawweb.pcc.gov.tw/EngLawContent.aspx?id=30
Comment: Procurements conducted by military entities, indeed, should follow all the provisions of the Government Procurement Act; the only exceptions are, as per art. 104, when ''procurement is for weapons, ammunition, war supplies, or related to national security or national defence AND has one of the following situations'' - that is, when the nation is confronted with a war or emergency situations. In other cases, only few articles do not apply.
Procurements not regulated by the Government Procurement Act are dealt with by the Regulations of Military Procurement (http://tcc.export.gov/Trade_Agreements/All_Trade_Agreements/exp_005400.asp). In addition, these deals go through internal and external auditing. The lack of more specific measures is compensated by the oversight that the LY has over the subject matter.
For reference, see also:
''Understanding on Government Procurement Between the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu (Chinese Taipei) and the Government of the United States'', http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=F0090016;
''Regulations for Coverage and Handling of Special Military Procurement'', http://lawweb.pcc.gov.tw/EngLawContent.aspx?id=30
Most MND procurement other than arms deals are covered by the Government Procurement Act. Oversight or scrutiny mechanisms are in place as in other ministries.
Regular arms procurement goes through three-stage planning: defining operational requirement, system analysis of various options, and programming investment. However, due to Taiwan's diplomatic difficulties, the U.S. is virtually Taiwan's sole-source arm supplier. The arms deals largely depend on what the U.S. wants to sell to Taiwan rather than what Taiwan wants to buy from the U.S. The type or supplier of weapon has often been determined before the initiation of the three-stage planning. This reality makes the three-stage rational planning process very fragile, if not totally meaningless. The detailed assessments of three-stage planning are not accessible to the public and legislators may, at best, obtain an abbreviated summary.
In 2013, Office of Defence Procurement was established to coordinate the three-stage planning.
No questions are raised as to general procurement programs. The key issue at hand is sensitive arms acquisition. Given the risk that China will politically sabotage Taiwan's foreign arms purchases the arms sales process keeps as much as possible from being disclosed until the deal is secured. A rational three-stage force planning process exists in the MND but the political reality always turns it upside down, and a factor outside Taiwan's control. Staff in SPD, IAO, and AB try to process this rational planning but ultimately all they can do is to rationalise the political reality in sales cases such as F-16 C/D, PERRY-class frigates, early warning radar, etc. The Government Reviewer knows more details about Air Force Trainer Jet than the country assessor. The journalist's challenge
in http://www.stormmediagroup.com/opencms/investigate/detail/f5239577-1d26-11e4-971e-ef2804cba5a1/?uuid=f5239577-1d26-11e4-971e-ef2804cba5a1 is a good case in point - the MND has not made a decision here after repeated rational planning processes.
Comment: Pursuant to the Government Procurement Act, it is mandatory for all of government entities to disclose required procurement information to the general public. The provisions cover &quoute;publishing notices given to invite industry to submit tenders&quoute;, &quoute;publishing notices on Government Procurement Gazette that may include budget and estimated value of a procurement&quoute;, &quoute;conducting a public presentation or soliciting reference data or information from industry&quoute;, &quoute;publishing outcomes of award of contracts and notifying all tenders in writing&quoute;, &quoute;publishing annual report of condition and efficiency analysis of a large procurement case (which case value is more than NT$ 200M) during its deployment service period&quoute;, etc. Arms procurements are covered by the Procurement Act as well. In total, there are 26,437 military procurement cases in recent three years (2011-2013) published on the Government e-Procurement System.
As to the defence articles or services deals with the United States government through the Foreign Military Sales channel, it is prescribed in the Article 105 paragraph 4, where the procurement from a foreign government is conducted in accordance with a treaty or agreement (i.e. Letter of Offer and Acceptance, LOA) to which this nation is a party and which has specific provisions for the invitation to tender and award of contracts (i.e. the Federal Acquisition Regulations, FAR). Furthermore, the FMS cases' awarded information (such as case description and contract value) is also available on the website of Government e-Procurement System, Public Construction Commission.
- Government Procurement Act, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030057
- Enforcement Rules of the Government Procurement Act, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030058]
- Government e-Procurement System, http://web.pcc.gov.tw/tps/pss/tender.do?method=goSearch&searchMode=common&searchType=advance
''特殊軍事採購適用範圍及處理辦法'', http://www.pcc.gov.tw/pccap2/BIZSfront/MenuContent.do?site=002&bid=BIZS_C00007235
Oversight of non-special military procurement in the MND functions well. Procedures for bidding, negotiating, contracting, and examining are institutionally implemented. An official website provides updated information for government-wide procurement. Information is accessible to the public and legislative scrutiny is rather easy.
For special military procurement (arms deals) however, their secretive nature complicates the oversight procedures. Due to varied modifications of weapon systems, there is no market (list) or even fixed price for frame of reference in oversight. This has resulted in questionable expenditures. For example, according to press report, the budget for long-range early-warning radar (Pave Paws) increased by NT$10 billion in the past 11 years.
The evidence provided by the Government Reviewer provides good evidence of strong procurement oversight function. Score changed from 3 to 4 and sources added.
Public Construction Commission, EY website
http://www.pcc.gov.tw/pccap2/TMPLfronted/ChtIndex.do?site=002&UserType=2
http://web.pcc.gov.tw/pishtml/pisindex.html
"軍武》樂山基地長程預警雷達 年花7億請美維護 (Long Range Early Warning Radar Needs NT$700 Million Every Year for American Maintenance)," Now News Media, October 5, 2013
https://tw.news.yahoo.com/軍武-樂山基地長程預警雷達-年花7億請美維護-083532287.html
Performance of Government Procurement Auditing, http://www.pcc.gov.tw/pccap2/TMPLfronted/ChtIndex.do?site=002
National Audit Office, Control Yuan, http://www.audit.gov.tw/files/11-1000-90.php and http://www.cy.gov.tw/np.asp?ctNode=871&mp=1
Agency Against Corruption, http://mojlaw.moj.gov.tw/LawContentDetails.aspx?id=FL010659
Comment: The Public Construction Commission has established a Central Government Procurement Unit in accordance with Article 108 of the Government Procurement Act. The unit's mission is to audit and monitor procurement by government agencies to assure that there is no violation of procurement law and that the agencies carry out procurement in accordance with procurement law, thereby building up an open and fair procurement environment. In addition, fourteen ministries and commissions with relatively many subordinate agencies, including the Ministry of National Defence, and 22 local governments have set up procurement supervision units, forming a complete auditing and monitoring system that reaches from the central to local government levels. This system facilitates the reinforcement of the procurement auditing and monitoring mechanism, the rectification of improper procurement behaviour by government agencies, and the reduction of deficiencies in government procurement. Furthermore, the National Audit Office, Control Yuan and Agency Against Corruption of Ministry of Justice also have the authority to be involved in and oversee the government procurements. Both entities have totally independent formalised resources and accesses to perform anti-corruption oversights and it have been demonstrated highly active in practice.
- Performance of Government Procurement Auditing, http://www.pcc.gov.tw/pccap2/TMPLfronted/ChtIndex.do?site=002
- National Audit Office, Control Yuan, http://www.audit.gov.tw/files/11-1000-90.php and http://www.cy.gov.tw/np.asp?ctNode=871&mp=1
- Agency Against Corruption, http://mojlaw.moj.gov.tw/LawContentDetails.aspx?id=FL010659
Comment: See also the Agency Against Corruption (MOJ) website: http://www.aac.moj.gov.tw/mp290.html
In terms of non-special military procurement, information is made accessible to the public through the Public Construction Commission, the unit responsible for government-wide procurement regulation and implementation. The Commission plays no significant role in foreign arms deals however. For special military procurement, and major platforms in particular, potential purchases will not be specific since premature announcement may create issues in the U.S. that jeopardise the deal. The MND may state what the military wants in policy publications such as the National Defence Report in an abstract term, for example using the phrase 'advanced fighter jet' rather than 'F-35B fighter'.
