Taiwan Probe Finds 12 Smartphone Brands Violate Privacy Rules

Taiwan has identified 12 smartphone brands that do not conform with its privacy standards, and the handsets makers could face fines or even an outright ban unless they address these breaches, an official at the telecoms regulator said on Friday.

Taiwan's government began to review privacy standards two months ago after media reports said smartphones made by Chinese firm Xiaomi Technology Co Ltd could be sending user data to its home servers in mainland China without users' permission.

Hsiao-Cheng Yu, vice chairman of Taiwan's National Communications Commision (NCC), did not name any of the 12 brands, but said the investigation found that some of these smartphones could allow their manufacturers to collect users' data without their permission.

Others contained "imperfections" which do not conform with the law, Yu said, without elaborating.

The NCC's findings will be released within weeks, he added.

Smartphones from Apple Inc, Samsung Electronics Co Ltd and HTC Corp were among the top 5 bestselling handsets in Taiwan during the third-quarter, according to industry data firm IDC. Xiaomi also said its phones are also among the 12 most popular in Taiwan.

Yu said the government would ask the offending brands to modify their handsets. If they refuse, the NCC could fine the companies up to TWD 200 million ($6.43 million, roughly Rs. 39 crores) or ban their handsets from being sold in Taiwan.

The Taiwanese probe underscores global concerns about data security and the scrutiny Chinese tech firms are subject to as governments become increasingly wary of potential cyber security threats from the world's second-largest economy.

Asked about the Taiwan probe, Xiaomi said its devices "never actively send any private user information without the users' approval."

Taiwan-based HTC said it was working with the Taiwanese regulators to improve compliance with the required security standards.

Samsung had no immediate comment on the findings, while Apple did not immediately respond to requests for comment.

© Thomson Reuters 2014