G/SCM/N/315/TPKM  
 
24 July 2017 
(17-4079) Page: 1/22 
Committee on Subsidies and Countervailing Measures  Original: English  
 
 SUBSIDIES  
NEW AND FULL NOTIFIC ATION PURSUANT TO AR TICLE XVI:1 OF THE  
GATT 1994 AND ARTICL E 25 OF THE AGREEMEN T ON 
SUBSIDIES AND COUNTE RVAILING MEASURES  
THE SEPARATE  CUSTOMS  TERRITORY OF  TAIWAN ,  
PENGHU , KINMEN AND  MATSU 
The following notification , dated 24 June 2017, is being circulated at the request of the Delegation 
of the Separate  Customs  Territory of  Taiwan , Penghu , Kinmen and  Matsu. 
 
_______________  
 
 G/SCM/N/315/TPKM  
 
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  TABLE OF CONTENTS  
I. AGRICULTURE  ................................ ................................ ................................ .........  3 
A. SUPPORT FOR RICE  ................................ ................................ ................................ . 3 
B. SUPPORT FOR DIVERSIFIED CROPS  ................................ ................................ ........  4 
C. SUPPORT FOR  TOBACCO LEAVES  ................................ ................................ .............  5 
D. SUPPORT FOR SUGAR  ................................ ................................ ..............................  6 
E. INTEREST SUBSIDY  ................................ ................................ ................................ . 6 
II. FISHERIES  ................................ ................................ ................................ ..............  8 
A. FISHING VESSELS BUY -BACK PROGRAMME  ................................ .............................  8 
B. REWARD FOR CLOSING FISHERY SEASON  ................................ ...............................  9 
C. FISHING VESSELS MARINE INSURANCE REWARD  ................................ ...................  9 
III. INDUSTRY  ................................ ................................ ................................ .............  10 
A. LOANS - LOANS FOR SMALL AND MEDIU M-SIZED ENTERPRISES (SMES)  ............... 10 
1. Specific and urgent financing and loans intended for recovery plans from 
damage caused by disasters  ................................ ................................ .................. 10 
2. Medium - and long -term loans for product marketing and loans for 
overseas investment and construction projects  ................................ ..................... 12 
B. LOANS FOR PRIVATE ENTERPRISES  ................................ ................................ .......12 
1. Loans for small and medium -sized enterprises and private enterprises  ................. 12 
C. DUTY AND TAX EXEMPTIONS GRANTED TO ENTERPRISES LOCATED 
WITHIN A DESIGNATED ZONE  ................................ ................................ ................ 14 
1. Duty and tax exemptions for high -technology industries  ................................ .......14 
2. Duty and tax exemptions for in -zone enterprises  ................................ ................... 15 
D. SUBSIDIES FOR THE ESTABLISHMENT AND OPERATION COSTS OF 
PETROLEUM FACILITIES, AND PRODUCTS CONSUMPTION COSTS IN THE 
REMOTE AREAS, ABORIGINAL AREAS AND ISOLATED ISLAND AREAS  .................... 17 
IV. RESEARCH AND DEVELOP MENT  ................................ ................................ .............  18 
A. FUNDS GRANTED FOR DEVELOPMENT OF NEW OUTSTANDING PRODUCTS  ............. 18 
B. FUNDS GRANTED FOR PROMOTING DEVELOPMENT OF INDUSTRIAL 
TECHNOLOGY  ................................ ................................ ................................ ......... 20 
C. FUND GRANTED FOR ENCOURAGING EXPLORATION AND DEVELOPMENT OF 
OIL AND NATURAL GAS RESERVES  ................................ ................................ ......... 21 
 
 
 
 
 
 
 G/SCM/N/315/TPKM  
 
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  I. AGRICULTURE  
A. SUPPORT FOR RICE  
1. Title of the programme  
 
Support for rice.  
 
2. Period covered by the notification  
 
2014-2015. 
 
3. Policy objective and/or purpose  
 
The policy objectives are to ensure the secur ity of the food supply by balancing supply and 
demand for rice, and to stabilize rice prices for the maintenance of farmers ' income.  
 
4. Background and responsible authorities  
 
(a) Laws and regulation s: Agriculture Development Act.  
Food Administration Act.  
 
(b) Responsible authorit ies: Council of Agriculture.  
 
5. Form of the subsidy/to whom and how the subsidy is provided  
 
There are three types of rice purchase s - planned purchase, supplementary purchase and 
additional purchase. The planned purchase is made  at guaranteed prices  which  are determined by 
taking into account production costs. The prices are set at NT$ 26 per kilogram for Japonica -type 
rice, and  NT$25 for Indica -type rice and glutinous rice. The quantity of the planned purchase is 
limited to  2,000  kg per hectare for the first crop and 1, 500 kg for the second crop. Supplementary 
rice purchase prices are set at NT$ 23 per kilogram for Japonica -type rice , and NT$ 22 for Indica -
type rice and glutinous rice. The quantity of the supplementary purchase is limited to 1,200 kg per 
hectare for the first crop and 800 kg for the second crop. The prices for additional purchase s are 
set at NT$ 21.6 per kilogram for Japonica -type rice , and NT$ 20.6 for Indica -type rice and glutinous 
rice. The quantity of the additiona l purchase is limited to 3,000 kg per hectare for the first crop 
and 2, 400 kg per hectare for the second crop.  
 
Planned, supplementary and additional rice purchases are made only for  the farmers who produce 
rice in paddy fields. Those who produce rice in t he upland areas, are only eligible for 
supplementary and additional purchases. Farmers are free to decide whether they want to sell 
products to the government or not.  
 
