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Aeropolitics, Airline Management, Regional Aircraft, Regional Airlines

SUMMARY: The Chairman of the Republic of China (ROC) (aka Taiwan) based Daily Air, has been detained over fraud. It is alleged the airline created fake invoices to get more state subsidies, and at this point no word if there was any ‘irregularities’ with the recent acquisition of 4 x DHC-6 Series 400’s from Viking Air which has a value of $US 30 million. The airline flies into the highly volatile and politicized islands of Penghu, Kinmen, and Matsu, which are claimed by the Peoples’ Republic of China (PRC) which considers the islands and Taiwan, its territory, and makes no bones about the fact the ‘renegade’ province will one day be part of the PRC again, ideally peacefully but by military force if need be. The ROC is now, sadly down to just 17 UN member states that recognize it over the PRC out of 193 UN member states, the tide is turning against Taiwan and its once big aspirations of full independence.

SEE:  https://www.linkedin.com/in/tomas-chlumecky-3200a021/


Head of Taiwan’s Daily Air detained over fraud

June 21, 2018

Daily Air’s new Viking Air DHC-6 Series 400 Twin Otter



The Chairman of Daily Air Corporation (4 x DHC-6 Series 400 from Viking Air and 2 x Do228-212), a state-subsidized domestic airline, serving several of the offshore islands of Taiwan, was detained and held incommunicado Thursday for allegedly filing bogus company financial statements to fraudulently obtain government funding, Taipei prosecutors said Thursday.


Daily Air Dornier 228-212


According to Taipei District Prosecutors Office, the company has received up to NT$100 million (about US$3.3 million) since 2005, based on false accounting that took advantage of government subsidies paid to airlines flying between Taiwan proper and outlying islands.

Prosecutors said airline staff are suspected of using fake invoices and vouchers to boost the company’s losses and thereby enable it to claim more in subsidies from the government.

On Wednesday, prosecutors raided the headquarters of the company in Taipei, along with eight offices at Taitung Airport and Kaohsiung International Airport, while also interviewing Kuo and several other suspects.


Map showing the offshore islands of the Republic of China (ROC) (aka Taiwan) that are situated between it and the People’s Republic of China (PRC).


A requested was later made for the detention of Kuo after prosecutors’ search turned up documents that credibly suggest his involvement in the illegal actions and asked that he be held incommunicable to prevent collusion.


The airline recently bought 4 Viking Air’s Series 400 Twin Otters at a list price of $US 30 million to replace its aging fleet of Dornier Do228-212’s.




I can’t leave this article without some political comment on the situation of Taiwan and the PRC, a graduate of International Relations, I combined my two loves when I can, and most often I do, and people should realize that global aviation is still driven by politics almost everywhere you look.

Those that say they do not go together are ignorant of the drivers of this industry from airlines to OEM’s, this is a very political industry once you leave the comfort of your home country, which some people and companies never do and therefore do not understand what I am talking about.


So, the PRC considers the ROC a ‘renegade’ province and wants it to reunite with the PRC as soon as possible, while the ROC talks of self-determination and independence, it risks a full-scale invasion by the PRC, which would overwhelm Taiwan very quickly and possibly bring the US and the PRC into open conflict, though the US recognized the “one China” policy, it is still an ally of ROC (Taiwan), for now, and arms it to the dismay of the PRC.


The controversy regarding the political status of Taiwan, sometimes referred to as the Taiwan Issue or Taiwan Strait Issue, or from a Taiwanese perspective as the Mainland Issue, is a result of the Chinese Civil War and the subsequent split of China into the two present-day self-governing entities of the People’s Republic of China (PRC; commonly known as China) and the Republic of China (ROC; commonly known as Taiwan).


The issue hinges on whether Taiwan, Penghu, Kinmen, and Matsu should continue to remain effectively the territory of the democratic government of the ROC and maintain the “status quo” of two self-governing entities; or become unified with the PRC under the existing communist government; or formally change the “Republic of China (ROC)” national title to a new Republic of Taiwan; or become unified with the mainland PRC.


