HONG KONG: China Mobile said on Tuesday it has set up a unit in Taiwan, paving the way for its long-stalled purchase of a 12 percent stake of Taiwanese mobile carrier Far EasTone.

"The set-up and registration of a China Mobile subsidiary in Taiwan has already received approval," China Mobile said in a statement.

China's dominant mobile carrier said it would use the unit to invest in Far EasTone, following its initial announcement of plans for such an investment a year ago.

"Completion of the unit's establishment will ... expedite the process of allowing such cooperation between China Mobile and Far EasTone," China Mobile said.

China Mobile raised eyebrows last April when it first said it had reached a deal to buy 12 percent of Far EasTone for $529 million, as relations thawed between the two former Cold War rivals under a year-old China-friendly Taiwan administration.

The deal was quickly thrown into doubt due to lack of rules permitting investments in Taiwan's sensitive telecoms sector by Chinese telephone companies, despite Taiwan's gradual opening of various sectors to Chinese investment.

"China Mobile sincerely hopes that Taiwan's next group of investments (open to Chinese companies) will include investments in the first-tier telecoms sector," China Mobile said in its statement.

"At that time, China Mobile will apply through its Taiwan unit to invest in Far EasTone."