6. Amount of the subsidy  
 
NT$583 million and NT$ 696 million for 20 14 and 2015, respectiv ely. 
 
7. Duration of the subsidy and/or any other time -limits attached to it  
 
The duration of the subsidy is not specified.  
 
8. Statistical data  
 
 Unit: 1,000 MT.  
Item  Year Production  Consumption  Import  Export  
Rice 2014 1,399.4  1,297.0  130.2  30.0 
2015 1,260.4  1,298.1  152.9  93.3 
Note: The data in above table have converted to brown rice, and are sourced from "Food Supply and Utilization 
Yearbook" published by the Council of Agriculture.  
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  B. SUPPORT FOR DIVERSIFIED CROPS  
1. Title of the programme  
 
Support  for diversified crops.  
 
2. Period covered by the notification  
 
2014-2015. 
 
3. Policy objective and/or purpose  
 
The policy objectives are to facilitate the adjustment of farmland utilization and to strengthen the 
farmland environmental conservation plan fo r sustainable use of farmland as the structure of 
agricultural production undergoes adjustment.  
 
4. Background and responsible authorities  
 
(a) Laws and regulation s: Agriculture Development Act.  
 
(b) Responsible authorit ies: Council of Agriculture.  
 
5. Form of the subsidy/to whom and how the subsidy is provided  
 
 (1) Diversion payment:  
 
The diversion payment is granted to those farmers  who follow the diversion programme from rice 
production to the production of diversion crops and adhere to any of the follo wing cases : 
 
(a) Growing rice in the base year (1994 -2003); or,  
(b) Growing guaranteed price purchase crops of feed corn, sorghum or sugarcane in the 
base year; or,  
(c) Registering as set -aside or diversion under "Rice Production and Rice Field Diversion 
Projects " in the base year.  
Diversi fied crops are selected according to policy objective and domestic  conditions  for such crops 
as feed corn, soybean, forage crops, wheat, sugarcane and other specialty local crops.  Diversion 
payments are made at NT$ 15,000-45,000  per hectare . 
 
6. Amount of the subsidy  
 
NT$3,524 million and NT$ 3,718   million for 2014 and 20 15, respectively.  
 
7. Duration of the subsidy and/or any other time -limits attached to it  
 
The duration of the subsidy is not specified.  
 
8. Trade effect s or related statistical data  
 
(a) Trade effects:  
 
After the three stages of the rice diversion programme and the set -aside programme  had been 
implemented, the acreage planted in rice dropped  from 645,855 hectares to 251,888  hectares  for 
a decrease of 61%,  from 1983 (the year prior to the implementation of the projects) to 2015 . The 
production of rice also fell from 2.48 million tons to 1. 26 million tons  for a decline of 49.2% . The 
quantity of rice purchased by the government was dropped  from 1.1 million tons to 0.36 million 
tons for a decrease of 67.3% . Measures relating to sweet potatoes, peanuts, vegetable, forage and 
other miscellaneous crops contributed to reductions in the production of rice.  
 G/SCM/N/315/TPKM  
 
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  (b) Related statistical data:  
 
Subsidy  for diversified crops i n 2014 and 2015  
 Unit: NT$ 1,000 
Products  2014 2015 
Feed Corn 486,553  526,969  
Vegetables  92,040  95,005  
Forage Crops  514,508  519,069  
Other Crops  2,430,563  2,576,599  
Total 3,523,664  3,717,642  
 
C. SUPPORT FOR TOBACCO LEAVES  
1. Title of the subsidy progra mme 
 
Support for tobacco leaves.  
 
2. Period covered by the notification  
 
Crop years 2013/2014-2014/2015 . 
 
3. Policy objective and/or purpose  
 
The purposes of the programme are to maintain the tobacco farmers ' income level  and improve 
the quality of tobacco  leaves produced.  
 
4. Background and responsible authorities  
 
(a) Laws and regulation s: The Tobacco and Alcohol Administration Act.  
 
(b) Authorities: Ministry of Finance . 
 
5. Form of the subsidy/to whom and how the subsidy is provided  
 
A purchase under res tricted price tendering is made according to the Government Procurement 
Act. The amount of subsidy is the purchase quantity multiplied by the price difference  between the  
purchase  price and  the external reference price  which is based on the average of pric es from 1990 
to 1992. 
 
6. Amount of the subsidy  
 
NT$216.7 million  and NT$210.7  million for the crop years 2013/2014 and 2014/2015 , respectively.  
 
7. Duration of the subsidy and/or any other time -limits attached to it  
 
The duration of the subsidy is not spec ified. 
 
8. Statistical data  
 Unit: MT. 
Item  Year Production  
(Crop year)  Consumption  Import  Export  
Tobacco 
leaves  2014 1,650  14,682  13,605  573 
2015 1,604  10,069  8,998  533 
Note: "Production" is sourced from "Agricultural Statistics Yearbook"  published by  the Council of Agriculture. 
"Import" and "Export" are sourced from the import and export statistics compiled by the Directorate -General of 
Customs of the Ministry of Finance. "Consumption" is estimated by deducting the export from the sum of the 
productio n and the import . 
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  D. SUPPORT FOR SUGAR  
1. Title of the subsidy programme  
 
Support for sugar.  
 
2. Period covered by the notification  
 
Crop years 2015-2016. 
 
3. Policy objective and/or purpose  
 
The purpose of the programme is to develop the sugar industry i n cooperation with the farmers.  
 
4. Background and responsible authorities  
 
(a) Laws and regulation s: Regulation for the Sugarcane Planting Contract.  
 
(b) Authorities:   TSC 
    Ministry of Economic Affairs.  
 
