WT/TPR/S/302/Rev.1  
18 December 2015  
(15-6705)  Page: 1/142  
Trade Policy Review Body   
 
TRADE POLICY REVIEW 
REPORT BY THE SECRETARIAT 
SEPARATE CUSTOMS TERRITORY OF TAIWAN , PENGHU , KINMEN AND MATSU 
Revision 
This report, prepared for the third Trade Policy Review of the Separate Customs Territory of 
Taiwan, Penghu, Kinmen and Matsu (Chinese Taipei ), has been drawn up by the WTO Secretariat 
on its own responsibility. The Secretariat has, as required by the Agreement establishing the Trade 
Policy Review Mechanism (Annex 3 of the Marrakesh Agreement Establishing the World Trade Organization), sought clarification from Chinese Taipei on its trade policies and practices.  
Any technical questions arising from this report may be addressed to: Mr Mario Kakabadse 
(tel: 022 739 5172), Ms Zheng Wang (tel: 022 739 5288) and Mr Xinyi Li (tel: 022 739 5579).  
Document WT/TPR/G/302 contains the policy statement submitted by the Separate Customs 
Territory of Taiwan, Penghu, Kinmen and Matsu.  
 
Note: This report was drafted in English. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  CONTENTS 
SUMMARY ....................................................................................................................... . 8 
Economic envi ronment ...................................................................................................... 8  
Trade policy fr amework ..................................................................................................... 8  
Main trade policy developments .......................................................................................... 9  
Sectoral policy developments ............................................................................................. 10 
1   ECONOMIC ENVIRONMENT ........................................................................................ 12  
1.1   Introduction ............................................................................................................. 12 
1.2   Recent econom ic developments .................................................................................. 12 
1.3   Macroecono mic policies ............................................................................................. 16 
1.3.1   Fiscal policy ......................................................................................................... . 16 
1.3.2   Monetary and ex change rate policies ........................................................................ 16 
1.4   Structural policies ..................................................................................................... 17 
1.5   Balance of payments ................................................................................................. 18 
1.6   Trade and in vestment flows ....................................................................................... 18 
1.6.1   Composit ion of trade .............................................................................................. 18 
1.6.2   Direction of trade ................................................................................................... 18 
1.6.3   Trade in services ................................................................................................... 21 
1.6.4   Foreign direct  investment  (FDI) ............................................................................... 21 
2   TRADE POLICY REGIME: FR AMEWORK AND OB JECTIVES .......................................... 24  
2.1   Introduction ............................................................................................................. 24 
2.2   General institutional framework for making and enfo rcing policies ................................... 24 
2.3   Administration  of trade policy ..................................................................................... 25 
2.4   Main trade laws ........................................................................................................ 26 
2.5   Policy objectives ....................................................................................................... 27 
2.5.1   National Deve lopment Plan  (NDP) ............................................................................ 27 
2.5.2   Economic Power-up Plan ......................................................................................... 28 
2.6   Trade Agreements and Arrangements .......................................................................... 28 
2.6.1   Multilateral and regional ag reements ........................................................................ 28 
2.6.1.1   World Tr ade Organi zation ..................................................................................... 28 
2.6.1.2   APEC ................................................................................................................. 29 
2.6.2   Cross-Straits Economic Cooperation Framework Agreement (ECFA) ............................... 29 
2.6.3   Other existing and pote ntial preferential agreements .................................................. 30 
2.6.4   TPP ...................................................................................................................... 30 
2.6.5   Unilateral trade preferences .................................................................................... 30 
2.7   Foreign inve stment regime ........................................................................................ 31 
3   TRADE POLICIES AND PRACTICES BY MEASURE ........................................................ 36  
3.1   Measures Direct ly Affectin g Imports ............................................................................ 36 
3.1.1   Customs procedures ............................................................................................... 36 
3.1.2   Custom s valuation ................................................................................................. 38 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.1.3   Rules of origin .......................................................................................................  39 
3.1.4   Tariffs ............................................................................................................... ... 39 
3.1.4.1   M FN tari ffs .........................................................................................................  39 
3.1.4.2   WTO bound tariffs ............................................................................................... 42 
3.1.4.3   Preferential tariffs ............................................................................................... 43 
3.1.4.4   Tariff exemption and reduction .............................................................................. 44 
3.1.4.5   Tariff- rate qu otas ................................................................................................ 45 
3.1.5   Tax collected at th e border and ot her char ges ............................................................ 46 
3.1.5.1   Internal taxes ..................................................................................................... 47 
3.1.5.2   Fees an d other charges ........................................................................................ 47 
3.1.6   Import prohibitions, restrictions, an d licensing ........................................................... 48 
3.1.6.1   Import prohibition ............................................................................................... 48 
3.1.6.2   Import licensing .................................................................................................. 48 
3.1.6.3   Other restrictions ................................................................................................ 50 
3.1.7   Continge ncy measures ........................................................................................... 50 
3.1.7.1   Overview ........................................................................................................... 50 
3.1.7.2   Anti-dumping  and counter vailing ........................................................................... 50 
3.1.7.3   Safeguards ........................................................................................................ 51 
3.1.8   Stat e-trading ........................................................................................................ 52 
3.1.9   Technical regu lations and standards ......................................................................... 52 
3.1.10   Sanitary and phyt osanitary requ irements ................................................................ 54 
3.2   Measures Directly Affecting Exports ............................................................................. 58 
3.2.1   Export document ation and pr ocedures ...................................................................... 58 
3.2.2   Export taxes, charges, an d levies ............................................................................. 58 
3.2.3   Export prohibitions, restrictions, and licensing ............................................................ 59 
3.2.3.1   Export prohibitions .............................................................................................. 59 
3.2.3.2   Export licensing .................................................................................................. 59 
3.2.3.3   Other export co ntrol ............................................................................................ 60 
3.2.4   Export operations of state enterprises ....................................................................... 60 
3.2.5   Export finance, pr omotion, and assistan ce ................................................................. 60 
3.2.6   Fr ee zone s ............................................................................................................  61 
3.3   Measures Affectin g Production and Trade ..................................................................... 61 
3.3.1   Taxation and incentives .......................................................................................... 61 
3.3.1.1   Di rect ta xes ....................................................................................................... 62 
3.3.1.2   Indi rect ta xes ..................................................................................................... 62 
3.3.1.3   Tax exemptio ns and ince ntives ............................................................................. 63 
3.3.2   Non-tax incentives, subs idies, and othe r assist ance .................................................... 63 
3.3.2.1   Subsidies to the agricultur e sector ......................................................................... 63 
3.3.2.2   Grants and loans for R&D ..................................................................................... 64 
3.3.2.3   Assistance to small-and-medium-sized enterprises ................................................... 65 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.3.2.4   Other subsidies and assistance .............................................................................. 65 
3.3.3   Government-o wned enterprises ............................................................................... 66 
3.3.4   Governme nt procurement ....................................................................................... 66 
3.3.5   Competition policy  and regulato ry issues ................................................................... 69 
3.3.5.1   Competition policy .............................................................................................. 69 
3.3.5.2   Price controls and price-stabilization measures ........................................................ 73 
3.3.6   Intellectual property rights ...................................................................................... 74 
3.3.6.1   Overview ........................................................................................................... 74 
3.3.6.2   Copyright ........................................................................................................... 75 
3.3.6.3   Patents .............................................................................................................. 76 
3.3.6.4   Trademarks and geographical indications ................................................................ 79 
3.3.6.5   Layout-designs of integrated circuits, plant varieties, trade secrets ............................ 81 
3.3.6.6   Enforc ement of IPRs ............................................................................................ 81 
4   TRADE POLICIES BY SECTOR ..................................................................................... 84  
4.1   Agriculture, fi sheries and forest ry ............................................................................... 84 
4.1.1   Agriculture ............................................................................................................ 84 
4.1.1.1   Overview ........................................................................................................... 84 
4.1.1.2   Agricultural policy objectives ................................................................................. 85 
4.1.1.3   Bord er measures................................................................................................. 86 
4.1.1.3.1   Tariffs ............................................................................................................. 86 
4.1.1.3.2   Ta riff qu otas .................................................................................................... 86 
4.1.1.3.3   Special safe guard measures  (SSGs) .................................................................... 87 
4.1.1.3.4   State trading ................................................................................................... 87 
4.1.1.3.5   Export promotion,  restriction an d prohibition ........................................................ 87 
4.1.1.4   Domestic support measures .................................................................................. 87 
4.1.1.4.1   Support levels .................................................................................................. 87 
4.1.1.4.2   Selected  support me asures ................................................................................ 89 
4.1.1.4.2.1   Direct payments under the adjustme nt programme ............................................ 89 
4.1.1.4.2.2   Price support  - guaranteed  purchase ................................................................ 89 
4.1.1.4.2.3   Interest subsidy ............................................................................................ 90 
4.1.1.4.2.4   Other assistance ............................................................................................ 91 
4.1.1.5   Key subsectors ................................................................................................... 91 
4.1.1.5.1   Fruits ............................................................................................................ . 91 
4.1.1.5.2   Pig rearing ...................................................................................................... 92 
4.1.1.5.3   Vegetables ...................................................................................................... 92 
4.1.1.5.4   Rice .............................................................................................................. . 92 
4.1.1.5.5   Sugar .............................................................................................................  93 
4.1.2   Fishery ................................................................................................................. 93 
4.1.3   Fo restry  .............................................................................................................. . 94 
4.2   Energy .................................................................................................................. .. 95 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  4.2.1   Overview ..............................................................................................................  95 
4.2.2   Key subsectors ...................................................................................................... 97 
4.2.2.1   Electricity ........................................................................................................... 97 
4.2.2.2   Hydrocarbons and natural gas ............................................................................... 98 
4.2.2.3   Renewable energy ............................................................................................... 99 
4.3   Manuf acturi ng .......................................................................................................... 99 
4.3.1   Overview ..............................................................................................................  99 
4.3.2   Recent developments ............................................................................................. 99 
4.4   Services ................................................................................................................  101 
4.4.1   Overview ............................................................................................................ 1 01 
4.4.2   Banking, finance and insurance .............................................................................. 101  
4.4.2.1   Overview ......................................................................................................... 10 1 
4.4.2.2   Banking ........................................................................................................... 1 02 
4.4.2.3   In suranc e ........................................................................................................ 10 4 
4.4.2.4   Securities ........................................................................................................ 1 05 
4.4.3   Telecommunications and postal se rvices ................................................................. 106  
4.4.3.1   Teleco mmunicati ons .......................................................................................... 106  
4.4.3.2   Postal service ................................................................................................... 10 8 
4.4.4   Transport ........................................................................................................... 1 09 
4.4.4.1   Mariti me transp ort ............................................................................................ 109  
4.4.4.2   Air transport ..................................................................................................... 109  
4.4.4.3   Road  transport ................................................................................................. 111  
4.4.4.4   Rail transport ................................................................................................... 11 1 
4.4.5   Tourism .............................................................................................................. 112  
4.4.6   Profession al services ............................................................................................ 113  
4.4.6.1   Legal services ................................................................................................... 113  
4.4.6.2   Account ing services ........................................................................................... 114  
4.4.6.3   Architectural services......................................................................................... 114  
4.4.6.4   Professional engineering se rvices ........................................................................ 114  
4.4.7   Other services ..................................................................................................... 11 5 
REFERENC ES ................................................................................................................ 116  
5   APPENDIX TABLES .................................................................................................. 117  
 
CHARTS 
 
Chart 1.1 Product composition of merchandise trad e, 2009 an d 2013 ...................................... 19 
Chart 1.2 Direction of merchandise trade, 2009 and 2013 ...................................................... 20 
Chart 3.1 Distribution of  MFN tariff ra tes, 2013 .................................................................... 40 
Chart 3.2 Average applied MFN tariff an d bound rates, by HS sectio n, 2013 ............................. 43 
Chart 3.3 Patent a pplications , 2013  .................................................................................... 79 
Chart 4.1 Green box support, 2007-10 ................................................................................ 88 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Chart 4.2 Amber bo x support , 2007- 10 ............................................................................... 89 
Chart 4.3 Interest subsidy for loans granted, 2007-11 ........................................................... 91 
Chart 4.4 Total en ergy suppl y, 2013 ................................................................................... 96 
Chart 4.5 Distribution of telecom revenue, 2013 ................................................................. 107  
Chart 4.6 Cross-Strait aviation:  numbe r of flights and pa ssengers, 2008-13 .......................... 111  
 
TABLES 
 
Table 1.1 Selected macroeco nomic indicato rs, 2009- 13 ......................................................... 13 
Table 1.2 Basic economic  indicators , 2009- 13 ...................................................................... 15 
Table 1.3 Trade in  services , 2009- 13 .................................................................................. 21 
Table 1.4 Inbound and outbound flows of direct investment by source and destination, 
2009-1 3 ....................................................................................................................... .. 22 
Table 1.5 Inbound and outbound flows of direct investment by activity, 2009-13 (approval 
basis)  ....................................................................................................................... ..... 23 
Table 2.1 Negative list for investment by overseas Chinese and foreign nationals (amended 
17 June 2013) .................................................................................................................  31 
Table 3.1 Summary of procedures and documents for tradin g across borders ........................... 36 
Table 3.2 Benefits of authorized economic operator  certificates .............................................. 38 
Table 3.3 Tariff structure, 2009 and 2013 ............................................................................ 41 
Table 3.4 Summary of the MFN applied tariff, 2013 ............................................................... 42 
Table 3.5 Summary analysis of  preferential tariff, 2013 ......................................................... 43 
Table 3.6 Temporary tari ff adjustme nt, 2010- 13 .................................................................. 44 
Table 3.7 Tariff ra te quotas , 2013  ...................................................................................... 46 
Table 3.8 Taxes and fees collected at the border, 2009-13 ..................................................... 46 
Table 3.9 Prior approval author ities for import licences .......................................................... 49 
Table 3.10 Specific trade concerns over Chinese Taipei's SPS measures, January 2010-
December 2013 ............................................................................................................... 54 
Table 3.11 Tax refunds on imported inpu ts for export manuf actures, 2010-13  .......................... 59 
Table 3.12 Direct and indirect tax revenues, 2009-13 ............................................................ 61 
Table 3.13 Sectoral allocation of grants  for developing new leading industries ........................... 64 
Table 3.14 Major amendments  to the GP Act in  2011 ............................................................ 66 
Table 3.15 Procurement by origin , 2009-13  ......................................................................... 67 
Table 3.16 Procurement methods and procedures ................................................................. 68 
Table 3.17 Procurement share by type of proced ure, 2009- 13 ................................................ 69 
Table 3.18 Amendments to  the Fair Trade Act ...................................................................... 70 
Table 3.19 Key characteristi cs of the Fair  Trade Act .............................................................. 70 
Table 3.20 Enforcement statistics on competition policy, 2009-13 ........................................... 72 
Table 3.21 Price-stabilization measures ............................................................................... 73 
Table 3.22 Major amendments to the Patent Act from 2011 to 2014 ........................................ 77 
Table 3.23 Patents applied fo r and granted, 2009-13 ............................................................ 78 
Table 3.24 Trademark and related data , 2009-13  ................................................................. 80 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Table 3.25 IPR enforcement at the border by Customs, 2009-13 ............................................. 81 
Table 3.26 IPR enforcement wi thin the border, 2009-13 ........................................................ 83 
Table 4.1 Value of agricu lture producti on, 2009- 12 ............................................................... 84 
Table 4.2 Agricult ural land , 2009- 12 ................................................................................... 85 
Table 4.3 State-trading arrangement for rice, 2009-12 .......................................................... 87 
Table 4.4 Domestic support to ag riculture and live stock, 2007-10  ........................................... 88 
Table 4.5 Guaranteed purchases of rice ............................................................................... 90 
Table 4.6 Fishery production, cons umption, and trade, 2009-12 ............................................. 93 
Table 4.7 Subsidies to th e fishing se ctor, 2009-12 ................................................................ 94 
Table 4.8 Subsidies to the energy sector, 2009-12 ................................................................ 96 
Table 4.9 Electricity tariffs, 2013 ........................................................................................ 97 
Table 4.10 2020 Industry de velopment obje ctives  .............................................................. 100  
Table 4.11 Banking in dicators, 2009-13 ............................................................................ 102  
Table 4.12 Weighted average interest rates on  deposits and loans and spreads,  2009-13 ......... 103  
Table 4.13 Performance of the insurance sect or, 2009-13 .................................................... 104  
Table 4.14 Performance of the securities sect or, 2009-13 .................................................... 106  
Table 4.15 Telecommunica tions market , 2009-13 ............................................................... 107  
 
BOXES 
 Box 2.1 Organization of the Mi nistry of Econ omic Affairs ........................................................ 25
 
Box 2.2 Key follow-on agr eements under the ECFA ............................................................... 29 
 
APPENDIX TABLES 
 
Table A1.1 Merchandise exports by group of products, 2009-13 ............................................ 117  
Table A1.2 Merchandise imports by  group of prod ucts, 2009- 13 ........................................... 119  
Table A1.3 Merchandise export s by destinatio n, 2009-13  ..................................................... 120  
Table A1.4 Merchandise impo rts by origin , 2009-13  ............................................................ 121  
 
Table A3.1 Tariff lines affected by  schedule changes in 2010 and 2012 .................................. 122  
Table A3.2 Tariff quotas utilization ratio, 2009-13 ............................................................... 124  
Table A3.3 Products subject to import prohibition, 2013 ...................................................... 125  
Table A3.4 Anti-dumping measur es, January 2002-No vember 2013 ...................................... 127  
Table A3.5 Products subject to export prohibition, 2013 ...................................................... 128  
Table A3.6 Products subject to export lice nsing, 2013 ......................................................... 129  
 
