萬國法律事務所

The competitiveness of Taiwan’s export processing zones should soon be enhanced as a result of the revision of the Statute for the Establishment and Management of Export Processing Zones.  The Legislative Yuan passed the revisions on 5 May 2006 and President Chen promulgated the same on 30 May 2006.  The major items of the revised Statute are identified below:

1. In order to attract more private investment in infrastructure projects, the private enterprises will be permitted to undertake land development in export processing zones.  In the past, only the Export Processing Zone Administration had the authority to do this.

2. Per the revisions, lease contracts will not be protected from cancellation and the Administration or its branches will be permitted to recover leased land in instances where the rents paid on structures built on land within an EPZ that was privately owned and which is in arrears for more than four months.  Additionally, the restrictions at Article 440 of the Civil Code and Article 103, Paragraph 4 of the Land Act will no longer be applicable.

3. The Administration has been entitled to negotiate the purchase of vacant private property located or situated within the zones in order to utilize EPZ lands and structures with greater efficiency.

4. The central government agency supervising labor affairs is now permitted to entrust the EPZ Administration or its branches to handle the grant of permits to recruit foreign nationals for “professional or technological work” within the zones and per Article 46, Paragraph 1, Subparagraph 1 of the Employment Services Act.  This, it is hoped, will enhance the efficiency of application processing.

5. The range of exemption from import, commodity, and business tax has been expanded.  For instance, in order to meet the operating requirements of companies and entities engaged in the biotechnology industry in the EPZs, plants and animals used for experimental purposes are now exempted from such taxes.

6. Goods transported to tax-liable areas from EPZs for repair, processing, or other non-sale purposes that are subsequently shipped back to the EPZs within a certain period of time shall be exempt from taxes and from the requirement to pay guarantee bonds.  Goods transported to tax-liable areas for non-sale purposes, such as for processing or other special needs shall be permitted, with EPZ Administration authorization, to be exported directly without the need to be returned to the EPZ.