5. Form of the subsidy/to whom and how the sub sidy is provided  
 
(1) Guaranteed purchase:  
 
TSC made contracts with farmers for the purchase of sugarcane and sugar sharing. The sugarcane 
farmers obtain 55% of the sugar made from sugarcane. If the domestic selling price of sugar is 
higher than the prepai d contract price, the sugarcane farmers are paid the domestic selling price. 
If the domestic selling price is lower than the prepaid contract price, the farmers are paid the 
prepaid contract price. The contract price is set after taking the domestic sellin g price and the 
marketing costs into account. It has been frozen since 1990.  
 
(2) Other grants:  
 
The TSC provides grants to sugarcane farmers such as interest subsidy for loans for the purchase 
of inputs, insurance premium s for sugarcane farms, fees for pe st and disease control, inspection 
fees for sugar brix, and others.  
 
6. Amount of the subsidy  
 
NT$98.9 million and NT$ 62.2 million for the fiscal years 20 15 and 2 016, respectively . 
 
7. Duration of the subsidy and/or any other time -limits attached to it  
 
The duration of the subsidy is not specified.  
 
8. Statistical data  
 Unit: 1,000 MT.  
Item  Year Production  Consumption  Import  Export  
Raw Sugar  2015 49.5 632.6  589.5  0 
2016 38.6 597.9  557.7  0 
 
E. INTEREST SUBSIDY  
1. Title of the subsidy programme  
 
The polic y-oriented special agricultural loan.  
 
2. Period covered by the notification  
 
2014-2015. G/SCM/N/315/TPKM  
 
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  3. Policy objective and/or purpose  
 
The overall objective is to assist farmers and businesses in agricultural industries to raise the funds 
needed for them to be able to operate smoothly. This plan was devised to help them update their 
equipment, improve developmental skills and innovation, increase the added -value of their 
products, strengthen product sales , and enhance their competitiveness. In addition, the plan help s 
farmers who are affected by natural disasters to rebuild their homes and their livelihoods, thus 
allowing them to maintain their standard of living . 
 
4. Background and responsible authorities  
 
(a) Laws and regulation s: Agriculture Development Act , Agricu lture Finance Act,  
Regulations of the Agricultural Deve lopment Fund  
 
(b) Authorities:    Council of Agriculture.  
 
5. Form of the subsidy/to whom and how the subsidy is provided  
 
Preferential  interest rate loans: the loan capital is provided by credit depart ments of farmers ' 
associations and fishermen 's associations or the Agricultural Bank. The source of finance for the 
interest subsid y is the Agricultural Development Fund.  
 
6. To whom and how assistance is provided  
 
(a) These preferential interest rate loan s are available to all farmers and fishermen,  and are not 
limited to a specific industry or enterprise  of agriculture . 
 
(b) Different ceilings are set for different types of loan s. Each loan application  is subject to the 
given loan ceiling. The amount of l oan granted is decided by the bank, based on the financial 
situation of the applicant.  
 
7. Amount  of the subsidy  
 
The amount of interest subsidy was NT$1,730 million and NT$1,408  million for the fiscal 
years  2014 and 20 15, respectively . 
 
8. Duration  
 
The d uration of the subsidy is not clearly specified . 
 
9. Trade effects or related statistical data  
 
(a) Trade effects:  
 
The programme is mainly used to promote the upgrading of the industry. Given the scope and 
nature of the programme, it is not possible to de termine what, if any, trade effects may result 
directly from this programme.  
 
(b) Related statistical data:  
Interest subsidy for loans granted in 2014 and 2015  
 Unit: NT$ 1,000 
Name of Project  2014 2015 
Loans to expand the family farm; to support land purc hases by 
farmers  123,696  129,920  
Loans for farm machinery  82,012  79,493  
Loans for natural agricultural disasters  71,012  49,377  
Loans for accelerating rural construction  1,453,721  1,149,079  
Total 1,730,441  1,407,869  
Note:  Loans for accelerating rural c onstruction include such items as:  
1. Loans in the agricultural food industry to provide guidance and assistance to management.  
2. Loans in the livestock and poultry industry to improv e management efficiency.  G/SCM/N/315/TPKM  
 
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  3. Loans to farmers to provide guidance, assistance and management improvement.  
4. Preferential loans extended to those businesses that move into the agricultural technology park.  
5. Loans for agriculture production and marketing groups.  
 
II. FISHERIES  
A. FISHING VESSELS BUY -BACK PROGRAMME  
1. Title o f the programme  
 
Fishing Vessels Buy -back Program.  
 
2. Period covered by the notification  
 
2015-2016. 
 
3. Policy objective and/or purpose   
 
Due to severe overfishing worldwide, the U nited Nations (UN)  has been urgently calling on nations 
to reduce their fishi ng capacities. This programme seeks to alleviate pressures on the fishery 
resources and ensure their sustainability.  
 
4. Background and responsible authorities  
 
(a) Laws and regulation s:  
 
(1) Directions on Buying Back and Processing Fishing vessels and Rafts in 2015 and 2016  
(2) Operation Directions on the 2nd Buying Back and Processi ng Fishing Vessels and Rafts 
in 2016 
 
(b) Authorit ies: Fisheries Agency, Council of Agriculture.  
 
5. Form 
 
Grant.  
 
6. To whom and how assistance is provided  
 
(a) Beneficiaries: Owners of all varieties of fishing vessels with valid fishing licences, including 
recreational fishing vessels.  
 
