According to Taiwanese media reports, OnePlus Technology founder and CEO and OPPO senior vice president and chief product officer Liu Zuohu was suspected of setting up a branch in Taiwan via Hong Kong without permission from the competent authorities. In fact, he was engaged in mobile phone software research and development and talent recruitment for the Shenzhen parent company. He used the name of a Hong Kong businessman to evade legal scrutiny. He spent US$72.93 million (508.7 million yuan) in six years and poached more than 70 top R&D engineers in Taiwan on a large scale. After an investigation by the Shilin District Prosecutor's Office, two Taiwanese cadres named Zheng and Lin were prosecuted for violating the Cross-Strait People's Relations Regulations; Liu Zuohu was wanted separately.
The indictment pointed out that Liu Zuohu, chairman of Shenzhen OnePlus Company, reached an agreement with Zheng Nv and Lin Nv to form a Taiwan R&D team. Since 2014, "OnePlus Company" was first established in Hong Kong, and the following year it came to Taiwan as a Hong Kong businessman to set up a branch (later renamed Shenghe Company).
The prosecutor's investigation found that the Taiwan branch was nominally a Hong Kong-funded consulting company, but its only business was actually developing software and testing for the Shenzhen parent company's "OnePlus" mobile phone. In order to maintain operations, the Shenzhen parent company and related companies have successively remitted huge funds of more than 72.93 million US dollars in six years from 2015 to 2021 for the purpose of paying salaries and purchasing research and development equipment.
Lin Nan testified during the interrogation that he was instructed by Liu Zuohu to serve as the head of the R&D department, and successively interviewed and hired more than 70 Taiwanese R&D engineers. Although this group of engineers receive salaries from the Taiwan branch, all the software they develop is used on OnePlus mobile phones, and administrative, financial and other operational details must be reported to the supervisor of the parent company in Shenzhen. The payment of year-end bonuses can even be decided with Liu Zuohu’s nod.
The person in charge surnamed Zheng argued that he was only a nominal person in charge, responsible for tax planning, and did not know the specific business. However, the prosecutor based on employee testimony and foreign exchange records determined that he knew about the company's undertaking of Shenzhen business.
Prosecutors believe that mainland profit-making enterprises are not allowed to engage in profit-making business activities in Taiwan without permission. However, the defendants and others used the method of "disguising foreign investment" to set up research and development bases in Taiwan without the approval of the Investment Review Commission. This not only disrupted market competition, but also involved the illegal recruitment of Taiwan's high-tech talents. Two Taiwanese cadres named Zheng and Lin were prosecuted for violating the Cross-Strait People's Relations Act; Liu Zuohu was separately wanted.