TAIWAN Trends and Developments Contributed by: Lihuei Mao, Dennis Yu and David Tien, Lee and Li, Attorneys-at-Law
Lee and Li, Attorneys-at-Law 8F No 555 Sec 4 Zhongxiao E Rd Taipei 11072 Taiwan
Tel: +886 2 2763 8000 Fax: +886 2 2766 5566 Email: attorneys@leeandli.com Web: www.leeandli.com/TW
Increase of Annual Foreign Exchange Settlement Quotas in Taiwan In light of Taiwan’s economic, trade and financial situ - ation and the rising wealth and investment demands of the Taiwanese, and to co-operate with govern - ment policy on developing Taiwan into an Asian asset management centre, the Central Bank of Taiwan has adjusted the annual quotas of foreign exchange set - tlements – starting from 1 November 2024 – as fol - lows: • for Taiwanese groups and individuals – the annual quota has been increased from USD5 million to USD10 million; and • for Taiwanese companies and firms – the annual quota has been increased from USD50 million to USD100 million. Incentives and Requirements for Companies in Taiwan Conducting Foreign Investments Under Amended Statute for Industrial Innovation To attract foreign investments in specific fields and to prevent the outflow of key technologies that could harm domestic industries and threaten Taiwan’s national security, the amendment to the Statute for Industrial Innovation (SII) was approved by the Legis - lative Yuan on 18 April 2025, and took effect on 7 May 2025, except that the effective date of Article 22 of the amendment to the SII will be determined separately by the Executive Yuan. Specifically, the amendment to the SII includes provi - sions on artificial intelligence and energy conserva - tion/carbon reduction within the scope of investment
tax credits, and enhances investment incentives for start-ups by lowering the threshold for tax incentives applicable to investments in limited partnership ven - ture capital enterprises. Furthermore, on 23 October 2025 the Ministry of Eco - nomic Affairs (MOEA) updated the list of sectors that are deemed to possess either a leading technologi - cal competitive advantage or innovative applications in mature manufacturing technologies. Under Article 10-2 of the SII, the companies that are in a critical position in the international supply chain within these sectors may be eligible for tax credits on qualifying expenditures related to forward-looking and innova - tive research and development. These designated sectors include semiconductors, electric vehicles, and communications and display technologies. Currently, the MOEA’s prior approval for outbound investments is required if the investment amount exceeds NTD1.5 billion. However, under Article 22 of the amendment to the SII, companies in Taiwan, including those with foreign investment, must seek approval from the MOEA before making outbound investments in specific countries or regions and specific industries or technologies, investments that exceed a certain amount, or investments that require approval under other applicable laws or regulations. Article 22 of the amendment to the SII will take effect upon promulgation by the Executive Yuan. The precise definitions or thresholds for the aforementioned terms (eg, “specific country or region”, “specific industries or technologies” and “certain amount”) will be estab - lished following the effective date of this provision.
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