(b) Content:  
 
1. The following is the buy -back amount for fishing vessels, calculated and accumulated 
in 2015-2016: 
 
- NT$50,000 for each gross ton of the 1st to 5th ton;  
- NT$40,000 for each gross ton of the 6th to 10th ton;  
- NT$30,000 for each gross ton of the 11th to 20th ton;  
- NT$25,000 for each gross ton of the 21st to 50th ton;  
- NT$20,000 for each gross ton of the 51st to 100th ton;  
- NT$18,0 00 for each gross ton over 100 tons; with the maximum  amount for each 
eligible vessel being NT$7.9 million.  
 
2. Since 2008, the buy -back of fishing rafts have been  calculated according to the length 
of raft, the pipe diameter and the power of main engine.  
 
7. Amount  
 
(a) Funds spent on buying back fishing vessels and rafts in 20 15 totalled NT$ 46.467 million; 
funds spent in 20 16 totalled NT$ 43.620  million.  
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  (b) Funds spent in 20 16 may be changed in the future based on the actual amount of fishing 
vessels ha ve been registering .  
 
8. Duration  
 
The d uration of the subsidy is not clearly specified.  
 
9. Trade effects or related statistical data  
 
N/A. 
 
B. REWARD FOR CLOSING FISHERY SEASON  
1. Title of the programme  
 
Reward for Closing Fishery Season.  
 
2. Period cov ered by the notification  
 
2015-2016. 
 
3. Policy objective and/or purpose  
 
Due to the problem of overfishing globally , the UN is calling on nations to reduce their catches. 
This programme seeks to alleviate pressures on fishery resources and ensure their su stainability.  
 
4. Background and responsible authorities  
 
(a) Laws and regulation s: Directions for Voluntary Fishing Suspense . 
 
(b) Authorit ies:   Fisheries Agency, Council of Agriculture.  
 
5. Form 
 
Grant.  
 
6. To whom and how assistance is provided  
 
Any f ishing vessels with valid fishing licences that comply  with the related regulations of closing 
fishery except recreational fishing charter boats.  
 
7. Amount  
 
The budget for the programme totalled NT$ 185.057  million in 2015 and NT$180.960  million 
in 2016. 
 
8. Duration  
 
The d uration of the subsidy is not clearly specified.  
 
9. Trade effects or related statistical data  
 
N/A. 
 
C. FISHING VESSELS MARINE INSURANCE REWARD  
1. Title of the programme  
 
Fishing Vessels Marine Insurance Reward.  
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  2. Period covered by the  notification  
 
2015-2016. 
 
3. Policy objective and/or purpose  
 
Insure fishing vessels against marine disasters.  
 
4. Background and responsible authorities  
 
(a) Laws and regulation s: Regulation s for the Insurance Reward for Owners of Fishing Vessels.  
 
(b) Authorit ies: Fisheries Agency, Council of Agriculture.  
 
5. Form 
 
Grant.  
 
6. To whom and how assistance is provided  
 
(a) Beneficiaries: Owners of fishing vessels  
 
(b) Content: The programme provides grants to cover a portion of the insurance costs for 
fishing vessels if damage d at sea.  
 
7. Amount  
 
The budget for the programme totalled NT$ 51.219  million for 20 15 and NT$ 53.840  million 
in 2016.  
 
8. Duration  
 
On-going since 1987.  
 
9. Trade effects or related statistical data   
 
N/A. 
 
III. INDUSTRY  
A. LOANS - LOANS F OR SMALL AND MEDIUM -SIZED ENTERPRISES (SMES)  
1. Specific and urgent financing and loans intended for recovery plans from damage 
caused by disasters  
1. Title of the programme  
 
Specific and urgent financing and loans intended for recovery plans from damage c aused by  
disasters.  
 
2. Period covered by the notification  
 
2015-2016. 
 
3. Policy objective and/or purpose  
 
Qualified SMEs are entitled to apply for financing and loans that are provided to help enterprises 
restructure during replacement of machinery and purchas e of new automated equipment.  
 G/SCM/N/315/TPKM  
 
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  4. Background and responsible authorities  
 
(a) Laws and regulation s:  
 
Statute for Development of Small and Medium -Sized Enterprises (Articles 9, 15, 17 and 18).  
Procedure s for Income -Expenditure Safeguarding and Utili zation of the SME Development Fund.  
 
The SME Development Fund was established according to Article 9 of the Statute for Development 
of Small and Medium -Sized Enterprises.  
 
(b) Authorit ies: Ministry of Economic Affairs.  
 
Note: The cumulative amount reach ed by the end of fiscal year 20 16 for the SME Development 
Fund was NT $4.3 billion.  
 
5. Form 
 
Financing and loan.  
 
6. To whom and how assistance is provided  
 
All enterprises which meet the "Standards for Identifying a Small and Medium -Sized Enterprise " 
are eligible to apply.  
 
According to the "Standards for Identifying a Small and Medium -Sized Enterprise " published by the 
Ministry of Economic Affairs, an SME is a company or commercial enterprise registered in 
accordance with the law with capital or operatin g revenue below the following thresholds:  
 
(a) For enterprises engaged in manufacturing, construction, mining or excavating, paid -in 
capital of less than NT$80 million.  
 
(b) For enterprises engaged in other economic activities such as agriculture, loggin g, fishing, the 
raising of livestock, utilities, commerce, transport, warehousing, communications, finance, 
insurance, real estate, commercial, social or individual services, an annual operating revenue of 
less than NT$100  million.  
 
The loan granted is provided  by the SME Development Fund. The ceiling interest rate is 1% plus a 
flat rate of the 2 -year postal fixed savings rate.  
 
7. Amount  
 
Statistics for Specific Programmes:  
 
Loaned by the SME Development Fund  
Unit: NT$ million . 
Title of Programme  2015-2016 
Urgent financing for major natural disasters  0 
 
8. Duration  
 
The above -mentioned programme loaned by the SME Development Fund was scheduled to be 
terminated after 2009 . However, in order to assist SMEs with accessing funding for recovery from 
disastrou s damage, we decided to continue this programme.  
 
