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1
What kind of documents should a foreign investor submit when applying to invest in Taiwan’s critical industries?

Foreign investors applying to invest in Taiwan’s critical industries shall submit common and essential documents (such as investor identifications, Power of Attorney certificates, identification of the appointed agent, information of the invested enterprise, investment kinds), case-specific documents (such as documents required for initial investments, capital increase, or transfer of equity interests), as well as the following:
I. Critical industries shall be as follows:
i. Taiwan’s top 100 listed or over-the-counter (OTC) companies by market capitalization, or public companies with equivalent scale,
ii. Enterprises operating restricted industries designated by the Statute for Investment by Foreign Nationals, or enterprises operating special permission industries, including cable radio and television, satellite broadcasting, financial and insurance industries, and public utility industries,
iii. Enterprises operating industries recognized as critical and substantial by the Competent Authority
II. The foreign investor shall provide detailed descriptions and relevant documents according to each of the following items:
i. Transparency of the investment plan:
(a) The transparency of the investment plan shall include comprehensive and detailed operational plan, investor’s background information, holding structure of the investment, details of the investor’s shareholders and directors, and sources of the investment capital.
If necessary, proof of investment capital, agreements of equity interest transfer (and other related agreements), evaluation documents of equity interest acquisition price, and information concerning the transaction process shall be submitted.
(b) The aforementioned “comprehensive and detailed operational plan” shall include future operational objectives, corporate structure and human resources planning, strategic planning for operation and marketing, detailed cost analyses and financial plans, impact towards the invested enterprise’s revenues and earnings, impact towards the advancement of the invested enterprise’s industrial technology and operational capability, and whether or not the investment is beneficial towards the invested enterprise in advancing the development of other related industries or companies in Taiwan.
ii. Financial soundness of multi-layer holding structure:
The investor shall clarify that utilizing multi-layer holding structure for investment is necessary and reasonable, and, for the invested enterprise and other enterprises within its domestic holding structure, the reasonableness of each enterprise’s capital amount level, its financing issues, its operational status, as well as its financial conditions.
If necessary, a most recent financial statement reviewed and certified by a Certified Public Accountant (CPA), an analysis of the investor’s future solvency and financial feasibility, a copy of lending statement or lending agreement from a commercial bank, as well as the impact on tax collections, shall be submitted.
iii. Protection of workers' rights in Taiwan:
The investor shall clarify the following: the impact towards employment (as well as possibilities of future job creation), mandatory compliance in accordance with labor regulations, commitments to employees’ working conditions (as well as wage growth contributions), and whether or not cheap labor costs in Taiwan contributed to the investor’s incentives. The investor shall also submit an original declaration, stating that it will not damage domestic worker’s employment interests and that it will not violate Taiwan’s labor regulations.
iv. Protection of shareholders’ interests of the invested enterprise:
The investor shall submit a statement concerning the protection of shareholder’s interests of the invested enterprise, including recusal by directors, supervisors, and shareholders with effective influence from conflict of interest, their responsibilities of administrative prudence, and their duty of loyalty. Disclosure of critical and substantial information of the invested enterprise, and the protection of domestic shareholder’s interests, shall also be included.
v. Other items may be requested for review by the authorities concerned in accordance with the specificity of the application.

What kind of documents should a foreign investor submit when applying to invest in Taiwan’s critical industries?

