TAIPEI (Taiwan News) — Armaments Bureau Director Lin Wen-hsiang (林文祥) said Monday that the defense ministry has canceled its contract with Home-Max Furniture Trading Ltd. to import Royal Demolition Explosive (RDX) after the company failed to obtain an export license within the required 180-day deadline.
Lin said Home-Max failed to secure the export license after winning the ministry's NT$590 million (US$20 million) RDX procurement contract, per ETtoday. The ministry imposed a fine of NT$83.9 million on the company and will exclude it from future defense procurement bids.
RDX is a high explosive developed during World War II and widely used in military applications.
Home-Max won the RDX import contract in December 2025 despite having registered capital of about NT$10 million, prompting criticism from opposition lawmakers. Defense Minister Wellington Koo (顧立雄) defended the decision at the time, saying Home-Max held the necessary licenses and that the ministry could easily verify whether the company fulfilled the contract requirements.
Questioned Monday by KMT Legislator Wang Hung-wei (王鴻薇) on whether he had changed his position following the controversy, Koo said the ministry's standards for similar imports had remained consistent for the past 20 years, per UDN. Wang then asked whether the ministry would review its procurement procedures after the cancellation of Home-Max's RDX contract and the cancellation of a contract with Tron Future Tech for a counter-drone system.
Koo said the ministry plans to strengthen domestic RDX production capacity. He said the project was initially included in the special defense budget but was later moved back into the regular budget process.
During the debate over the contract in December 2025, Home-Max was accused by opposition lawmakers of having ties to President Lai Ching-te (賴清德), per Liberty Times. The company rejected the allegations, saying China and India are the only international exporters of RDX, making procurement through civilian channels necessary.
KMT Legislator Ma Wen-chun (馬文君) alleged at the time that an intermediary had proposed sourcing RDX from India, claiming that the procurement requirements had been tailored to benefit Home-Max, per Storm Media.
In addition to the RDX contract, Home-Max also won a contract with the National Chung-Shan Institute of Science and Technology to supply High Melting Explosive (HMX), an explosive with manufacturing processes similar to those used for RDX. Citing a Reuters report on India's HMX exports to Russia, Ma questioned whether Home-Max intended to use the same supplier for both explosives.
The institute said Home-Max won the HMX contract during the third round of bidding after submitting an offer that met the reserve price. It said consultations with the US State Department confirmed that Home-Max had obtained an export license for HMX, and the company had said deliveries could begin as early as March.
The institute said it had attempted to purchase HMX directly from US manufacturers, including BAE Systems and SAE Manufacturing Specialties Corp., but was unsuccessful, per CNA. It said SAE advised the institute to seek domestic agents; however, because the recommended agent did not hold exclusive distribution rights, the institute decided to open the procurement to competitive bidding.
Defense Strategy and Resources Division at the Institute for National Defense and Security Research Director Su Tzu-yun (蘇紫雲) weighed in on the controversy in 2025, recommending stricter requirements for future defense procurement contracts, per Liberty Times. He said the government should assess whether contractors have sufficient storage facilities for specialized cargo and whether their personnel have the necessary training to handle such materials.
Su argued that additional requirements would improve safety and public confidence in defense procurement.