9. Trade effects or related statistical data  
 
Given the fact that 98% of enterprises are SMEs, it is difficult to estimate the trade effects of these 
programmes.  
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  2. Medium - and long -term loans for product  marketing and loans for overseas 
investment and construction projects  
1. Title of the programme  
 
Medium - and long -term loans for product marketing, and loans for overseas investment and 
construction projects.  
 
2. Period covered by the notification  
 
2015-2016. 
 
3. Policy objective and or/purpose  
 
These programmes are implemented for the purpose of providing SMEs with financial assistance in 
exploring new markets for their machinery and equipment, in investing and establishing plants in 
foreign countries, a nd in undertaking overseas contracts for construction projects.  
 
4. Background and responsible authorities  
 
(a) Laws and regulation s:  
 
Statute for Development of Small and Medium -Sized Enterprises (Articles 9, 15, and  16).  
Procedure s for Income -Expendit ure, Safeguarding and Utilization of the SME Development Fund.  
 
(b) Authorit ies: Ministry of Economic Affairs.  
 
5. Form 
 
Loan.  
 
6. To whom and how assistance is provided  
 
(a) All enterprises which meet the "Standards for Identifying a Small and Medium -Sized 
Enterprise " are eligible for application.  
 
(b) The approval of loan applications is performed by commercial banks. However, the capital 
needed is provided entirely by the SME Development Fund.  
 
7. Amount  
 
Loaned by the SME Development Fund.  
FY 2015-2016: NT$ 1.1 billion.  
 
8. Duration of subsidy  
 
The programmes are not subject to any fixed completion date.  
 
9. Trade effects or related statistical data  
 
Given the fact that 98% of enterprises are SMEs, it is difficult to estimate the trade effects of these 
programmes.  
 
B. LOANS FOR PRIVATE ENTERPRISES  
1. Loans for small and medium -sized enterprises and private enterprises  
1. Title of the programme  
 
Loans for small and medium -sized enterprises and private enterprises.  
 G/SCM/N/315/TPKM  
 
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  2. Period covered by the notific ation 
 
2015-2016. 
 
3. Policy objective and/or purpose  
 
This programme is implemented for the purpose of improving production technology and product 
quality, promoting industrial upgrading and assist ing in the upgrading of small and medium -sized 
enterprises  and private enterprises.  
 
4. Background and responsible authorities  
 
(a) Law and regulation:  
 
 1. Prior to 12 May 2010 – Sub-paragraphs (2) and (3), and Paragraph 1 of Article 21 of 
the Statute for Upgrading Industries.  
 
 2. Sub-paragraphs (2) and (3), a nd Paragraph 1 of Article 21 of the Statute for 
Upgrading Industries were superseded by Article 30 of the Industrial Innovation Act, which 
was promulgated on 12 May 2010.  
 
(b) Authorities: The guidelines for the loan programme are given in the Development Fund.  
 
5. Form 
 
Loans: 25% of each loan is provided by the Development Fund and 75% by domestic banks. 
 
6. To whom and how assistance is provided  
 
The loans are available to all enterprises and are not limited to a specific industry or enterprise.  
 
7. Amount 
 
There are no official statistics with respect to the programme.  
 
8. Duration  
 
The projects will be implemented until the expiration of the I ndustrial Innovation Act .  
 
9. Trade effects or related statistical data  
 
(a) Trade effects:  
 
This programme is mainly implemented  to promote industry upgrading. In light of the scope and 
nature of the programme, it is not possible to determine what, if any, trade effects may result.  
 
(b) Related statistical data:  
 
Total amount of loans granted in 2015  
Name of Project  Number of Granted Cases Total Amount of  
Granted Loans 
(NT$ hundred million ) 
Loans to assist in the upgrading 
of small and medium -sized 
enterprises  40 5.12 
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  Total amount of loans granted in 2016  
Name of Project  Number of Granted Cases Total Amount  of Granted 
Loans  
(NT$ hundred million ) 
Loans to assist in the upgrading 
of small and medium -sized 
enterprises  13 1.03 
 
C. DUTY AND TAX EXEMPTIONS GRANTED TO ENTERPRISES LOCATED WITHIN A 
DESIGNATED ZONE  
1. Duty and tax exemptions for high -technology indu stries  
1. Title of the programme  
 
Duty and tax exemptions for high -technology industries.  
 
2. Period covered by the notification  
 
Fiscal year  2015-2016. 
 
3. Policy objective and/or purpose  
 
This programme is implemented with a view to stimulating the rese arch and innovation of 
industrial technology and to promote the development of advanced technology. The "Science -
Based Industrial Park "(the Park) has been established by introducing sophisticated industries and 
personnel with advanced technological backgro unds into a designated zone.  
 
4. Background and responsible authorities  
 
(a) Law and regulation:  
 
 Act for Establishment and Administration of Science Parks  (Article  20); 
 Enforcement Rules of Act for Establishment and Administration of Science Parks  (Article 17).  
 
(b) Authorities:   The Park is managed by the Science Park Bureau;  
    The policy -making body is the Ministry of Science and Technology . 
 
5. Form 
 
The subsidy programme will be implemented in the form of dut ies and tax exemptions.  
 