Foreign investors applying to invest in Taiwan’s critical industries shall submit common and essential documents (such as investor identifications, Power of Attorney certificates, identification of the appointed agent, information of the invested enterprise, investment kinds), case-specific documents (such as documents required for initial investments, capital increase, or transfer of equity interests), as well as the following:
I. Critical industries shall be as follows:
i. Taiwan’s top 100 listed or over-the-counter (OTC) companies by market capitalization, or public companies with equivalent scale,
ii. Enterprises operating restricted industries designated by the Statute for Investment by Foreign Nationals, or enterprises operating special permission industries, including cable radio and television, satellite broadcasting, financial and insurance industries, and public utility industries,
iii. Enterprises operating industries recognized as critical and substantial by the Competent Authority
II. The foreign investor shall provide detailed descriptions and relevant documents according to each of the following items:
i. Transparency of the investment plan:
(a) The transparency of the investment plan shall include comprehensive and detailed operational plan, investor’s background information, holding structure of the investment, details of the investor’s shareholders and directors, and sources of the investment capital.
If necessary, proof of investment capital, agreements of equity interest transfer (and other related agreements), evaluation documents of equity interest acquisition price, and information concerning the transaction process shall be submitted.
(b) The aforementioned “comprehensive and detailed operational plan” shall include future operational objectives, corporate structure and human resources planning, strategic planning for operation and marketing, detailed cost analyses and financial plans, impact towards the invested enterprise’s revenues and earnings, impact towards the advancement of the invested enterprise’s industrial technology and operational capability, and whether or not the investment is beneficial towards the invested enterprise in advancing the development of other related industries or companies in Taiwan.
ii. Financial soundness of multi-layer holding structure:
The investor shall clarify that utilizing multi-layer holding structure for investment is necessary and reasonable, and, for the invested enterprise and other enterprises within its domestic holding structure, the reasonableness of each enterprise’s capital amount level, its financing issues, its operational status, as well as its financial conditions.
If necessary, a most recent financial statement reviewed and certified by a Certified Public Accountant (CPA), an analysis of the investor’s future solvency and financial feasibility, a copy of lending statement or lending agreement from a commercial bank, as well as the impact on tax collections, shall be submitted.
iii. Protection of workers' rights in Taiwan:
The investor shall clarify the following: the impact towards employment (as well as possibilities of future job creation), mandatory compliance in accordance with labor regulations, commitments to employees’ working conditions (as well as wage growth contributions), and whether or not cheap labor costs in Taiwan contributed to the investor’s incentives. The investor shall also submit an original declaration, stating that it will not damage domestic worker’s employment interests and that it will not violate Taiwan’s labor regulations.
iv. Protection of shareholders’ interests of the invested enterprise:
The investor shall submit a statement concerning the protection of shareholder’s interests of the invested enterprise, including recusal by directors, supervisors, and shareholders with effective influence from conflict of interest, their responsibilities of administrative prudence, and their duty of loyalty. Disclosure of critical and substantial information of the invested enterprise, and the protection of domestic shareholder’s interests, shall also be included.
v. Other items may be requested for review by the authorities concerned in accordance with the specificity of the application.
2
Our center is a nonprofit professional institute registered in Hong Kong to provide product testing, authentication and inspection services. We would like to cooperate with a China-Hong Kong joint venture company which is registered in Guangzhou, China (one stockholder of the company is an state-owned enterprise, and the other is a Hong Kong enterprise) to establish a company limited in Hong Kong, and is planning to set up a branch or subsidiary in Taipei City with the name of a limited company registered in Hong Kong. Would you please give us approval to establish such a branch or subsidiary in Taipei? The scope of business of the branch or subsidiary in Taipei will include providing services of testing, authentication, factory assessment and system authentication for domestic and foreign products for export sales.

1. A foreign company intends to establish a branch in Taiwan shall apply to the Department of Commerce, MOEA. Please consult the Department directly by telephone 02-23212200 or visit it’s website: https://gcis.nat.gov.tw/mainNew/English/index.jsp for further information.
2. The company in Hong Kong to be newly established is a China-Hong Kong joint venture. At present, there is no regulations has been prescribed on the investment of capital from P.R.C into Taiwan, so the Commission will not accept any such application.

Our center is a nonprofit professional institute registered in Hong Kong to provide product testing, authentication and inspection services. We would like to cooperate with a China-Hong Kong joint venture company which is registered in Guangzhou, China (one stockholder of the company is an state-owned enterprise, and the other is a Hong Kong enterprise) to establish a company limited in Hong Kong, and is planning to set up a branch or subsidiary in Taipei City with the name of a limited company registered in Hong Kong. Would you please give us approval to establish such a branch or subsidiary in Taipei? The scope of business of the branch or subsidiary in Taipei will include providing services of testing, authentication, factory assessment and system authentication for domestic and foreign products for export sales.

