2012-11-19
Proposed Relaxation of Foreign Investment Regulation in Taiwan
Articles 4 and 8 of Statute For Investment By Foreign Nationals (Statute) stipulate that any foreign national or juridical person seeking to make an investment in Taiwan through any of the methods indicated below, must submit an investment application, together with the investment plans and relevant documents, to the authorities for prior approval: (1) holding shares issued by a Taiwan company, or contributing to the capital of a Taiwan company; (2) establishing a branch office, a proprietary business, or a partnership in the territory of Taiwan; or (3) providing loan(s) to the invested business referred to above at (1) or (2) for a term of one year or longer.
On November 8, 2012, the Executive Yuan passed an amendment proposal for the Statute, under which the current requirement for prior approval of foreign investment will be relaxed. If the amendment is ultimately passed and enacted, rather than needing to obtain prior approval, investors will be able to submit an ex post report to the authorities, provided that the investment project meets certain criteria.
The criteria will be considered and decided upon by the Ministry of Economic Affairs (MOEA). It is reported that MOEA plans to set a monetary threshold of US$ 1,000,000 so that foreign investment projects valued at less than US$ 1,000,000 may make an ex post report. It is also reported that for the industries listed on the Negative List, such as Type I telecommunications and airlines businesses, the current requirement for prior approval will remain.
The proposed amendment must still be approved by the Legislative Yuan before the amendments can become effective.
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