6. To whom  and how assistance is provided  
 
(a) Effective from 1  January 2000, the merged Park entities in accordance with the domestic 
Company Law, or surviving or new Park entities after mergers, shall succeed to tax benefits, which 
are not yet terminated nor fully  offset, originally enjoyed by the dissolving science -based industry 
before mergers. As for succeeding to the exemption of profit -seeking income tax as investment 
incentives from the dissolving Park entities, the surviving Park entities, within the scope o f 
science -based industries under the merger/consolidation projects, shall continue to produce 
products or to provide services identical to those produced or provided by the dissolving Park 
entities and such tax benefits shall apply only to the portion of i ncome derived from products or 
services independently produced or provided by the original dissolving Park entities. If the tax 
benefits are provided in the manner of investment offset or deduction, such tax benefits shall 
apply only to the payable tax por tion of the surviving or new Park entities after mergers of the 
dissolving science -based industries (Article  18). 
 
(b) All Park enterprises are entitled to the following exemptions:  
 
Customs duties, commodity tax, and business tax on imported machinery an d equipment, raw 
materials, commodities, fuel, and semi -finished products .  
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  Note: "Park enterprise " refers to a science -based industry and to an enterprise approved and 
established in the Park that is able to provide services in respect of operational, ma nagement or 
technical support to science -based industries.  
 
A research and development institution or a venture capital investment incubatory centre may also 
apply for establishment and operation in the Park.  
 
A venture capital investment incubatory cent re eligible for establishment in the Park shall be 
limited to one that engages in research and development activities, does not engage in mass 
production and has been approved by the Park Administration. It will stay in the Park for a period 
of not more th an three years.  
 
7. Amount  
 
2015-2016 Business Tax Exemption for all Imports  
Unit: NT$ million  
Year Total Import Value  Total Amount of Business  
Tax Exemption  
2015 723,548  36,177  
2016 824,649  41,232  
 
8. Duration  
 
There is no time limit attached to the p rogramme.  
 
9. Trade effects or related statistical data  
 
 Unit: NT$ million  
Year 2015 2016 
Number of approved park enterprises  
(accumulated numbers ) 799 811 
Total import value  723,548  824,649  
Total export value  1,374,098  1,510,274  
 
In light of the sco pe and nature of the se programmes, it is not yet possible to determine what, if 
any, trade effects may result.  
 
2. Duty and tax exemptions for in -zone enterprises  
1. Title of the programme  
 
Duty and tax exemptions for in -zone enterprises.  
 
2. Period covere d by the notification  
 
Fiscal  years 2015-2016. 
 
3. Policy objective and/or purpose  
 
Export Processing Zones have been established for the purpose of promoting investment and 
international trade.  
 
4. Background and responsible authorities  
 
(a) Laws and reg ulation s: 
 
 Statute for Establishment and Administration of Export Processing Zones (the EPZ  Law), 
(Articles 1, 5 and 13).  
 Measures for the Screening of Application for Establishment of Enterprises in Export 
Processing Zones.  
 Categories of Industr ies eligible to be established in Export Processing Zones.  G/SCM/N/315/TPKM  
 
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  (b) Authorities:  
 
 Export Processing Zones are managed by the Export Processing Zone Administration.  
 The policy -making body is the Ministry of Economic Affairs.  
The task for reviewing the eligibilit y of enterprises established in Export Processing Zones 
shall be undertaken by the Export Processing Zone Administration together with the other 
government agencies involved.  
 
Note: In -zone enterprises include industries authorized to be engaged in manufa cturing, 
processing, assembly, research and development, trade, consulting, technical services, 
warehousing, transportation, loading and unloading, packing, repairs and other related businesses 
approved by the Ministry of Economic Affairs for Export Proces sing Zones.  
 
5. Form 
 
Duties and tax exemptions.  
 
6. To whom and how assistance is provided  
 
All in-zone enterprise industries are entitled to the following exemptions:  
 
(a) Import duty, commodity tax and business tax on imported machinery and equipment . 
 
(b) Import duty, commodity tax, and business tax on imported raw and consumption materials, 
fuels, semi -finished products, samples, and finished products for transhipment by traders and 
warehousing operators.  
 
(c) Deed tax when acquiring a new standard  plant building in the Export Processing Zone or 
acquiring a building from the Export Processing Zone Administration.  
 
It should be noted that within five years of import ation, all machinery and equipment are not 
entitled to duty and tax exemptions when s hipped to leviable areas from Export Processing Zones. 
Moreover, products manufactured by in -zone enterprises shall be subject to customs duties, 
commodity taxes and business taxes when they are shipped to leviable areas. While customs 
duties would be appl ied on the basis of ex -factory prices minus value -added resulting from 
manufacturing or processing activities in the EPZs, other taxes would be based on the ex -factory 
price.  
 
7. Amount  
 
2015-2016 Business Tax Exemption for all Imports  
Unit: NT$ million  
Year Total Import Value  Total Amount of Business  
Tax Exemption  
2015 257,232  12,862  
2016 262,875  13,144  
8. Duration  
 
There is no time limit attached to the programme.  
 G/SCM/N/315/TPKM  
 
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  9. Trade effects or related statistical data  
 
 Unit: NT$ million  
Year 2015 2016 
Numbe r of approved park enterprises  
(accumulated numbers ) 601 605 
Total import value  257,232 262,875 
Total export value  409,932  427,492  
 
In light of the scope and nature of these programmes, it is not yet possible to determine what, if 
any, trade effects may  result.  
 
D. SUBSIDIES FOR THE ESTABLISHMENT AND OPERATION COSTS OF PETROLEUM 
FACILITIES, AND PRODUCTS CONSUMPTION COSTS IN THE REMOTE AREAS, 
ABORIGINAL AREAS AND ISOLATED ISLAND AREAS  
1. Title of the programme  
 
To subsidize the set up of petroleum facilit ies in remote, aboriginal and isolated island  areas as 
well as transportation outlays, and offer price subsidies.  
 
