Doing Business in Taiwan for Foreign Investors

The most common forms of legal entity for foreign investors are limited company and company limited by shares. A Taiwan subsidiary of foreign company will be treated as a domestic company in Taiwan having legal and economic independence. The injection of registered capital is required. In addition, a subsidiary can have business operation and issue government uniform invoices.

A branch is managed by its head office and does not constitute an independent legal entity. Similarly to a subsidiary, branch can have business operation and issue government uniform invoices on behalf of its head office in Taiwan. Operating capital is also a necessity. The establishment of a foreign company’s branch in Taiwan should first be approved by the Central Region Office, Ministry of Economic Affairs.

A representative office (RO) is not a corporation and it is prohibited to carry on business. The main function of RO is to coordinate, promote, procure and provide after-sales services on behalf of its head office. Without undertaking business activities, RO is exempted from business tax and corporate income tax filing requirements. Nonetheless, annual withholding tax filing is still required.