1. A foreign company intends to establish a branch in Taiwan shall apply to the Department of Commerce, MOEA. Please consult the Department directly by telephone 02-23212200 or visit it’s website: https://gcis.nat.gov.tw/mainNew/English/index.jsp for further information.
2. The company in Hong Kong to be newly established is a China-Hong Kong joint venture. At present, there is no regulations has been prescribed on the investment of capital from P.R.C into Taiwan, so the Commission will not accept any such application.
3
A Taiwanese company invests in China through a company in a third country/region. To collect working capital for the daily operations of the business in China, it is prepared to issue overseas floating-rate bonds through the company in the third country/region, and the guarantee is to be provided by the Taiwanese company. Does it meet the relevant provisions on investment in China?

According to the provisions of Paragraph 1, Article 35 of the Act Governing Relations between Peoples of the Taiwan Area and the Mainland Area (hereinafter referred to as the ""Cross Straits Act""), citizens, juridical persons, associations and other organizations in Taiwan may, with the permission of the Ministry of Economic Affairs, make investments or undertake technical cooperation in China; investment amount under certain limit, may be made after declaration. Therefore, for any investment or technical cooperation undertaken by Taiwanese citizens, juridical persons, associations and other organizations in China, shall make declaration or apply for permission to the MOEA (responsible unit: Investment Commission).
In addition, according to the provisions of Paragraph 1, Article 4 of the Regulations on Permit of Investment or Technical Cooperation in China (hereinafter referred to as the ""Regulations on Permit"") prescribed under the authorization of Paragraph 3, Article 35 of the Cross Straits Act, any of the following actions conducted by Taiwanese citizens, juridical persons, associations or other organizations in China shall be regarded as investment in China: initiating a new company or business (Subparagraph 1), increasing the capital of an existing local company or business (Subparagraph 2), acquiring the stock rights of an existing local company or business (Subparagraph 3), or expanding a branch or business (Subparagraph 4). To conduct such action in China, a Taiwanese investor shall make a declaration or submit an application for permission to the Commission in advance.
According to your question, the Taiwanese company invests in China through a company in a third country/region, and for the purpose of collecting working capital for the daily operations of the business in China, it is prepared to issue overseas floating-rate bonds through the company in the third country/region with the guarantee provided by the Taiwanese company. If the collection of the capital involves any of the above actions of investment, a declaration shall be made or an application for permission submitted to the Commission in advance.

A Taiwanese company invests in China through a company in a third country/region. To collect working capital for the daily operations of the business in China, it is prepared to issue overseas floating-rate bonds through the company in the third country/region, and the guarantee is to be provided by the Taiwanese company. Does it meet the relevant provisions on investment in China?

According to the provisions of Paragraph 1, Article 35 of the Act Governing Relations between Peoples of the Taiwan Area and the Mainland Area (hereinafter referred to as the ""Cross Straits Act""), citizens, juridical persons, associations and other organizations in Taiwan may, with the permission of the Ministry of Economic Affairs, make investments or undertake technical cooperation in China; investment amount under certain limit, may be made after declaration. Therefore, for any investment or technical cooperation undertaken by Taiwanese citizens, juridical persons, associations and other organizations in China, shall make declaration or apply for permission to the MOEA (responsible unit: Investment Commission).
In addition, according to the provisions of Paragraph 1, Article 4 of the Regulations on Permit of Investment or Technical Cooperation in China (hereinafter referred to as the ""Regulations on Permit"") prescribed under the authorization of Paragraph 3, Article 35 of the Cross Straits Act, any of the following actions conducted by Taiwanese citizens, juridical persons, associations or other organizations in China shall be regarded as investment in China: initiating a new company or business (Subparagraph 1), increasing the capital of an existing local company or business (Subparagraph 2), acquiring the stock rights of an existing local company or business (Subparagraph 3), or expanding a branch or business (Subparagraph 4). To conduct such action in China, a Taiwanese investor shall make a declaration or submit an application for permission to the Commission in advance.
According to your question, the Taiwanese company invests in China through a company in a third country/region, and for the purpose of collecting working capital for the daily operations of the business in China, it is prepared to issue overseas floating-rate bonds through the company in the third country/region with the guarantee provided by the Taiwanese company. If the collection of the capital involves any of the above actions of investment, a declaration shall be made or an application for permission submitted to the Commission in advance.
4
How can an applicant apply for a project of investment in China already approved by the Commission in case of merger of domestic companies?

