As far as I understood from the newspaper articles, the problem is that this award is Taiwanese (and not Chinese). Only citizens of Taiwan are eligible for the award. As far as I understood, though TK was born in Taiwan and his nationality is Taiwanese, he holds Japanese citizenship. So formally they had some reason for disqualifying him. But honestly speaking, I think it just a pretext for the disqualification, no more. How you can say that a man born of a Taiwanese mother is not Taiwanese is beyond my understanding. Frankly speaking, I must be an ignoramus, but TK seems to be the ONLY Taiwanese actor whose name is world-famous. And bingo - out he goes! As I said, an incomprehensible and unfair decision.
Chinese is not absolutely the same as Taiwanese, at least continental China has always claimed Taiwan as part of its territory, and the USA and China are still the two major powers that brawl over Taiwan, China wanting it back, the USA supporting its independence.
If you are interested in a concise history of Taiwan to see the roots of Cinese-Taiwanese tension, consult the corresponding Wiki page.
What worries me more is that he is not among the nominees for the upcoming 28th Hong Kong Film Award, which seems to be more geographically open-minded. I wonder, is it because it's rumoured he's been at difference with John Woo over how to interpret the part of Zhuge Liang?
Once again, I must be an ill-informed person, but imdb.com lists NO awards for TK AT ALL. I believe that scores of worse actors keep receiving awards, but not he. WHY?
Unfortunately, our opinion does not count anywhere. And I think that to do him justice, he's not just a nice face on the screen (an eye-candy, as the film reviews say), he's much more. He's a talented actor because he's different in all the parts he plays, he has a presence, he is a personality on the screen. Maybe, he's not Dustin Hoffman in 'Rainman', but has anybody offered him anything as deep and as difficult? Anyway, we remember most films he was in THANKS to HIS acting, thanks to what he made of his characters.
I hope he will remain himself, 'his own man', won't be discouraged (the world is on the whole an unfair place), and will keep doing what he's doing now. Let him shrug it off, he's one of the best actors now living.