2. Period covered by notification  
 
Fiscal  years  2015-2016.  
 
3. Policy objective  
 
The goals of the subsidy are:  
 
(1) to ensure a steady and reliable supply of transport fuels  and LPG  in these areas, and  
(2) to maintain fuel prices at levels consistent with the main island.  
 
4. Background and responsible authorities  
 
(1) Laws and regulation s:  
 
Petroleum Administration Act was amended on 4 Jun e 2014. The subsidy regulation was 
promulgated on 31 October and effective on 2 November 2014 . 
 
(2) Authorit ies: Bureau of Energy, Ministry of Economic Affairs.  
 
5. Form 
 
Grant.  
 
6. To whom and how the subsidy is provided  
 
(1) Owners  and/or operators of p etroleum facilities in these areas are entitled to apply for the 
following items :  
 
(a) Subsidy for the establishment of petroleum facilities in such areas . 
(b) Subsidy for maintenance cost s of petroleum facilities in such areas . 
(c) Subsidy to offset the cost of shipping petroleum or LPG to such areas . 
(d) Subsidy for extra personnel costs in the operation of petroleum facilities in such areas . 
 
(2) Subsidy to offset the cost of shipping  household LPG between remote areas, aboriginal areas 
and urban or/and  suburban areas.  
 G/SCM/N/315/TPKM  
 
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  7. Amount for the past two years  
 
Statistics for specific subsidies  
Unit: NT$  thousand  
Title of Subsidy  2015 2016 
Subsidy for the establishment of petroleum 
facilities in such areas  0 1,660  
Subsidy for maintenance cost s of petroleum 
facilities in such areas  14,703  5,498  
Subsidy to offset the cost of shipping petroleum or 
LPG to such areas  164,601  157,331  
Subsidy for extra personnel costs in the operation 
of petroleum facilities in such areas  29,196  35,250  
Subsidy to offset the cost of  shipping household 
LPG between remote areas, aboriginal areas and 
urban or/and suburban areas  71,712  52,090  
Total 280,212  251,829  
 
8. Duration  
 
(1) The Program me was initia lized in 2002 , but the household LPG subsidy in aboriginal  areas 
was started on 1 9 August 2010.  
 
(2) The subsidies for the remote areas, aboriginal plan areas were started on 2  November  2014.  
 
(3) Not subject to deadline.  
 
9. Trade effects or related statistical data  
 
The Program me is based on the annual budget of the Petroleum Fund. In light of the scope and 
nature of activities that may be financially supported by these subsidies, it is not yet possible to 
determine what, if any, trade effects may eventually result from this programme.  
 
IV. RESEARCH AND DEVELOP MENT  
A. FUNDS GRANTED FOR D EVELOPMENT OF NEW OUTSTANDING PRODUCTS  
1. Title of the programme  
 
(a) Grants for development of new leading industries.  
(b) Project for subsidizing development of major market -comprehensive products . 
(c) Grants for development of innovative applications a nd services  
 
2. Period covered by the notification  
 
2015 to 2016.  
 
3. Policy objective and/or purpose  
 
In order to encourage research and development of new leading products and upgrade the 
technical capability of the leading industries, the programme gran ts funds to private enterprises.  
 
In response to promoting "critical leading edge of product development plan " and taking into 
consideration the "market applicability " and "technological competitiveness ", the Industrial 
Development Bureau of the Ministry of Economic Affairs launched the new special "project for 
subsidizing development of major market -comprehensive products " in June 2010 and thereafter.  
 
To encourage the development of innovative market -oriented trading service model, and guide the 
planning  of market assessment, developing the market -oriented innovative business or service 
model through the integration of cross -cutting technology applications or services business 
processes and business model of innovation.  
 G/SCM/N/315/TPKM  
 
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  4. Background and responsible auth orities  
 
(a) Laws and regulation s:  
 
Measures for Assistance in the Development of New Leading Products w ere promulgated on 
26 April 1991 and were superseded by the Subsidy and Assistance Regulations for Promoting 
Industry Innovation by the Ministry of Eco nomic Affairs on 15 November 2010.  
 
(b) Authorit ies: The Industrial Development Bureau, Ministry of Economic Affairs.  
 
5. Form 
 
Grant.  
 
6. To whom and how assistance is provided  
 
(a) Any company incorporated under the Company Law with sound financial stan ding and 
without ever  having a record of refusal or bounced cheque through a domestic bank, may apply for 
the assistance fund relating to the development of  a new leading product. The product should 
possess great market potential and its core technology sh ould surpass the current level of 
domestic industrial technology .  
 
(b) The assistance funds granted are a total of no more than f ifty per cent ( 50%) of the amount 
of the following expenses incurred exclusively for the development of new leading products:  
 
1. Costs incurred for full -time research personnel;  
2. Costs of consumable instruments and raw materials;  
3. Costs for use and maintenance of R&D equipment;  
4. Costs for technology transfer.  
5. Travel fees related to the project.  
 
7. Amount  
 
(a) Since the programme 's inception, the cumulative amount of grant s stands at 
NT$17,817,771,233  at the end of fiscal year 20 16 (fiscal years 1992 -2016). 
 