A letter of application, enclosed with the minute of the shareholders' meeting of the two parties agreeing the merger, minute of the board of directors' meeting, merger contract, preparatory balance sheet after the merger is approved by accountants, the latest financial report of the surviving company, and relevant documents on indirect investment by the two companies in China originally approved by the Investment Commission (investment structure, approved amount of investment, and confirmed amount of investment) shall be submitted to the Commission for approval prior to the merger in the name of the two parties.

How can an applicant apply for a project of investment in China already approved by the Commission in case of merger of domestic companies?

A letter of application, enclosed with the minute of the shareholders' meeting of the two parties agreeing the merger, minute of the board of directors' meeting, merger contract, preparatory balance sheet after the merger is approved by accountants, the latest financial report of the surviving company, and relevant documents on indirect investment by the two companies in China originally approved by the Investment Commission (investment structure, approved amount of investment, and confirmed amount of investment) shall be submitted to the Commission for approval prior to the merger in the name of the two parties.
5
How can an applicant apply for a merger of business invested in China with the approval of the Commission?

A letter shall be prepared to apply to the Commission in advance, and enclosed with the resolution of the highest organization that in charge of corporate mergers in China on the action of merging, the merger agreement, the original letter of approval of investment and the actual investment data. If the domestic investor is a listed or OTC company, the minute of the shareholders' meeting shall also be submitted; if it is authorized by the shareholders' meeting, the minute of the board of directors' meeting shall be submitted in addition to the above.

How can an applicant apply for a merger of business invested in China with the approval of the Commission?

A letter shall be prepared to apply to the Commission in advance, and enclosed with the resolution of the highest organization that in charge of corporate mergers in China on the action of merging, the merger agreement, the original letter of approval of investment and the actual investment data. If the domestic investor is a listed or OTC company, the minute of the shareholders' meeting shall also be submitted; if it is authorized by the shareholders' meeting, the minute of the board of directors' meeting shall be submitted in addition to the above.
6
Should an application be filed with the Department of Investment Review, MOEA in advance for Taiwanese citizens, juridical persons, associations or other organizations to buy the bonds or convertible bonds issued by a company in China or to loan funds to a juridical person, association or other organization in China?

A Taiwanese citizen, juridical person, association or other organization buys the bonds or convertible bonds of a company in China or obtains creditor's rights against the company, if the bonds or creditor's rights are not transferred into shares and there is only a pure creditor-debtor relationship between the two parties, the case is beyond the scope of application of the Regulations on Permission for Investment or Technical Cooperation in China.

Should an application be filed with the Department of Investment Review, MOEA in advance for Taiwanese citizens, juridical persons, associations or other organizations to buy the bonds or convertible bonds issued by a company in China or to loan funds to a juridical person, association or other organization in China?

A Taiwanese citizen, juridical person, association or other organization buys the bonds or convertible bonds of a company in China or obtains creditor's rights against the company, if the bonds or creditor's rights are not transferred into shares and there is only a pure creditor-debtor relationship between the two parties, the case is beyond the scope of application of the Regulations on Permission for Investment or Technical Cooperation in China.
7
Should an application be filed to use the surplus of a business invested in China for capital increase or investment

An application Form for Investment in China shall be submitted to the Commission in advance. Upon submission, shall enclose with the minute of the board of directors' meeting, surplus appropriation statement and approval certificate of the business invested in China; if investment is made through a company in a third country/region, a stockholder list of the business invested in the third country/region shall be submitted in addition to the above.