Table A4.1 Special safe guard measur es, 2009- 13 ............................................................... 130  
Table A4.2 Trigger price of  price-based SSGs, 2014 ............................................................ 131  
Table A4.3 Electricity produced  and purchased, 2012-13 ..................................................... 132  
Table A4.4 Summarized trade regimes of transport services ................................................. 133  
Table A4.5 Summarized trade regimes of other selected  services .......................................... 140  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  SUMMARY 
Economic environment 1. The Separate Customs Territory of Taiwan, Pe nghu, Kinmen and Matsu (hereinafter referred 
to as Chinese Taipei) remains one of the world's most important economic and trading entities. In 
2012, it ranked 19
th in the world in terms of the size of it s GDP on a purchasing-power parity basis 
and was the 18th largest exporter and 18th largest importer. Possessing scant natural resources, 
the island economy imports virtually all its energy needs and raw materials; on the export side, its 
manufacturing operations satisfy a large proporti on of global demand for semiconductors, flat 
panel displays, precision machine tools, and a wide range of other products. 
2. Economic growth is heavily dependent on exports of goods and services, which are 
equivalent to some 73% of GDP. The sharp drop in global demand owing to the 2008-09 global 
economic crisis exposed the risks associated with dependence on a relatively limited range of 
manufactured exports, prompting the authorities to seek new engines of economic growth and 
diversify the economy. 
3. After growing by 2.1% in 2013, the export-ori ented economy is expected to benefit from 
firmer external demand in the medium term as OE CD economies are likely to post stronger rates 
of expansion. The economy's vulnerability to external demand volatility represents the main risk in 
the medium term. The government's fiscal position means that it has limited resources with which 
to combat fluctuations in external demand. 
4. The economy has become increasingly linked with China and the government is expected to 
further develop these links and liberalize cross-Strait economic relations, in particular through 
negotiations under the Economic Cooperation Framework Agreement (ECFA). The ECFA should 
boost services-sector growth thanks to increased tourism from China due to the introduction of direct flights between the two territories. Increasing tourist arrivals are expected to support 
employment, thus encouraging household consumption to continue as the main growth driver. 
5. With competitive advantages in the information technology manufacturing industries, 
Chinese Taipei is highly competitive and has development potential, according to several world 
competitiveness reports released in recent years.  Nevertheless, the government faces significant 
economic challenges and has set out a programme of economic reforms: signing free-trade agreements; reforming its taxation, land regu lation, services sector, and health system; 
liberalizing cross-Straits economic policies and pursuing structural reforms notably the Economic 
Power-Up Plan and the launching of the Free Economic Pilot Zone Plan. 
6. Chinese Taipei remains a net investor abroad with outbound FDI flows almost treble the 
amount of inbound direct investment. China is by far the main destination for capital outflows. 
Inbound direct investment as a share of GDP rema ins low by regional standards even though most 
sectors are open to inbound FDI. 
Trade policy framework 
7. Trade policy formulation and implementation have remained largely unchanged with the 
Ministry of Economic Affairs taking the lead administrative role.  High level policy coordination is assured by the Committee of Global Economic and Trade Strategy chaired by the premier. 
8. The broad trade policy objectives of Chinese Ta ipei continue to be focused on its further 
integration into the global economy through its active participation in the WTO and, increasingly, 
the negotiation of free-trade agreements and economic-cooperation agreements, the strengthening of trade facilitation and promotion activities, and the reduction of trade barriers in 
overseas markets. Since the signing of the ECFA  with China in 2010, the government has looked 
to negotiate trade deals with countries that do not recognize it diplomatically, its first successes in this regard being the economic cooperation agreements signed with New Zealand and with 
Singapore in 2013. Similar agreements with other economies are likely to follow in the medium 
term and the government is interested in joining the U.S.-led Trans-Pacific Partnership (TPP) as well as the ASEAN-backed Regional Comprehensive Economic Partnership (RCEP). The prospect of WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  further FTAs should support attempts to reform and liberalize the domestic economy over the next 
few years. 
Main trade policy developments 9. The tariff remains Chinese Taipei's main trade policy instrument, accounting for around 5% 
of total tax revenue. The contribution of trade- related taxes (including business tax, commodity 
tax, and tobacco and alcohol tax) to total tax revenue increased from 22.8% in 2009 to 26.8% in 2013; business tax consistently accounted for two thirds of total trade-related tax during the 
review period. 
10. The tariff schedule has barely changed since the previous Review. It consists of ad valorem  
duties, specific duties, and alternate duties. In 2013, ad valorem  rates covered 98.2% of all tariff 
lines, enhancing the transparency of the tariff st ructure. However, there are still 150 rate bands: 
86 ad valorem;  16 specific; and 48 alternate rates. The tariff thus remains relatively complex, 
involving a multiplicity of rates. Non- ad valorem  duties, in particular in agriculture, tend to conceal 
relatively high ad valorem  equivalents (AVEs). 
11. The 2013 tariff comprised 8,728 lines at the eight-digit level: 30.2% of all tariff lines are 
duty free and 52.6% of lines have rates below 10%; 4.4% of lines are "nuisance" rates. The 
simple average applied MFN tariff rate, including the ad valorem  equivalents (AVEs) of non- ad 
valorem  tariff rates, was 7.8% in 2013, the same as in 2009 as no tariff cuts occurred during the 
review period. Based on the WTO definition, th e average applied rate remained at 22.1% for 
agriculture, and at 5.0% for non-agricultural products. TRQs, mainly for agricultural items, dropped from 1.2% of tariff lines in 2009 to 0.8% in 2013. All tariff lines are bound. Applied rates 
are close to or coincide with their bound rates with a simple average bound tariff rate of 8.1%, 
which suggests broad predictability in the tariff. 
12. Regarding trade facilitation, Customs has implemented a single window system to accelerate 
customs clearance and has introduced an authorized economic operator scheme to facilitate 
procedures for traders meeting certain requirements. Since the 2010 Review, Chinese Taipei has increased the scope of its import bans from 63 ten-digit HS items to 70 items. There are no QRs 
although prohibitions are in place for inbound cross-Strait trade involving 2,172 tariff lines, down 
from 2,243 tariff lines in 2009 for both security and commercial reasons.  
13. The legislative and institutional framework for contingency measures remained largely 
unchanged during the period under review. Chinese Taipei has applied a total of 12 anti-dumping 
(AD) measures since 2003, affecting mainly the steel, textile, and chemical industries. It did not 
resort to countervailing or safeguard measures during the review period but maintained a number of AD measures. Special safeguards are applied in agriculture. 
14. There have been no significant changes to  the government procurement regime. The 
percentage of the total value added awarded to non-local suppliers fell from 28% in 2008 to 10.6% in 2009, but rose again to 26.5% in 2012. GPA membership has affected the operation of 
the government procurement regime due to the lengthened time-limit for tendering. 
Chinese Taipei participated in and contributed to the renegotiated GPA, which entered into force on 6 April 2014. According to the authorities, this should add market-access opportunities of NT$3 billion annually. 
15. Different types of assistance, including subsid ies for production and therefore trade, have 
continued to be provided for agricultural, fisheries,  and industrial products and activities. Following 
the phase-out of tax incentives under the Statute for Upgrading Industries, a new incentive was 
introduced under the Statute for Innovative Industries to support innovation and R&D activities. 
16. Government-owned enterprises continue to be dominant in several sectors, notably in 
electricity generation, petroleum, postal services, utilities, telecoms, banking, and land transport. 
The privatization process, which began in 1992, is currently suspended or under re-evaluation, 
except with regard to the aerospace sector. Trading activities of government-owned enterprises involve, inter alia,  rice, the most important crop. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  17. Regarding export measures, the government continues to maintain prohibitions and 
licensing requirements for certain exports mainly  on grounds of security, public safety and 
environmental protection. The government also continues to provide tariff exemption, duty 
drawback, and the facilities and advantages of free zones. The export processing zones (EPZs) and 
free trade zones (FTZs) offer similar incentives for enterprises. Businesses allowed to operate in 
FTZs include trading, collecting, transhipment, forwarding, customs clearance, assembling, packaging, repair, manufacturing, testing, and technological services. Business allowed to operate 
in EPZs include manufacturing, financial services, management services, and information and 
communication. The authorities state that FTZs mainly aim at developing a global logistics industry, while EPZs focus on promoting investment and developing industries. In addition to exemption from import duties, imports to EPZs an d FTZs are exempt from other indirect taxes and 
charges collected at the border. 
18. There have been significant changes to the competition policy framework in terms of 
amendments in 2011 to the Fair Trade Act and the granting of independent status to the Fair 
Trade Commission in 2012. Certain activities such as import cartels may be exempted from the 
application of the Fair Trade Law. Price controls apply to some utility services, including energy and telecom services, and a price stabilization committee monitors prices of certain commodities 
and products with a view to coordinating their supply and demand when necessary. 
19. There have been a number of legislative changes to the IPR-related legislation: the 
Copyright Act was amended in 2010 and 2014, the Copyright Intermediary Organization Act was 
amended in 2010, the new Trademark Act went into force in 2012, the Patent Act was most 
recently amended in 2014, and amendments were  made to the Trade Secret Act in 2013. The 
authorities have been making efforts to shorten the examination process for patents. On enforcement, cases involving imported commodities  infringing trademarks and copyright seem to 
have been declining. The authorities recognize IPR protection as an essential contribution to 
economic development and overall competitiveness, as well as to efforts in attracting foreign investment. IPR enforcement at the border is conducted by Customs, which may suspend ex officio  
the release of goods suspected of infringing IPRs. 
20. The SPS and standards regimes remained largely unchanged during the review period. 
Products subject to mandatory technical regulations are subject to commodity inspection for conformity through market surveillance operations rather than using prior entry controls. SPS 
border inspection procedures have been streamlined. Domestic standards (including national and 
professional standards) are voluntary, except those designated as technical regulations. The 
standards policy is intended to promote standardization; to pursue quality improvement for 
products, processes, and services; to increase prod uctivity; and to ensure adequacy of production, 
transportation, marketing, and consumption so as to promote public safety.  
21. According to the authorities, all technical regulations are aligned with international 
standards. Technical regulations, which form the basis for issuance of conformity certificates, are 
mandatory and applied mainly to electrical products, chemical products, machinery, and agricultural products. Products subject to technical regulations must undergo a commodity inspection for conformity before they are placed on the market. Inspections are required for 
imported, exported, and domestically produced good s. As of February 2014, in addition to 1,853 
agricultural and fishery products, 1,137 commodities were subject to mandatory inspections; among which 756 chemical products and 381 mechanic al, electrical, and electronic products. The 
authorities maintain a website, available to the public, for enquiries on products subject to 
commodity inspection. 
Sectoral policy developments 
22. The structure of the economy is virtually unchanged since the previous Review. Agriculture 
accounts for less than 2% of GDP but despite its limited and deceasing role in the economy, continues to be a major recipient of government assistance, including border protection and domestic support. There has been no significant change to the legislative and institutional 
framework of the agriculture sector since the prev ious Review. Chinese Taipei relies heavily on 
imported food and has a trade deficit in food prod ucts. In terms of the total value of production, 
the main subsectors are fruits, pig rearing, an d vegetables. Rice, while representing a limited 
share of the total value of agricultural production, continues to be the major recipient of 
government assistance, including border protection  through tariffs, tariff quotas, special safeguard WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  measures, state trading arrangements, as well as domestic support including direct payments, 
price support, and interest subsidies. The average applied MFN tariff for agricultural products (WTO definition), including AVEs, is 22.1%, the same as in 2010, compared to 5% for non-agricultural products. 
23. The economy relies heavily on energy imports with fuels accounting for over 25% of the 
overall import bill in 2013, up from 21% in 2009, and 98% of the total energy supply is imported. 
Import tariffs on energy products are relatively low with an average tariff of 1.5%. Licensing is 
required for the import and/or export of some energy products. Subsidies have also been provided 
to encourage the establishment and operation of petroleum facilities in mountain and offshore 
island areas. 
24. During the review period, manufacturing account ed, on average, for a quarter of GDP, and 
around 88% of merchandize exports. Despite the government’s aim to optimize and restructure 
manufacturing industries, it appears to have b een unable to sufficiently counter developments 
such as excessive concentration on ICT, relatively low value-added and insufficient product 
innovation. 
25. Services remain the biggest sector in the economy, accounting for about 66% of GDP and 
59% of employment. The government identified certain services sectors as “key” industries as the 
main focus for further development. Despite this, there have been no significant changes in the 
legislative or institutional framework in the main services sectors, and there have been no significant liberalization measures to further open market access to non-local service suppliers. 
26. Chinese Taipei's GATS commitments cover about 120 of the roughly 160 services 
subsectors. It lists MFN treatment exemptions for the acquisition of land and air transport services, 
which are to be regulated on the basis of reci procal treatment and/or bilateral arrangements. 
Market-access limitations concern, inter alia , financial services (including banking, insurance, and 
asset management), telecommunications (including satellite communications, land-based mobile 
communications, radio, and TV), and some prof essional services (such as legal services, 
accounting, and taxation). 
27. The government has selected ten key services industries, and other industries, as the main 
focus, to promote its industrial development policy. The services industries are: medical tourism, music and digital content, international logistics,  fundraising for high-tech and innovation-oriented 
industries, urban renewal, international promotion of its cuisine, the MICE (meetings, incentives, 
conferencing, and exhibition) industry, WiMAX technology, Chinese-language e-commerce, and 
expanded recruitment of overseas students. A numbe r of key strategies were set out in the action 
plans for these industries, including developing international markets, cultivating talent with 
foreign language and international marketing expertise, and providing loans, guidance, and 
assistance for overseas market expansion. 
28. Among significant subsector developments, th e telecommunication sector has expanded 
rapidly, at an annual average rate of 20% during the review period, roughly ten times that of the 
GDP growth rate. Total revenue from telecommunica tion services accounted for about 3% of GDP 
in 2013, of which mobile services represented the largest share. The tourism sector has also been developing fast, and is one of the government-designated key emerging industries to boost 
economic development. In 2012, there were 7.3 m illion international travellers, an increase of 
20% from 2011. The largest source of arrivals was China, followed by Japan, and Hong Kong, China. The fast growth of tourism reflects, among other things, the increase of cross-Straits 
flights, the opening up to groups and independent visitors from China, and the launch of an open 
skies regime with Japan and with the Republic of Korea. In financial services, government shares 
in total banking assets increased from 52% to 59% during the review period. The banking sector is 
characterized by over-banking with over 400 institutions classified as banks. Only 39 are 
commercial banks but these hold 76% of total banking assets. 
 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  1  ECONOMIC ENVIRONMENT 
1.1  Introduction 1.1.  Despite its more disappointing recent growth performance, at least judged in the context of 
its own impressive record, the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu 
(Chinese Taipei) remains one of the world's most  important economic and trading entities. In 
2012, it ranked 19
th in the world in terms of the size of it s GDP on a purchasing-power parity basis 
and was the 18th largest exporter and 18th largest importer. At the end of the same year, the 
island held the 6th largest reserves of foreign exchange in the world and ranked 35th in terms of its 
cumulative stock of outward foreign direct invest ment (FDI). Possessing scant natural resources, 
the island economy imports virtually all its energy needs and raw materials; on the export side, its 
manufacturing operations satisfy a large proporti on of global demand for semiconductors, flat 
panel displays, precision machine tools, and a wide range of other products. 
1.2.  The economy continues to be characterized by a high savings rate that persistently exceeds 
the rate of investment. The savings-investment gap is reflected in large current account surpluses 
in the balance of payments. Economic growth is heavily dependent on exports of goods and 
services, which are equivalent to some 73% of GDP. The sharp drop in global demand owing to the 2008-09 global economic crisis exposed the risks associated with the dependence of 
Chinese Taipei on a few manufactured exports, pr ompting the authorities to seek new engines of 
economic growth and diversify the economy. 
1.3.  After growing by 2.1% in 2013 (Table 1. 1), the export-oriented economy is expected to 
benefit from firmer external demand in the medium term as OECD economies are likely to post 
stronger rates of expansion. However, its export competitiveness has been eroded by its lack of 
FTAs and the diminished performance of its vital electronics sector. Chinese Taipei's vulnerability to external demand volatility represents the main risk in the medium term. An economic hard 
landing in China, the destination for around 27% of exports could have significant repercussions 
for the economy. The government's fiscal position means that it has limited resources with which to combat adverse fluctuations in external demand. Amid increased international competition, 
Chinese Taipei will come under increasing pressure to overhaul its traditional dependence on 
contract electronics production and move into higher value-added manufacturing and services 
sectors. 
1.4.  Chinese Taipei faces many of the same economic issues as other developed economies. As 
labour-intensive industries have relocated to countries with low-cost labour, its future development 
will rely increasingly on further transformation to a high-technology and service-oriented economy and establishing its place in the global supply chain. The economy has become increasingly linked 
with China and the government is expected to further develop these links and liberalize cross-
Strait economic relations, in particular through negotiations under the Economic Cooperation Framework Agreement (ECFA). The ECFA should boos t services sector growth thanks to increased 
tourism from China due to the introduction of direct flights between the two territories. Increasing 
tourist arrivals are expected to support employment, thus encouraging household consumption to continue as the main growth driver. 
1.5.  With competitive advantages in the IT manufacturing industries, Chinese Taipei is highly 
competitive and has development potential, according to several world competitiveness reports 
released in recent years. Nevertheless, the gove rnment faces significant economic challenges and 
has set out a programme of economic reforms: signing free-trade agreements; reforming its 
taxation, land regulation, services sector and health system; and liberalizing cross-Straits 
economic policies. 
1.2  Recent economic developments 
1.6.  The start of this review period was strongly influenced by the global economic downturn 
when GDP growth plummeted in the second half of  2008 with steep reductions in exports, private 
consumption, and investment. As a result, GDP growth declined to under 1% in 2008, and the economy contracted by 1.8% in 2009. The most important factor in the economic downturn of 
Chinese Taipei following the global financial crisis was the steep decline in both foreign trade and 
domestic investment. In 2009, gross fixed capital formation decreased by more than 11%. In the WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  same year, the contraction in foreign trade was most apparent when exports and imports declined, 
respectively, by 20% and 27%. By contrast, both government and private consumption were much less affected. 
Table 1.1 Selected macroeconomic indicators, 2009-13 
  2009  2010  2011 2012 2013  
Accounts (%age change, unless otherwise indicated)   
Real GDP (at 2006 prices) -1.8 10.8 4.2 1.5 2.1 
   Consumption 1.3 3.3 2.9 1.5 1.4 
        Private consumption 0.8 4.0 3.1 1.6 1.8  
        Government consumption 4.0 0.4 2.2 1.0 -0.3 
   Gross fixed capital formation -11.2 21.1 -2.3 -4.0 5.3 
   Exports of goods and non-factor services -8.7 25.6 4.5 0.1 3.8 
   Imports of goods an d non-factor services -13.1 27.7 -0.5 -2.2 4.0 
          XGS/GDP (%) (at current market price) 62.5 73.8 76.0 73.4 73.0 
          MGS/GDP (%) (at current market price) 53.8 66.8 69.3 65.7 63.6 
Unemployment rate (%) 5.9 5.2 4.4 4.2 4.2 
Prices and interest rates (%, unless otherwise indicated)    
Inflation (CPI, %age change) -0.9 1.0 1.4 1.9 0.8 
Discount rate of the central bank (end-period) 1.250 1.625 1.875 1.875 1.875 
Commercial 1-year deposit rate (end-period) 0.890 1.130 1.360 1.360 1.360 
Commercial base lendin g rate (end-period) 2.563 2.676 2.882 2.883 2.882 
     Interest rate spread 1.673  1.546 1.522 1.523 1.522 
Exchange rate      
NT$/US$ (period average) 33.05 31.64 29.46 29.61 29.77 
Real effective exchange rate (%age change) -6.7 -1.9 -0.5 -1.3 1.2 
Nominal effective exchange rate (%age change) -3.9 1.2 2.5 -0.2 1.9 
Fiscal balancea (% of GDP)      
Total revenue 16.9 15.6 16.8 16.5 17.0 
  Current revenue 16.4 15.2 16.3 16.0 .. 
    Tax revenue 12.3 12.0 12.9 12.8 12.6 
Total expenditure 21.4 18.9 19.1 19.0 18.6 
  Current expenditure 16.1 14.1 14.7 15.5 .. 
Overall fiscal balance -4.5 -3.3 -2.2 -2.5  -1.6 
  Fiscal current balance 0.3 1.1 1.6 0.6 .. 
Revenue of Central Government 12.3 11.1 12.2 11.9 11.9 
Expenditure of Central Government 16.0 14.0 14.0 13.5 12.8 
Fiscal balance of Central Government -3.7 -3.0 -1.8 -1.6 -0.9 
General government debt 38.0 38.3 40.0 41.0 41.5 
Central government debt 33.1 33.5 34.8 35.6 35.8 
Saving and investment (% of GDP)      
Gross national savings 28.5 32.7 30.8 29.8 30.0 
Gross domestic investment 17.7 22.4 20.9 19.8 19.3 
Savings-investment gap 10.8 10.3 10.0 9.9 10.7 
External sector (% of GDP, unless otherwise indicated)    
Current account balance  11.4 9.3 9.0 10.7 11.7 
Net merchandise trade  8.1 6.2 6.1 6.6 7.6 
   Merchandise exports 53.9 63.9 66.1 63.2 62.3 
   Merchandise imports 45.8 57.8 60.0 56.6 54.7 
Services balance 0.5 0.6 0.8 1.3 1.9 
   Services exports 8.4 9.4 9.9 10.3 10.6 
   Services imports 7.9 8.8 9.0 9.0 8.7 
Financial account 3.6 -0.1 -6.9 -6.7 -8.4 
   Direct investment -0.8 -2.1 -3.2 -2.1 -2.1 
Balance of payments 14.3 9.4 1.3 3.3 2.3 
Terms of trade (2005=100) 83.1 79.2 73.7 73.5 75.3 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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    2009  2010  2011 2012 2013  
Merchandise exports (%age change) -20.2 34.6 12.3 -2.3 1.4 
Merchandise imports (%age change) -26.9 43.1 12.9 -3.7 -0.4 
Service exports (%age change) -13.7 27.0 13.8 6.9 5.1 
Service imports (%age change) -14.9 27.1 11.0 1.8 -0.9 
Foreign exchange reserves (US$ billion) 348.2 382.0 385.5 403.2 416.8 
   in months of imports of goods and servicesb 20.6 16.1 14.4 15.5 16.1 
Total external debt (US$ billion) 82.0 101.6 122.5 130.8 170.4 
   Short term (US$ billion) 68.2 83.7 107.8 116.5 155.9 
Debt service ratioc 2.6 1.2 2.2 1.2 2.0 
.. Not available. 
 a Based on general government, including central and local government. Data for 2013 are 
provisional. 
b Import figures taken from the balance of payments. c Debt service in % of exports of goods and services.  Source: Table reproduced from the Ce ntral Bank Statis tics. Viewed at: http://www.cbc.gov.tw ; Statistics 
online information. Viewed at: http://eng.stat.gov.tw ; and data provided by the authorities. 
1.7.  From the perspective of mid-2010, signs of recovery in the global economy were expected to 
generate stronger GDP growth in Chinese Taipei . In the event, the economy rebounded strongly, 
recording annual GDP growth of 10.8%, while GDP per capita increased to reach US$18,503. Weak 
internal and external demand was a constraint on growth in 2011 and 2012, with the rate of 
increase of aggregate and per capita GDP slowing considerably. 
1.8.  Affected by the severity of the spreading euro-zone debt crisis and the U.S. fiscal situation, 
as well as the slowing of China's economic grow th, Chinese Taipei experienced export shrinkage 
and a slump in investment in 2012, with an economic  growth rate of 1.5%, falling well short of the 
government target of 4.3%. 
1.9.  Commodity price inflation was moderate in 2012 and the CPI rose by 1.9%, due to the 
reduction of oil and electricity subsidies, but still meeting the target of not exceeding 2%. Inflation 
was expected to remain stable in 2013 at under 1%, with the rise in regulated electricity prices planned for December 2012, postponed to October 2013. The labour market showed stability with 
an unemployment rate of 4.2% in 2012 and 2013, the lowest in four years. 
1.10.  After a period of weak growth, the econom y showed signs of recovery in 2013. The mild 
economic growth that has been achieved is mainly due to weak or negative expansion in imports of goods and services, with net exports serving as the main driver. Inflation averaged only 0.8% in 
2013, the lowest rate in four years, with weak demand and moderating global commodity prices 
reducing upward pressure on prices.  
1.11.  The sectoral composition of the economy has changed very little since its previous review in 
2010 (Table 1.2). In 2013, the agriculture sector generated 1.7% of GDP, and accounted for 5% 
of total employment. Agriculture is likely to continue to decline in importance as local producers become less able to compete with cheaper goods from overseas. 
1.12.  During the review period, manufacturing a ccounted for about a quarter of GDP, with growth 
in the sector providing a boost to domestic demand through a multiplier effect. The fortunes of the 
electronics export sector, which ranges from personal computers through optoelectronics and semiconductors, tend to drive manufacturing and in dustrial activity. The services sector accounts 
f o r  a r o u n d  6 5 %  o f  G D P  a n d  n e a r l y  5 9 %  o f  e m p l o y m e n t .  I t  i s  l i k e l y  t h a t  t r a d e  g r o w t h  i n  t h e  
medium term will help the expansion of trade-related services and further support may be provided by improvements in economic and trade links with China, which will facilitate cross-Strait 
service operations of firms and financial institutions. Tourism has the potential to become a more 
important foreign exchange earner, although receipts from tourism accounted for little more than 2.3% of GDP in 2012. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Table 1.2 Basic economic indicators, 2009-13 
  2009  2010  2011  2012 2013  
Real GDP (NT$ billion, 2006 prices) 12,834.0 14,215.1 14,810.7 15,029.9 15,346.4 
Real GDP (US$ billion, 2006 prices) 406.9 430.1 468.1 510.1 515.5 
Current GDP (NT$ billion) 12,481.1 13,552.1 13,709.1 14,077.1 14,564.2 
Current GDP (US$ billion) 377.7 428.3 465.3 475.4 489.2 
GDP per capita at current market price (US$) 16,359.0 18,503.0 20,057.0 20,423.0 20,958.0 
GDP by economic activity at constant 2006 prices (annual %age change)  
Agriculture, forestry and fi shing -3.0 1.7 6.4 -1.6 0.2 
Mining and quarrying 4.4 13.6 1.4 10.1 -5.7 
Manufacturing -4.3 25.5 6.8 1.8 2.0 
Electricity, gas and water 0.1 5.0 0.4 2.6 0.2 
Construction -6.8 11.8 2.2 -2.3 0.8 
Services -0.2 4.8 3.2 1.2 1.5 
   Wholesale and retail trade -1.0 5.1 4.2 -0.2 1.0 
   Transport and storage -3.5 8.0 3.0 0.9 2.7 
   Restaurants and hotels -1.3 9.7 9.2 2.3 1.0 
   Information and communication 4.2 8.9 4.7 3.7 1.6 
   Finance and insurance -7.7 6.5 3.7 0.8 2.5 
   Real estate 1.9 3.1 1.2 2.2 2.8 
   Professional, scientific and technical services 2.8 7.6 3.2 0.0 3.2 
   Support services -1.8 8.0 5.0 4.6 3.8 
   Public administration and defence 0.8 3.1 0.3 0.8 -0.7 
   Education 2.4 0.8 1.4 1.0 0.7 
   Human health and social work 4.8 0.3 4.3 0.0 0.8 
   Arts, entertainment and recreation 3.1 4.7 5.3 4.5 3.4 
   Other services 2.3 4.9 2.7 4.3 1.0 
GDP (production approach) by economic  activities at current prices (%)   
Agriculture, forestry and fishing 1.7 1.6 1.8 1.8 1.7 
Mining and quarrying 0.4 0.5 0.2 0.3 0.4 
Manufacturing 23.8 25.9 25.2 24.4 24.9 
Electricity, gas and water 2.0 1.8 1.6 1.5 1.8 
Construction 2.7 2.8 2.9 2.8 2.9 
Services 66.7 64.4 65.2 66.2 65.2 
   Wholesale and retail trade 18.7 18.3 18.8 18.9 18.5 
   Transport and storage 3.0 3.2 3.0 3.1 3.0 
   Restaurants and hotels 2.1 2.0 2.1 2.2 2.3 
   Information and communication 3.7 3.6 3.6 3.5 3.4 
   Finance and insurance 6.4 6.3 6.5 6.5 6.5 
   Real estate 9.2 8.6 8.6 8.7 8.8 
   Professional, scientific and technical services 2.3 2.2 2.3 2.3 2.3 
   Support services 1.5 1.4 1.5 1.6 1.6 
   Public administration and defence 7.7 7.3 7.2 7.4 7.0 
   Education 5.0 4.6 4.6 4.7 4.5 
   Human health and social work  3.2 3.0 3.1 3.2 3.2 
   Arts, entertainment and recreation 0.9 0.9 0.9 1.0 1.0 
   Other services 3.1 3.0 3.0 3.2 3.1 
Othera 2.6 2.9 3.1 3.0 3.1 
Share of sector in total employment (%)      
Agriculture, fore stry and fishing 5.3 5.2 5.1 5.0 5.0 
Mining and quarrying 0.05 0.04 0.04 0.04 0.04 
Manufacturing 27.1 27.3 27.5 27.4 27.2 
Electricity, gas and water 1.0 1.0 1.0 1.0 1.0 
Construction 7.7 7.6 7.8 7.8 7.9 
Services 58.9 58.8 58.6 58.8 58.9 
   Wholesale and retail trade 16.9 16.6 16.5 16.6 16.6 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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    2009  2010  2011  2012 2013  
   Transport and storage 3.9 3.9 3.8 3.8 3.9 
   Restaurants and hotels 6.7 6.9 6.8 6.9 7.1 
   Information and communication 2.0 2.0 2.0 2.1 2.1 
   Finance and insurance 4.0 4.1 4.0 3.9 3.8 
   Real estate 0.7 0.7 0.8 0.8 0.8 
   Professional, scientific and technical services 3.1 3.1 3.2 3.1 3.2 
   Support services 2.3 2.2 2.3 2.4 2.4 
   Public administ ration and defence 3.7 3.7 3.6 3.5 3.5 
   Education 6.0 5.9 5.9 5.8 5.8 
   Human health and social work 3.6 3.7 3.8 3.9 3.9 
   Arts, entertainment and recreation 0.9 0.9 0.9 0.9 0.9 
   Other 5.1 5.1 5.0 5.0 4.9 
a Including import  duties and value-added tax. 
 Source: Statistics online information. Viewed at: http://eng.stat.gov.tw ; and data provided by the 
authorities. 
1.13.  Chinese Taipei boasts a well-educated workforce and the labour market is likely to remain 
stable. The overall burden of labour and wage regulation is relatively light and the costs of the 
mandatory health and pension schemes for workers are not a primary concern for companies. The likely fall in the island's working population fr om 2016 may increase pressure on the authorities to 
reconsider restrictions on the employment of foreign workers. 
1.3  Macroeconomic policies 1.14.  Fiscally, Chinese Taipei remains in a strong position. As of the end of 2012, its foreign 
reserves were the sixth largest in the world, at  over US$400 billion. The currency, the NT dollar, 
floats freely and the role of the central bank in monitoring the currency and managing the inflow of 
foreign capital remains flexible. The fiscal deficit of the central government improved from 3.7% of GDP in 2009 to an estimated 1.4% in 2014 as both the deficit and net borrowings of the central 
government budget are gradually being reduced. 
1.3.1  Fiscal policy 1.15.  In order to accumulate financial resources to support major policies and public construction, 
the government has adopted significant fiscal measures to achieve healthy public finances and 
sustainable economic growth. These measures include: control of the debt limit in accordance with the Public Debt Act; restructuring of expenditur e and review of inefficiencies in expenditure; 
development of multiple channels for cultivating government financial resources; and provision of 
incentives to promote private participation in infrastructure projects. 
1.16.  Progress towards reducing the large budget deficit that emerged as a result of the fiscal 
stimulus applied during the 2008-09 global financial crisis was uneven during the review period, as 
weak economic expansion curtailed growth in tax receipts. The government has tightened growth 
in public spending in recent years but has shown few signs of complementing fiscal discipline with tax increases. The revenue base was the equivalent of an estimated 16.5% of GDP in 2012, a low 
level by advanced-economy standards, and is forecast to remain at around this level in the 
medium term. Tax revenues remained at a constant  12% to 13% of GDP during the review period; 
according to the authorities, the central government did not sell its shares in state-owned companies during the period. The general government debt to GDP ratio rose to 41.5% in 2013, 
up from 38% in 2009. 
1.3.2  Monetary and exchange rate policies 1.17.  The Central Bank (CBC) is responsible for the formulation and implementation of monetary 
policy. Under legislation dating from 1979, it is re quired to perform the functions of both a central 
bank and a financial regulator. It manages the mo ney supply and credit, serves as the fiscal agent 
of the government, issues currency, regulates foreign exchange activities, and monitors banks and WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  other financial institutions. Chinese Taipei maintains a managed float exchange rate system, under 
which the exchange rate is determined in principle by market forces.  
1.18.  The CBC has tended to favour allowing the NT dollar to strengthen in order to combat 
inflation. In the medium term, substantial current account surpluses will help to ensure that the 
currency strengthens in real terms against the U.S.  dollar. However, inward and outward flows of 
speculative capital will continue to play a significant role in determining changes in the NT dollar's value. Since the U.S. Fed signalled that it ma y taper the size of the bond-buying programme, 
Chinese Taipei has seen capital outflow from em erging economies and the depreciation of their 
currencies. The NT dollar weakened by 0.5% against the U.S. dollar on average in 2012 amid relatively weak global trade flows.  
1.19.  During 2013, the CBC continued to keep the NT dollar exchange rate relatively stable. 
Nevertheless, when seasonal or irregular factors (such as massive flows of short-term capital) lead 
to excessive volatility and disorderly movements in the NT dollar exchange rate with adverse implications for economic and financial stability, the CBC may step in to maintain an orderly 
market. 
1.20.  Since 2011, the CBC has kept interest rates unchanged, leaving its main policy interest rate, 
the discount rate, at 1.875%. The authorities might resume tightening monetary policy in 2014, 
when the recovery of their economy should be more solidly established. The central bank's 
capacity to maintain a relatively loose monetary policy stance is likely to be supported by relatively subdued inflation. 
1.21.  The post-crisis period has been marked by large capital inflows, betting on appreciation of 
the NT dollar. The Financial Supervisory Commission (FSC) did not introduce any new measures in 
2011-12 aimed at controlling capital inflows, in particular. Nor did the FSC take any measures 
prohibiting non-residents from holding deposits. During 2013, the CBC was expected to continue 
intervening on the foreign exchange market to limit the appreciation of the currency, accumulating 
foreign exchange reserves to protect the econom y from a foreign exchange liquidity crisis.  
1.4  Structural policies 
1.22.  During the review period, the government co ntinued to pursue structural reform as a means 
of increasing the efficiency and competitiveness of  the domestic economy. In order to adjust its 
industrial structure, in 2009 the government selected a number of industries as the main focus for economic development. These included the so -called six emerging industries (including 
biotechnology, green energy, cultural and creative  industries), the four intelligent industries 
(including cloud computing and electric vehicles),  and the ten major service industries (including 
international medical care services and international logistics services). To accelerate the 
adjustment process, in 2012 the authorities launched the Economic Power-up Plan, which aims 
inter alia to strengthen export competitiveness. In 2013, Chinese Taipei launched the Free 
Economic Pilot Zones  plan, which demonstrates its strong ambition to participate in regional 
economic integration and marks an important chan ge in its development strategy to emphasize 
innovation over investment. 
1.23.  In line with the policy of reducing taxe s while simplifying govern ment administration, the 
tax on business profits was lowered to 17% in 2010, and R&D tax incentives were kept in place in 
a wide range of businesses in order to encourag e long-term innovative R&D by enterprises. The 
"Negative List for Investment by Foreign Na tionals" was amended in 2010, 2012, and 2013 in 
order to further reduce limitations and restrictions on foreign investors. In addition, in order to 
facilitate the approval process for FDI, the government submitted draft amendments to the 
"Statute for Investment by Foreign Nationals", which are undergoing examination by the legislature.
1 It is expected that once these amendments take effect, most foreign investors will 
only need to notify the Investment Commission as the investment is implemented rather than 
having to file an application for approval in advance. 
                                               
