Report: France to cut military contact with Taiwan

TAIPEI, Taiwan

France will withdraw a military liaison unit in Taiwan after an international court ordered Paris to make a large compensation payment to Taipei over a frigate sale, a Taiwanese newspaper reported.

Monday's report by the Liberty Times comes three weeks after a court ruled Paris breached a 1991 contract to sell six Lafayette frigates to Taipei by paying commissions to intermediaries. The compensation amounts to at least 630 million euros ($830 million).

The newspaper says Paris will remove its military liaison unit in Taiwan in July to show its unhappiness over the move.

France's Foreign Ministry denied the unit exists.

Taiwan's Foreign Ministry says Paris may remove the unit because of budget issues, and the Defense Ministry says bilateral military exchanges remain normal.