萬國法律事務所

On 2 March 2011, Taiwan’s Ministry of Economic Affairs (MOEA) announced the list of industries in Taiwan opened for PRC investment, including some of highly concerned industries, such as integrated circuit (IC) manufacturing, semiconductor packaging and testing and LCD panels, which will be opened to strategic investors from PRC.

The deregulation includes 25 items under manufacturing, 8 items under services and 9 items under public works and infrastructure, for a total of 42 items in this second wave.

In the manufacturing industry, MOEA pointed out that, together with the additional 25 items deregulated in this second wave, a total of 89 items have been deregulated to date, representing 42% of the items classified under the manufacturing industry. Within this class, 10 items, such as dyes and pigments, batteries and wind power equipment are unconditionally opened, while 10 other items, such as rubber and plastic processing machinery and equipment are only conditionally opened to PRC investment. However, PRC shareholding may not exceed 20% in an existing enterprise or must be less than 50% in a newly established joint venture enterprise. Further, PRC investors cannot have controlling power over said invested enterprises.

In order to ensure the development advantages of Taiwan’s key technologies and to maintain initiative, this wave of deregulation will also open PRC in five industries, such as the IC manufacturing industry, semiconductor packaging and testing industry, LCD panels and parts manufacturing, metal cutting machine tool manufacturing, and the electronics and semiconductor production equipment manufacturing industry. MOEA pointed out that, PRC investment in existing enterprises may not exceed a 10% shareholding and in a newly established joint venture enterprise, PRC shareholding must be lower than 50%. PRC investors cannot have controlling power over the invested enterprise. Further, specific approvals must be obtained before PRC investment may be made in these categories.