1 Online information available at: www.ly.gov.tw. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  1.5  Balance of payments 
1.24.  During the period under review, the balance-of-payments current account showed a 
persistent surplus, owing to a high savings rate that consistently exceeded the investment rate. 
The current account surplus reached 10.7% of GDP in 2012, and 11.7% in 2013, according to the 
authorities. The merchandise trade surplus increased in 2012 and 2013, representing 6.6% and 
7.6% of GDP respectively, following a period of  sub-par expansion in value terms due to weak 
global demand conditions for technology products. The small surplus on the services account rose 
to 1.9% of GDP in 2013, with tourism earnings boos ted by significant expansion in visitor arrivals 
from China. As noted above, foreign exchange re serves continued to increase, reaching almost 
US$417 billion in 2013, equivalent to 16 months of merchandise and services imports. 
1.6  Trade and investment flows 
1.25.  A rapid expansion in international trade has fuelled economic growth. In 1992, total trade 
represented 70% of GDP and by 2012, the total me rchandise trade of Chinese Taipei (exports + 
imports) represented almost 120% of GDP and wa s valued at over US$571 billion, making it the 
world's 18th largest trader (though it is only the 26th largest economy in the world). The economy 
is thus highly dependent on international trad e. Between 2005 and 2012, net exports were the 
most important driver of growth, focused on producing parts and components that are 
incorporated into final products, often sold by companies from Japan, the United States or the EU. 
1.26.  The global economic crisis, which began in 2008, sharply decreased Chinese Taipei's trade 
in 2009 with exports and imports falling by 20.2% and 26.9% respectively and real GDP declining 
by 1.8% over the previous year. However, global economic recovery, especially in China, boosted 
exports and imports by 34.6% and 43.1% respectively in 2010; in the same year its real GDP 
grew by 10.8%. Exports and imports increased furt her in 2011 under the impetus provided by the 
E C F A  a s  w e l l  a s  r i s i n g  d e m a n d  f o r  e l e c t r o n i c  a n d  m a c h i n e r y  p r o d u c t s  a s  a  r e s u l t  o f  i n c r e a s i n g  
labour costs in China. However, the upward momentum was not maintained in 2012 when the 
total value of trade declined by 3% under the impact of slowing growth in some major economies and weakening external demand, before exports made a modest recovery in 2013. 
1.6.1  Composition of trade 
1.27.  The structure of trade has changed signif icantly since the 1960s, when raw and processed 
agricultural goods began to be replaced by manufactured products as the dominant export category. Manufactured products accounted for around 88% of exports between 2009 and 2013 
(Chart 1.1 and Table A1.1), and these exports shif ted from labour-intensive to capital-intensive 
goods and subsequently to knowledge- and techno logy-intensive products. In 2013, machinery 
and transport equipment accounted for over 40% of total merchandise exports and within this 
category electronic integrated circuits and micro-assemblies remain the single most important 
export item. 
1.28.  Imports have comprised mainly raw materials, particularly fuel, and semi-finished goods 
required for production, with the balance made up  by consumer goods. The composition of imports 
continued to shift during the period under review mainly because of the increased share of fuel in the total import bill, which climbed from 21.4% in 2009 to 25.5% in 2013 (Chart 1.1 and Table A1.2). The share of manufactures in tota l merchandise imports decreased from 64.3% to 
60.8% over the same period. The main categories continued to be office machines and telecoms 
equipment and chemicals. Imports declined sharply as a result of the global financial crisis of 
2008-09, especially of base metals and minerals.  
1.6.2  Direction of trade 
1.29.  Chinese Taipei's main export markets continue to be East Asia (China; Hong Kong, China; 
Singapore; and Japan), the United States, and th e European Union (Chart 1.2 and Table A1.3). 
China is its major export market receiving 26.8% of total merchandise exports in 2013 (slightly up 
from 26.6% in 2009). The shares of other Asian countries such as Korea, the Philippines and Viet Nam and Thailand also increased during the review period while the shares of the U.S., EU, 
Japan and Hong Kong, China declined. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Chart 1.1 Product composition of merchandise trade, 2009 and 2013 
2009 2013
(a)    Exports (f.o.b.)
Other consumer goods
13.2%
Manufactures
88.5%
Total:   US$203. 5 billion Total:  US$305.4 billion
(b)    Imports (c.i.f.)
Chemicals
13.7% Iron & steel
3.1%Manufactures
64.3%Office machines &
telecommunication 
equipment
19.9%Other electrical
machines  
4.1%
Non-electrical 
machinery
8.8%Other
1.6%Other electrical 
machines
3.7%Office machines & 
telecommunication equipment
31.7%
Other semi-manuf.  
3.3%
Chemicals
13.3%Manufactures
60.8%Office machines &
telecommunication
equipment
17.4%
Total:   US$174.9 b illion Total:   US$269.9 billionManufactures
87.4%Other electrical
machines
6.1%Fuels
7.5% Other electrical 
machines
8.0%
Other consumer 
goods
11.2%
Other
2.0%Office machines & 
telecommunication equipment
30.4%Textiles &  clothing  
4.3% Other
5.1%
Other semi-manuf.  
6.0%
Non-electrical 
machinery
6.8%Transport equipment
4.1%Fuels
5.5%
Other consumer goods
11.0%Other consumer 
goods
12.4 Textiles & clothing
3.7%
Other semi-manuf.
5.7%
Non-electrical 
machinery
5.8%
Other semi-manuf.
3.6%Transport equipment
4.3%
Agriculture
5.5%Agriculture
5.9%
Iron & steel
3.2%Iron & steel
4.2%Iron & steel
3.7%
Chemicals
12.7% Chemicals  
12.9%Other 
5.9
Fuels
25.5% Fuels
21.4%
Other mining
6.2%Other mining  
6.4%Non-electrical 
machinery
8.8%
 
Source: UNSD, Comtrade database (SITC Rev.3) ; and data provided by the authorities. 
 
 
 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Chart 1.2 Direction of merchandise trade, 2009 and 2013 
2009 2013
(a)    Exports (f.o.b.)
Asia
70.2%
Total:   US$203. 5 billion Total:  US$305.4 billion
(b)    Imports (c.i.f.)
Other 
5.0%
China
14.0%EU27
9.0%
Other Middle East
7.8%Saudi Arabia
5.0%United States
10.5%
Africa
2.2%EU27
8.8%
China
15.8%Australia
2.9%
Saudi Arabia
5.8%United States
9.3%
Total:   US$174.9 billion Total:   US$269.9 billionJapan
7.1%
Other 
Middle East
10.3%Korea, Rep. of
5.8%Korea, Rep. of  
6.0%United States
11.6% Other Asia
9.1%United States
10.7%Other 
5.4%
Japan
16.0%China
26.8%Singapore
6.4%EU27
8.3%
China
26.6%Singapore
4.2%
Japan
20.8%Other
4.9%
Other Asia
14.2%Hong Kong, China
12.9%EU27
10.5%Other
4.9%
Viet Nam
2.9%Other America
2.9%
Hong Kong, China
14.5%
Japan
6.3%Philippines
3.2%Other Asia
10.2%
Australia
3.4%Other Asia   
13.5%Korea, Rep. of
3.6%Viet Nam
2.9%
Korea, Rep. of
4.0%Philippines
2.2%
Asia
54.7%Asia
57.7%Asia
72.6%
Other America
3.1%Other America
2.9%Other America
2.9%
Africa
3.0%
 
Source: UNSD Comtrade database; and data provided by the authorities. 
1.30.  Asian countries supply around 55% of imports to Chinese Taipei; Japan is still the most 
important source. Chinese Taipei has a traditional large deficit with Japan, from which it imports machinery and equipment, mainly for its local IT industry, while it maintains a substantial trade surplus with China, to which it exports components for assembly into final products exported to 
industrialized countries. Imports from Middle Eastern countries consist largely of oil. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  1.6.3  Trade in services 
1.31.  During the review period, Chinese Taipei has been a net exporter of services, running a 
surplus in the services account, amounting to 1.9% of GDP in 2013 (Table 1.3). This is mainly due to high receipts in "other business services" which helped to offset payments for transport, travel 
and other services. According to the authorities,  other business services consist of: merchanting 
and other trade-related services; operational leasing services; and miscellaneous business, professional, and technical services. 
Table 1.3 Trade in services, 2009-13 
  2009  2010  2011 2012 2013  
Total credit (US$ million) 31,774  40,357  45,920 49,111 51,640  
 (% of total credit) 
Transport 20.0 24.2 21.1 20.3 19.5 
Travel 21.5 21.6 24.1 24.0 24.5 
Communications 1.1 1.0 1.0 1.0 0.9 
Construction 0.9 0.9 0.8 0.9 0.7 
Insurance 1.5 1.1 1.1 1.2 1.1 
Finance 2.3 2.1 2.0 1.9 2.3 
Computer and information 0.4 0.5 0.8 1.0 1.7 
Royalties and licence fees 0.8 1.1 1.8 1.9 2.0 
Other business servicesa 50.2 46.6 46.4 46.9 46.2 
Personal, cultural and recreational 0.3 0.2 0.3 0.3 0.4 
Government 1.2 0.6 0.6 0.6 0.5 
Total debit (US$ million) 29,783  37,864  42,026 42,763 42,371  
 (% of total debit) 
Transport 26.1 26.1 24.4 24.5 24.9 
Travel 26.2 24.7 24.1 24.9 29.0 
Communications 1.4 1.2 1.3 1.4 1.9 
Construction 0.3 0.6 0.6 1.0 1.1 
Insurance 3.0 2.6 2.7 3.0 2.8 
Finance 1.1 0.5 0.6 0.6 0.8 
Computer and information 1.1 1.1 1.1 1.3 1.4 
Royalties and licence fees 11.5 13.1 13.8 10.6 9.0 
Other business servicesa 26.3 27.4 29.1 30.3 26.8 
Personal, cultural and recreational 0.7 0.6 0.6 0.7 0.6 
Government 2.4 2.0 1.7 1.7 1.6 
 
a Including mainly the receipts from "merchanting", i.e. the net income generated by finance 
departments of Chinese Taipei-based companies for ha ndling receipts and paym ents of export orders 
on behalf of their manufacturing sites located in China and south-east Asian countries. 
 Source: Central Bank online information; and data provided by the authorities. 
1.6.4  Foreign direct investment (FDI) 
1.32.  Statistics on FDI are available from the Investment Commission (IC) and the Central Bank 
(CBC). CBC publishes FDI arrivals on a quarterly and yearly basis; CBC data contained in BOP 
statistics are not classified by industry or country. The IC publishes monthly and yearly foreign 
investment statistics by industry and by country, although they may not correspond exactly to realized investment. The authorities note that, in practice, the FDI statistics of the Investment 
Commission are collected on the basis of IC's approved investment projects and include country 
and industry categories. On the other hand, accordin g to the authorities, statistics collected by the 
CBC are based on transactions in the foreign ex change market and may differ from those of the 
IC. 
1.33.  Although Chinese Taipei frequently scores relatively well in international competitiveness 
surveys, those rankings do not translate into high levels of inbound investment. During the review period, inbound FDI remained in the region of 1%  of GDP (Table 1.4). At US$5.3 billion in 2013, WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  FDI remains low compared with regional economies such as Thailand, Viet Nam, Singapore, and 
the Republic of Korea. Chinese Taipei has struggled  to increase FDI inflows in recent years which, 
in part, reflects a difficult global environment but also the declining price competitiveness of the manufacturing sector, stalled trade liberalization, and a failure to address regulatory concerns of 
foreign investors in matters such as land purchasing and services sector access. 
Table 1.4 Inbound and outbound flows of dire ct investment by source and destination, 
2009-13 
(US$ million and %) 
 2009  2010  2011  2012 2013  
Inbound direct investment       
Total (US$ million) 4,835.4 3,905.9 4,999.2 5,887.1 5,294.3 
% of GDP 1.3 0.9 1.1 1.2 1.1 
By source (%)       
United States 5.5 8.2 14.8 6.9 11.0 
Japan  4.9 10.3 8.9 7.0 7.7 
Hong Kong, China 5.7 4.3 8.0 6.2 7.0 
Singapore 1.4 3.2 16.6 2.6 3.9 
Netherlands 20.5 10.9 10.6 20.4 4.5 
United Kingdom 18.3 16.6 1.8 1.1 1.2 
British Overseas Territory in the 
Caribbean 22.8 27.1 22.6 23.5 27.2 
Others 20.9 19.5 16.8 32.4 37.5 
Outbound direct investment       
Total (US$ million) 10,148.2 17,441.3 18,073.5 20,890.7 14,424 
% of GDP 2.7 4.1 3.9 4.4 2.9 
By destination (%)       
United States 11.0 2.8 4.0 0.7 2.9 
China 70.4 83.8 79.6 61.2 63.7 
Hong Kong, China 2.4 1.4 1.4 1.4 2.2 
Singapore 0.4 0.2 2.5 21.5 1.1 
Viet Nam 2.4 3.8 2.5 4.5 12.0 
British Overseas Territory in the 
Caribbean 5.4 3.3 4.4 0.8 1.6 
Others 8.2 4.7 5.6 9.8 16.5 
 
