Scandal-tainted Seibu Railway Co. said Saturday it will continue to operate the Takaragaike Prince Hotel in Kyoto, the upscale hotel that hosted the 1997 conference which produced the Kyoto Protocol, reversing its original plan to sell the property under a business rehabilitation program.

A panel tasked with rebuilding the Seibu Railway group has judged it possible to reconstruct the hotel's business in view of its location in a city known around the world as a tourist destination, and its record of hosting international conferences, Seibu said.

The decision, already relayed to the Kyoto Prefectural Government and other concerned parties, is also in response to strong calls from the local government and business community, Seibu said.