There are some MND official publications which have identified what kind of capabilities match with the desired strategy or operational concept. And both the QDR and Defence Reports set the theme of arms modernisation, but they do not amount to detailed planning, and the MND spokesperson neither admits nor denies any journalists' reports related to potential arms sales. Despite the range of evidence the set out more broadly, the Government Reviewer notes that &quoute;some planning information concerning major platforms is limited&quoute;; the MND will only rarely disclose what kind of platforms or weapons it seeks to procure. As with the assessment in Question 58, there are understandable reasons for this - staff may wish to conduct foreign arms procurement transparently but they are not able to, particularly at the planning stages, and in some cases this is a result of supplier country concerns. Score maintained.
National Defence Report, 2013, p. 73.
Executive Yuang, Public Construction Commission website.
''Government Procurement Act'', esp. art. 27, 34, 61, 101-3, 106, 111, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030057;
http://www.bot.com.tw/English/EGovernment_Procurement/Procurement/Pages/default.aspx
Quadrennial defence Review, Chapter 3, http://qdr.mnd.gov.tw/enchap3.html/
Government e-Procurement System, http://web.pcc.gov.tw/pishtml/pisindex.html
Comment: Major defence capabilities and preparedness build-up plans are stated in the Quadrennial Defence Review (QDR) and National Defence Report with a view to illustrating national defence strategy and force build-up direction to the Legislative Yuan and the public. Some planning information concerning major platforms is limited in details due to the specific diplomatic, political concerns and sensitive nature of the force capability build-up requirements. However, during budgeting stage, a budget allocation proposal needs to be submitted to the Executive Yuan and Legislative Yuan for review and approval around 4-8 months before target fiscal year. The LY has full authority to scrutinise and challenge these acquisition programs, and, sometimes they can be cut, amended or frozen. In the case or program execution stage, the Government Procurement Act and its enforcement rules stipulate all procurement implementation procedures for entire government entities. The MND shall follow all the regulations and observe the principles of protecting public interests, fairness and reasonableness, and shall not accord differential treatment to suppliers without due cause. During this stage, the related information from beginning of &quoute;invitation to tender&quoute; through &quoute;contract awarded&quoute; is all available to the general public on the Government e-Procurement System website of Public Construction Commission, Executive Yuan. In addition, The MND has also set up a transparent policy to enforce all military services to use the Government Procurement Gazette for conducting required information, presentations or soliciting references from industrial marketing to those planning procurement cases which have a total case value exceeding 50 million New Taiwan Dollars.
- Quadrennial defence Review, Chapter 3, http://qdr.mnd.gov.tw/enchap3.html/
- Government Procurement Act, Article 34, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030057
- Government e-Procurement System, http://web.pcc.gov.tw/pishtml/pisindex.html
''Government Procurement Act'', esp. art. 27, 61, 101-3, 106, 111, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030057;
Compliance program refers to 'systematic procedures instituted by an organisation to ensure that the provisions of the regulations imposed by a government agency are being met'. In the case of Foreign Companies Article 17 of the Government Procurement Act indicates that a compliance program is not a necessary precondition for bidding by foreign companies, but is instead based upon mutual treaty and agreement. In the cases between Taiwan and France for the commission scandals in frigate and fighter jet deals of the 1990s, French courts held the jurisdiction though there were anti-corruption clauses in the contracts.
Current requirements for bidding companies, whether foreign or domestic, are mostly about the capabilities of fulfilment of contract obligation rather than anti-corruption commitment, although the Government Procurement Act prohibits the bidding of companies involved in bribery for three years. This does not appear in practice to be a very effective deterrent from corruption for small- or medium-size local contracts as companies may use a new company or owner's name to bid again.
The MND provides relevant, convincing sources demonstrating that suppliers with prosecutions for any illegal activities will be partially or totally barred from future bidding to all of the government procurements for a certain period of time, and that companies have to make clear that they are not debarred when participating in a procurement exercise, but this is not evidence that the government requires companies to show they have formal and publicly declared compliance programmes.
Government Procurement Act, articles 17, 87, 90, 101, 103. http://law.moj.gov.tw/Law/LawSearchResult.aspx?p=A&t=A1A2E1F1&k1=%E6%94%BF%E5%BA%9C%E6%8E%A1%E8%B3%BC%E6%B3%95
Government Procurement Act - Enforcement Rules. http://law.moj.gov.tw/Law/LawSearchResult.aspx?p=A&t=A1A2E1F1&k1=%E6%94%BF%E5%BA%9C%E6%8E%A1%E8%B3%BC%E6%B3%95
Ministry of Finance, &quoute;Standards for Qualifications of Tenderers and Determination of Special or Large Procurement&quoute;. Amended 11 November 2009. http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030099
Public Construction Commission, &quoute;Procurement statistics&quoute;, last updated 4 March 2013. http://web.pcc.gov.tw/ars/wr/wrclient.do?method=duration&reportId=EngBidder
Public Construction Commission, &quoute;Government procurement regulations - Tender documents and forms&quoute;. http://www.pcc.gov.tw/pccap2/BIZSfront/MenuContent.do?site=002&bid=BIZS_C09804055
Public Construction Commission, &quoute;Suppliers barred from bidding for government procurement&quoute;. http://web.pcc.gov.tw/pis/main/pis/client/pssa/downloadFiles.do?id=50003004
Apple Daily, &quoute;借牌搶公家標案 神通起訴&quoute;, 12 October 2011. http://www.appledaily.com.tw/appledaily/article/headline/20111012/33730902
Comment: The qualification for a supply to bid for government procurement is generally depicted explicitly in the specific case's tender documentation. The Government Procurement Act and related regulations stipulate that the bidders shall clearly certify and state their businesses are not prohibited from participating in the government procurements. In practice, suppliers with prosecutions for any illegal activities will be partially or totally barred from future bidding to all of the government procurements for a certain period of time. During 2009 to 2011, a real prosecution case happened on the MiTAC Information Technology Corporation which involved in collusive activities to many tenders of government entities. As to the cases dealt with France in early 90s mentioned by original assessor, it happened before Government Procurement Act was established, and, the disputes between each other on anti-corruption clause of contracts were resolved through international arbitration, not jurisdiction of France.
- Government Procurement Act and its Enforcement Rules, http://law.moj.gov.tw/Law/LawSearchResult.aspx?p=A&t=A1A2E1F1&k1=%E6%94%BF%E5%BA%9C%E6%8E%A1%E8%B3%BC%E6%B3%95
- Standard reference documents and forms for government procurement, http://www.pcc.gov.tw/pccap2/BIZSfront/MenuContent.do?site=002&bid=BIZS_C09804055
- List of Supplies barred from bidding for government procurement, http://web.pcc.gov.tw/pis/main/pis/client/pssa/downloadFiles.do?id=50003004
- http://web.pcc.gov.tw/ars/wr/wrclient.do
- Standards for Qualifications of Tenderers and Determination of Special or Large Procurement, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030099
- http://www.appledaily.com.tw/appledaily/article/headline/20111012/33730902
''Bidding Instructions for Foreign Procurements'', http://www.mnd.gov.tw/UserFiles/File/procrement06.pdf;
''Enforcement Rules of the Government Procurement Act'', http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030058
The MND prepares long- (10-year) and mid-term (5-year) force planning as guidelines for overall arms procurement, in addition to the three-stage planning for specific arms procurement items. The logic embedded in these planning procedures is that strategy guides arms procurement; the DPP Defence Blue Paper No. 7 offers further insights about this structure. All above-mentioned planning involves rigour and laborious joint staff work. For major platform cases such as F-16 C/D, while the number of staff is not published, at least 8 units from the Air Force, J-2, J-3, J-4, SPD, IAO, and Office of the Minister of Defence are involved.