Source: Information provided by th e Investment Commission, MOEA at: 
http://www.moeaic.gov.tw/system_external/ctlr?PRO=PubsCateList&cid=5 . 
1.34.  Chinese Taipei continues to be a net investor abroad. According to balance-of-payments 
statistics, total outbound direct investment reached almost US$14.4 billion in 2013, nearly three 
times as much as inbound direct investment. China remained by far the main destination, receiving between 61% and 84% of total investment outflows during the review period. Most 
outbound direct investment was in the manufacturing sector, although its share declined from 
67% in 2009 to 54.4% in 2013 (Table 1.5). Its businesses have been relocating their production bases to China since the late 1980s. The WTO accessions of China in 2001 and Chinese Taipei in 
2002 prompted firms to accelerate this relocation to improve their competitive edge in exports. 
1.35.  The cumulative approved FDI from Chinese Taipei to China from 1991 to 2012 was 
US$124.5 billion, 81% of which in manufacturing. The top sectors of cumulative FDI include: electronic parts and components manufacturing; computers, electronic and optical products 
manufacturing; electrical equipment manufacturing; wholesale and retail trade and fabricated 
metal products manufacturing. The level of its investment in China may be under-reported as many investors are believed to invest there through a Hong Kong entity in order to avoid scrutiny 
by the government of Chinese Taipei. More than 1 million of its people are estimated to be residing 
in China and more than 70,000 of its companies ha ve operations there. The authorities point out 
that in order to protect the rights and interests of investors, promote mutual investments, create 
an impartial investment environment and enhance cross-Strait economic prosperity, the WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  cross-Strait Bilateral Investment Protection and Promotion Agreement was signed and ratified in 
August 2012, making the above-mentioned phenomenon less likely to happen. 
Table 1.5 Inbound and outbound flows of  direct investment by activity, 2009-13 
(approval basis) 
(US$ million and %) 
  2009  2010  2011  2012 2013  
Inbound direct investment       
Total (US$ million) 4,835.4 3,905.9 4,999.2 5,887.1 5,294.3 
% of GDP 1.3 0.9 1.1 1.2 1.1 
By activity (%)       
Agriculture, hunting, forestry & fishing 0.1 0.1 0.6 0.0 0.1 
Mining and quarrying  0.0 0.0 0.1 0.0 0.0 
Manufacturing 20.7 34.7 29.5 25.6 35.6 
Electronic parts and components 5.1 9.2 11.9 11.1 15.8 
Electricity, gas and water 0.9 2.7 2.1 1.2 2.9 
Construction 0.5 0.9 1.3 0.8 0.7 
Services 70.1 60.9 65.1 72.4 63.0 
Wholesale and retail trade 13.8 10.2 15.1 18.3 14.2 
Finance and insurance  46.6 39.8 36.8 37.4 26.5 
Outbound direct investment       
Total (US$ million) 10,148.2 17,441.3 18,073.5 20,890.7 14,422.4 
% of GDP 2.7 4.0 3.9 4.40 2.94 
By activity (%)       
Agriculture, hunting,  forestry & fishing 0.1 0.1 0.0 0.0 0.0 
Mining and quarrying 0.0 0.1 0.1 0.0 6.9 
Manufacturing 67.0 68.5 63.8 48.1 54.4 
  Basic metal 0.9 1.9 3.2 4.2 12.8 
  Electronic parts and components 21.2 28.8 21.7 15.8 9.0 
  Computers and electronics 10.7 7.5 9.0 7.5 9.1 
  Electrical equipment 4.9 4.1 3.7 2.3 3.7 
Electricity, gas and water 0.2 0.3 0.0 0.0 0.0 
Construction 0.3 0.5 0.4 0.3 0.3 
Services 29.7 29.2 35.2 51.4 38.1 
Wholesale and retail trade 10.2 7.7 8.5 7.5 9.6 
Finance and insurance 14.2 10.0 15.5 31.1 18.8 
 
Source: Information provided by th e Investment Commission, MOEA at: 
http://www.moeaic.gov.tw/system_external/ctlr?PRO=PubsCateList&cid=5 . 
1.36.  Chinese Taipei factories based in China use the lower labour and land costs to process 
domestic inputs into finished goods for export to industrial markets such as the United States, 
Japan, and the EU, and for final sale in China. Recently, however, rising labour and land costs in China have prompted some firms to move from China to other Asian economies such as Viet Nam. 
Some firms have also shifted to producing higher  value-added goods and higher-tech products in 
China. 
1.37.  During the review period, FDI inflows to high tech industries, including electronic parts and 
components, picked up, while there was a relative decline in investments in the financial sector. 
The main sources of inbound investment during the review period were the United States; Japan; 
Hong Kong China; and the Netherlands. FDI also flows from the tax havens of British Territories which include a number of multinational corporations, including those originating from 
Chinese Taipei. The bulk of their investment has been directed towards financial services, real 
estate, and wholesale and retail trade. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  2  TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
2.1  Introduction 2.1.  The broad trade policy objectives of the Separate Customs Territory of Taiwan, Penghu, 
Kinmen and Matsu (Chinese Taipei) continue to be focused on its further integration into the global 
economy through its active participation in the WTO and, increasingly, the negotiation of free-
trade agreements and economic-cooperation agreem ents, the strengthening of trade facilitation 
and promotion activities and the reduction of trad e barriers in overseas markets. Since the signing 
of the ECFA with China in 2010, the government has looked to negotiate trade deals with countries 
that do not recognize it diplomatically, its first success in this regard being the economic cooperation agreement signed with New Zealand in 2013. Similar agreements with other economies are likely to follow in the medium term  and Chinese Taipei has also expressed interest 
in joining the U.S.-led Trans-Pacific Partnership (TPP) as well as the ASEAN-backed Regional 
Comprehensive Economic Partnership (RCEP). The prospect of further FTAs should support attempts to reform and liberalize the domestic economy over the next few years. 
2.2.  Chinese Taipei's many science-based indust rial parks, export-processing zones and free-trade 
zones provide favourable trade and investment opportunities. While Chinese Taipei frequently scores relatively well in international competitiveness surveys
1, its levels of inbound investment 
are not high, compared to other regional econom ies like the Republic of Korea, Singapore, 
Thailand, and Viet Nam. Chinese Taipei remains a moderate recipient of inward FDI in the east-Asian region with inflows concentrated in ma nufacturing, finance, and insurance services, and 
averaging around only 1% of GDP. During th e review period, the government continued to 
liberalize its regulations with respect to FDI and it is generally expected that investors from China 
will continue to stimulate investment. 
2.2  General institutional framewor k for making and enforcing policies 
2.3.  Chinese Taipei states as follows: the central government consists of the Office of the 
President and five branches, or yuans: the Execut ive Yuan, the Legislative Yuan, the Judicial Yuan, 
the Examination Yuan, and the Control Yuan.
2 The executive, or cabinet, is the main policy-making 
arm of government, and there are 14 ministries and 15 agencies under it.  
2.4.  The legislature is the law-making body, comprising 113 legislators, elected to four-year 
terms. In addition to making laws, its functions include questioning government officials and ministers on policies, and reviewing budgetary bi lls and audit reports. The members of the civil 
service are selected through an examination pr ocess by the examination branch. The judicial 
branch comprises a lower court, a court of ap peals, and a supreme court. The courts are 
independent. The control branch serves as a watchdog body exercising the powers of 
impeachment, censure, and audit.
3 
2.5.  A natural or juridical person whose rights and interests in a matter relating to WTO issues 
may be impaired by an administrative action in Ch inese Taipei is permitted to appeal such action, 
in principle to the Administrative Court, provided that relevant requirements are met under the 
Administrative Litigation Act. 
2.6.  Trade and other such agreements enter into  force after being ratified and promulgated and 
have the same force and effect as domestic laws. 
                                               
1 The World Bank ranked Chinese Taipei 16th out of 183 economies for "Ease of Doing Business" in 2014, 
up from 25th in 2012. Viewed at: http://www.doingbusiness.org/rankings . Also in 2012, Chinese Taipei was 
ranked 37th in the Transparency International Corruption Index, viewed at: 
http://www.transparency.org/cpi2012/results ; 17th in the 2014 Heritage Economic Freedom ranking, viewed 
at: http://www.heritage.org/index/ranking ; and 13th in the WEF Global Competitiveness Report, 2013-14, 
viewed at: http://www.weforum.org/reports/global-competitiveness-report-2013-2014 . 
2 More information on the institutional framework is available at the following website: 
http://www.taiwan.gov.tw/ct.asp?xItem=136104&CtNode=3558&mp=1. 
3 Online information available at: www.exam.gov.tw  for the examination branch; at: 
www.judicial.gov.tw  for the judicial branch; and at: www.cy.gov.tw  for the control branch. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  2.3  Administration of trade policy 
2.7.  The Ministry of Economic Affairs (MOEA) remains the main governmental agency involved in 
trade policy formulation and implementation. It is also responsible for concluding and signing trade-related agreements with trading partners. In addition to trade, the MOEA's operational scope 
embraces industrial development, water resources, investment, energy, mining, national 
corporations, commercial affairs, SMEs, intellectual property, and standards and measurement (Box 2.1). 
Box 2.1 Organization of the Ministry of Economic Affairs 
The Ministry of Economic Affairs currently consists of staff units, administrative agencies, national 
corporations, as well as 63 overseas commercial offices located in 52 countries. 
Staff units 
Department of Mines 
Department of Commerce 
International Cooperation Department  
Department of Investment Services 
Department of Industrial Technology  
Department of Statistics  
Central Region Office  
Southern Taiwan Joint Services Center 
Office of Trade Negotiations  
Administrative agencies 
Industrial Development Bureau  
Bureau of Foreign Trade 
Intellectual Property Office  
Bureau of Standards, Metrology and Inspection  
Bureau of Energy  
Water Resources Agency  
Small and Medium Enterprise Administration  
Export Processing Zone Administration  
Central Geological Survey  
State-owned Enterprise Commission  
Investment Commission  
International Trade Commission  
Bureau of Mines  
Corporations 
Taiwan Sugar Corporation 
Taiwan Power Company 
CPC Corporation, Taiwan 
Aerospace Industrial Development Corporation 
Taiwan Water Corporation 
Overseas offices 
Asia Pacific 
America 
Europe 
Middle East 
Africa  
Source: Box provided by the Ministry of Economic Affairs. 
2.8.  MOEA's Bureau of Foreign Trade (BOFT) is responsible for drafting international trade 
policies, promoting trade, and managing trade- related activities. Its major functions are: 
(i) drawing up and implementing trade policies and regulations; (ii) participating in the activities of international trade organizations (WTO, APEC, OECD) and enhancing bilateral trade relations; 
(iii) handling and coordinating trade negotiations, consultations, and disputes; negotiating and 
signing FTAs; handling ECFA follow-up agreements and the Cross-Straits Economic Cooperation WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Committee; preparing and researching a Chinese Ta ipei-EU Economic Cooperation Agreement; and 
researching potential participation in the TPP; (iv) administering the import/export regime and providing guidance to trading businesses; and managing trade security and export control 
administration and related issues; (v) promoting foreign trade and developing overseas markets; 
and (vi) supervising and coordinating the MOEA's overseas offices. 
2.9.  The Office of Trade Negotiations (OTN) was established in March 2007 to serve as a 
coordination office among the relevant agencies to develop government positions and strategies 
for trade negotiations. Both the OTN and the BOFT report to the MOEA. Consisting of a trade policy 
team and a legal team, OTN's mission consists of: (i) participating in WTO-related negotiations
4, 
namely the Doha round, Chinese Taipei's accession to the Government Procurement Agreement, and expansion of the Information Technology Agreem ent, and preparations for negotiating trade in 
environmental goods; (ii) participating in WTO dispute cases and generally harmonizing domestic 
trade laws and regulations with WTO obligations; and (iii) engaging in bilateral negotiations on economic cooperation agreements (ECAs) and bilateral investment arrangements with, inter alia, 
Japan, New Zealand, and Singapore. 
2.10.  According to the authorities, other ministries and agencies involved in the formulation and 
implementation of trade policy include the Ministry  o f  F i n a n c e ,  M i n i s t r y  o f  H e a l t h  a n d  W e l f a r e ,  
Financial Supervisory Commission, National Development Council, Council of Agriculture, Public 
Construction Commission, Ministry of Transportation and Communications, Ministry of Justice, the Fair Trade Commission, and the Nati onal Communications Commission. 
2.11.  Prior to 2012, high-level trade policy coordination was undertaken by the Committee of 
Global Trade Policy Strategy Alliance and Arrangements. The Committee, chaired by the Premier, 
was renamed the Committee of Global Economic and Trade Strategy in 2012 and aims to enhance policy coordination and performance for promoting economic and trade liberalization, including the 
drafting of a work agenda for launching and sign ing FTAs and ECAs. In this work, the government 
has classified accession to the TPP/RCEP as important targets. 
2.12.  The executive or Cabinet is coordinating work on building a national consensus, directing 
related ministries to draft response measures for sensitive domestic industries, and assisting 
businesses to engage in global planning, industri al upgrade and development of high value-added 
products to increase competitiveness and mitigate the potentially negative effects of joining the TPP. Under the auspices of this committee, the MOEA is entrusted with convening the Task Force 
of the Global Economic and Trade Strategy, compos ed of 20 vice-ministers who coordinate trade-
related issues. 
2.13.  In order to foster participation from industries and academia in the formulation of trade 
policies, the Consultative Committee of Industrial and Academic Sectors was established under the 
Committee of Global Economic and Trade Strategy with a view to facilitating dialogue between the government and relevant stakeholders. Meetin gs of the group are jointly chaired by the 
vice-premier and an industrial leader nominated by group members. The Committee provides the 
government with advice on the impact of trade liberalization on domestic industries and responsive adjustment policies, and generally helps to build consensus and obtain support from key domestic sectors for ongoing trade liberalization. 
2.14.  The Chung-Hua Institution for Economic Research (CIER) is a government think tank 
responsible for providing relevant agencies with appropriate research concerning Chinese Taipei's participation in various trade negotiations. The CIER also builds and maintains economic and trade 
databases, issues e-papers, and handles outreach and training in order to assist government 
departments in the administration of trade affairs. 
2.4  Main trade laws 
2.15.  The primary law governing trade in goods remains the Foreign Trade Act. The main law 
regarding tariffs and customs administration is the Customs Act. For services sectors, while certain sector-specific laws and regulations apply (e.g. Banking Act, Telecommunications Act, Healthcare 
                                               
4 As well as negotiations on the Trade in Services Agreement (TISA) taking place outside the WTO. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Act), most services sectors are only subject to the generally applied Civil Act, Company Act, and 
the Business Registration Act. 
2.16.  A number of articles in the Foreign Trade Act were amended in 2010 and 2011, in order to 
comply with the requirement for clarity of legal authorization, the requirements of international 
conventions such as CITES, as well as to incorporate labour unions as applicants for investigation 
of import relief. The Customs Act has been amen ded twice since 2010 to ensure facilitation of 
customs clearance as well as compliance with international guidelines. Changes and amendments 
to IP-related laws and regulations are covered in more detail in section 3 of this report. 
2.17.  When Chinese Taipei acceded to the WTO, it  undertook to ensure that all laws, regulations, 
and judicial decisions and administrative rulings of  general application relating to goods trade, as 
well as measures subject to the transparency pr ovisions of the GATS and TRIPS Agreements would 
be translated and published in an official WTO la nguage no later than 90 days after enactment or 
issuance. The authorities have set up enquiry points based on the requirements of relevant WTO Agreements.  
2.5  Policy objectives 
2.18.  Chinese Taipei's overall trade and investment policy objectives remain largely unchanged 
since its previous review and are focused on increased integration into the world economy through 
the development of a liberalized and internationa lly competitive market economy. The government 
aims to diversify its exports to emerging markets so as to create new business opportunities, and continues to implement trade promotion campaigns. 
2.19.  Chinese Taipei has participated in WTO negotiations such as the Doha Round and ITA 
expansion and has utilized WTO rules to reduce and eliminate trade barriers. The government also 
continues to promote bilateral economic and trade relations through the negotiation and signing of 
FTAs and ECAs. In order to actively participate in economic integration, it has enacted regulatory 
reforms and streamlined business operating requirem ents and, during the review period, stepped 
up efforts for deregulation and regulatory alignm ent. According to the authorities, from May 2008 
to March 2014, the government completed 904 actions to loosen economic and financial regulation 
in the areas of finance and taxation, human resources, industry, and cross-Strait economic affairs, 
including the easing of multiple entry for businessmen from China. 
2.20.  Among the government's key policy targets are: the active launching of ECAs to improve 
connection to the Asia Pacific region; further steps towards economic liberalization in order to 
attract multinational corporations to establish operational headquarters in Chinese Taipei, and 
building it into an effective and efficient portal for enterprises worldwide to access the Asia-Pacific market; and the gradual creation of conditions to achieve the goal of participation in the TPP. 
2.21.  The authorities point out that these policy objectives are consistent with the overall national 
economic plan (4-year National Development Pl an 2013-2016) and the Economic Power-up Plan 
launched in 2012, which both emphasize trade expansion and investment promotion as key 
economic development goals. 
2.5.1  National Development Plan (NDP) 2.22.  In addition to promoting exports and accelerating trade diversification, Chinese Taipei is 
seeking to negotiate and sign FTAs and ECAs with the objective of increasing trade with FTA and 
ECA partners to 50% of total foreign trade by 2016, from 5% in 2013; this might be rather 
optimistic. The authorities are also seeking to create favourable conditions for joining the Trans-Pacific Partnership (TPP), as well as to speed up completion of the follow-up agreements 
under the Cross-strait Economic Cooperation Framework Agreement (ECFA). 
2.23.  The authorities are seeking to attract investment by, inter alia, broadening inducements for 
foreign enterprises to invest in Chinese Taipei, providing fully customized consulting services, 
bolstering inter-agency coordination, and optimizi ng single-window efficiencies. The government is 
also seeking to encourage overseas firms that have developed international brands or high 
value-adding processes to invest back in Chinese Taipei. The government is mapping out and implementing plans to establish free economic pilot zones with the primary goal of developing high WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  value-added service industries and the secondary go al of developing manufacturing industries that 
can promote development of the service industry. 
2.5.2  Economic Power-up Plan 2.24.  Complementing the NDP, this plan contains  policies aimed at: raising the added value of 
exports and developing exports to emerging ma rkets; strengthening the competitiveness of 
services exports, including improving the quality of tourism; and at the organizational level, strengthening the mission and functions of the trade-policy-making apparatus by raising the level 
and profile of the Committee of Global Economic  and Trade Strategy by placing it under the 
chairmanship of the premier and strengthening its role in the negotiation and conclusion of ECAs and other trade arrangements; and formulating a strategic plan for intellectual property to enable Chinese Taipei to become an Asian leader in IP creation, utilization, and protection. 
2.6  Trade Agreements and Arrangements 
2.25.  Chinese Taipei's position in Asian supply chains and its economy's reliance on international 
trade has made market access for its exports and stable trading relations a priority. It acceded to 
the WTO with effect from 1 January 2002, and was admitted to the Asia Pacific Economic 
Cooperation (APEC) forum in November 1991. It is a participant in the Competition, Steel and Fisheries Committees of the OECD. During the review  period, Chinese Taipei tried to expand trade 
amid concerns about the proliferation of regional and bilateral FTAs in particular among its major 
trading partners and competitors. The authoritie s recognize that exclusion from such FTAs has 
been problematic and could weaken enterprise competitiveness, adversely affecting trade and 
economic growth. 
2.6.1  Multilateral and regional agreements 
2.6.1.1  World Trade Organization 2.26.  Chinese Taipei applies MFN treatment to all other WTO Members except with regard to 
specific circumstances that are consistent with WTO rules for general and security exceptions. 
However, the growing share of international trade that is now subject to preferential treatment 
under FTAs is perceived to be undermini ng the value of the WTO MFN commitment. 
2.27.  Chinese Taipei became a signatory to the plurilateral Agreement on Government 
Procurement in July 2009. It participated in the new round of GPA negotiations and adopted the revised GPA, together with other GPA members, at the ministerial meeting convened by the GPA Committee on 30 March 2012. The revised GPA entered into force on 6 April 2014.  
2.28.  The government continues to be a strong supporter of the multilateral trading system, 
which played a critical role in curtailing protectionism during the 2008 financial crisis. The authorities believe that the WTO system must continue to be strengthened in order to respond to 
the ever-changing global trade environment. Regarding the Doha Round, it is considered that the 
Bali package covers only a small fraction of th e DDA negotiations and that future negotiations 
must take into consideration ambitious and balanced outcomes while adequately responding to the 
special flexibility needs of developing countries and newly acceded members. In particular, the 
government recognizes the importance of the Do ha Round as a milestone in safeguarding and 
advancing food security. As a developing Member , Chinese Taipei emphasizes the importance of 
responding to the needs of developing countries and LDCs by helping them integrate further into 
the multilateral trading system through contributions to the WTO's various development 
programmes, including the Doha Development Agenda Global Trust Fund (DDAGTF) and the Standards and Trade Development Facility (STDF). 
2.29.  The government welcomed the Trade Facili tation Agreement concluded at the MC9 and will 
implement the agreement accordingly. In addition, it is willing to provide the necessary technical 
assistance to other developing members by sharing its experience on the modernization of 
customs procedures. Concerning the implementa tion of the MC9 decision on duty-free and 
quota-free market access for LDCs (WT/MIN(13)/44, WT/L/919), providing assistance to LDCs is considered central to the Doha Development Agenda. The government has therefore continuously WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  supported and provided various kinds of trade assi stance projects to further enhance the balanced 
and sustainable development of LDCs.  
2.30.  As discussed elsewhere, the services sector  i s  i n  n e e d  o f  r e f o r m .  A l o n g  w i t h  2 2  t r a d i n g  
partners, the government is participating in plurilateral negotiations (outside of the auspices of the 
WTO) with the aim of negotiating a trade in services agreement (TISA). Successful conclusion of 
an ambitious services agreement could help provid e impetus to reform Chinese Taipei's services 
sectors while opening up new market opportunities for its services exports.  
2.31.  Regarding dispute settlement, during the previous review period, Chinese Taipei was a 
complainant in one case, concerning the tariff treatment by the EU on imports of certain information technology products. It participated as a third party in panels involving 16 cases in the period 2010-2013. It has never been a respondent in a WTO dispute settlement case. 
2.32.  During the review period, Chinese Taipei met notification requirements under various WTO 
Agreements. Regarding the notifications of QRs, concerned agencies are currently compiling data 
and the authorities expect to notify the WTO by end-September 2014. 
2.6.1.2  APEC 
2.33.  Since joining APEC in 1991, Chinese Taipei has taken an active role in various meetings and 
initiatives. It supports and cooperates with other member economies in areas such as promoting 
ease of doing business, supply chain connectivity, structural reforms, SMEs, and energy efficiency. 
It underwent Individual Action Plan (IAP) peer Reviews in 2004 and 2007, and the 2014 IAP is currently being studied by the APEC Secretariat's Policy Support Unit.  
2.6.2  Cross-Straits Economic Cooper ation Framework Agreement (ECFA) 
2.34.  Chinese Taipei pursued closer economic integration with China during the review period. The 
most significant vehicle for this is the ECFA, which entered into force in September 2010. The ECFA serves as a road-map for future economic integration through four follow-on agreements 
concerning investment protection, trade in g oods, trade in services, and dispute settlement 
(Box 2.2). It also includes provisions on an early harvest programme on tariff elimination and 
services liberalization. As of June 2013, two of the four follow-up agreements were completed (on 
trade in services and investment promotion and pr otection). The services trade agreement is still 
under legislative consideration. Chinese Taipei made 64 market-access commitments to investors from China, including for hotels and restaurants, social services, transport, and wholesale commerce. Limits imposed on the amount that Chinese institutions are able to own in local banks 
are likely to be raised gradually. However, sectors that are considered important for the strategic 
defence of Chinese Taipei remain off-limits. 
Box 2.2 Key follow-on agreements under the ECFA  
 Trade promotion offices: Taiwan External Trade Development Council of Chinese Taipei opened its 
first trade promotion office in Sh anghai in December 2012 and since then has established offices in 
Beijing, Tsingtao, and Guangzhou.  The China Chamber of Commerce for Import and Export opened 
its first trade promotion office in Chinese Taipei in January 2013.  These offices are designed to 
facilitate cross-Strait trade, primarily in the servic es sector, by providing local market information, 
product advertising, and consulting services to businesses. 
 Trade in goods agreement: as part of the ECFA, Chinese Taipei and China agreed to reduce and 
gradually eliminate tariffs on select imports. The final group of these "early harvest" items became 
tariff free on 1 January 2013. Through this a rrangement, China has removed tariffs on 539 items 
imported from Chinese Taipei wh ile Chinese Taipei has removed tariffs on 267 items imported from 
China. Both parties intend to build on this prog ress by completing a more comprehensive trade in 
goods agreement in the near future. 
 Trade in services agreement: in  June 2013, Chinese Taipei and China signed a services trade 
agreement to eliminate investment restrictions  and other barriers across 11 service sectors. 
Chinese Taipei investors will gain access to numer ous service subsectors in China, including those 
in e-commerce, printing, construction, transpor tation, tourism, entertainment, and funeral 
services; and Chinese investors will gain access, inter alia,  to car rental, cargo transportation, 
beauty parlours, online gaming, and funeral services. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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   Dispute settlement mechanism:  Chinese Taipei and China in  2013 continued to discuss a 
mechanism to help resolve disputes that might ar ise from the interpretation, implementation, and 
application of the ECFA follow-on agreements. 
Source: WTO Secretariat and Chinese Taipei authorities. 
2.6.3  Other existing and pote ntial preferential agreements 
2.35.  At the start of the review period, Chinese Taipei was a party to only five signed and ratified 
FTAs, with: Panama (2004), Guatemala (2005), Nicaragua (2008), El Salvador (2008), and Honduras (2008). Together they accounted for on ly 0.14% of its total trade in 2013. Since the 
conclusion of the ECFA, Chinese Taipei has also signed an Economic Cooperation Agreement (ECA) 
with New Zealand in July 2013
5, its first such deal with a country with which it does not have 
official diplomatic relations. Chinese Taipei and Singapore agreed in principle to an ECA in 
May 2013, and signed the ASTEP agreement6 in November 2013. 
2.36.  In broad terms, the ECAs involve the removal of most market access barriers within a 
certain period, including: elimination of tariffs for agricultural and industrial products; opening of 
the services sector market; removal of foreign investment restrictions; and the bringing into line 
with international norms, regulations and policies affecting issues such as competition, IPR protection, standards and SPS measures, e-commerc e, environmental protection. Chinese Taipei 
aims to substantially increase the value of its trade conducted via ECAs.  
2.37.  Chinese Taipei has engaged in ECA feasibility studies with India and Indonesia. The study 
with Indonesia was completed in December 2012 and the results suggested that both sides could enhance bilateral relations by means of an ECA. Similarly, the report on the study with India, 
delivered in September 2013, contains policy recommendations to further bilateral economic 
relations and suggests a joint working group for ex ploring ways to move forward. The authorities 
note that think tanks from Chinese Taipei and the Philippines have conducted an ECA feasibility 
study. The EU is one of Chinese Taipei's main trading partners and has become a prime target for 
an ECA. 
2.38.  The 1994 Trade and Investment Framework Agreement (TIFA) between the United States 
and Chinese Taipei is the key framework for the two governments to discuss their trade and 
economic relationship. The TIFA talks were suspended from 2007 until March 2013 due to disputes 
over access for U.S. beef and pork. In April 2014, the 8
th TIFA meeting was held in Washington. 
2.6.4  TPP 
2.39.  The government has identified economic liberalization as a key driver of economic growth 
and has undertaken to reform the economy to be ready to join the TPP, according to the authorities, as soon as practically possible. The ac hievement of this goal is significant not only as 
regards the opening of new export markets for Chin ese Taipei and the preservation of its role in 
Asian supply chains, but also in terms of driving crucial domestic economic reforms. A government policy report entitled "2012 Golden Decade National  Vision" identifies a number of core challenges 
such as a too large reliance on industry and manufacturing, dependence on too few export 
markets, the need to expand innovation and redu ce reliance on trade as a driver of growth, the 
need to increase the competitiveness of the se rvices sector and achieve greater market access 
overseas. The government places emphasis on st rengthening economic and trade relations with 
other TPP members. 
2.6.5  Unilateral trade preferences 2.40.  Chinese Taipei grants duty-free access to items of LDC origin. The preference scheme 
covers nearly 98% of the total value of all products imported from LDCs. In terms of tariff lines, 
nearly 32% of imported LDC products receive preferential treatment. Chinese Taipei does not receive GSP (Generalized System of Preferences)  treatment from any of its trading partners. 
                                               