Should an application be filed to use the surplus of a business invested in China for capital increase or investment

An application Form for Investment in China shall be submitted to the Commission in advance. Upon submission, shall enclose with the minute of the board of directors' meeting, surplus appropriation statement and approval certificate of the business invested in China; if investment is made through a company in a third country/region, a stockholder list of the business invested in the third country/region shall be submitted in addition to the above.
8
Should a declaration be made for the capital reduction of a business in which investment has been made in China?

The enterprise may send a letter to apply for capital reduction, but the accumulated amount of investment will not be reduced until the stock capital is remitted back into Taiwan.

Should a declaration be made for the capital reduction of a business in which investment has been made in China?

The enterprise may send a letter to apply for capital reduction, but the accumulated amount of investment will not be reduced until the stock capital is remitted back into Taiwan.
9
I am studying in the School of Oriental and Asian Affairs, University of London, for a doctor's degree, and the theme of my research is economic integration across the Strait. I would like to know what standards have been adopted for the industry-specific statistics of Taiwanese investment in Mainland Area. Are there defined English translations of industries? Is there time series data for each industry? Is there detailed investment data on individual companies (projects, amount, purpose and province of investment)?

The statistical data of Taiwanese investment in Mainland Area is classified by the Investment Commission according to the business items recorded in the application forms in accordance with the Industry Classification Standards of the R.O.C. published by the Directorate-general of Budgeting, Accounting and Statistics, Executive Yuan.
The statistical data released by the Commission every month is also compiled into the Statistical Monthly of the R.O.C. on Overseas Chinese and Foreign Investment, Overseas Investment, Foreign Technical Cooperation, Indirect Investment in Mainland Area and the Introduction of Industrial Technology from Mainland Area. The Monthly statistical data is a Chinese-English bilingual edition, including region-specific and industry-specific time series statistical data.
As to the investment data of individual companies mentioned in your letter, at present only the list of listed/OTC companies investing in Mainland Area is released to the public, including the project and target province of investments, but the amount of investment is not published. Please log onto the website of the Commission www.moeaic.gov.tw and click Publications Information to download the List of Listed/OTC Companies that have Investment in Mainland Area.

I am studying in the School of Oriental and Asian Affairs, University of London, for a doctor's degree, and the theme of my research is economic integration across the Strait. I would like to know what standards have been adopted for the industry-specific statistics of Taiwanese investment in Mainland Area. Are there defined English translations of industries? Is there time series data for each industry? Is there detailed investment data on individual companies (projects, amount, purpose and province of investment)?

The statistical data of Taiwanese investment in Mainland Area is classified by the Investment Commission according to the business items recorded in the application forms in accordance with the Industry Classification Standards of the R.O.C. published by the Directorate-general of Budgeting, Accounting and Statistics, Executive Yuan.
The statistical data released by the Commission every month is also compiled into the Statistical Monthly of the R.O.C. on Overseas Chinese and Foreign Investment, Overseas Investment, Foreign Technical Cooperation, Indirect Investment in Mainland Area and the Introduction of Industrial Technology from Mainland Area. The Monthly statistical data is a Chinese-English bilingual edition, including region-specific and industry-specific time series statistical data.
As to the investment data of individual companies mentioned in your letter, at present only the list of listed/OTC companies investing in Mainland Area is released to the public, including the project and target province of investments, but the amount of investment is not published. Please log onto the website of the Commission www.moeaic.gov.tw and click Publications Information to download the List of Listed/OTC Companies that have Investment in Mainland Area.
10
On reinvestment through business invested in China

According to the provisions of the current laws and regulations in force, investment conducted by Taiwanese citizens, juridical persons, associations or other institutions in China shall be governed by the Regulations on Permission for Investment or Technical Cooperation in China. Where the business invested in China makes any reinvestment, it is not necessary to apply to the Commission for permission unless the business in China is a stockholding company.

On reinvestment through business invested in China

According to the provisions of the current laws and regulations in force, investment conducted by Taiwanese citizens, juridical persons, associations or other institutions in China shall be governed by the Regulations on Permission for Investment or Technical Cooperation in China. Where the business invested in China makes any reinvestment, it is not necessary to apply to the Commission for permission unless the business in China is a stockholding company.
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