Some conclusions are published in MND policy documents, although in abstract terms. For example, the use of 'advanced fighter jet' rather than F-35B fighter (see Q60).
Arms deals however are not the buyer's (Taiwan) call and are subject to political decisions from the White House; for example in placing pressure on Taiwan to buy early warning radar, and refusal to sell F-16 C/D aircraft. As a result, the MND finds difficulties in obtaining what it wants in terms of weapon acquisition. Priorities are listed in these force planning, but the ranking of various priorities are largely dependant on the situation, financial capabilities, American response, or even minister's (or president's) personal preference. The reality (at least for J-3 staff) is that strategy is the product of arms procurement.
The Government Reviewer again makes a good counter argument by stating "In reality, there is a significant gap between what Taiwan's military wants and what it can get. The MND often makes decisions based upon the possible alternatives, rather than the best option. And, this should not be a considerable factor to affect the above-mentioned efforts of Taiwan's open, well-audited national defence procurement strategy". These sentences hit the point: the military staff conduct planning as reasonably as possible; the procurement requirements are derived from the strategy, imperfect outcomes are caused by external factors.
Score changed from 2 to 4 and sources added.
National defence Report, 2013, pp.72-73.
Quadrennial defence Review, 2013, pp. 32-40, 65-67
Democratic Progressive Party, &quoute;DPP defence Blue Paper No. 7: Bolstering Taiwan's Core defence Industries&quoute;, 2014, p. 33. http://english.dpp.org.tw/wp-content/uploads/DPP-defence-Blue-Book-Issue-7.pdf
NTI, &quoute;Taiwan Pushes Back on U.S. Pressure to Do More on Missile defence&quoute;, 6 June 2014. http://www.nti.org/gsn/article/taiwan-pushes-back-against-us-pressure-do-more-missile-defence/
Shannon Tiezzi, &quoute;Why The US Will Not Sell Advanced Fighters To Taiwan&quoute;, The Diplomat, 11 January 2014. http://thediplomat.com/2014/01/why-the-us-will-not-sell-advanced-fighters-to-taiwan/
Comment: The major defence capabilities and preparedness build-up plans are stated in the Quadrennial Defence Review (QDR) and National Defence Report with a view to illustrating national defence strategy and force build-up direction to the Legislative Yuan and the public. Some planning information of major platforms is somehow limited to disclose in details due to the specific diplomatic, political concerns and sensitive nature of the force capability build-up requirements. In considering of Taiwan's unique international diplomatic status, many countries (mainly the NATO) might not sell the arms to Taiwan in accordance with our priority. The MND's defence acquisitions are based on the strategy of &quoute;prioritizing indigenous production and domestic supply, then, using foreign procurements for back-ups&quoute;, so as to enhance self-reliant national defence. As to the major weapon systems, Taiwan is always seeking to acquire defence equipment, systems or services in various approaches as possible. However, it tries not to be solely dependent on the United States government's decisions, which are frequently influenced by politics and diplomatic policies. In reality, there is a significant gap between what Taiwan's military wants and what it can get. The MND often makes decisions based upon the possible alternatives, rather than the best option. And, this should not be a considerable factor to affect the above-mentioned efforts of Taiwan's open, well-audited national defence procurement strategy.
Comment: Various studies conclude that Taiwan's military procurement is influenced by non-defence strategy related criteria:
Dennis Hickey, 'China's Military Modernatiozation and Taiwan's defence Reforms', in Edmonds, M and Tsai, M. (eds), Taiwan's defence Reform (NY, Rouutledge, 2006) pp49-50
Michael D. Swaine, Policy, and Weapons Procurement Processes, RAND corporation report, http://www.rand.org/pubs/monograph_reports/MR1128.html accessed June 25, 2013
Since the ranking of various priorities are largely dependant on the situation, financial capabilities, the US response, or even the Minister or President's personal preference, arms procurement is more a contextual process than a rational, linear one. Source, quantity, quality and priority of procurement may all be changed and such changes are not rare. During the 1990s, after the U.S. agreed to sell Taiwan F-16 A/B, the quantity of Indigenous Defence Fighters (IDF) to be purchased reduced. Similarly, during the 2000s, after the U.S. refused to sell Taiwan Aegis-equipped destroyers, Taiwan turned instead to acquiring Kidd-class destroyers. In 2007 after Taiwan allocated budget for purchase of 66 F-16 C/D aircraft, the U.S. pulled back from the sale and provided an upgrade to its F-16 A/B fleet instead. Another case has resulted in a bipartisan consensus developing to manufacture medium- or small-size submarines locally after 10-year political debate. Previously, the skipper-background admiral minister preferred foreign-made fleet submarines.
Both the Government Reviewer and Peer Reviewer 2 provide useful additional information and argument. As most military purchases do not related to sensitive foreign arms sales, it is fair to consider the majority cases where requirements are clearly identified and quantified. And as Peer Reviewer states very clearly &quoute;It is evident that ROC Armed Forces follow a clear strategic line when indicating new procurement needs, and formulate their strategy based on actual security threats, as clearly stated in the MND annual report to the LY and the website&quoute;.
Government Procurement Act, Articles 26, 34 and 36. http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030057
Public Construction Commission, &quoute;Government e-Procurement System - Procurement tendering information&quoute;, http://web.pcc.gov.tw/tps/pss/tender.do?method=goSearch&searchMode=common&searchType=basic
Ministry of National defence, &quoute;defence Organization and Transformation&quoute;, http://qdr.mnd.gov.tw/enchap4.html
Dr. Alexander Chieh-cheng Huang, ''A Midterm Assessment of Taiwan's First Quadrennial defence Review'', http://www.brookings.edu/research/papers/2011/02/taiwan-huang
Global Defence Technology, &quoute;Ching-Kuo (IDF) Multirole Fighter Jet, Taiwan&quoute;,
http://www.airforce-technology.com/projects/ching/
Global Defence Technology, &quoute;Kee Lung (Kidd) Class Destroyers, Taiwan&quoute; http://www.naval-technology.com/projects/keelungkiddclassdest/
"The U.S. Still Considers Selling Taiwan F-16 C/D," Apple Daily, 23 September, 2011
http://www.appledaily.com.tw/appledaily/article/headline/20110923/33687828
"Navy Abandons U.S. Acquisition and Turns to Indigenous Made Submarine," Liberty Times, 12 March, 2013
Comment: As mentioned in previous comments of related questions, the MND formulates its defence capabilities build-up and acquisition strategies through a logical process starting with requirements assessment, planning, programming, budgeting and execution. The results are shown in the National Defence Report, QDR, annual budgetary proposals and related documentations. Pursuant to the Government Procurement Act, as soon as a defence procurement plan is approved and well-prepared for tender publication, the tender documentation or request for proposal shall be clearly prescribed in terms of specific function or performance. In the event that there are applicable international or national standards, the tendering specifications also should be stated clearly therewith. Technical specifications laying down the characteristics of the articles or services to be procured, such as quality, performance, safety, dimension, terminology, etc., shall not be applied with a view to, or with the effect of, creating unnecessary obstacles to marketing competition. Please see the current tender publication status of the MND's procurement cases on the website of Government e-Procurement System. As to the new fighter and submarine acquisitions planned to procure from the United States government mentioned by the original assessor, they are truly particular cases with highly political and sensitive manners, therefore, would not be the good examples for discussion.
