Taisun Company Fined NT$6 Million by Changhua Health Bureau Over Contaminated Oil Incident

1. Date of Incident: 115/07/07

2. Company Name: Taisun Enterprise Co., Ltd.

3. Relationship to Company (Please enter 'Company' or 'Subsidiary'): Company

4. Cross-shareholding Ratio: Not applicable

5. Media Names: UDN United News, China Times, and other media outlets

6. Report Content:

The Changhua County Health Bureau today imposed a fine of NT$6 million on our company for violating the Food Safety and Sanitation Act. Additionally, Zhonglian Oils Co., Ltd. has been fined NT$165.2 million by the Ministry of Health and Welfare.

7. Cause of Incident:

On June 30, Taisun received notification from Zhonglian Oils, its oil product contract manufacturer, that a batch of salad oil raw material (Lot No. 0409315) supplied to Taisun, Fushou, and Fumao companies failed to meet Taiwan's regulatory standards for benzo[a]pyrene (BaP) during third-party testing as required by law.

In response, Taisun immediately conducted a preventive recall of 10 related products and voluntarily reported the incident to the competent authority in accordance with regulations. To protect consumer rights, the company also expanded the refund program to include all consumers who purchased any of the 10 affected products between April and June.

However, during an investigation, the competent authority determined that Taisun should have been aware of the potential contamination earlier. Specifically, Taisun attended a quality assurance coordination meeting hosted by Zhonglian Oils on June 15, where it was believed that the company should have known that the No. 315 salad oil tank produced on April 4 might be contaminated. As such, the authority ruled that Taisun failed to take timely legal action when safety concerns arose, resulting in the NT$6 million fine under the Food Safety and Sanitation Act.

Zhonglian Oils Co., Ltd., in which Taisun holds a 33.33% equity stake, has been fined NT$165.2 million by the Ministry of Health and Welfare for the benzo[a]pyrene超标 incident. If this penalty is finalized, Taisun will recognize an investment loss in accordance with IFRS (International Financial Reporting Standards).

8. Response Measures:

Taisun has not yet received official documentation from the Changhua County Government. Upon receipt, the company will make a public announcement as required by law and implement appropriate response measures.

9. Other Matters to be Disclosed: None.