5 ANZTEC (Agreement between New Zealand and the Separate Customs Territory of Taiwan, Penghu, 
Kinmen and Matsu on Economic cooperation) entered into force on 1 December 2013. 
6 ASTEP (Agreement between Singapore and the Se parate Customs Territory of Taiwan, Penghu, 
Kinmen and Matsu Economic Partnership)  entered into force on 19 April 2014.  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  2.7  Foreign investment regime 
2.41.  The government has long maintained a policy of attracting FDI as part of its growth 
strategy, although FDI inflows have been subject to various restrictions. The main aim of investment policy was initially to attract export-oriented investment based on the competitiveness 
of Chinese Taipei's educated workforce. More recently, the objective has been adjusted to focus on 
attracting FDI into technology-intensive areas and to promote technological spill-overs. 
2.42.  Currently, the most significant efforts to improve attractiveness to foreign investors are 
centred on the further opening of the economy to  investment flows from China. The government 
has also announced policies aimed at encouraging the territory's overseas companies, especially 
those based in China, to reinvest on the island. Planned free economic pilot zones (FEPZs) in six major ports and Taoyuan International Airport form a key part of the government's strategy to 
attract more foreign investment. Restrictions on labour and on capital and goods flows are being 
loosened, and tax incentives are being provided to firms investing in designated industrial and services activities in the FEPZs. 
2.43.  In order to improve the investment climate, the government abandoned the use of a 
permitted investments list in favour of a negative list of industries, closed to foreign investment for security, environmental and health protection. Further reforms in this direction were undertaken 
during the review period. In June 2013, the Investment Commission of the MOEA reviewed the 
negative list and more than 20 subsectors were removed, including the manufacture of chemical products, the plantation and growing of fruits and flowers, land cargo transport, and certain 
financial intermediation services.  
2.44.  The negative list for investment by overseas Chinese and foreign nationals, now consists of 
10 prohibited industries and 16 restricted industries (Table 2.1). Liberalization has reduced the list to less than 1% of manufacturing categories and less than 5% of service industries. For an 
investment in an industry that is restricted by law or regulations, approval must be obtained from 
the competent industry authority. The amended list entered into effect in June 2013. The government will review and modify the list periodically or when required.  
Table 2.1 Negative list for investment by  overseas Chinese and foreign nationals 
(amended 17 June 2013) 
1. Prohibited industries 
Code 
No. Scope of 
industry Sub-item of 
Industry Description Competent 
authorities Remarks 
18 Manufacture 
of chemical material 1810 
Manufacture of basic chemical material Manufacturing of 
nitroglycerin for military use (nitroglycerin used in explosive pillars involving public safety) Defence 
authorities
7  
Soda-chloride factories 
operating with mercuric electrolyzers Ministry of 
Economic Affairs National 
treatment 
A category of chemical products in accordance with the prohibition of chemical weapons of the United Nations Ministry of 
Economic Affairs; defence authorities National 
treatment 
CFC, halon, methylchoroform, carbon tetrachloride Environmental 
Protection Administration National 
treatment 
19 Manufacture 
of chemical 
products 1990 
Manufacture of 
other chemical 
products Gun powder fuse, agents of 
fire and fulmin ating mercury Defence 
authorities  
24 Manufacture 
of basic 2499 
Manufacture of Cadmium smelting Ministry of 
Economic Affairs National 
treatment 
                                               
7 Online information available at: www.mnd.gov.tw. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Code 
No. Scope of 
industry Sub-item of 
Industry Description Competent 
authorities Remarks 
metals other basic metals 
not elsewhere classified 
29 Manufacture 
of machinery 
and 
equipment 2939 
Manufacture of 
other general-
purpose machinery Firearms, weapons 
manufacturing, arms repair, 
ammunition and fire-control 
(for military use, exclusive 
of military aircraft) Defence 
authorities   
49 Land 
transport-ation 4931 
Motor bus transportation including city passenger bus 
services and highway passenger services Ministry of 
Transportation and Communication Not 
prohibited for overseas Chinese 
4932 Taxi transportation  
4939 
Other bus 
transportation Tour bus services 
54 Postal and 
courier 
activities 5410 
Postal activities  Ministry of 
Transportation 
and 
Communication National 
treatment 
60 Programming 
and broadcasting activities 6010 
Radio broadcasting 
6021 
Television broadcasting 
6022 
Cable and other subscription programming Radio broadcasting industry; 
Radio television industry National 
Communications Commission  
64 Financial 
intermedia-
tion 6415 
Postal saving and 
remittance services  Ministry of 
Transportation 
and 
Communication; 
Financial 
Supervisory 
Commission National 
treatment 
69 Legal and 
accounting activities 6919 
Other legal activities Public notary services Judicial branch Not 
prohibited for overseas Chinese 
93 Sports 
activities and 
amusement 
and 
recreation 9323 
Special amusement 
activities  Ministry of 
Economic Affairs  
 2. Restricted industries  
Code 
No. Scope of 
industry Sub-item of 
industry Description Competent 
authorities Remarks 
01 Agriculture 
and animal husbandry 0111 
Growing of rice  Council of 
Agriculture  
0112 
Growing of cereals (except rice)   
0113 
Growing of special crops   WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Code 
No. Scope of 
industry Sub-item of 
industry Description Competent 
authorities Remarks 
0114 
Growing of vegetables  
0116 
Growing of mushrooms  
0119 
Growing of other crops  
0121 
Raising of cattle  
0122 
Raising of swine/pigs Raising of breed swine 
0123 
Raising of chickens Raising of breed chickens 
0124 
Raising of ducks Raising of breed ducks 
0129 
Other animal husbandry  
02 Forestry   Council of 
Agriculture Not 
prohibited 
for overseas 
Chinese 
03 Fishing and 
aquaculture   Council of 
Agriculture  
10 Manufacture 
of tobacco 
products   Ministry of 
Finance National 
treatment 
18 Manufacture 
of chemical material 1810 
Manufacture of basic chemical material Manufacturing of 
nitroglycerin (not used in gun powder and explosive pillars involving public safety) Defence 
authorities  
27 Manufacture 
of computers, 
electronic and 
optical 
products   Military instrument and 
equipment Defence 
authorities  
31 Manufacture 
of other transport 
equipment 
and parts  3190 
Manufacture of other transport equipment 
and parts not 
elsewhere classified Manufacture, repair and 
assemble of military aircraft Defence 
authorities; Ministry of 
Economic Affairs  
33 Other 
manufacturing 3399 
Other manufacturing 
not elsewhere 
classified Processing of ivory Council of 
Agriculture National 
treatment 
35 Electricity and 
gas supply 3510 
Electricity supply Electric power 
transmission and power distribution  Ministry of 
Economic Affairs  
3520 
Gas supply Piped fuel gas supply Ministry of 
Economic Affairs  
36 Water supply 3600 
Water supply Tap water supply Ministry of 
Economic Affairs  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Code 
No. Scope of 
industry Sub-item of 
industry Description Competent 
authorities Remarks 
50 Water 
transport-ation 5010 
Ocean transportation 
 5020 
Inland and lake transportation Transport by ship and 
ship leasing service Ministry of 
Transportation and Communication Not 
restricted for overseas Chinese 
51 Air transport-
ation 5100 
Air transportation  Ministry of 
Transportation 
and 
Communication Not 
restricted for 
overseas 
Chinese 
52 Supporting 
activities for transport-ation 5260 
Service activities incidental to air transportation Airport ground services 
and air catering services Ministry of 
Transportation and Communication 1. Not 
restricted for overseas Chinese. 
2. Except as 
otherwise provided in relevant treaties or agreements 
60 Broadcasting 
and 
programming 6010 
Radio broadcasting Cable television services 
and satellite television 
broadcasting National 
Communications 
Commission  
6021 
Television 
broadcasting 
6022 
Cable and other 
subscription 
programming 
61 Telecommun- 
ications 6100 
Telecommunications Type-I 
telecommunications enterprise National 
Communications Commission  
69 Legal and 
accounting 
activities 6912 
Scrivener activities Land registration services Ministry of the 
Interior  
 
Source: MOEA onlin e information at: 
http://www.moeaic.gov.tw/system_exte rnal/ctlr?PRO=LawsLoad&lang=1&id=32 . 
2.45.  Regulations governing FDI mainly derive from the Statute for Investment by Foreign 
Nationals (SIFN) and the Statute for Investment by Overseas Chinese (SIOC). The two laws permit 
foreign investors to use foreign currencies or NT dollars, and both statutes specify that foreign invested enterprises must receive the same regu latory treatment accorded local firms. Foreign 
companies may invest in state-owned firms undergoing privatization and are eligible to participate 
in publicly financed R&D programmes. Foreigners investing in Chinese Taipei by incorporating new companies need prior approval from the Investment Commission. 
2.46.  In order to facilitate the FDI application process, the Investment Commission tabled draft 
amendments to both statutes in 2012, which the legislature is expected to legalize. The 
amendments should loosen restrictions so that investors may report to the competent authority after implementing investments in Chinese Taipei, while prior official approval will still be required 
under some exceptional circumstances. Around 80% of FDI projects are expected to benefit from 
this new policy, which should not only streamline and facilitate the FDI investment application but also make the FDI regime consider ably more investor-friendly.  
2.47.  The government established the InvesTaiwan Service Center in 2010 in order to provide 
one-stop solutions to investors, including evaluation of investment projects, legal and tax advice, identification of potential factory locations, and interagency coordination (http://investtaiwan.nat.gov.tw/eng/show.jsp?ID=1200&MID=8 ). According to the authorities, WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  foreigners may lease or purchase land for certain usage (such as offices, residences, and factories) 
on a reciprocal basis. 
2.48.  Chinese Taipei is not a member of the International Centre for Settlement of Investment 
Disputes, established by the World Bank to provide arbitration and conciliation services for 
government and foreign investors. Foreign investment disputes are normally resolved according to 
domestic law and regulations based on "national treatment" and investment guarantee agreements.  
2.49.  Up to March 2014, Chinese Taipei had bilateral investment agreements or ECAs/FTAs with 
investment chapters in force with 32 countries, including five added since its previous Review (St Vincent and the Grenadines, Gambia, Japan, China
8, and New Zealand). Chinese Taipei has 
double taxation avoidance agreements in force with 25 economies. 
 
 
                                               
8 The Cross-Strait Bilateral Investment Protection and Promotion Agreement with China was signed in 
August 2012 and entered into force in February 2013. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3  TRADE POLICIES AND PRACTICES BY MEASURE 
3.1  Measures Directly Affecting Imports 3.1.1  Customs procedures 3.1.  The basic customs legislation in the Separa te Customs Territory of Taiwan, Penghu, Kinmen 
and Matsu (Chinese Taipei) is the Customs Act and its Enforcement Rules. The Customs Act was 
amended twice during the period under review (in May 2010 and May 2013).
1 The authorities note 
that these amendments served to facilitate customs clearance and ensure compliance with 
international guidelines. The Customs Administrati on, under the Ministry of Finance, implements 
customs legislation, including border measures2; other competent authorities, such as the Council 
of Agriculture and the Department of Health an d Welfare, are involved in SPS inspection and 
licensing procedures at the border. 
3.2.  Customs legislation and related operational guidelines are available online.3 The authorities 
indicate that regular conferences or symposia are held for consultations between traders and Customs on relevant matters. No change was made in the appeal procedure for customs decisions 
during the review period. Traders who disagree with customs decisions may request administrative 
remedies (e.g. reviews by Customs, or appeals to the Ministry of Finance). Traders may then refer the case to the Administrative Court if they are not satisfied with the outcome of the 
administrative remedies. During the review period, an average of 400 disagreements with customs 
decisions were registered each year. 
3.3.  In order to engage in import/export business a firm must register as an importer/exporter 
with the Bureau of Foreign Trade (BOFT) under the Ministry of Economic Affairs (MOEA).
4 Branch 
offices of foreign firms registered with the authorities may apply for registration as 
importers/exporters. Other than these branch o ffices, non-permanent residents are not normally 
allowed to engage in import/export on a professional basis. An exporter/importer whose trade 
performance in the preceding year has reached a prescribed turnover, may benefit from certain 
preferences.5 
3.4.  According to the World Bank's Doing Business  report6, trading across borders ranks well 
compared to the regional average (Table 3.1). 
Table 3.1 Summary of procedures and documents for trading across borders 
  Chinese Taipei East Asia and 
Pacific average OECD high 
income average 
Number of documents required Import 6 7 4 
Export 5 6 4 
Days required to complete 
procedures Import 10 22 10 
Export 10 21 11 
Cost to complete procedures 
(US$ per container) Import 720 884 1,090 
Export 655 856 1,070 
Source: World Bank Group (2013), Doing Business 2014; Economy Profile . Viewed at: 
http://www.doingbusiness.org/reports/globalrep orts/~/media/giawb/doing%20business/documents/
profiles/country/TWN.pdf . 
 
                                               
1 The Enforcement Rules of the Customs Act August 2010 amendment. Viewed at: 
http://law.moj.gov.tw/Eng/LawC lass/LawAll.aspx?PCode=G0350002  [28/05/2013]. 
2 Customs Administration online information. Viewed at: http://eweb.customs. gov.tw/mp.asp?mp=21 . 
3 Customs Administration online informat ion, "Laws and Regula tions". Viewed at: 
http://eweb.customs.gov.tw/np.asp?ctNode=12878  [26/11/13]. 
4 Article 9, the Foreign Trade Act. The BOFT mainta ins a directory of registered importers/exporters. 
Viewed at: http://www.trade.gov.tw/english/Pages/List.aspx?nodeID=115  [13/12/13]. 
5 Article 9-1, the Foreign Trade Act. Preferences incl ude reduction/exemption in service fees charged by 
Taiwan External Trade Development Council (TAITRA), a hi gher credit line of loans for export-brand-promotion 
activities, and listing in a BOFT directory. Also see WTO document WT/TPR/M/232/Add.1, p.31, 25 August 
2010. 
6 The World Bank Group (2013); see also OECD Trade Facilitation Indicators – Chinese Taipei. Viewed 
at: http://www.oecd.org/tad/facilitation/Chinese- Taipei_OECD-Trade-Facilitation-Indicators.pdf  [05/12/13]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.5.  Customs has operated the Customs-Port-Trade (CPT) Single Window since August 2013, 
which allows documentation related to customs procedures, including customs declarations, trade licensing, and SPS permits, to be submitted and processed electronically.
7 The Single Window can 
be accessed either directly via the Customs Automa tion System (web-based application) or via the 
"through customs network" (message-based appl ication in EDI or XML format). The "through 
customs network" is an interface between traders and the CPT Single Window operated by private 
contractors.8 There are no fees for traders linking directly to the Single Window; traders using the 
"through customs network" pay service fees to th e private contractors, and the services charged 
are regulated by the Ministry of Finance. A ccording to the authorities, 99.95% of customs 
procedures in 2013 were done electronically. 
3.6.  Import declarations must be lodged within 15 days following arrival of the shipment. 
Importers may submit a "pre-entry declaration". Pre-entry declared goods may be released by 
Customs upon payment of a guarantee deposit, which may be for imports through a specific regional customs house, or for imports through all customs houses nationwide.
9 The Customs Act 
was amended in May 2010 to enlarge the scope of assets that may be considered as deposits, 
however the authorities note that the usage rate of pre-entry declaration was still only around 10% in 2011. 
3.7.  Customs clearance for shipments may be ca rried out under one of three modes: "by-pass", 
"document review" or "document review and physic al inspection", determined by computerized 
selectivity criteria based on various factors, incl uding the reputation of importers/exporters, duty 
rates, and origin of imports (or destination of exports).
10 Physical inspections are, in general, 
carried out on a random basis. In 2011, the average length of clearance was two days for sea 
cargos, and one day for air cargos. Using pre-arrival clearance, the average length was 20 hours for sea cargos, and 4 hours for air cargos; 24-hour customs clearance has been available for 
express consignments since 2001. 
3.8.  The use of customs brokers is voluntary. A customs broker who satisfies certain criteria may 
seek approval for a reduced inspection ratio, valid for one year; this may be renewable.
11 
3.9.  Customs may grant authorized economic operator (AEO) status to "economic operators in the 
supply chain".12 There are two types of AEOs, General AEOs (AEO-G) and Security & Safety AEOs 
(AEO-S). The benefits of AEO status depend on the type of certificate granted to the economic 
operator, and could include fewer customs controls (such as less documentation examination and 
reduced random inspection rate), simplified cust oms procedures, and flexibility in customs duties 
payment (Table 3.2). Participation in the authorized economic operator programme is voluntary. As of 2 May 2014, 618 applicants were granted the AEO status (329, AEO-G; and 289, AEO-S). 
The AEO schemes are not open to operators established outside Chinese Taipei. 
3.10.  Chinese Taipei signed AEO mutual reco gnition agreements with the United States 
(November 2012), Singapore (July 2013) and Israel (December 2013)
13, through which AEOs 
recognized by the customs authorities of the United  States, Singapore or Israel enjoy the benefits 
of trade facilitation in Chinese Taipei, and vice versa .  
                                               
7 The CPT Single Window incorporated the FT-Net system that has been operated since 2009. The CPT 
Single Window is an integrated paperless infrastructu re for customs clearance do cuments, and exchange of 
trade documents and document verification. 
8 Two EDI service providers run the "through customs network". 
9 Article 5, the Regulations Governing the Implementation of Post-Release Duty Payment Procedures For 
Imported Goods, amended on 20 December 2010. 
10 The by-pass mode requires no document review or physical inspection. The "document review and 
physical inspection" mode is conducted on the prin ciple of random-select insp ection, unless a thorough 
inspection is deemed necessary. 
11 The detailed criteria are listed on the Operat ion Directions for Customs Brokers Application for 
Lowering Goods Inspection Ratio. Viewed at: http://web.customs.gov.tw/ct.asp?xItem=51578&ctNode=5831  
[14/12/13, in Chinese]. 
12 Economic operators in the supply ch ain refers to operators involved in the international movement of 
goods, such as importers, exporters, manufacturers, customs brokers, freight fo rwarders, shipping agents, 
warehouse operators, highway carri ers, sea carriers, air carriers. 
13 Customs Administration Press Release. Viewed at: 
http://aeo.customs.gov.tw/aeo/PTL_AEO_101.aspx?NEWS_ID=CH1220131030001  [11/12/13, in Chinese]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 38 - 
 
