Despite dramatic improvements in press freedom conditions in recent years, Taiwan's ruling Kuomintang (KMT) continues to limit critical coverage of the party, relying on lawsuits and a license regime to achieve that objective. Although the government granted a license to Taiwan's first private television network in 1995, the station's owners have yet to meet a requirement to raise a prohibitively high amount of capital. The requirement ensured that broadcast coverage of Taiwan's presidential election campaign in early 1996 was weighted in favor of the incumbent president, the KMT's Lee Teng-hui.

Taiwan's pirate radio stations, which are overwhelmingly critical of the KMT, no longer face massive police raids as they did through early 1995, but the most popular of those stations – Voice of Taiwan – remains mired in legal battles. The High Court in late 1996 overturned an eight-month prison sentence imposed on Hsu Rong-chi, the station's owner and operator, for breaching the Parade and Assembly Law, but placed him on a five-year probation. Hsu's alleged offense was inciting taxi drivers to protest an increase in car insurance fees by massing in front of the Ministry of Finance. Hsu also faces a separate charge of breaching the Parade and Assembly Law for inciting a demonstration against electricity shortages in front of President Lee's house.

In a move supported by senior members of the KMT, Lui Tai-ying, director of the KMT's Business Management Committee, filed a libel suit in November against Ying Chan and Hsieh Chung-liang over an article in Yazhou Zhoukan (Asia Weekly), a Hong Kong-based Chinese-language newsweekly. The suit elicited objections from CPJ, other press freedom groups, and prominent U.S. journalists and news organizations, but it remained on the docket at year's end.

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