2019-01-07

Foreign and Overseas Chinese Investors May File Post-Investment Reports

Taiwan's Executive Yuan has passed draft amendments to both the "Statute for Investment by Foreign Nationals" and the "Statute for Investment by Overseas Chinese".  The amendments, if passed and enacted will allow foreign nationals and overseas Chinese investors who invest amounts of under US$ 1 Million to report the same after the funds are invested.  The amendments will be sent to the Legislative Yuan for review and deliberation.
 
In fact, these amendments have been under discussion since 2013, yet these drafts have not been passed due to concerns regarding certain loopholes in the regulations.
 
In order to mitigate these concerns, the new versions of the draft amendments strengthen the regulations and introduce penalties and fines on unlawful investments.  Specifically, Chinese fund houses that have de facto control over 30% of an investment will be subject to the regulations governing Chinese investments.  Further, only attorneys and accountants are permitted to file such post-investment reports, in an attempt to prevent false foreign investments.
 
The permission to make such post-investment reports will not apply to investments which have restrictions and or to investments from regions facing UN sanctions.
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