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Doing Business in Taiwan


Details of the business scope of a profit-seeking enterprise in Taiwan must be registered with the authorities, and licenses must be obtained prior to commencement of operations. Some business activities cannot be carried out in the form of a corporation. These include cram schools, professional accounting, legal and medical services and other specified businesses.

A company may be formed as an unlimited company, an unlimited company with limited liability shareholders, a limited company or a company limited by shares. A limited company and a company limited by shares are the most common in Taiwan. A branch office or a representative office of a foreign company may also be used.


There are two types of company in Taiwan, a limited company and a company limited by shares.Both types of company has the following natures:
• possess legal person status
• liability of each shareholder limited to capital contribution.

A foreign company or individual may set up a company for the purpose of doing business in Taiwan. A company that is a subsidiary of a foreign company differs from a branch office in that it is a Taiwan-based profit-seeking business entity with foreign investors. A Taiwan-domiciled company or subsidiary may have other branch offices in Taiwan and overseas. Aside from business areas designated in the Negative List for Foreign Investment, companies formed by foreign companies or foreign individuals in Taiwan and approved by the Investment Commission under the Ministry of Economic Affairs are not subject to foreign ownership restrictions. Aside from the specifically designated minimum capital requirement for certain industrial sectors, starting 2009, there is no minimum capital requirement, however, initial capital should be sufficient to at least cover organisation costs incurred when establishing the company.

Limited Company
• Generally requires a minimum capital contribution of NT$250,000.
• Should have at least one shareholder.
• Should have at least one, but not exceeding three, directors; no supervisor required.

Company Limited by Shares

• Generally requires a minimum capital contribution of NT$500,000.
• Should have at least one corporate shareholder or two individual shareholders
• Shares held by promoters shall not be transferred until one year following incorporation.
• Should have at least three directors and at least one supervisor.

Representative Office

A representative office is one of the easiest ways to establish a legal business presence in Taiwan. It is a form that many foreign companies take during early development stages of investing in Taiwan. A representative office is basically a legal agent of the foreign company that is permitted to engage in price negotiations, provide quotations, participate in tenders, and sign procurement agreements. However, a representative office is not permitted to engage in income-generating business activities such as signing sales contracts, providing services, or receiving funds from clients. Only businesses recognised as legally established companies in a foreign country are allowed to establish a representative office in Taiwan.

Applications to establish a representative office of a foreign company in Taiwan must be filed with the Department of Commerce, MOEA.

Branch Office

According to company Act of Taiwan, a branch of a foreign company has the same rights and obligations as a domestic company. A branch is not an independent legal entity, the head office assumes all liabilities left unsettled by the branch.

There is no requirements for a branch to have shareholders, directors or supervisors. The branch manager is the responsible person for the branch.

A branch office has the following tax advantages over a subsidiary.

• no retained earnings surtax, while a subsidiary is subject to 20% withholding tax for
• retained earrings distributed to foreign share holders;
• no withholding tax on after tax profits, while a subsidiary is subject to 10% tax
• rate for retained earnings not distributed.

A branch office is a profit-seeking business entity established for the purpose of doing business in Taiwan, with a head office located in a foreign country. Foreign business entities registered as companies under foreign laws shall first apply for recognition as a foreign company and its establishment of a branch office in Taiwan with the Department of Commerce under the MOEA. Starting 2009, there is no minimum working capital requirement, however, initial working capital should be sufficient to at least cover organization costs incurred when
establishing the branch.

The working capital for the branch office shall be remitted from its foreign head office. The foreign company establishing a branch office shall appoint a representative for litigious and non- litigious matters in Taiwan and a branch manager for managing day-to-day business operations. If the branch manager is a foreign national, he or she shall obtain a work permit from the Council of Labour Affairs. Branch offices shall pay income tax on income generated within Taiwan but are exempt from income tax when they remit their after-tax surplus earnings back to their parent companies, because such remittances are not considered distribution of dividends.





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