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National Development Council announces plans to simplify incorporation

by Michael Fahey

The National Development Council and other agencies recently announced three planned measures to simplify procedures for foreign investors wishing to establish business entities in Taiwan.

1. A university may allow a startup to register its business address at a university incubator

A business in Taiwan must register the actual premises from which the business is conducted as its address. Universities however have been reluctant to allow startups to register their business addresses at university incubators because universities are in general not permitted to allow for-profit businesses to use university property.

As a solution, the NDC, the Ministry of Education and the tax authorities have reached a consensus that allowing universities to permit startups  to register their businesses addresses at university-operated incubators serves policies to encourage academic-business cooperation. Consequently, a university incubator will be permitted to allow a student startup to register its business address at the incubator instead of having to make other arrangements such as leasing off-campus premises. It appears that student startups will include startups founded by non-degree students who take courses in entrepreneurship.

2. Foreign investors may appoint agents to open bank accounts and file for tax registration

Currently, a foreign investor must come to Taiwan to open corporate bank accounts and register for taxes in person.  In many cases,the foreign investor must make two trips to Taiwan during the process. The NDC now plans to allow foreign investors to appoint an agent (typically a lawyer or an accountant) to open corporate bank accounts and file for tax registration on behalf of the foreign investor.

3. Foreign investors may appoint an agent to use the online company registration system without use of a digital certificate

The Ministry of Economic Affairs has created a one-stop website that investors can use for routine company filings including name reservation, incorporation, and business registration. To use the website, users must currently create a cumbersome digital certificate using a Chinese interface. To simplify use of the website, the Ministry of Economic Affairs has agreed that foreign investors will be permitted to authorize an agent to make routine filings on their behalf without the foreign investor’s having to obtain a digital certificate.

According to the NDC’s press release, these measures will be adopted in one month.

While all of these measure are steps in the right direction, allowing agents to open bank accounts and file for tax registration  has the most potential to simplify the process of setting up a business in Taiwan for foreign investors.

 

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