  3.11.  Under the Customs Act, Customs may issue, upon request, written advance rulings on tariff 
classification14, origin matters15, and customs valuation.16 
3.12.  Customs implements the Customs Convention on the ATA Carnet for the Temporary 
Admission of Goods (ATA Carnet) at the border. The Taiwan External Trade Development Council 
(TAITRA) is the designated ATA document issuer and the guarantor for the security of temporarily 
imported goods. The ATA Carnet is valid for up to one year. 
Table 3.2 Benefits of authorized economic operator certificates 
 AEO-G AEO-S 
Document review and inspection  ratio applied Lower Lowest 
Simplified procedure when inspected √ √ 
Priority treatment when inspected n.a. √ 
Non-intrusive approach of inspection n.a. √ 
Duties payment on a monthly basis √ √ 
Affidavit as substitute for se curity of duties and charges √ √ 
Prior release of re-imports of Chinese Taip ei originating products with an affidavit √ √ 
Single contact windows for customs clearance assistance n.a. √ 
√ Applicable. 
n.a. Not applicable. 
Source: WTO Secretariat, summary based on the Regula tions Governing the Certification and Management of 
the Authorized Economic Operators. 
3.1.2  Customs valuation 
3.13.  There has been no change in customs valu ation legislation since the last Review. The rules 
were set out in the Customs Act (Articles 29 to 42) and its Enforcement Rules (Articles 11 to 27). 
3.14.  The transaction value is the primary basis for customs value determination. The transaction 
values used are c.i.f. values.17 In the event that transaction values cannot be used, the customs 
value is based either on a deductive value or computed value; if neither of these methods can be 
used, the customs value is determined on the basis of data available to Customs.18 According to 
Customs, around 99% of all import declarations in 2013 were accepted in accordance with the 
transaction value method.  
3.15.  Imports of used motor vehicles continue to be valued on the basis of the deductive c.i.f . 
price19 of "model year of imported cars" or the "t rade-in price" in the exporting countries plus 
freight and insurance20, or reasonable means provided in Article 7 of the Customs Valuation 
Agreement. Imports of used cars accounted for 8.4% of total imports of motor vehicles in 2013. 
3.16.  For imports for which payment of royalties and licence fees is a condition of the sale of the 
goods21, the royalties and licence fees paid/payable must be taken into account for customs 
valuation purpose.22 
                                               
14 Article 21, the Customs Act. 
15 Advance ruling on country of origin are applicable  only to imports from trading partners that have 
signed ECA/FTA with Chinese Taipei, given that the ECA/ FTA contains relevant provisions. These preferential 
trading partners are: Panama, Guatemala, Nicar agua, El Salvador, Honduras, and New Zealand. 
16 Article 36-1, the Customs Act. Advance rulin gs are not applied to imports of waste. 
17 Article 29, the Customs Act, Article 11 and 12 of the Enforcement Rules of the Customs Act. 
18 WTO document WT/ACC/TPKM/18, 5 October 2001. 
19 A deductive c.i.f. price is the market price of an equivalent new car discounted by the years in use, 
plus the insurance and freight costs occurred during importing the used car in question. 
20 Notes on Customs Clearance of Imported Used Motor Vehicles, revised in December 2011. Viewed at: 
http://eweb.customs.gov.tw/ct.asp?xItem=44745&ctNode=6493  [11/09/2013]. 
21 Customs Administration online information. Viewed at: 
http://eweb.customs.gov.tw/ct.asp?xItem=14995&ctNode=6493  [12/09/2013]. 
22 Customs Administration online information. Viewed at: 
http://eweb.customs.gov.tw/ct.asp?xItem=51324&ctNode=6493  [12/9/2013]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 39 - 
 
  3.1.3  Rules of origin 
3.17.  There are both non-preferential and preferen tial rules of origin. Non-preferential rules are 
applied for the purpose of, inter alia , implementation of anti-dumping and countervailing 
measures, quantitative restrictions, MFN tariff quot as, and origin marking. Preferential rules of 
origin are set out in reciprocal and non-reciprocal trade arrangements. 
3.18.  For non-preferential rules, in cases where more than one country is involved in the 
production of a good, the country of origin is determined as the country where the product has 
undergone its "last substantial transformation".23 Substantial transformation may be expressed 
as24:  a  c h a n g e  o f  H S  t a r i f f  h e a d i n g  o r  s u b h e a d i n g  c r i t e r i o n ;  a  m o r e  t h a n  3 5 %  i n  a d d e d  v a l u e  
criterion; or the "completion of major process".25 
3.19.  Preserving operations, to ensure that a product remains in good condition during transport 
and storage, breaking up and assembly of packag es, simple mixing of products, simple assembly 
of parts, etc. are not considered as substantial transformation. 
3.20.  Imports from LDCs must have no less than 50% of value added in the country of origin.26 
Where more than one country is involved in production, no cumulation rules are provided for LDCs. 
To qualify for tariff preferences, LDC-origin good s must be transported directly to Chinese Taipei.27 
3.21.  Regarding the value-added criterion for obtaining originating status, Chinese Taipei 
maintains bilateral cumulation only with WTO Members with which it has free-trade arrangements, 
i.e. only the originating products or materials may benefit from preferential treatment. 
3.22.  Chinese Taipei maintains preferential rule s of origin through its free-trade arrangements 
with El Salvador and Honduras; Guatemala; Nicaragua; New Zealand; Panama; and Singapore. 
Preferential rules of origin vary according to different reciprocal trade arrangements.28 The 
authorities indicate that the variations are small. 
3.23.  Certificates of origin are issued by the BOFT to facilitate exports. Since 6 November 2013, 
traders have been allowed to self-issue a certificate-of-origin-declaration that serves as a 
certificate of origin.29 
3.1.4  Tariffs 
3.24.  The tariff schedule has three sets of rates: MFN rates applied to WTO Members or other 
countries/areas that accord reciprocal treatment; preferential rates; and rates applied to all other 
imports.30 
3.1.4.1  MFN tariffs 
3.25.  The tariff nomenclature, also known as th e Import and Export Co mmodity Classification 
(CCC), is based on the Harmonized Commodity De scription and Coding System (HS), and further 
specified at the ten-digit level. The current nomenclature reflects the fourth amendment to the HS 
                                               
23 Article 5, the Regulations Governing the Determin ation of Country of Origin of an Import Good, 
amended 24 December 2010. 
24 Article 7, the Regulations Governing the Determin ation of Country of Origin of an Import Good, 
amended 24 December 2010. 
25 The origin rules for "completion of major proces s" are provided in the table of "list rules". 
26 Article 8, the Regulations Governing the Determin ation of Country of Origin of an Import Good, 
amended 24 December 2010. 
27 In the case of shipping through a third country, no operations are allowed other than unloading and 
reloading in the country of transit. See Article 11, th e Regulations Governing the Determination of Country of 
Origin of an Import Good, amended 24 December 2010. 
28 For detailed information, see Cust oms Administration online informatio n, "Rules of Origin". Viewed at: 
http://eweb.customs.gov.tw/ct.asp?xItem=42658&CtNode=12640  [07/10/2013]. 
29 Article 20-3, the Foreign Trade Act, amended 6 November 2013. 
30 These other rates are equal to or higher than thei r corresponding MFN rates. The authorities note that 
imports subject to the third set of tariff rates accounted for 0.006% of total trade in 2013. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 40 - 
 
  (HS 2007). The authorities maintain a public online database of tariff rates and other measures, 
including quantitative restrictions and contingency measures, applied to imports (and exports).31 
3.26.  Changes to the tariff schedule are enacted and promulgated through a legislative procedure. 
Changes to the tariff schedule are usually proposed by the relevant sectoral authorities (e.g. the 
industrial and agricultural authorities) to the Customs Tariff Commission under the Ministry of 
Finance.32 After review and discussion with relevant stakeholders, the Ministry of Finance submits 
its proposal for tariff changes to the executive and the legislature for approval. During the period 
under review, Chinese Taipei amended its MFN tariff schedule twice, in June 2010 (35 lines 
amended) and in November 2012 (seven lines amended). According to the authorities, the 
changes in the tariff schedule reflected the change of nomenclatures, but also resulted in tariff 
reductions on certain products with the aim of lowering firms' operational cost and thus enhancing 
industrial competitiveness. Products that benefited from tariff reductions include fuels, parts and 
components of motor vehicles, tube monitors, and frames and mountings for spectacles/goggles (Table A3.1). 
3.27.  Apart from the above, the tariff schedule ha s hardly changed since its previous Review. It 
consists of ad valorem  duties, specific duties, and alternate duties. In 2013, ad valorem  rates 
covered 98.2% of all tariff lines, which enhances th e transparency of the tariff structure. However, 
there are st ill 150 rate bands; 86 ad valorem;  16 specific; and 48 alternate rates. The tariff thus 
remains relatively complex, involving a multiplicity of rates. Non- ad valorem  duties in particular in 
agriculture tend to conceal relatively high AVEs. 
3.28.  The 2013 tariff comprises 8,728 lines at the eight-digit level: 30.2% of all tariff lines are 
duty free and 52.6% of lines have rates below 10% (Chart 3.1); 4.4% of lines are "nuisance" 
rates. The simple average applied MFN tariff rate, including the ad valorem  equivalents (AVEs) of 
non-ad valorem  tariff rates
33, was 7.8% in 2013, the same as in 2009. Based on the WTO 
definition, the average applied rate remained at 22.1% for agriculture, and at 5.0% for non-agricultural products. Tariff-rate quotas cove r less than 1% of tari ff lines (Table 3.3). 
Chart 3.1 Distribution of  MFN tariff rates, 2013 
(30.2%) (34.3%) 
(18.3%)
(7.9%)
(4.2%) 
(2.0%)   (1.4%) (1.0%) (0.7%) 
05001,0001,5002,0002,5003,0003,500
Duty free >0-5 >5-10 >10-15 >15-20 >20-25 >25-30 >30-50 >50Number of tariff lines
Tariff rates (%) 
Note: Figures in parentheses denote the share of total lines. Calculations exclude in-quota rates and 
include AVEs for non- ad valorem rates as provided by the authorities. 
 Source: WTO Secretariat calculations, based on data provided by the authorities. 
                                               
31 Customs Administration - Tariff Da tabase Search System. Viewed at: 
http://eweb.customs.gov.tw/RateWebEn/Search1.aspx  [07/10/2013]. 
32 The Customs Tariff Commission al so "studies and reviews" matters related to the levy of special 
customs duties such as anti-dumping and countervailing duties. 
33 The ad valorem  equivalents (AVEs) were provided by the au thorities; they were calculated based on 
the 1999-2001 trade data. The authorities indicate that the calculation followed the method based on WTO 
document JOB(05)/166/Rev.1. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 41 - 
 
  Table 3.3 Tariff structure, 2009 and 2013 
(%, unless otherwise indicated)  
 MFN applied Final bounda   2009 2013 
Bound tariff lines (% of all tariff lines) 100.0 100.0 100.0 
Simple average rate 7.8 7.8 8.1 
WTO agricultural products 22.1 22.1 23.0 
WTO non-agricultural products 5.0 5.0 5.2 
Duty-free tariff lines (% of all tariff lines) 30.1 30.2 28.8 
Simple average rate of dutiable lines only 11.2 11.1 11.3 
Tariff rate quotas (% of a ll tariff lines) 1.2 0.8 0.8 
Non-ad valorem  tariffs (% of all tariff lines) 1.8 1.8 1.8 
Domestic tariff "peaks" (% of all tariff lines)b 5.2 4.9 4.8 
International tariff "peaks" (% of all tariff lines)c 9.3 9.3 9.6 
Overall standard deviation of tariff rates 29.3 29.4 29.6 
Coefficient of variation of tariff rates 3.8 3.8 3.7 
Nuisance tariffs (% of all tariff lines)d 4.4 4.4 3.6 
Total number of tariff lines 8,730 8,728 8,728 
Ad valorem  rates 5,945 5,934 6,054 
Duty free 2,625 2,635 2,515 
Specific rates 89 88 88 
Alternate rates 71 71 71 
a Based on the 2013 tariff schedule in HS07 nomenclature. 
b Domestic tariff peaks are defined as those exc eeding three times the overall average applied rate. 
c International tariff peaks are defined as those exceeding 15%. d Nuisance rates are those greater than zero, but less than or equal to 2%. 
Note: Both tariff schedules ar e based on HS07 nomenclature. 
 Calculations for averages are based on national tari ff line level (8-digit); excluding in-quota rate and 
including AVEs as provided by the authorities. 
Source: WTO Secretariat calculations, based on data provided by the authorities. 
3.29.  In the 2013 tariff schedule, 159 lines are non- ad valorem  rates ( i.e. specific rates plus 
alternate rates) accounting for less than 2% of lines. On average, non- ad valorem rates continue 
to afford higher protection than ad valorem  rates. The average AVE of non- ad valorem  tariff rates 
is 102.9%, compared with 6.1% for ad valorem  duties. Under the WTO definition, cereals and 
preparations are subject to the highest average ta riff rate, followed by fruit, vegetables and 
plants; oils seeds, fats, oil and their products; and dairy products (Table 3.4). Rates above 100% 
are mostly AVEs related to agricultural goods34, applying to, inter alia , rice and rice products 
(102.6%~1,069%), betel nuts (822.1%), ground-nuts products (744.2%), and certain milk products (146.9%). Apart from agricultural products, non- ad valorem  tariff rates apply to 54 lines, 
for example, on dried, salted or in-brine squid (753.6%). 
3.30.  Additional tariffs in the form of special safeguard (SSG) measures are imposed on 
15 products, including dried shiitake, betel nuts, chicken legs and wings, and milk. Within the 
review period, most applied SSG measures were triggered by volume-based action.
35 
3.31.  Duty drawbacks refer to the refund of tariff duties that are collected on the imported raw 
materials used for manufacturing products for export (section 3.2.2). In 2013, NT$2,528 million 
were refunded as duty drawbacks. 
                                               
34 Six tariff lines have ad valorem rates above 100%; they are out-of-quota rates for agricultural 
products. 
35 WTO documents G/AG/N/TPKM/104, 23 May 2013; G/AG/N/TPKM/95, 13 March 2012; 
G/AG/N/TPKM/86, 21 March 2011; and G/AG/N/TPKM/74, 25 February 2010. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 42 - 
 
  Table 3.4 Summary of the MFN applied tariff, 2013 
 Number 
of lines Simple 
average 
(%) Tariff range 
(%) Standard 
deviation Duty 
free 
lines 
(%) Non- ad 
valorem  
rates 
(%) 
Total 8,728  7.8 0-1,069.9  7.8 30.2 1.8  
HS 01-24 1,584 23.7 0-1,069.9 66.1 18.6 10.0 
HS 25-97 7,144 4.2 0-30 4.3 32.8 0.0 
By WTO category       
WTO agricultural products 1,407  22.1 0-1,069.9  67.4 23.7 7.5  
   Animals and animal products  190 18.9 0-45 11.1 2.6 13.2 
   Dairy products 46 31.6 5-146.9 34.6 0.0 28.3 
   Fruit, vegetables, and plants 435 22.1 0-822.1 53.4 22.5 6.9 
   Coffee and tea 46 13.4 0-43 11.8 26.1 10.9 
   Cereals and preparations 160 53.5 0-1,069.9 137.2 5.0 16.3 
   Oils seeds, fats, oil and their 
   products 120 27.0 0-744.2 113.3 50.0 3.3 
   Sugars and confectionary 28 16.4 0-27.5 7.7 7.1 0.0 
   Beverages, spirits and tobacco 110 18.2 0-40 10.2 13.6 0.0 
   Cotton 5 0.0 0-0 0.0 100.0 0.0 
   Other agricultural products 267 6.1 0-500 30.9 48.3 0.7 
WTO non-agricultural 
products 7,321  5.0 0-753.6  10.6 31.4 0.7 
   Fish and fishery products 282 23.8 0-753.6 45.7 6.0 18.8 
   Minerals and metals 1,452 2.9 0-12.5 3.7 54.3 0.1 
   Chemicals and photographic 
   supplies 1,543 2.7 0-20 2.3 29.6 0.0 
   Wood, pulp, paper and 
   furniture 372 0.6 0-12.5 2.4 92.5 0.0 
   Textiles 878 7.6 0-12.5 3.4 3.4 0.0 
   Clothing 366 11.8 10.5-12 0.6 0.0 0.0 
   Leather, rubber, footwear and 
   travel goods 219 5.4 0-10 3.4 15.1 0.0 
   Non-electric machinery 792 3.3 0-17.5 2.8 23.9 0.0 
   Electric machinery 488 4.2 0-15 3.7 27.0 0.0 
   Transport equipment 240 9.3 0-30 8.5 21.7 0.0 
   Non-agricultural products, 
   n.e.s. 661 3.3 0-14 3.2 37.4 0.0 
   Petroleum 28 2.1 0-5 2.1 46.4 0.0 
Note: Calculations are based on national tariff line level (8-digit); excluding in-quota rates and including 
AVEs for non- ad valorem  rates provided by the authorities. 
Source: WTO Secretariat calculations, based on data provided by the authorities. 
3.1.4.2  WTO bound tariffs 
3.32.  All tariff lines are bound. Applied rates are cl ose to or coincide with their bound rates with a 
simple average bound tariff rate of 8.1%, compared  to a simple average of applied rate at 7.8% 
(Chart 3.2).36 This suggests broad predictability in the tariff. 
3.33.  Chinese Taipei is covered by the collective General Council waiver suspending the 
application of GATT binding disciplines to al low WTO Members to implement HS 2012 changes, 
pending the incorporation of these changes into their schedules of concession.37 This waiver will 
expire on 31 December 2014. 
 
                                               
36 Simple average at national tariff line level. 
37 WTO document G/C/W/684/Rev.1, 8 October 2013. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Chart 3.2 Average applied MFN tariff an d bound rates, by HS section, 2013 
(%) 
0.05.010.015.020.025.030.035.0
01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 2101   Live animals & products  
02   Vegetable products03   Fats & oils      
04   Prepared food, etc.
05   Mineral products06   Chemicals & products07   Plastic & rubber
08   Hides & skins09   Wood & articles
10   Pulp, paper, etc.
11   Textiles & articles12   Footwear, headgear13   Articles of stones
14   Precious stones, etc.15   Base metals & products
16   Machinery
17   Transport equipment18   Precision instrument19   Arms & ammunition
20   Miscellaneous manufacturing21   Works of art, etc.Average bound
(8.1%) Average MFN applied
(7.8%)MFN applied Bound 
 
Note: Calculations exclude in-quota rates and include AVEs for non- ad valorem  rates as provided by the 
authorities. 
Source: WTO Secretariat calculations, based on data provided by the authorities. 
3.1.4.3  Preferential tariffs 
3.34.  Preferential tariffs are granted to least developed countries (LDCs) and to WTO Members 
that have free-trade agreements or economic cooperation agreements with Chinese Taipei (Table 3.5). 
Table 3.5 Summary analysis of preferential tariff, 2013
 
(%) 
 Total WTO agriculture WTO non-agriculture 
  Average 
(%) Duty free  
ratesa 
(%) Average  
(%) Duty free  
ratesa 
(%) Average 
(%) Duty free  
ratesa (%)  
MFN 7.8 30.2 22.1 23.7 5.0 31.4 
Free trade arrangements       
FTA with El Salvador 3.5 78.8 16.3 49.3 1.0 84.4 
FTA with Guatemala 3.0 78.5 15.2 48.7 0.7 84.3 
FTA with Honduras 3.3 83.9 16.3 49.5 0.8 90.5 
FTA with Panama 1.9 97.9 11.3 88.7 0.1 99.6 
FTA with Nicaragua 2.9 85.2 14.6 55.4 0.7 91.0 
ECFA with China 7.6 33.3 22.1 23.7 4.8 35.1 
Least developed countries 
(LDCs) 7.6 31.7 22.1 24.3 4.9 33.1 
a Duty-free lines as a percentage of total tariff lines. 
Note: Calculations are based on national tariff line level (8-digit); excluding in-quota rates and including 
AVEs for non- ad valorem  rates provided by the authorities. 
Source: WTO Secretariat calculations, based on data provided by the authorities. 
 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 44 - 
 
  3.35.  Simple average tariff rates of FTAs, in gene ral, are lower than MFN rates, and the duty-free 
coverage is wider (Table 3.5). The main items still subject to tariffs in the FTAs with Central American countries are small passenger vehicles and parts, tobacco and tobacco products, and some agricultural products.
38 Since January 2013, all lines listed in the Early Harvest for Trade in 
Goods in the ECFA with China have been zero-rated. The simple average rate under the ECFA was 
7.6% in 2013, with about one-third of total tari ff lines duty free. In 2013, duty-free trade with 
China accounted for 11.15% of total trade, which gave a weighted average tariff rate at 1.4%.39 In 
addition to MFN duty-free treatment, other duty-f ree trade of China-origin goods under the ECFA 
Early Harvest covers 267 lines, including products such as petrochemical, textiles, machinery, and 
transport equipment. 
3.36.  Chinese Taipei unilaterally provides LDCs with duty-free treatment, covering 31.7% of lines 
in the 2013 tariff schedule.40 While 98% of the total value of trade with LDCs was under this 
duty-free treatment, trade with LDCs accounted fo r only 1.5% of Chinese Taipei's total trade in 
2013. 
3.1.4.4  Tariff exemption and reduction 
3.37.  Under the Customs Act, certain imports are exempted from tariff payment. These include: 
articles imported by certain government officials or for certain official use; articles for educational, 
research, or experimental purposes imported by public and private schools or other educational or 
research institutions; and advertising material and samples of no commercial value or of a value below the prescribed ceiling. 
3.38.  The Ministry of Finance has authority to adjust customs duties temporarily in order to deal 
with an "extraordinary" economic situation, domestic or overseas, or a situation to accommodate 
the supply of goods, or to provide a "reaso nable operational environment" without seeking 
approval from the legislature.
41 Adjustments are allowed within 50% of the statutory duty rate or 
quantity, and may be applied for up to one year. Different from the procedure for schedule 
changes, enterprises and/or industrial associatio ns may apply for temporary tariff adjustment. The 
decision for temporary adjustment is subject to approval by the executive. 
3.39.  During the review period, the authorities temporarily lowered tariff rates for certain 
products five times; each temporary adjustme nt was valid for a maximum of six months, and 
reduced most affected rates by half (Table 3.6) . According to the authorities, the tariff rate 
adjustments were made in response to a hike in food prices, with the aim of lowering the cost of 
living. 
Table 3.6 Temporary tariff adjustment, 2010-13 
HS Code Product Original 
rate (%) Temporary 
reduced rate 
(%) Validity 
11081410 Manioc starch 7 3.5 10 Aug 2011-9 Feb 2012 
10011000 Durum wheat 6.5 3.25 
10019000 Other wheat and meslin 6.5 3.25 
11010010 Wheat flour 17.5 8.75 
11031100 Groats, meal of wheat 20 10 
04021000; 
04022100 Milk and cream powder 10 7.5 
19011000 Preparation for infant use 5 2.5 25 Nov 2011-24 May 2012 
19019021; 
19019022 Prepared milk powder 12 6 
                                               
38 WTO document WT/TPR/M/232/Add.1, page 51, 25 August 2010. 
39 Calculation by the authorities of Chinese Taipei. 
40 Customs Administration online info rmation, "General Rules of the Customs Import Tariff". Viewed at: 
http://www.customs.gov.tw/rate/rate/General%20Rules%20of%20The%20Customs%20Import%20Tariff.pdf  
[26/10/13]. 
41 Article 71, the Customs Act. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 45 - 
 