- Government Procurement Act, Articles 26, 34 and 36, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030057
- Procurement tendering information on the Government e-Procurement System, http://web.pcc.gov.tw/tps/pss/tender.do?method=goSearch&searchMode=common&searchType=basic
Comment: Taking into account of specific security situations, financial capabilities and potential American response does not make Taiwan's situation any different from that of every single country in the world. These steps are common to most nations and can be accounted as an inherent process of security evaluation.
Changing the item to be purchased because there is no seller willing to meet the demand is also quite natural, since certain tasks can be realised through multiple combinations of platforms, and at times the second or third choice may turn out to be the only viable one.
It is evident that ROC Armed Forces follow a clear strategic line when indicating new procurement needs, and formulate their strategy based on actual security threats, as clearly stated in the MND annual report to the LY and the website: ''To procure weapons and equipment required for joint operations, future military investment programs will make adjustment according to "Joint Warfighting Capability Planning." The investment plans must complete "Operational Requirement Documents" before being included in the Five-Year Force Construction Plan and proceeding to the stage of "system analysis" and "investment outline plans."''
Dr. Alexander Chieh-cheng Huang, ''A Midterm Assessment of Taiwan's First Quadrennial defence Review'', http://www.brookings.edu/research/papers/2011/02/taiwan-huang;
defence Organization and Transformation, http://qdr.mnd.gov.tw/enchap4.html
No data regarding the percentage of open competition in MND procurement is available to the public. Apart from foreign arms deals, most local and non-sensitive procurements are conducted through open competition procedures under the Government Procurement Act. Single-source procurements are not frequent in number but consist primarily of major platform foreign arms sale. Expenditures are therefore often huge: according to media reports, the sum of U.S. arms sales to Taiwan since 2008 reaches 18.3 billion US dollars in total.
The Government Reviewer's figures state that there was NT$15.6 billion worth of FMS from USG in 2013. This alone totals 22% of total defence spending (NT$68.5 billion). From the same figures, 510 cases of procurement were not conducted using open tendering (8041 - 7531). The Government Reviewer has only accounted for 75 of these (US FMS), meaning there are a further 483 cases of closed procurement. It's unclear what their value is or what percentage they make up of the total defence spend. Without knowing this, or additional evidence to suggest that the Taiwanese government is able to oversee the US award process closely enough to ensure fair competition occurs, a higher score cannot be awarded.
"Government Procurement Act," article 22, 37.
"U.S. Arms Sale to Taiwan Reach 18.3 billion US Dollars," ET Today, 13 August 2013
http://www.ettoday.net/news/20130822/260265.htm
Comment: Pursuant to the government Procurement Act and related regulations, in principle, all procurements conducted by government entities are subject to apply open tendering procedures. According to the government procurement contract awarded information available on the website of Government e-Procurement System database, for the statistic figures of the MND's procurements, a total of 8,041 cases were carried out by the entire armed forces in 2013, total amount reaching NT$ 68.5 billion; in which 7,966 case were domestic and only 75 cases were foreign procurements (including 27 Foreign Military Sales cases dealt with the United States government). Furthermore, among that, a total of 7,531 cases (93.65%) were conducted by using the open tendering (i.e. competitive procedures). As for the procurements from the US FMS channel, in numbers, there are only 27 cases with a total amount of NT$ 15.6 billion in 2013. It is needed to clarify that the FMS procurement is conducted in accordance with the Article 105, Government Procurement Act, where the procurement from a foreign government is conducted in accordance with a treaty or agreement (i.e. Letter of Offer and Acceptance, LOA) to which this nation is a party and which has specific provisions for the invitation to tender and award of contracts (i.e. Federal Acquisition Regulations, FAR). Thus, the USG on behalf of purchasing country has the responsibility for source selection based on its own procurement laws and regulations.
- Government e-Procurement System, http://web.pcc.gov.tw/tps/pss/tender.do?method=goSearch&searchMode=common&searchType=advance&searchTarget=ATM
It is necessary to clarify again that FMS procurement is conducted in accordance with Article 105 of the Government Procurement Act, where procurement from a foreign government is conducted in accordance with a treaty or agreement (i.e. Letter of Offer and Acceptance, LOA) to which this nation is a party and which has specific provisions for the invitation to tender and award of contracts (i.e. Federal Acquisition Regulations, FAR). Thus, The USG on behalf of purchasing country bears responsibility for source selection based on its own procurement laws and regulations. Thus, the MND directs Services not to accept the recommendation on "sole source" unless the US Services provides valid justifications which the circumstances applied to the limited tendering procedures (including sole source) of Article 22, Government Procurement Act.
Comment: Even if Taiwan's procurements have &quoute;open tendering&quoute; procedures based on the degree of competitiveness, as stipulated by the Government Procurement Act, the practice suggests that the US is by far the major source of arms procurements for the country; despite this being understandable due to the specific political/security situation of the island, confidential clauses of these government-to-government agreements make impartial scrutiny from outside almost impossible.
Shirley A. Kan, ''Taiwan: Major U.S. Arms Sales Since 1990'', http://fas.org/sgp/crs/weapons/RL30957.pdf
A tender board is required when the procurement at hand is designed to select the most appropriate bidder, not lowest price bidder. There are regulations, directives, and codes of conduct in place as to the establishment, organisation of such a tender board as well as the behaviours of members on the board. For example, members of tender boards are obliged to withdraw in the case of a conflict interests (the case at hand involves the interests of member or member's spouse, close relatives). The procedure and result of the board is subject to the audit office's review. The MND follows the same practices in open-bidding cases. Existing regulations do not require results of the tender board to be automatically published for public scrutiny, meaning this does not necessarily occur. A recent case of a mine-hunter vessel contract though may illustrate issues with procedures (see penultimate source). But Taiwan's National Audit Office is able to audit procurement processes and issues reports to the public.
[should this be a four? presumably the results of the tender don't need to be published but the results of the audit]
The Government Reviewer has provided reference detailing the regulations governing tender boards, but the recent mine-hunter examples demonstrates that there are still some issues.
Government Procurement Act, articles 22, 56, 94.
Procedural Rules for Procurement Selection Board, article 5, 6-1, 7-13, 14, 14-1.
Rule for the Most Appropriate Bidding Cases, article 4-8.
&quoute;Mine-hunter vessel contract&quoute;, China Times, Oct 2014, http://www.chinatimes.com/newspapers/20141029000144-260204
&quoute;Irregularities found in procurement of military equipment&quoute;, Taipei Times, August 2015, http://www.taipeitimes.com/News/taiwan/archives/2015/08/13/2003625247
Comment: The MND apply same rules and practices prescribed in the Government procurement Act while dealing with the &quoute;Most Advantageous Tender&quoute; or so call &quoute;Best Value Procurement&quoute;. A tender board is formulated to look at factors other than just price, such as quality and expertise, when selecting vendors or contractors. Thus, typically values are assigned to factors such as price, past performance and schedule, etc. It is beneficial because it needs less decision making, prepares for the future, and minimises risk. Recent years, the responsible entity of Taiwan government procurement, Public Construction Commission, encourage all government entities to use this approach instead of selecting vendors based on a low bid. A comprehensive rules, standards and codes of conduct have been well formulated to ensure fairness of procurements.
