Starting a Business in Taiwan/media/IE Singapore/Files/Events...PwC Taiwan 資誠 Table of Contents 2 Starting a Business in Taiwan 04.18.2013 Page 1 Government’s Efforts in Building

Starting a Business in Taiwan

Rosamund Fan 04.18.2013

www.pwc.com/tw

PwC Taiwan 資誠

Table of Contents

2

04.18.2013 Starting a Business in Taiwan

Page

1 Government’s Efforts in Building a Business Friendly

Environment in Recent Years

3

2 Roadmap of Starting a Business & Major Documentation

Required

6

3 Basic Comparison of Branch & Subsidiary 9

PwC Taiwan 資誠

Section 1 Government’s Efforts in Building a Business Friendly Environment in Recent Years

3


PwC Taiwan 資誠

Government’s efforts in building a business friendly environment in recent years

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Pha

se 3

Pha

se

4

2010.06

2010.06

Economic Cooperation Framework Agreement ECFA has been signed on June 29, 2010 to promote the cross-strait economic and trade relations by way of duty reduction, amongst others.

Reduction of Corporate Income Tax Rate to 17%

With the expiration of the Statute for Upgrading Industries, the

corporate income tax rate has been reduced from 25% to 17%.

4


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Pha

se 3 2010.08 Setup of “InvesTaiwan Service Center”

InvesTaiwan Service Center is set up for promoting and

facilitating foreign investments as a one-stop service provider.

03.25.2013

Pha

se 3 2012.07 Further Release of “Negative List” for Foreigner Investment

“Negative List” is further released for a friendlier business

environment for foreigner investor.

PwC Taiwan 資誠

Government’s efforts in building a business friendly environment in recent years

5

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Pha

se

3

2013.03 Planning of “Free Economic Demonstration Zone”

The Council for Economic Planning and Development (CEPD) is

planning the “free economic demonstration zone” to accelerate

economic liberalization and regional economic integration.

Ranked 13th in Global Competitiveness Index Report by World Economic Forum (2012)

Ranked 4th in Risk Assessment on Business Environment by BERI (2012)

Ranked 7th in Institute for Management Development World Competitiveness Yearbook

(2012)

Ranked 16th in Ease of Doing Business by World Bank (2012)

Ranked 20th in 2013 Index of Economic Freedom by Wall Street Journal/Heritage

Foundation

Our rapid rise in

business environment

rankings.


PwC Taiwan 資誠

Section 2 Roadmap of Starting a Business & Major Documentation Required

6


PwC Taiwan 資誠

Roadmap of Starting a Business Ex. Foreigner Investment Approved (FIA) Company

7


Starting the

Business

Investors

Pre-approval of Company Name and Business Scope

Ministry of Economic Affairs

(MOEA)

Pre-approval of Investment

ICMOEA

Capital Injection

Local Bank

Capital

Verification

ICMOEA

Company

Registration

MOEA/City Government

Business/Tax

Registration

Tax Authority

Exporter/Importer Registration

Bureau of Foreign

Trade

Environmental

Pre-approval for Factory

City Government

Open Bank Account

Local Bank

Joint Approval for Regulated Businesses (*)

Other Competent Authorities

Factory Registration

City Government

(*) Regulated businesses includes businesses

that are restricted, cross-border merger,

investment amount exceeding NTD1.5 billion.

PwC Taiwan 資誠

Major Documentation for a FIA subsidiary, branch & representative office


8

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Major

Document FIA Subsidiary Branch

Representative

Office

Documents

from

Shareholder

/Head Office

(1) Certificate of

Incorporation (*) (2) Power of Attorney

appointing rep. to be

directors/supervisor

(1) Certificate of

Incorporation (*) (2) Articles of


appointing legal

rep./branch

manager (*)

(1) Certificate of


appointing Taiwan

rep. (*)

Others

(examples, not

a complete

list)

(1) Articles of Incorporation

(2) Shareholders/Board

resolution

(3) Landlord’s consent/

lease agreement for

office address

Landlord’s consent/

lease agreement for

office address

Landlord’s consent/

lease agreement for

office address

(*) Taiwan Consulate authentication required

PwC Taiwan 資誠

Section 3 Basic Comparison of Branch & Subsidiary

9


PwC Taiwan 資誠

Basic Comparison of Branch & Subsidiary

Item FIA Subsidiary Branch

1. Number of

shareholders/

owners

(1) At least 2 individual

shareholders; or

(2) 1 corporate shareholder

1 (head office)

2. Registered

responsible person

3 directors & 1 supervisor

(No restriction on

nationality/residency)

1 litigious/non-litigious rep. & 1

branch manager

(No restriction on

nationality/residency)

3. Capital requirement Yes Yes

4. Withholding taxes on

dividends/ profit

remittances

Dividends distributed to non-

resident corporate or individual

shareholders are subject to

withholding tax at a rate of 20%

(or lower due to tax treaty)

The law currently contains no

provision for levying

withholding tax on remittance

of after-tax branch profit to its

head office.


10

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PwC Taiwan 資誠

Basic Comparison of Branch & Subsidiary

Item FIA Subsidiary Branch

5. Undistributed

retained earnings

(1) Undistributed earnings will

be subject to corporate tax

at a rate of 10%.

(2) The above 10% tax can be

used as tax credit by non-

resident corporate and

individual shareholders

against the withholding tax

on dividends and by the

domestic individual

shareholders against their

individual income tax.

N/A

6. Legal Responsibility Limited to the shareholder‘s

capital contribution

Head office bears unlimited, joint and several liabilities for

its branch office


11

04.18.2013

Thank you!

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information contained in this publication or for any decision based on it.

© 2013 PricewaterhouseCoopers Taiwan. All rights reserved. In this document, “PwC” refers to

PricewaterhouseCoopers Taiwan which is a member firm of PricewaterhouseCoopers

International Limited, each member firm of which is a separate legal entity.

Rosamund Fan, Partner

PricewaterhouseCoopers Taiwan

[email protected]

+886 2 27296077