  HS Code Product Original 
rate (%) Temporary 
reduced rate 
(%) Validity 
04051000 Butter 5 3.75 1 Dec 2011-31 May 2012 
04059010 Milk fat 8 6 
11022000 Flours of maize 6 3 
12081000 Soya beans 3 1.5 
04021000; 
04022100 Milk and cream powder 10 5 10 Feb 2012-9 Aug 2012 
08081000; 
08093000; 
08105000 Fresh apples, nectarines 
and kiwifruits 20 10 5 Oct 2012-4 Dec 2012 
Source: Information provided by the authorities. 
3.1.4.5  Tariff-rate quotas 
3.40.  Tariff-rate quotas (TRQs) are applied to 85  agricultural products at the HS ten-digit level 
(74 national tariff lines). The in-quota tariff rates for goods subject to tariff quotas are listed 
separately under Chapter 98 of the CCC.42 TRQs for small vehicles and chassis were abolished in 
January 2011. The authorities state that appropriate border measures need to be maintained to ensure sustainable development, given the mu lti-functionality of the agriculture sector.
43 
According to the authorities, the quantities of TR Qs are in line with Chinese Taipei's commitment 
upon its accession to the WTO. 
3.41.  Tariff-rate quotas are applied only to goods originating from WTO Members and are 
administered by the Ministry of Finance. The Bank of Taiwan (BOT) is delegated by the Ministry to 
allocate the TRQs.44 TRQs for all agricultural products except rice are based on both global quotas 
and country-specific quotas.  
3.42.  Allocation of TRQs, in practice, is through open bidding. When TRQs are allocated via open 
bidding, the BOT collects a deposit (referred to as  a performance bond or a premium) upon issuing 
a certificate of tariff quota. Quota holders may apply for refund of the deposit if the entire quantity of goods specified in their TRQ certificate has been imported within the certificate validity.
45 TRQs 
are transferable, partially or wholly, with the amount of the allocated quotas, within the validity of 
the TRQ certificates.  
3.43.  When the annual quota for a product is used up, normal import duties will be applied to the 
out-of-quota imports (Table 3.7). The out-of-quota rates can be ad-valorem  or specific. Some non-
ad valorem  rates (e.g. rice flakes) provide extremely high protection, which makes out-of-quota 
imports almost prohibitive (Table 3.7). 
3.44.  During 2009-12, TRQs for rice, longans, and deer velvet were almost filled whilst those for 
bananas, betel nuts, mangoes, and shaddocks were barely used (Table A3.2). The authorities note 
that very low or zero usage of the TRQs is attributed to the fact that products intended for import fail to pass relevant SPS requirements. 
3.45.  TRQs provided in the bilateral trade arrangements with New Zealand, Nicaragua, and 
Panama are administered in a similar manner to the MFN TRQs. 
                                               
42 Customs Administration  online information, General Rules of the Customs Import Tariff . Viewed at: 
http://eweb.customs.gov.tw/public/Attachment/091011391771.pdf  [22/10/13]. The out-of-quota rates are 
listed on the corresponding line s of other relevant chapters. 
43 WTO document WT/TPR/M/232/Add.1, page 8, 25 August 2010. 
44 Bank of Taiwan online information, "Tariff Rate Quota". Viewed at: 
http://www.bot.com.tw/Trade/TradeW TO/WTO_intro/Pages/default.aspx  [16/04/14]. 
45 If the amount of goods not imported is less than  a proportion prescribed in the TRQ announcement, 
the goods in questions are considered as imported en tirely. The performance bond or premiums may not be 
refunded after five years. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 46 - 
 
  Table 3.7 Tariff rate quotas, 2013 
Products Out-of-quota rates 2013 In-quota rates 2013 
Deer velvet (1 line) 500% 22.5% 
Fresh pears (1 line) NT$49/kg 18% 
Bananas (1 line) 100% 12.5% 
Red bean (8 lines) NT$22/kg 22.5% 
Milk (17 lines) NT$15.6/kg 15% 
Peanuts (11 lines) 
Ground-nuts and flours and meals thereof NT$42/kg or NT$64/kg 25% 
Ground-nuts oil 338% 25% 
Garlic bulbs (3 lines) 
for planting NT$27/kg 0% 
other NT$27/kg 22.5% 
Dried shiitake (1 line) NT$369/kg 25% or NT$110/kg 
whichever is the higher 
Dried day lily (1 line) NT$58/kg 22.5% 
Coconuts (1 line) 120% 15% or NT$0.9/kg 
whichever is the higher 
Betel nuts (1 line) NT$810/kg 17.5% 
Pineapples (1 line) 173% 15% 
Mangoes (1 line) 60% 25% 
Shaddocks (1 line) 184% 25% 
Dried longans (1 line) NT$88/kg 15% 
Rice(24 lines) 
Rice NT$45/kg 0% 
Rice products NT$49/kg 20% or 25% 
Groats and meal of rice NT$45/kg or NT$49/kg 0 – 25% 
Source: WTO document G/AG/N/TPKM/102, and information provided by the authorities. 
3.1.5  Tax collected at the border and other charges 
3.46.  Customs collects import duties and, on be half of other government agencies a number of 
taxes: Business Tax; Commodity Tax; Tobacco and Alcohol Tax; Specially Selected Goods and 
Services Tax; Health and Welfare Surcharge on Tobacco Products; and Trade Promotion Services 
Fee on imported goods at the border. The Specia lly Selected Goods and Services Tax has been 
imposed on "high-priced" products since 1 June 20 11. The contribution of trade-related taxes to 
total tax revenue increased from 22.8% in 2009 to 26.8% in 2013 with a certain amount of 
fluctuation (Table 3.8). Business Tax constantly accounted for two thirds of total trade-related tax 
during the review period. 
Table 3.8 Taxes and fees collected at the border, 2009-13 
(NT$ million) 
 2009  2010  2011  2012 2013  
Import tariffs 68,827 89,484 96,323 94,918 97,009 
Business Tax 232,165 322,710 344,727 328,093 327,246 
Commodity Tax 17,436 26,982 32,684 30,975 34,242 
Tobacco and Alcohol Tax 17,579 17,547 17,084 16,036 16,774 
Health and Welfare Surcharge 
on Tobacco Products 13,327 18,070 15,845 14,257 15,159 
Specially Selected Goods and 
Services Tax n.a. n.a. 791 1,304 1,685 
Total 349,334 474,793 507,454 485,583 492,115 
Percent of total tax revenue 22.8 29.3 28.8 27.0 26.8 
Trade Promotion Service Fee 3,503 4,588 4,921 4,827 4,813 
n.a. Not applicable. 
Source: Information provided by the authorities. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 47 - 
 
  3.1.5.1  Internal taxes 
3.47.  Internal taxes such as Business Tax, Commodi ty Tax, Specifically Selected Goods & Services 
Tax, and Tobacco and Alcohol Tax46 are applied equally to domestically produced and imported 
products. 
3.48.  Rubber tyres, cement, beverages, flat-glass (except conductive glass), fuels (such as oil and 
gas), electric appliances (e.g. fridges, air conditioners, audio/video recorders), and motor vehicles (including electric motor vehicles) are subject to Commodity Tax. Commodity Tax rates vary from 
8% to 35%, while the rates on cement and fuels are specific taxes. The executive is allowed to 
adjust the specific taxes within 50% of taxes specified in the legislation. However, no Commodity Tax adjustment was made in the review period. During the review period, Commodity Tax collected at the border accounted around  for 19% of total Commodity Tax revenue. 
3.49.  From 1 June 2011, certain "high-priced" goods, such as passenger cars, yachts, aircraft, 
helicopters, ultra-light vehicles, furniture, turtle shells, hawksbill, coral, ivory, and furs and fur products are subject to Specifically Selected Goods and Services Tax.
47 The tax rate is 10%. More 
than 30% of Specially Selected Goods and Services Tax was collected at the border in 2013. 
3.50.  Tobaccos (including tobacco products) and alcohol beverages are subject to Tobacco and 
Alcohol Tax. In addition, tobacco and tobacco products are subject to the Health and Welfare 
Surcharge. 
3.51.  Business Tax collected on imported goods is a value-added tax (VAT) set at the rate of 5%. 
VAT rates for imported wheat, barley, corn, or soy beans may be adjusted at the discretion of the executive.
48 According to the authorities, such discret ion was exercised twice during the review 
period, in order to deal with extraordinary economic situations and stabilize the supply of goods: 
VAT exemptions were granted on imported wheat, barley, corn, and soy beans for 15 months (10 March 2009 to 9 June 2010), and to corn for one year (6 April 2012 to 5 April 2013). VAT is 
exempted for imports of vessels for international transport, ocean fishing ships, fertilizers, and 
gold and gold products.  
3.1.5.2  Fees and other charges 
3.52.  The Trade Promotion Service Fee is collecte d at the border at the rate of 0.04% on the 
value of imports (and exports). The Fee finances the Trade Promotion Fund, managed by the Trade Promotion Fund Management Committee; about a third of the 21 members of the Committee are representatives of exporters/importers. The Trade Promotion Fund is used to cover 
administrative expenses related to trade promotion activities, such as organizing exhibitions and 
travel expenses. In 2012, the Fund collected NT$4,827 million at the border and spent NT$4,640 million on trade promotion events.
49 
3.53.  Harbour dues are based on the gross tonnage  of ships entering the port (ship port dues), 
number of passengers departing (passenger  port dues), and the "revenue tons"50 of loaded or 
                                               
46 The Health & Welfare Surcharge on tobacco products is levied and paid at the same time as the 
Tobacco & Alcohol Tax is collected; see Articl e 22, Tobacco and Alcohol Tax Act. Viewed at: 
http://law.moj.gov.tw/Eng/La wClass/LawAll.aspx?PCode=G0330010  [11/11/13]; and Article 18, Regulations 
for the Collection of Tobacco and Alcohol Tax. Viewed at: 
http://law.moj.gov.tw/Eng/La wClass/LawAll.aspx?PCode=G0330022  [11/11/13]. 
47 Specifically Selected Goods and Services Tax Act Article 2, lists all taxable-value thresholds for goods 
subject to this tax. For example, passenger cars whose value is not less than US$1 million are subject to this tax. Viewed at: http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=G0340128  [11/11/13]. 
48 Article 9-1, Value-Added and non-Valued-Add ed Business Tax Act, amended 23 November 2011. 
49 Bureau of Foreign Trade online information, "2012 Accounting Reports of Units under Trade Promotion 
Fund". Viewed at: http://www.trade.gov.tw/App_Ashx/File.ashx?FilePath=../Files/PageFile/275_433287/%e4%b8%ad%e8%8f%
af%e6%b0%91%e5%9c%8b101%e5%b9%b4%e5%ba %a6%e6%8e%a8%e5%bb%a3%e8%b2%bf%e6%98
%93%e5%9f%ba%e9%87%91%e9%99%84%e5%b1%ac %e5%96%ae%e4%bd%8d%e6%b1%ba%e7%ae%
97.pdf  [20/05/14, in Chinese]. 
50 Revenue tonnes (or charged tonnes) are the grea ter of measurement tonnes or weight tonnes. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 48 - 
 
  unloaded cargoes (cargo port dues).51 Harbour dues are specific to shipping routes, and are 
applied equally to domestic and foreign ships for the same routes; nonetheless, harbour dues for overseas routes are 60% higher than for domest ic routes. The authorities explained that this 
difference reflects the costs related to the type of equipment and services provided for vessels 
operating these routes. The authorities note that the dues collected are used mainly for 
construction and development of the commercial ports. 
3.54.  Customs charges for its services, including a special supervision fee, cargo examination fee, 
customs sealing fee, escorting fee, certificate issuance fee, and bonded warehouse stocktaking 
charge. The authorities note that all these fees are commensurate with the service cost. In the context of its last TPR, the authorities indicated that there was no intention to abolish these fees.
52 
3.1.6  Import prohibitions, restrictions, and licensing 
3.55.  The basic framework for import prohibitions, restrictions, and licensing has remained largely 
unchanged since 2010, although live marine mammalian wildlife and their products have been included in import restrictions since 25 January 2013.
53 The relevant legislation includes the 
Foreign Trade Act; the Regulations Governing Import of Commodities; the Regulations on Import 
and Export of Endangered Species of Wild Fauna , Flora and Related Products; and the Regulations 
Governing Export and Import of Strategic High-Tech Commodities. 
3.56.  A negative-list approach is applied to import prohibitions/restrictions, i.e. no import licences 
are required except for those on the List of Commodities Subject to Import Restriction.54 The 
authorities state that they maintain such measures in order to protect public morals, to safeguard international peace and security, to protect human life or health, to fulfil its WTO accession 
commitment, and to fulfil its obligations under international agreements in accordance with GATT 
Articles XX and XXI. The Bureau of Foreign Trade (B OFT), under the Ministry of Economic Affairs, 
administers import management measures, such as issuance of import licences, and issuance of 
approval of exemption from import prohibitions. Tariff-rate quotas for agricultural products are 
administered by the Ministry of Finance.  
3.1.6.1  Import prohibition 
3.57.  Seventy products at HS 10-digit level are prohibited from entry into Chinese Taipei. They 
cover, inter alia , whale sharks, puffer fish, narcotics, toxic chemicals, fire extinguishers
55, and 
waste lead-acid accumulators (Table A3.3). The authorities impose import prohibitions for reasons of public security, environmental protection, and compliance with its international obligations. 
3.1.6.2  Import licensing 
3.58.  The import licensing requirements and procedures have remained largely unchanged since 
2010, except that imports of small vehicles and chassis no longer require tariff-quota licences.
56 
3.59.  Import licences (e.g. import permits or import clearance certificates) are issued by the 
BOFT. Prior to applying for a licence, importers must obtain approval from the relevant sector-specific authority (e.g. the Council of Agri culture, or the Food and Drug Administration) 
(Table 3.9). These conditions apply for reasons of, inter alia,  requirements of trade agreements; 
essential security; and protection of culture, humans, and the environment. 
                                               
51 Other port-service charges include: port charge s (dockage, buoy, tugboat, mooring and unmooring, 
water supply, cleaning maintenance) and terminal operation charges (cargo  handling, storage, wharf passage, 
equipment utilization). 
52 WTO document WT/TPR/M/232/Add.1, page 29, 25 August 2010. 
53 Article 24, Wildlife Conservation Act, 25 Janu ary 2013. WTO document G/TBT/N/TPKM/132/Rev.1, 13 
March 2013. 
54 Article 7, Foreign Trade Act, amended 6 November 2013. For the list of import restrictions see Bureau 
of Foreign Trade online information. Viewed at: http://www.trade.gov.tw/Pages/List.aspx?nodeID=987 . 
55 Imports of fire extinguishers containing hydr ochlorofluorocarbons (HCFCs) are prohibited.  
56 WTO documents G/LIC/N/3/TPKM/2/Rev.2, 15 Se ptember 2011; and G/LIC/N/3/TPKM/4, 16 August 
2013. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 49 - 
 
  Table 3.9 Prior approval authorities for import licences 
Goods Approval authority Rationale 
Methyl bromide; HCFCs  Environmental Protection 
Administration To comply with obligations set out in 
the Montreal Protocol 
Breeding livestock/poultry; 
Genetic resources, genetically 
modified breeding stock/poultry 
and genetic resources Council of Agriculture To preserve public health and safety of 
humans, animals, and to prevent entry 
of infectious diseases from abroad 
Diamonds Bureau of Foreign Trade To cooperate with the Kimberley 
Process Certification Scheme 
Yellow-fin tuna; Bluefin tuna; 
Southern Bluefin tuna; 
Swordfish; Big-eye tuna Fisheries Agency To protect marine ecology 
Tobacco, alcohol products; Undenatured ethyl alcohol Ministry of Finance; 
Industrial Development Bureau  (for ethyl alcohol used in non-alcohol manufacturing/non-medical alcohol);  Defence authorities (for military use) To ensure the sound management of 
alcohol imports pursuant to the relevant laws/regulations 
Oil and petroleum products Bureau of Energy To promote the sound development of 
the oil industry; to develop the national 
economy and enhance people's 
livelihoods; to protect the environment 
Fishing boats Fisheries Agency To ma intain the sustainability of fishery 
resources 
Vessels; civil aircraft Ministry of Transportation and 
Communication To maintain the safety of transport 
vessels 
Firearms; ammunition; simulation guns; police weapons; controlled swords National Police Administration; 
Municipal/City/County Police (for controlled swords) To ensure the safety and peace of the 
society 
Industrial use explosives Bureau of Mines To ensure the safety and peace of the 
society  
Beef from Canada and the 
United States Bureau of Foreign Trade (with 
prior approval from Taiwan Food and Drug Administration) To protect human health 
Source: WTO document G/LIC/N/3/TPKM/2/Rev.1, 31  August 2009; and information provided by the 
authorities. 
3.60.  Automatic import licensing is applied to optical disc manufacturing equipment, and to six 
iron and steel products under import surveillance.57 The authorities note that the issuance of 
import clearance certificates for optical disc manufacturing equipment is to prevent infringement of 
intellectual property rights. 
3.61.  Importers of endangered species of wild fauna and flora protected under CITES must apply 
to the BOFT for import permits; the application must be accompanied by CITES certificates issued 
by the exporting country. 
3.62.  Enterprises or individuals not registered with the BOFT as importers/exporters must seek an 
import licence from the BOFT for any import of an f.o.b. value of US$20,000 or above. 
3.63.  An import licence is valid for six months from its issuance, and may be extended for 
18 months maximum. No licensing fees, other administrative charges or deposit are required. Import licences are not transferable. 
3.64.  Chinese Taipei maintains tariff-rate quotas (TRQs) on agricultural products (sections 3.2.4 
and 4.1.1.3). A certificate of tariff quota serves as an import licence. In the context of the last TPR, the authorities indicated that the maintenance of TRQs and other special safeguard measures 
on agriculture products was to ensure the sust ainable development of the agriculture sector.
58 The 
TRQ for small vehicles and chassis was abolished in January 2011. 
                                               
57 WTO document G/LIC/N/3/TPKM/2/Rev.1, 31 August 2009. 
58 WTO document WT/TPR/M/232/Add.1, page 8, 25 August 2010. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 50 - 
 
  3.1.6.3  Other restrictions 
3.65.  Products originating from China generally require permission from the MOEA prior to their 
exportation to Chinese Taipei.59 The list of permitted goods originating from China is reviewed and 
revised every six months. As of 10 April 2014, 2,186 China-origin products at HS 10-digit level 
were prohibited from importation into Chinese Taipei.60 This cross-Strait prohibition covers, 
inter alia , live animals; animal products including meat  and poultry; fish and fishery products; milk 
and dairy products; plants and plant products including fruits and vegetables; rice; processed 
foods and food-related products; fabrics and textile products; iron and steel products; certain 
machinery; and motor vehicles and parts.61 Among the 9,150 China-origin products that are 
permitted entry into Chinese Taipei, 126 products at HS 10-digit level require import licences. According to the authorities, this was a solution to the failure to conduct bilateral consultations 
during WTO accession negotiations of the two pa rties, and the authorities indicate that the 
situation will improve after the entry into force of the ECFA. 
3.66.  Imports of radio-communication apparatus do  not require licensing, but importers of these 
apparatus must obtain approval from the relevant authorities prior to importation; the NCC
62 
approves these imports for civilian use, and the defence authorities for military use. 
3.1.7  Contingency measures 
3.1.7.1  Overview 
3.67.  The legislative and institutional framework for contingency measures has remained largely 
unchanged during the period under review. 
3.68.  Chinese Taipei has applied a total of 12 anti-dumping (AD) measures since 2003, affecting 
mainly the steel, textile, and chemical industries. It has applied no countervailing or safeguard 
measures since its accession to the WTO. 
3.1.7.2  Anti-dumping and countervailing 
3.69.  The main AD legislation is contained in the Customs Act and the Regulations Governing the 
Implementation of the Imposition of Countervailing and Anti-Dumping Duties. Competence for AD/CV investigations is shared between the Mini stry of Finance and the Ministry of Economic 
Affairs: the Ministry of Finance is focused on dumping/countervailing determination, whereas the 
International Trade Commission (ITC) under the Minist ry of Economic Affairs (MOEA) verifies injury 
to domestic industries.
63 The authorities maintain websites, which are available to the public, on 
information on investigations, reviews, and measures adopted.64 
3.70.  Provisional measures may be imposed no earlier than 60 days from the initiation of the 
proceeding. Provisional duties must be secured by  a guarantee; upon provision of the guarantee, 
imports of the product concerned will be cleared from Customs. Provisional duties may be imposed 
for four months, up to a maximum of nine months.65  
                                               
59 Article 7, Regulations Governing Permission of Trade Between Taiwan Area and Mainland Area. 
60 Bureau of Foreign Trade online information, "T rade Services – Mainland Goods Administration". 
Viewed at: http://www.trade.gov.tw/Pages/List.aspx?nodeID=744  [28/05/14, in Chinese]. 
61 The prohibition of 2,186 products includes 70 prohibited  products on an MFN basis. See detailed list of 
prohibited China-origin goods at: https://fbfh.trade.gov.tw/rich/text/fhj/asp/downlo ad.asp?src=FHJP191R01.xls&progNo=FHJP340&progName=
貨品資料表下載  [28/05/14, in Chinese]. 
62 Online information available at: www.ncc.gov.tw. 
63 International Trade Commission online information, "Industry injury investigat ions for AD/CV duties". 
Viewed at: http://www.moeaitc.gov.tw/ITCWEB/w ebform/wFrmRule.aspx?programid=551  [21/11/13, in 
Chinese]. 
64 Customs Administration online in formation, "Anti-dumping and Coun tervailing Measures in Force". 
Viewed at:  http://eweb.customs.gov.tw/ct.asp?xItem=67293&CtNode=15591  [16.04.14]; and International Trade 
Commission online information, "I nvestigation Cases". Viewed at: 
http://www.moeaitc.gov.t w/itcweb/IC/wFrmIcOngoingEn.aspx?programid=574  [20/11/13]. 
65 When the authorities "consider to examine" whethe r a duty lower than the margin of dumping would 
be sufficient to remove injury, the application of provisional measures will be extended to six months (from WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 51 - 
 