- Regulations for Evaluation of the Most Advantageous Tender, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030080
- Regulations Governing the Organization of Procurement Evaluation Committee, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030103
- Regulations For Review by Procurement Evaluation Committee, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030102
- http://lawweb.pcc.gov.tw/LawContentDetails.aspx?id=FL039294&KeyWordHL=%e6%9c%80%e6%9c%89%e5%88%a9&StyleType=1
- PCC encourage to use best value procurement, http://www.pcc.gov.tw/pccap2/BIZSfront/NewsContent.do?site=002&bid=BIZS_C10207410
Article 87 of Government Procurement Act clearly prohibits collusive behaviour which "intend[s] to influence the bidding price and seize improper benefit and arrange collective action by contract, agreement or other means to dissuade other companies not to bid or not to complete in price". Violation of this article may result in imprisonment ranging from six months to five years. However, collusive behaviour due to its very nature is difficult to detect and in the past the Taiwan Fair Trade Commission has had difficult in securing direct evidence to prove the collusive behaviour.
The Government Procurement Act clearly prohibits collusive behaviour. However there have been cases of collusion reported in the media (see final source). In an effort to strengthen existing measures to deter and punish,Taiwan has also amended the Fair Trade Act earlier this year, including by strengthening Taiwan's Fair Trade Commission and by launching a new antitrust fund to encourage whistleblowers.
Government Procurement Act, article 87.
Amendments to the Taiwan Fair Trade Act, Lee and Li Newsletter, January 2015, http://www.leeandli.com/EN/NewslettersDetail/5318.htm
Taiwan to launch antitrust fund to encourage whistleblowers, Want China Times, June 2015, http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20150610000007&cid=1103
Taiwan launches investigation into CM-32 supply chain, IHS, June 2015, http://www.janes.com/article/52192/taiwan-launches-investigation-into-cm-32-supply-chain
Comment: The government Procurement Act and related regulations has stipulated that the bidders shall clearly certify and state their businesses are not prohibited from participating in the government procurements. In practice, suppliers with prosecutions for any illegal activities will be partially or totally barred from future bidding to all of the government procurements for a certain period of time. During 2009 to 2011, a real prosecution case happened on the MiTAC Information Technology Corporation which involved in collusive activities to many tenders of government entities.
''Anti-Corruption Act'', esp. art. 11, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=C0000007;
The government Procurement Act, Article 95 and its regulations sets out requirements for professional procurement personnel, including personnel qualification, examination, training, certification and management of professional procurement personnel of all level of governments. Evidence suggests military procurement officers are professional and experienced. No pre-assignment training programs exist for procurement officials in other governmental sectors. In contrast, defence procurement officers receive management education at undergraduate level in military academy , on-job training at service level, and then are assigned to Armament Bureau in handling major procurement procedures.
Some are also sent to the U.S. for further procurement training. The training does not cover negotiations to obtain the best price, however officers have otherwise normally received a very thorough level of exposure to contract management by the end of their training.
The Government Reviewer also states that a total of 14 training courses were offered in 2012, including &quoute;basic&quoute; and &quoute;advanced&quoute; qualification courses for procurement , lectures on procurement practices, lectures for high level management personnel on procurement supervision affairs and Foreign Military Sales procurement training courses. However, recent media reports on into an investigation into the production of CM-32 Clouded Leopard (雲豹) armoured vehicles in which prosecutors found that none of the three subcontractors were qualified or certified to fulfill the contract, may indicate some shortcoming in the ability to ensure contracts are met.
Quadrennial defence Review, 2013, p. 41.
"MND Disclose the Training and Management of Procurement Personnel," NowNews, 13 June 2010, http://www.nownews.com/n/2010/07/13/676800
&quoute;Nine on bail in military procurement scandal&quoute;, June 2015, http://www.taipeitimes.com/News/taiwan/archives/2015/06/13/2003620595
Comment: The government Procurement Act, Article 95 and its regulations, strictly stipulates that a government entity shall conduct its procurement by professional procurement personnel. The regulations cover personnel qualification, examination, training, certification and management of professional procurement personnel of all level of governments. A total of 14 training courses were offered for 1,042 person-times in 2012, including &quoute;basic&quoute; and &quoute;advanced&quoute; qualification courses for procurement speciality, lectures on procurement practices, lectures for high level management personnel on procurement supervision affairs and Foreign Military Sales procurement training courses. Furthermore, under guidance of the &quoute;Regulations on Commissioned Officer Education and Experience Management,&quoute; cultivation plans are formulated for cadre members responsible for procurement at each level to receive Strategic Management, Commanding staff management and formal advanced courses. In 2012, three members completed strategic management, eight members received commanding staff management, and fifty members acquired formal advanced certifications on procurement-related courses.
- http://law.moj.gov.tw/Law/LawSearchResult.aspx?p=A&t=A1A2E1F1&k1=%E6%8E%A1%E8%B3%BC%E5%B0%88%E6%A5%AD%E4%BA%BA%E5%93%A1%E8%B3%87%E6%A0%BC%E8%80%83%E8%A9%A6%E8%A8%93%E7%B7%B4%E7%99%BC%E8%AD%89%E5%8F%8A%E7%AE%A1%E7%90%86%E8%BE%A6%E6%B3%95
The Government Procurement Act outlines the complaint mechanism for companies. Directives as to the procedures of complaint and the operation of resolving or mediating disputes are issued by Public Construction Commission. The Commission also establishes complaint and dispute review committee to coordinate such operations. There are no acts or directives to prevent companies submitting complaints from possible retaliation or disadvantage, however companies may address the administrative court, civil court, or even Control Yuan in order to deter this.
The Government Reviewer has provided evidence of protection against discrimination, with all the results and resolutions of procurement disputes available on the website of Public Construction Commission. The high frequency of complaints by local shipyards (a recent example see http://www.nownews.com/n/2014/10/28/1478460) shows the complaint mechanism functions well.
Government Procurement Act, chapter 6.
記者王莞甯, 台船搶國防部6艘獵雷艦國造採購案失利 將提救濟力求翻案, NOWNews.com News Today, 28 October 2014. http://www.nownews.com/n/2014/10/28/1478460
Public Construction Commission, see:
http://web.pcc.gov.tw/piaq/piat.do?method=goSearch
Comment: Evidences show that it is well conducted and companies are well protected against discrimination in practices. all the results and resolutions of procurement disputes are also available on the website of Public Construction Commission.
- http://web.pcc.gov.tw/piaq/piat.do?method=goSearch
Penal provisions in Government Procurement Act are rather strict in terms of possible sentence periods of imprisonment. For example, a person who commits violence or threatens with the intent to cause a supplier not to tender or to tender contrary to its real intention, or cause the winning tenderer to forego the award or to assign or subcontract after the award shall be punished with imprisonment for 1 to 7 years (article 87), an equivalence of credit card counterfeit (Criminal Law article 201-1). According to Article 15 of Government Procurement Act, debarment can also be applied. But in practice, it is easy to set up a new company to evade the practical consequences.
Response to Peer Reviewer 1:
The cases provided by the reviewer shows that although regulations are in place, they are not being applied strongly enough to fully deter corrupt practice.
Score changed from 4 to 3 and two sources added.
