Taiwan and China’s LED markets have been affected by market rumors this morning of rising LED tariffs in China, with Chinese manufacturers in general reaping in profits, while neighboriing Taiwan manufacturers saw stock prices drop.

The disruptive market rumor has proven to be false by a source from China’s Ministry of Commerce (MOC), according to a report from Chinese financial media NetEase.

Following manufacturers denial of the rumor, an official from MOC has also confirmed its untrue. The ministry currently has no intention of adjusting LED tariffs, and has not received any related information, said the source. Additionally, the ministry is not involved in changing tariff policies, which are decided by The Central People’s Government before being implemented by China's General Administration of Customs.

An industry insider believes if the tariff raise was implemented it would limit international and Taiwanese LED chip imports, and protect local Chinese manufacturers. It could also effectively prevent oversupply situations from government subsidies. On the downside, the tariff raise policy could backfire on Chinese manufacturers. It would have obstructed technology exchange, which is badly needed by Chinese manufacturers, whose technology in general  lag behind American, Taiwanese, Korean, and German manufactures.