(b) For the fiscal year 2013: the amount of grant s was NT$ 468,428,332 . A breakdown of the 
products involved is shown below:  
 Unit: NT$  thousand  
Name of Project (or Sector)  Grant  Amount  
Grants for development of new leading industries  371,492  
Project for subsidizing development of major market -
comprehensive products  96,936  
Total 468,428  
 
(c) For the fiscal year 2014: the am ount of grants was NT$1,198,650,137. A breakdown of the 
products involved is shown below:  
 
 Unit: NT$  thousand  
Name of Project (or Sector)  Grant  Amount  
Grants for development of new leading industries  920,096  
Project f or subsidizing development of major market -
comprehensive products  188,874  
Grants for development of innovative applications 
and services  89,680  
Total 1,198,650  
 G/SCM/N/315/TPKM  
 
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  (d) For the fiscal year 20 15-2016: the amount of grant s was NT$ 3,295,910,000 . A breakdown 
of the products involved is shown belo w: 
 
 Unit: NT$  thousand  
Name of Project (or Sector)  Grant  Amount  
Grants for development of new leading industries  492,665  
Grants for development of innovative applications and 
services  142,170  
Grants for Industrial upgrading and transformation  2,661,075 
Total 3,295,910  
 
8. Duration  
 
There is no time -limit attached to the programme.  
 
9. Trade effects or related statistical data  
 
It is not yet possible to determine what, if any, trade effects may result from this subsidy 
programme.  
 
B. FUNDS GRANTED FO R PROMOTING DEVELOPMENT OF INDUSTRIAL TECHNOLOGY  
1. Title of the programme  
 
Technology Development Programme for Enterprise s. 
 
2. Period covered by the notification  
 
2015-2016. 
 
3. Policy objective and/or purpose  
 
The programme 's objective is to encourage busi nesses to engage in the development of 
technological innovations and applications for the purpose of reinforcing domestic enterprises ' 
capabilities, especially in the field of research and development.  
 
4. Background and responsible authorities  
 
(a) Laws and regulation s:  
 
Regulations of Subsidization for Encouraging Enterprises R & D Activities were promulgated on 27 
November 2002 and were superseded by the Subsidy and Assistance Regulations for Promoting 
Industry Innovation by the Ministry of Economic Af fairs on 15 November 2010.   
 
(b) Authorit ies: Department of Industrial Technology, Ministry of Economic Affairs.  
 
5. Form 
 
Fund assistance for advanced research and development.  
 
6. How assistance is provided and to whom  
 
(a) Any company established acco rding to the Company Law with sound financial standing  and 
research and development department that has made significant achievements in the past, and 
which is currently staffed by competent specialists , in the Separate Customs Territory of Taiwan, 
Penghu,  Kinmen and Matsu, may apply for this fund to offset the costs of the following activities:  
 
1. Research and development of advanced technologies  that may be aptly characterized 
 as vital and innovative in the long term.   
2. Technologies research and deve lopment that enhance vertical or horizontal integration 
 and drive the forming of industry chain ecosystems or clusters.  G/SCM/N/315/TPKM  
 
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  3. Establishment of research and development centers in Chinese Taipei  that create 
 innovative technologies and services.  
4. Developm ent of innovative or integrative manufacturing technology by small and 
 medium -sized businesses.  
(b) The assistance funds to be granted shall not exceed 50% of the total amount of the 
following expenses:  
 
1. Costs incurred for full -time and/or part -time r esearch personnel;  
2. Costs of consumable instruments and raw materials;  
3. Costs for use and maintenance of R&D equipment;  
4. Costs for technology transfer; and  
5. Domestic travel expenses.  
6. Rewards for patent application.  
 
7. Amount  
 
The total amoun t of grant s in the fiscal year 2015-2016 was NT$ 4,509,721,000.   
 
8. Duration  
 
There is no time -limit attached to the programme.  
 
9. Trade effects or related statistical data  
 
It is not yet possible to determine what, if any, trade effects may result from  this subsidy 
programme.  
 
C. FUND GRANTED FOR ENCOURAGING EXPLORATION AND DEVELOPMENT OF OIL 
AND NATURAL GAS RESERVES  
1. Title of the programme  
 
Fund Granted for Encouraging Exploration and Development of Oil and Natural Gas Reserves.  
 
2. Period covered b y notification  
 
2015-2016. 
 
3. Policy objective and/or purpose  
 
The policy objectives of the programme are to secure oil supply and stabilize the domestic oil 
market.  
 
4. Background and responsible authorities  
 
(a) Laws and regulation s: Petroleum Administr ation Act.  
 
(b) Responsible authorit ies: Bureau of Energy, Ministry of Economic Affairs.  
 
5. Form 
 
Grant.  
 
6. How assistance is provided and to whom  
 
Companies limited by shares incorporated under the Company Law that engage in the exploration 
and devel opment of oil and natural gas reserves are eligible for the grant.  
 
The grant is used only in support of the following activities:  
 G/SCM/N/315/TPKM  
 
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  (1) The implementation of geological, geophysical, and/or geochemi cal surveys and research 
necessary for the exploration of oil and natural gas.  
 
(2) Drilling for the exploration and/or development of oil and/or natural gas reserves.  
 
(3) Any other necessary pertinent activities that have been reviewed and approved by the 
authorities.  
 
The total subsidy allocated for an appl icant's exploration proposal is not to exceed 50% of the 
budget in the applicant 's proposal. The total subsidy allocated for an applicant 's development 
proposal is not to exceed 12% of the budget in the applicant 's proposal.  
 
While the proposal is success ful, the whole grant plus additional feedback, computed by 10% 
compound interest, must be returned in 5 -15 years.  
 
7. Amount  
 
 Unit: NT$  thousand  
Year 2009  2010  2011  2012  2013  2014  2015  2016  
Total  294,125  308,751  398,648  251,542  350,000  430,000  400,000  68,342 
 
8. Duration  
 
The programme was initiated in 2002. It is not subject to any fixed completion date.  
 
9. Trade effects or related statistical data  
 
Given the scope and nature of the activities that may be financially supported by th is subsidy, it is 
not yet possible to determine what, if any, trade effects may eventually result from this 
programme.  
 
 
__________