Government Procurement Act, article 87-92
&quoute;Four military officers, 13 civilians indicted in procurement scandal&quoute; The China Post, February 12, 2014,
http://www.chinapost.com.tw/taiwan/national/national-news/2014/02/12/400408/Four-military.htm accessed June 25, 2014
&quoute;Taiwan's Frigate Corruption Investigation: Can they Collect?&quoute;, defence Industry Daily, Apr 17, 2014 http://www.defenceindustrydaily.com/full-steam-ahead-for-taiwan-frigate-corruption-investigation-01546/ accessed June 25, 2014
- Government Procurement Act, Articles 101, 102 and103
- Prosecution case, http://www.appledaily.com.tw/appledaily/article/headline/20111012/33730902
- Prosecution case, http://www.appledaily.com.tw/appledaily/article/headline/20140212/35635041/
Comment: Although relevant legislation exists, there is limited public information regarding cases and enforcement. Recent (2014) scandals suggest that the problem is present. ROC government should increase transparency on such cases.
Comment: I agree with the score; however, it needs to be pointed out that military supplier's convictions remain, most of the times, not revealed to the general public - due to the secrecy nature of military procurements. Therefore, even if the legislation is very clear and available, the cases remain surrounded by a more mysterious aura.
''Anti-Corruption Act'', esp. art. 11, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=C0000007
The MND Industrial Cooperation Program aims to obtain 40 percent offset for every foreign arms deal valued above 5 million US dollars, with 60 percent of the offset quota used to bolster local defence industries (direct offset).
The Industrial Cooperation Program is the responsibility of the Ministry of Economic Affairs, but the MoEAplays no role in negotiating foreign arms procurement, and only takes on this task after the signature of the contract. This makes it difficult to implement industrial cooperation programmes effectively, particularly as the Ministry is not brought into discussions on MND acquisition planning; the risk is that offset spend is on less relevant or even completely non-relevant investments.
There are some directives as to the management of offsets, but the oversight mechanisms against corruption risk are primitive.
According to the MOEA website accessed by the assessor, the MND, and the reviewer, the ICP quota was mostly applied to indirect ICP unrelated to the defence industry. Only 20% of total ICP promised quota was used in defence industries, excluding aviation-related technology transfer, to improve the technological level of the indigenous defence industry. In the transfer of sensitive technologies only 50% of total ICP promised quota was used in technology transfer.
Although there are some ICP regulations in place, no information as to the assessment results of specific ICP requests are publicly available. Those published on the website are mainly SOP. The situations has not improved much after the establishment of MoEA/MND ICP Policy Committee in 2010. For example, in 2010 approximately 110 ICP agreements were signed and the sum of promised quota reached 9.054 billion US dollars. The sum of actual fulfilment quota was only 6.003 billion US dollars however. In other words, only 62.83% of the promised quota have been successfully implemented. Since 2000, such a gap between promised and fulfilled ICP quota is steadily growing.
Industrial Development Bureau, Ministry of Economic Affairs website
http://www.icpo.org.tw/cica_icp/editor_model/u_editor_v1.asp?id=50
Comment: In Taiwan, an offset agreement is called the "industrial Cooperation Program (ICP)" which refers to an obligation imposed on an international contractor under a government procurement project to undertake certain industrial or commercial activities. Such obligation is particularly common related to major defence procurement. A negotiation for the ICP conducted by the industrial Development Bureau, Ministry of Economic affairs (IDB, MOEA), starts at very beginning stage while defence procurement requirements being formulated. All potential suppliers are welcome to submit their intention of participating in future ICP before the designated procurement tender to be awarded. An industrial cooperation agreement (ICA) negotiation is normally scheduled to be accomplished in six months after the procurement contract being awarded. It is a totally independent process from the procurement contracting procedure. Furthermore, the ICP transactions are carried out as "the credits to be granted with various multipliers". It is not real money and there is no cash flow among the government responsible entity, foreign contractor and domestic company. The main objective of ICP is to improve cooperative relationship and mutual benefits between international contractors and Taiwan industrial. Companies are making such efforts for their granted obligations and reputations. Thus, evidences show that corruption risks are not an issue for ICP in practices. As to the follow-up performance and integrity supervision for the ICPs and utilization of relevant resources, the IDB, MOEA has set up several management aspects of directives and rules for governing. Details are on the website and available to the public.
References added: ICP, IDB, MOEA website
- http://www.icpo.org.tw/cica_icp/editor_model/u_editor_v1.asp?id=63
The main objective of the ICP is to improve cooperative relationships and mutual benefits between international contractors and Taiwan Industrial. The IDB, MOEA's selections for local companies in cooperation with main supplier or manufacture should also consider the capabilities of the firms. Details are on the IDB's website and available to the public.
- http://www.storm.mg/article/45335
Comment: Relevant regulations on due diligence requirements for contractors and a thorough screening and processing procedure exist. Integrity is indirectly addressed.
Regulations-ICP website, Industrial Development Bureau, Ministry of Economic Affairs:
http://www.icpo.org.tw/cica_icp/editor_model/u_editor_v1.asp?id=85 accessed June 26, 2014
Procedure - Industrial Development Bureau, Ministry of Economic Affairs:
The Industrial Development Bureau and the Ministry of Economic Affairs provides some basic information on the prioritised items for potential industrial cooperation programs, including possible suppliers. Details, in particular for defence-related programs, are not available on the website however and are provided only by contacting the program manager. Detailed information on the contracts are not available to the public. The number and ratio of those ICP allocated to local industries is made public, but further information on whether on contract performance is not.
As mentioned in the previous assessment, there is no detailed information as to the selection standard and application results for local ICP participants. The exact ICP source also cannot be found from data on the website as ICP covers military arms deals and other civilian articles or services. The website only advises the potential ICP applicants to contact the program manager for further details. In relation to this question the use of ICP in military arms deals therefore remains largely unknown.
Comment: Details are all on the ICP, IDB, MOEA website and available to the public.
- http://www.icpo.org.tw/cica_icp/
- News releases, http://www.moeaidb.gov.tw/external/ctlr?PRO=news.NewsView&id=10924 and http://www.ey.gov.tw/cp.aspx?n=DF5E80D618175A1D
Comment: The level of transparency of the process is high, including reports on ongoing projects. Also, the committee for Aviation Industry development has information on both civilian and military ICPs. Overall, the reports could be more detailed and information in some aspects is scattered so there is space of improvement.
Websites: Industrial Cooperation Programs http://www.icpo.org.tw/cica_icp/ accessed June 26, 2014
Committee for Aviation Industry Development http://www.casid.org.tw/casid/editor_model/u_editor_v1.asp?id=326 accessed June 26, 2014
According to the information provided on the Industrial Development Bureau website, a review board consisting of 8 members in total (2 from Ministry of Economic Affairs, 6 from the MND) is responsible for selection. There are no related directives governing competition.
It is difficult to compare the competition between the offset component and the main contract since no significant competition exists in foreign arms deals.
Although the Government Reviewer points out that the overall procurement has to be subject to the Government Procurement Act, it's not clear that there are regulations in place to ensure that off-set contracts are won through competition. The additional sources provided by the government and reviewers do not provide evidence that a "competition regulation" exists in the offset process. There are only six executive directives (not laws) as to offset procedures: "Directions governing Penalty provisions for Breach of Industrial Cooperation Regulation by Contractors," "Directions Governing Payment of Contribution by Participants of Industrial Cooperation Program," "Directions for Export Control of Technologies Acquired through Industrial Cooperation Programs," "Directions for Supervising the Implementation of ICP Transactions," "Directions for Handing Performance of ICP Transaction in Excess of Pre-Approved Credit," and "Directions for Demand Planning and Utilization of Industrial Cooperation Projects," No article in these directives mentions competition. Score changed from 2 to 1.