This controversy also concerns whether the existence and legal status as a nation-state (country) of both the ROC and the PRC is legitimate as a matter of international law, and how much diplomatic recognition either country receives from the international community.


The foreign relations of the Republic of China (ROC), (aka Taiwan), are dwindling away as more and more UN member states switch recognition from the ROC to the PRC.


The Republic of China is this year has lost the recognition of the Dominican Republic and Burkina Faso this past March, and last December it lost Panama, which are big blows to the ROC as now it is recognized by only 17 out of the 193 United Nations member states (plus the Holy See, which is the Vatican,  which is not a UN member, just an observer, like the ROC which lost its UN seat in 1971).


The few small nations that still recognize the ROC (aka Taiwan) over the mighty PRC, from the above scratch out the Dominican Republic and Burkina Faso as of March, 2018


The remaining 17 UN members that recognize the ROC over the PRC are generally small Caribbean and Pacific island nations plus a few Central American states.

You can bet they use the ROC for its generous financial aid to keep the relationships going, the ROC has kept the smaller nations as it knows it cannot compete with the PRC on bigger nations, money talks and when you are a poor nation like Swaziland, Haiti you “milk” the relationship, and the PRC is willing to pay its dues to keep some international recognition alive, even if it is only 17 out of 193 UN member states (8.8% of the General Assembly votes, where each country no matter how big or small, has 1 vote).

Caribbean (4): Haiti, St. Kitts & Nevis, St. Lucia, St. Vincent & the Grenadines

Africa (1): Swaziland

Europe (1): Holy See (not UN member)

Central America (5): Belize, El Salvador, Guatemala, Honduras, Nicaragua

South America (1): Paraguay

Oceania (6): Kiribati, Marshall Islands, Nauru, Palau, Solomon Islands, Tuvalu


The Few remaining nations that recognize the ROC (aka Taiwan), you can take out Burkina Faso and the Dominican Republic from the above flags as of this March.

I should point out that there are signs that Nicaragua, Paraguay, and Swaziland may flip soon, the writing is on the wall that one day the ROC will be re-united with the PRC just like Hong Kong and Macau, peacefully I hope, it’s not fair, its sad, but it is what it is!



About Aviation Doctor - Helping aviation companies to transform the present into a more profitable tomorrow

I am a Canadian and EU national with an MBA and 33+ years experience in aviation business development with 20 years overseas and work in 30+ countries. A former investment/merchant banker (mergers and acquisitions to corporate turnarounds). airline and OEM senior executive and past owner of 6 successful aviation companies in 3 countries (executive jet charter/management companies, aircraft sales, aircraft broker, airline/aerospace consulting to aircraft insurance). I have a very diverse aviation background with 75+ aviation companies (50+ airlines of all sizes, OEM's, airports, lessors, MRO to service providers) as consultant, executive management, business analyst and business development adviser. Excellent success track record in International Business Development. Most work with airlines is with new start-ups and restructuring of troubled carriers. I sold new business jets, turboprops and helicopters for Cessna, Raytheon, Gulfstream to Eurocopter as an ASR as well as undertaking sales and marketing of commercial aircraft for Boeing, de Havilland, Dornier, Saab and Beechcraft. Brokered everything from LET-410's to B747's and from piston PA31 to G550 business jets. I look beyond the headlines of the aviation news and analyze what the meaning and consequences of the new information really means. There is a story behind each headline that few go beyond. Picked the name Aviation Doctor, as much of my work has been with troubled companies or those that want and need to grow profitably. I fix problems in the business for a better tomorrow. You can reach me with comments or suggestions at: Tomas.Aviation@gmail.com I write a lot of Articles and Posts on LinkedIN: https://www.linkedin.com/in/tomas-chlumecky-3200a021/


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