Ministry of Economic Affairs, Industrial Development Bureau website
Comment: Please refer to my comments on question #70. An Industrial Cooperation Program (ICP) is associated with obligation imposed on a foreign contractor under a specific procurement. In early stage, all potential suppliers are welcome to submit their intention of participating in future ICP before the designated procurement tender to be awarded. After the procurement being awarded and the main contractor being selected (follow the rules set up in the Government Procurement Act) , a negotiation with the main contracted on an Industrial Cooperation Agreement (ICA) is normally scheduled to be accomplished in six months after the contract being awarded. Thus, ICA's negotiation is a totally independent and different process from the procurement contracting procedure. The overall competition regulations of the procurement have to be subject to the Government Procurement Act. Main contractor is making efforts not only for the awarded procurement contract but its granted obligations negotiated and signed ICA. Details are on the website and available to the public.
- MND ICP regulation http://law.mnd.gov.tw/scp/Query4A.asp?FullDoc=all&Fcode=A001721001
ICP, IDB, MOEA website
Comment: Main and offset contracts fall under the same standards.There is no differentiation in legislation. The process of selection and approval involves civilian participation and oversight, although weaknesses exist as the military and the executive have the final saying in such decisions.
Industrial Cooperation Program website:
The MND officially permits contractor agents or brokers if they are formally registered.
The perception among the general public of arms brokers is very negative. Reports in the media suggest that brokers exist in various forms: local dealers of foreign companies, ghost companies established to circumvent export-controlled items, lobbyists charged to persuade foreign or local governments, or company-sponsored think tanks involved in marketing. Brokers cannot be eliminated totally even in a strictly controlled U.S.-Taiwan FMS procedure, as although the U.S. military is the contractor for FMS, brokers can be reimbursed by U.S. suppliers. In the arms deals involving foreign countries other than the U.S., brokers are needed to drive interactions/lobby foreign governments.
Article 59 of Government Procurement Act does make clear that agents and intermediaries are controlled or limited. But although there are some regulations to govern agent activities, the sources provided nonetheless point to the continued existence and use of agents. And it is Foreign Military Sales (FMS) that matter. FMS are not an insignificant exception; they occupy a huge percentage of total defence expenditure. As government reviewer admits, The "United States government on behalf of purchasing country has the responsibility for source selection based on its own procurement laws and regulations." In other words; this makes it difficult for the Taiwanese government to exercise &quoute;control" over the company's use of agents and intermediaries in the procurement cycle.
"Guidelines to the Registrations for In-country Agents or Representatives of the Foreign Suppliers"
"Laifu, the Biggest Arms Broker in Taiwan, Has Good Connection," Apple Daily, April 25, 2008
Government Procurement Act, Article 8, 59 and 16, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030057
Deutsche Presse-Agentur, &quoute;Taiwan seeks life sentence for arms broker in kickbacks scandal&quoute;, September 28, 2006, http://rawstory.com/news/2006/Taiwan_seeks_life_sentence_for_arms_09282006.html
STAFF WRITER, WITH CNA, &quoute;Fugitive arms broker and his family a no-show at kickback trial in Taipei&quoute;, Taipei Times, Apr 08, 2008
Related News, https://tw.news.yahoo.com/%E6%B3%95%E8%B3%A0270%E5%84%84-%E6%8B%89%E6%A1%88%E6%8E%92%E4%BD%A3%E6%A2%9D%E6%AC%BE-%E6%88%91%E5%A4%A7%E7%8D%B2%E5%85%A8%E5%8B%9D-191244970.html
Comment: Pursuant to the Article 8 of Government Procurement Act, it is necessary to clarify that the term &quoute;supplier&quoute; referred to in government procurement means any company, industrial or commercial firm under partnership or proprietorship, of any natural person, juridical person, institution or organization that may offer construction work, article or service to the government entity. Furthermore, in accordance with the Article 59 of Government Procurement Act, a supplier shall not induce the procuring entity to sign a contract by giving others commission, percentage, brokerage, kickback, or any other benefits. Where a supplier is in breach of such requirements, the government entity may terminate or rescind the contract, or deduct the over-valued portion and any other benefits from the contract amount. Therefore, an agent or representative branch with legal business registration in-country has its right to be a supplier to participate in any government procurement and becomes an awarded contractor. The activities needed to be forbidden are those so-call "ghost broker, dealer or company" which involving by giving commission, percentage, brokerage, kickback, or any other benefits with awarded contractor. In addition, according to the Article 16 of Government Procurement Act, any entreating or lobbying shall not be used as reference in evaluation of procurement tenders. The anti-corruption entities have the power to review those records and enforce necessary actions. As to the FMS procurement from the United States government, as my comments on previous questions, the FMS procurement is conducted in accordance with the Article 105, Government Procurement Act, where the procurement from a foreign government is conducted in accordance with a treaty or agreement (i.e. Letter of Offer and Acceptance, LOA) to which this nation is a party and which has specific provisions for the invitation to tender and award of contracts (i.e. Federal Acquisition Regulations, FAR). Thus, The USG on behalf of purchasing country has the responsibility for source selection based on its own procurement laws and regulations. As understanding, the U.S. Federal Acquisition Regulations have same provisions applied.
- Government Procurement Act, Article 8, 59 and 16, http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030057
- Related News, https://tw.news.yahoo.com/%E6%B3%95%E8%B3%A0270%E5%84%84-%E6%8B%89%E6%A1%88%E6%8E%92%E4%BD%A3%E6%A2%9D%E6%AC%BE-%E6%88%91%E5%A4%A7%E7%8D%B2%E5%85%A8%E5%8B%9D-191244970.html
Since all major arms deals are foreign procurement, there are no contract payment details available to the legislative scrutiny let alone the public. In most cases, the monitor units outside the MND can exercise oversight over whether payments are correct and made on time, but not how the money is transferred.
There are some elements of financing package which can be found in annual defence budget proposal. For example, the annual payment planning and details of F-16A/B upgrade program are accessible on the MND website (http://www.mnd.gov.tw/UserFiles/File/主計局/104年度國防部所屬單位預算/3-2-4_104空軍司令部.pdf). In 2016, Air Forces plan to pay NT$ 9,554,723,000. However, details such as interest rates considerations cannot be found.
Ministry of National Defence, 歲出計畫提要及分支計畫概況表(公開部分) 2014-2015. http://www.mnd.gov.tw/UserFiles/File/主計局/104年度國防部所屬單位預算/3-2-4_104空軍司令部.pdf
''Foreign Exchange Regulation Act'', art. 4(3), http://law.banking.gov.tw/Eng/FLAW/FLAWDAT0202.asp; Fell, Dafydd J. (2010),
''Taiwan's Democracy: Towards a Liberal Democracy or Authoritarianism?'', Journal of Current Chinese Affairs, 39(2), p. 189
Comment: In accordance with the Article 63 of Government Procurement Act and its model contracts prescribed by the Public Construction Commission, all essential requirements associated with detailed financing information shall be included in the package of tender documentation for a specific procurement case and available to the public on the Government e-Procurement System. The procurement financing package contenting budget allocation, procurement value, payment schedule arrangement, down payment, required taxation, bid bond, guarantee bond, certificates of deposit pledged to the procuring entity, irrevocable stand-by letters of credit issued by a bank and related information shall be well prepared by the government entity for tenderer for conducting a preparation for bidding. As to the FMS cases dealt with the United States government, a Letter of Offer and Acceptance (LOA) is signed by the representatives of both governments as a contract which has already set up an initial deposit along with quarterly payment schedule for every case. The payments arrangement is based on the MND and military services' budget allocation stated in the annual budgetary proposal submitted to the Executive Yuan and Legislative Yuan. The U.S. DoD and its responsible services will on behalf of Taiwan MND conduct further procurements for the FMS case in accordance with the Federal Acquisition Regulations and clearly follow the signed LOA's case value and payment schedule to make required arrangement with its contractors. The specific procurement information shall be available on the U.S. defence Security Cooperation Agency and federal government's websites.
- Government Procurement Model Contracts, http://www.pcc.gov.tw/pccap2/BIZSfront/MenuContent.do?site=002&bid=BIZS_C09804055
- FMS contracts awarded, DSCA, http://search.defence.gov/search?input-form=advanced&affiliate=DL_contracts&query-or=foreign
- Federal Business Opportunities, rhttps://www.fbo.gov/
Comment: The identity of the provider is made public through the ICP website. Information on the financial package is scattered.
ICP website: http://www.icpo.org.tw/cica_icp/editor_model/u_editor_v1.asp?id=89 accessed June 26, 2014
U.S.-China Economic and Security Review Commission – 2013 Annual Report to Congress - Taiwan
http://origin.www.uscc.gov/sites/default/files/Annual_Report/Chapters/Chapter%203%3B%20Section%202%20Taiwan.pdf
Comment: The details of foreign procurements may not be made public, but this does not mean that there is no legislative oversight on the process. For instance, see the ''Foreign Exchange Regulation Act'', art. 4(3), http://law.banking.gov.tw/Eng/FLAW/FLAWDAT0202.asp; Fell, Dafydd J. (2010), ''Taiwan's Democracy: Towards a Liberal Democracy or Authoritarianism?'', Journal of Current Chinese Affairs, 39(2), p. 189
Anti-corruption obligations are not confined to main contractors and all parties in the supply chain are subject to the same obligations. Evidence suggests there may be problems with MND enforcement capabilities however. Sub-contractors are sometimes unknown to the MND and the MND does not have sufficient manpower to ensure sub-contractors follow the rules. For example, official reports following a 2013 Control Yuan rectification case show the MND remained inactive even after an aircraft maintenance sub-contractor working for Aerospace Industrial Development Corporation (AIDC) had been found guilty of misconduct.
The MND counter argument does not affect the original assessment. There are indeed some regulations, but according to Control Yuan's investigation, the MND simply does not have the manpower resource to fully enforce them. More importantly though, evidence that the government requires compliance programmes would be required to score three in this question.
Control Yuan, &quoute;漢翔公司糾正案文-內外上網版&quoute;.
http://www.cy.gov.tw/AP_HOME/Op_Upload/eDoc/糾正案/102/102000145漢翔公司糾正案文-內外上網版.pdf
http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030057
http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=C0000007
Comment: Pursuant to the Article 67 of Government Procurement Act, a contractor may subcontract the contract to other suppliers. The &quoute;subcontracting&quoute; means an arrangement not constituting an assignment but pursuant to which another supplier performs a part of the contract for the contractor. In the event that a subcontract has been reported to the procurement entity for file and that the subcontracted part has been pledged by the contractor to the subcontractor, the subcontractor will have the mortgage right and the claim right of the contractor for the contract value or compensation against the entity. Under this circumstance, the subcontractor for the part subcontracted to it shares the liabilities of warranty with the contractor jointly and severally. As to the anti-corruption issue, Article 11 of the Anti-Corruption Act and Articles 87 to 92 of Government procurement Act dictate that any unjust gain or illegal activities is subject to be punished, fined or prosecuted. The suppliers might not necessary be main contractors or subcontractors. As long as they are involved in the government procurement, they are considered as the same liabilities, and the Government Procurement Act and Anti-Corruption Act are applied.
- http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=A0030057
- http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=C0000007
Article 11 of the Anti-Corruption Act and Articles 87 to 92 of the Government Procurement Act dictate that any unjust gain or illegal activities are subject to punishments, fines or prosecutions. The suppliers might not necessary be main contractors or subcontractors. As long as they are involved in the government procurement, they are considered as the same liabilities, and the Government Procurement Act and Anti-Corruption Act are applied.
Almost all Taiwan's foreign arms deals are made with the U.S. and almost all of these are political decisions. Due to the unique U.S.-China-Taiwan relationship, every U.S. arms sale to Taiwan is sensitive. U.S. decisions on whether or when to sell some certain weapons to Taiwan carries significant political messages, and are not based upon Taiwan's military needs alone.
The MND counter argument that this is not a &quoute;controllable problem&quoute; does not affect the original assessment. A score 3 requires either that most Taiwanese arms procurement is free from US political influence or the value of such arms purchases is small. Taiwan's situation means it cannot meet these conditions. There is no question that every single major arms sales (such as naval or air platforms) from the U.S. will be influenced by U.S. political considerations. This is a political reality that Taiwan faces, no matter how well-written into the National defence Report.
National defence Report, 2013, pp. 41-42.
Lin, Cheng-yi, &quoute; The US-Taiwan Military Cooperation: Threat Assessment and Responses," in Lin Bih-jaw and Lin Cheng-Yi editors, 30 Years of Taiwan Relation Act: Examination of U.S.-China-Taiwan Relations (Taipei: Chuliu Co., 2009), pp. 200-233.
US-Taiwan Business Council, &quoute;The Looming Taiwan Fighter Gap&quoute;, October 1, 2012
WENDELL MINNICK, &quoute;Taiwan Still Hungry for More US Arms&quoute;, defenceNews, Nov. 13, 2013, http://www.defencenews.com/article/20131113/DEFREG03/311130021/Taiwan-Still-Hungry-More-US-Arms
Oliver Bräuner, &quoute;How Europe Shies from Taiwan&quoute;, The Diplomat, March 20, 2012, http://thediplomat.com/2012/03/how-europe-shies-from-taiwan/
Comment: Reference is made to the National Defence Report, Part III, Chapter 6, The Taiwan armed forces' armaments acquisition is carried out based on the principle of &quoute;prioritizing domestic supply and self-production, using foreign procurement as a support,&quoute; and aims to enhance indigenous technological research and development capabilities. As to the arms sales dealt with the U.S. government, most programs can be executed smoothly. Only few programs are depend on the USG's leaderships to take all aspects of political considerations to make decision for release. Therefore, due to Taiwan's unique international status, the question is "how common", the selling nation, especially the U.S., occasionally takes arms sale as a politicized issue; it's truly not a controllable problem for Taiwan and any other country in the world.
Reference added: National defence Report, Part III, Chapter 6, http://report.mnd.gov.tw/en/m/part27.html
Due to Taiwan's unique international status, the question is "how common", the selling nation, especially the U.S., occasionally takes arms sales as a politicized issue. It is truly not a controllable problem for Taiwan and any other country in the world. And, this condition has no direct connection with corruption issues; especially, acquiring defence articles or services from the USG through FMS channel.
Comment: None of descriptions that complement the 1-5 marks accurately depicts the role of political influence in Taiwan's defence acquisition decisions.
I would say that 2 is a correct mark, yet few could doubt that the Taiwanese authorities have &quoute;an uncertain military need&quoute;. The security situation of the island forces the leaders to enhance their defences; the US exercise some degree of political influence when they become the selected seller for defence items just because they are perceived as Taiwan's ultimate security guarantee. For instance, such a role became evident in the air defence choices, or the acquisition of diesel submarines from the US - who are not producers.

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