  3.71.  Definitive anti-dumping or countervailing me asures are usually imposed for a fixed period of 
f i v e  y e a r s ,  s u b j e c t  t o  e x p i r y  r e v i e w s .  I f  n o  expiry review is requested, the measure expires 
automatically. Domestic industries may request ex piry reviews no later than five months before 
the expiry of a measure. If the expiry review determines the measure should be retained, the 
duties normally remain in force for another five years. The authorities indicated that the average 
duration of AD measures is seven years. 
3.72.  AD or CV measures may be terminated or changed before their expiry. After the measures 
have been in place for more than one year, inte rim reviews may be requested by any interested 
party, including importers and exporters.66 Interim or expiry reviews may result not only in a 
decision to continue or end the duties in force, but also in a change in the level or form of the duties. For instance, AD duties were raised, duri ng the interim review on sodium formaldehyde 
sulpoxylate from China (in June 2012), and during the expiry review on art paper from Japan (in 
March 2006).
67 The threshold for terminating AD measures is where the dumping margin is 
determined to be less than 2% of the export price. 
3.73.  There were six definitive AD measures in force during the review period, two of which were 
extended through expiry reviews. These measures affect: towelling products, certain footwear, benzoyl peroxide, sodium formaldehy de sulpoxylate, and Portland cement type I, II and its clinker 
from China; and cold-rolled stainless steel products from China and Korea (Table A3.4). The 
highest definitive AD duties imposed between January 2010 and November 2013 concern towelling products at 204.1% and Portland cement at 91.58%. The measure concerning art paper from Japan expired in March 2011. 
3.74.  During the period under review, eight new AD investigations were initiated; three 
investigations resulted in the imposition of definitive AD measures. The investigations covered the industries of cement, chemical, paper, steel, an d computerized thermal CTP (computer to plate) 
from five trading part ners (Table A3.4). 
3.75.  Chinese Taipei has applied no countervailing measures since its accession to the WTO in 
2002. 
3.1.7.3  Safeguards 
3.76.  The basic legislation on safeguards is contained in the Foreign Trade Act and the Rules for 
Handling Import Relief Cases. Provisions regarding the Transitional Product-Specific Safeguard Mechanism against products from China were de leted in January 2014, in accordance with the 
expiry of the corresponding section in the WTO Accession Protocol of China. The MOEA ITC is the 
competent authority for safeguard measures. 
3.77.  The authorities do not maintain any market surveillance or other similar measures on the 
grounds of safeguard concerns. When safeguard meas ures are applied, tariff increases (including 
tariff-rate quotas) or import quotas may be imposed to the products concerned.
68 
3.78.  A new investigation on all imports of high density polyethylene (HDPE) and linear low 
density polyethylene (LLDPE) was opened in July 2013, and negative injury was determined in 
April 2014. Since its accession to the WTO, Chinese Taipei has initiated two safeguard investigations. According to the authorities, no safeguard measures have been applied under the provision of the WTO Agreement on Safeguards. 
3.79.  Chinese Taipei maintains special safeguard (SSG) measures, through imposition of 
additional tariffs, on 15 agricultural products (secti on 3.1.4.1). In the context of its last TPR, the 
                                                                                                                                               
four months) and nine months (from six months). See Ar ticle 13, Regulations Governing the Implementation of 
the Imposition of Countervai ling and Anti-Dum ping Duties. 
66 An interim review may also be carried out on the initiative of the authorities. See Article 43, 
Regulations Governing the Implementation of the Impo sition of Countervailing and Anti-Dumping Duties. 
67 International Trade Commission online information, "List of Antidumping Review Investigation Cases". 
Viewed at: http://www.moeaitc.gov.tw/itcweb/webform /wfrmSite.aspx?pagestyle=2&programid=275  
[21/11/13]. 
68 Article 4, Rules for Handling Import Relief Cases. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 52 - 
 
  authorities note that the SSG measures on agricultural products were distinct from the safeguard 
measures pursuant to the WTO Agreement on Safeguards.69 
3.80.  All of Chinese Taipei's bilateral trade arrangements contain provisions on safeguards. 3.1.8  State-trading 
3.81.  Chinese Taipei maintains state trading over rice products and banknote paper 
(eight national tariff lines).
70 
3.82.  As stipulated in the Food Administration Act, imports of rice and rice products within the 
tariff-rate quotas are carried out by the Agricult ure and Food Agency (AFA) under the Council of 
Agriculture71; 65% of the TRQs are assigned to the AFA (section 4.1). The authorities note that 
these measures are to ensure food security, food  market stability, and the security of farmers' 
income. 
3.1.9  Technical regulations and standards 
3.83.  During the period under review, the institutional framework for technical requirements and 
standards remained largely unchanged. The relevant legislation includes provisions in the 
Standards Act, the Weights and Measures Acts, the Commodity Inspection Act, and their 
implementation regulations, as well as the Regu lations Governing the Establishment of National 
Standards and the Regulations Governing Registrati on of Product Certification. The TBT enquiry 
point is the Bureau of Standards, Metrology and Inspection (BSMI) under the Ministry of Economic 
Affairs (MOEA).72 
3.84.  BSMI notified 74 technical regulations an d conformity assessment procedures to the WTO in 
the period from January 2011 to November 2013. The notifications cover, inter alia , consumer 
chemicals, electric and electronic equipment, household appliances, motor vehicles and parts, food 
and beverage, and textile products. The notifications normally specify a comment period of at least 60 days and a proposed date of adoption. The authorities also submitted a number of addenda, 
providing additional information on the adoption, entry into force, extension of comment period, 
and contents of the final text of previously notified TBT measures. 
3.85.  Any person, legal entity, government agency or organization may submit proposals for 
national standards to the National Standards Review Council. The relevant standard authorities 
such as various National Standards Technical Comm ittees prepare the draft standards, and publish 
for comments. The standards, once finally adopte d, will be granted a CNS symbol and a serial 
number. As stipulated in the Regulations Governing the Establishment of National Standards, 
international standards are used as the basis for drafting national standards, except where these 
would not conform to the purpose of the national standard.
73 Notices of proposed technical 
regulations, standards, procedures for conformity  assessment, and their final texts are published 
in the Government Gazette74 and on the BSMI website.  
3.86.  Domestic standards (including national and professional standards)75 are voluntary, except 
those designated as technical regulations.76 The standards policy is intended to promote 
standardization; to pursue quality improvement for products, processes, and services; to increase 
productivity; and to ensure adequacy of produc tion, transportation, marketing, and consumption 
so as to promote public safety. According to the authorities, all technical regulations are aligned with international standards.
77 Technical regulations form the basis for issuance of conformity 
                                               
69 WTO document WT/TPR/M/232/Add.1, page 37, 25 August 2010. 
70 WTO document G/STR/N/14/TPKM, 25 June 2012. 
71 Article 7, the Food Administration Act, amended 24 November 2010. 
72 WTO document G/TBT/ENQ/38/Rev.1, 8 July 2011. 
73 Article 6, Regulations Governing the Establishment of National Standards, amended on 5 December 
2011. 
74 Online information available at: http://gazette.nat.gov.tw/egFront/eng/EngIndex.jsp . 
75 Professional standards are private standards. 
76 Article 4, the Standards Act. 
77 WTO document WT/TPR/M/232/Add.1, page 17, 25 August 2010. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  certificates. Technical regulations, which are mandatory, are mainly applied to certain electrical 
products, chemical products, machinery, and agricultural products. 
3.87.  Products subject to technical regulations must undergo a commodity inspection for 
conformity before they are placed on the markets.  Inspections are required for imported, exported 
and domestically produced goods. As of Februa ry 2014, in addition to 1,853 agricultural and 
fishery products, 1,137 commodities were subject to mandatory inspections; among which 756 chemical products
78, and 381 mechanical, electrical and electronic products. The authorities 
maintain a website, available to the public, for enquiries on products subject to commodity 
inspection.79 
3.88.  Inspections are carried out under four conformity assessment procedures: batch-by-batch 
inspection, monitoring inspection, registration of product certification, and declaration of 
conformity. The choice of inspection procedures de pends on the nature of risks involved. Products 
of simple design with fewer safety concerns may be cleared through declaration of conformity; whereas other products mainly are subject to registration of certification, i.e . submission of 
relevant documentations, including quality management accreditation and laboratory testing 
certificates, to the BSMI. As of February 2014, 52 products (41 electronic products and 11 chemical products) were subject to declarat ion of conformity; 80% of mechanical, 100% of 
electrical, and 60% of electronic products were subject to registration of product certification. 
3.89.  Products meeting the criteria set out in na tional standards (including technical regulations) 
may bear CNS marks, upon application by the producers to the BSMI. Applications for using CNS marks must be product and producing-plant specific.
80 Foreign-origin products may also apply for 
CNS marks.81 Approval is conditional on the applicant's acquisition of accreditation of quality 
management, and certificates of conformity. 
3.90.  Certificates of conformity for chemical products are issued only by the BSMI; certificates for 
mechanical, electrical and electronic products, and certificates of quality management may be 
issued by the BSMI or by BSMI-commissioned certification bodies (third-party certification agencies). Domestic non-profit institutions (e.g. government institutes, universities, colleges) with 
BSMI-recognized laboratories may apply to become third-party certification agencies; application is 
not open to foreign institutions. Product certification by foreign agencies may be recognized only through mutual recognition arrangements.  
3.91.  Product testing activities that lead to certification must be conducted in the laboratories 
recognized/designated by the BSMI. Laboratories  that apply for BSMI recognition must be 
accredited by the Taiwan Accreditation Foundation (TAF) prior to submitting their applications. Foreign laboratories may also apply for BSMI recognition.
82 BSMI recognition is valid for three 
years, renewable.83 The TAF has accredited 1,638 laboratories; there are 262 conformity 
assessment bodies.84 
3.92.  Foreign laboratories may also obtain BSMI recognition through bilateral cooperation 
agreements or mutual recognition agreements fo r example under the International Accreditation 
Forum, Inc. (IAF) or the Pacific Accreditation Cooperation (PAC).85 As of March 2014, 117 foreign 
                                               
78 Textile products of synthetic fabrics are included in chemical products. 
79 BSMI online information, "Searc h System of the Bureau of Standa rds, Metrology, and Inspection". 
Viewed at: http://civil.bsmi.gov.tw/bsmi_pqn/index.jsp?lang=en  [25/11/13]. 
80 Article 8, Regulations Governing CNS Mark. 
81 Foreign applications must be made through an agent who has a house or business address in 
Chinese Taipei. 
82 Foreign applications must be made through an agent who has a house or business address in 
Chinese Taipei. Foreign applicants fo r designated laboratori es for chemical produc ts, and for designated 
electrical safety laboratories recognized by the BSMI must be accredited by the TAF prior to application; 
applications for designated EMC laboratories  may be submitted directly to the BSMI. 
83 Recognized laboratories may apply for the BSMI accreditation for quality management certification 
bodies. Accreditation is valid for five  years, renewable every five years. 
84 Conformity assessment bodies incl ude not only third-party certificatio n bodies, but also test facilities, 
factory inspection bodies, and qualit y management certification bodies. 
85 If there is no accreditation body (AB) in an applic ant’s country, or if the AB in the applicant’s country 
is not a member of the IAF MLA or PAC MLA, accreditation may be acquired from other IAF MLA or PAC MLA member ABs located in other countries. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  laboratories have acquired BSMI recognition through mutual recognition arrangements. The 
authorities may accept test reports, inspection certificates, and/or other relevant certification documents issued by accredited laboratories from bilateral agreement partners, or under multilateral mutual recognition agreements.
86 As of February 2014, the BSMI had signed bilateral 
cooperation agreements with 35 organizations in 26 countries87; and Chinese Taipei has mutual 
recognition agreements (MRAs) with seve n WTO Members (Australia, Canada, Japan, 
New Zealand, Singapore, Viet Nam, and the United States). The authorities note that 
seven foreign certification documents were acce pted through mutual recognition arrangements 
during the review period. 
3.93.  The BSMI also runs two voluntary certification programmes: CNS-mark certification also for 
products passing national standards that are not designated as technical regulations; and VPC as 
an alternative to the CNS mark for products that have a short life-cycle and where relevant 
international standards are available. 
3.94.  Product labelling is mandatory in88: imported products must have labels and instructions in 
Chinese language, and the Chinese version may not be simpler than the version in the original 
language. 
3.1.10  Sanitary and phytosanitary requirements 
3.95.  The Bureau of Animal and Plant Health Inspection and Quarantine (BAPHIQ) under the 
Council of Agriculture is the SPS enquiry point in the WTO.89 
3.96.  The Bureau notified 122 regular and seven emergency SPS measures to the WTO between 
1 January and 30 November 2013. Chinese Taipei considered that, of the 39 notified measures for 
which there was a relevant international standard, 26 conformed to that international standard. 
Apart from emergency notifications, about 55% of notifications allowed a 60 day period for public comment; for the rest the authorities considered that a comment period was not applicable or 
practical. Among the notified measures, Chinese Ta ipei identified 20 as "trade facilitating". In 
addition, the authorities submitted a number of ad denda during the period under review, providing 
additional information on previously notified SPS measures.  
3.97.  Since the last Review, WTO Members have discussed concerns in the SPS Committee 
regarding a number of measures. Two new trade concer ns were raised for the first time during the 
review period, and one was resolved (Table 3.10). The authorities note that the maximum residue level (MRL) of ractopamine in beef was adopted in September 2012. 
Table 3.10 Specific trade concerns over Chinese Taipei's SPS measures, January 2010-
December 2013 
Issue WTO reference 
documenta Raised by Date first 
raised Solution 
Restrictions on ractopamine in 
beef and pork G/SPS/R/66 United States, Brazil, 
Canada, Costa Rica, 
Ecuador, Peru 08/10/2008 Not reported 
BSE measures G/SPS/R/63 Canada, United States, 
European Union 17/03/2010 Not reported 
MRLs for roasted and 
powdered coffee G/SPS/R/67 India, Colombia, 
European Union 10/07/2012 Resolved 
(18/10/2012) 
a Only the most recent source document is cited. 
Source: WTO Secretariat. 
                                               
86 Article 15, Commodity Inspection Act. 
87 The authorities stated that the cooperation agreem ents with the BSMI and other jurisdictions mainly 
involve co-registration cooperation on management system certification, product marks, technical cooperation, regulatory cooperation and cooperation, for general purposes. WTO document WT/TPR/M/232/Add.1, page 32, 
25 August 2010. 
88 Article 12, Commodity Labelling Act, amended on 26 January 2011. 
89 WTO document G/SPS/ENQ/16, 9 December 2013. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.98.  Chinese Taipei is a member of the World Organization for Animal Health (OIE), but is not a 
member of the Codex Alimentarius Commission, or the International Plant Protection Convention (IPPC). The authorities note that they do take IPPC standards, guidelines, and recommendations 
into consideration.
90 Chinese Taipei maintains bilateral arrangements such as consultations 
meetings on promoting mutual cooperation on SPS issues with Australia, Canada, China, the 
European Union, Japan, Thailand, the Netherlands, New Zealand, the Philippines, Viet Nam, and the United States. SPS measures are also covered in the free-trade arrangements with 
El Salvador; Guatemala; Honduras; New Zealand; Nicaragua; Panama; and Singapore.  
3.99.  Legislation pertaining to SPS measures for foods (the Food Sanitation Act) has been 
amended five times since 2010 (last amendment effective February 2014). Other legislation such as the Statue for Prevention and Control of Infectious Animal Diseases; and the Plant Protection 
and Quarantine Act remained unchanged. 
3.100.  All foods and related products (e.g. food additives, food containers/packages, and food 
cleansers) must comply with the general requirement laid down in the Food Sanitation Act and 
specific requirements depending on the products. The Food Sanitation Act was renamed "Act 
Governing Food Safety and Sanitation" in Febr uary 2014. The Food and Drug Administration 
(TFDA), under the Ministry of Health and Welfare,  is the competent authority for foods and related 
products.
91 
3.101.  Food businesses within the category and scale designated by the central competent 
authorities must apply for registration prior to commencing operations.92 The registration 
requirement covers food manufacturing and proc essing businesses, catering businesses, food 
importing businesses, and food retail businesses.93 
3.102.  Imported foods in the form of tablets or capsule must file for registration with the TFDA, 
and acquire an import permit/licence before importation. The authorities note that this 
requirement is necessary to identify the nature of  tablet/capsule contents (i.e. food or drug). 
Imports of beef and beef products from the United  States or Canada require import licences from 
the BOFT. In the context of its last TPR, the authorities noted that this "import licensing measure 
is a special arrangement", and there were no plans to notify the WTO about such licensing 
procedures.94 
3.103.  Imported foods and related products are subject to TFDA inspection prior to customs 
clearance if "designated by the central competent authorities".95 TFDA border inspection may take 
the form of: batch-by-batch inspection (on-site sampling of each batch); randomly selected batch 
inspection (up to 50% on-site sampling of each batch); "oversee inspection" (on-site verification and sampling); batch-by-batch verification; and document review. Importers may apply for a 
second inspection within 15 days if the imports fail to pass the inspection. Food importers with an 
excellent performance record may be granted import inspection with less control, including the application of minimum inspection rate
96, and the use of document review.97 
3.104.  Food importers may apply to the TFDA for prior release due to the product nature (e.g. 
perishable goods) or inspection time-frame. They  may be required to pay a deposit against prior 
release; however, prior release does not imply that the imports may be freely circulated in the market without inspection. 
                                               
90 WTO document WT/TPR/S/232/Rev.1, July 2010. 
91 Food and Drug Administration online information. Viewed at: http://www.fda.gov.tw/EN/index.aspx  
[05/12/13]. 
92 Article 8, Food Sanitation Act. 
93 Article 4, Regulations Governing the Registration of Food Businesses, entry into force on 3 December 
2013. 
94 WTO document WT/TPR/M/232/Add1, page 39, 25 August 2010. 
95 Article 30, Food Sanitation Act. If the imported product is not for sale, and its value and quality are 
consistent with the TFDA announcement (or are approved  by the TFDA), import inspection may be exempted. 
96 Criteria for importers with excellent performance are listed in Article 14, of the Regulations of 
Inspection of Imported Foods and Related Products, amended 27 January 2014. 
97 For importers whose products conformed to the re gulations within two years. See Article 15, the 
Regulations of Inspection of Imported Foods and Related Products, amended 27 January 2014. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.105.  Imported foods deemed to be high risk are subject to "systematic inspection" prior to 
importation. "Systematic inspection" covers me a t  p r o d u c t s  u n d e r  H S  c o d e  c h a p t e r  0 2 ,  a n d  
headings 0504, 1601, 1602, and 1603. When a source control is needed, or in response to a specific food-safety incident in the export country, Chinese Taipei may send inspectors for an 
on-site visit to the suppliers.
98 The authorities indicate that Chinese Taipei does not charge a fee 
for on-site inspection and generally pays the expenses of the inspection team. 
3.106.  Foods or food additives that have never been provided for human consumption or have 
never been proven to be harmless to human health are prohibited (from manufacturing, 
importation and exportation). It is also prohibited to import skulls, brains, eyes, spinal marrow, ground beef, viscera and other related products fr om non-epidemic areas with a reported case of 
Bovine Spongiform Encephalopathy or New Variant of Creutzfeldt-Jakob Disease within the past 
ten years.
99 Food with pesticide or veterinary drugs residue exceeding the permissible tolerance 
may not be placed on the market. Chinese Taipei amended its Standards for Pesticide Residue Limits in Foods on 31 December 2013, and the Standards for Pesticide Residue Limits in Livestock 
and Poultry Products on 20 August 2013.
100 As of end 2013, 3,587 pesticide MRLs had been 
published and enforced. According to the authorities, Chinese Taipei follows Codex principles and FAO/OECD risk-assessment procedures when setting pesticide MRLs for fruits and vegetables. 
Chinese Taipei does not ban the use of beta-agonists (a chemical group including ractopamine) as 
a feed additive in cattle, and established a 10 ppb MRL for ractopamine in beef muscle in September 2012 by adopting the Codex standard. For domestic use, a registration procedure needs to be completed. 
3.107.  Imports of terrestrial animals, fertilized eggs, semen, embryos, sera, and biological 
materials for research purpose (inactivated biological preparation excluded) are subject to prior clearance (e.g. import permits, or issuance of quarantine requirements)
101 from the quarantine 
authorities. In Chinese Taipei, the term "animal products" covers products whether intended for 
human consumption or not, that have been derived from animals or come from animals, whether processed or not, inter alia , meat, dog and cat food, dry animal products (e.g. bone, horn, claw, 
feather, etc.), fish, processed products containi ng meat, animal feed preparations, processed egg 
products, and milk and milk products. Importation of Bats is prohibited, as well as animals and animal products from animal-disease-infected area s, except those meeting the relevant quarantine 
requirements.
102 
3.108.  The simplified quarantine clearance proced ure is applied to imports of low-risk animal 
products, which includes certain products originating in non-infected areas of animal diseases, and dog and cat food processed by high-temperature st erilization procedures. This clearance procedure 
is based mainly on reviews against application documents; on-site inspections will be conducted on 
the basis of random selection among all applications.  
3.109.  Request for first-time imports of live animals and animal products is subject to risk 
assessment by the quarantine authorities. The ri sk assessment may result in setting quarantine 
requirements specific to the imports. If the risk  assessment concludes that there is no risk for 
disease transmission, or the risk for disease transmission can be controlled and the relevant quarantine requirements have been adopted, the importation will be allowed. Subsequent 
consignments of the same kind may be imported by simply following quarantine requirements 
issued by the authorities.  
                                               
98 Article 35, Food Sanitation Act. 
99 Article 15, Food Sanitation Act. 
100 Food and Drug Administration online informat ion, "Laws and Regulations: Food". Viewed at: 
https://consumer.fda.gov.tw/Files/LawFile/518_127/St andards%20for%20Pesticide%20Residue%20Limits%20
in%20Foods.PDF , and 
https://consumer.fda.gov.tw/DownLoadMethod/ashx/downloadFile.ashx?id=2189&type=0 . 
101 The quarantine requirement is a binding document that Chinese Taipei quarantine authorities issue 
to importers according the specific conditions of the imports. All technical details to comply with the quarantine requirements are listed and serve as a guideline. The authorities are of a view that the quarantine requirement is a trade facilitation measure, and is expected to reduce  border denial of goods if it is properly followed.  
102 Animals originating from disease-fr ee areas but transhipped through po rts/airports in infected areas 
are considered as originating from infected areas, and are thus prohibited from impo rtation. However, animal 
products under the same situation may be imported if transported in closed containers. See Article 3 and 6, 
Quarantine Requirements for the Importation of An imal and Animal Products, amended on 21 March 2014. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.110.  According to the authorities, the importat ion of animals and animal products generally is 
not confined to specific sources (e.g. farms) as long as quarantine requirements are met. 
However, the TFDA maintains a list of approved establishments/farms for beef imports from Canada and crab imports from China; only products from the establishments on the list are 
allowed to enter Chinese Taipei. According to the authorities, the list is maintained as per the 
respective bilateral arrangements with trade partners.  
3.111.  Importation of plants and plant product is subject to prior clearance from the authorities. 
Hazardous insects, soil, plants with soil, and their containers are prohibited from importation. A 
detailed list of plant quarantine requirements is published, and available to the public; the recent 
updated version entered into force on 23 May 2014.
103 There are two categories of quarantine 
requirements on the list: import prohibition and import permit. The import prohibition list is 
country- and plant-specific.104 For imports of plants subject to quarantine requirements must have 
phytosanitary certificates issued by the competent authorities of the exporting country must be submitted prior to the shipments' arrival in Chinese Taipei. 
3.112.  Requests for first-time imports of plants and plant products are subject to risk assessment 
by the quarantine authorities. 
3.113.  Animals, animal products, plants and plant products that are on the import inspection list, 
must be inspected prior to customs clearance.
105 The official controls at the border involve 
documentary, identity, and physical checks. Importers must submit applications for inspection prior to the arrival of shipments. Applications may be submitted through the Single Window (section 3.1.1). The BAPHIQ carries out quarantine  inspections on a batch-by-batch basis, except 
for animal and plant products deemed to be low risk, for which inspection is conducted on the 
basis of random selection. Importers are not allowe d to apply for a second inspection for intended 
imports that fail to comply with the quarantine requirements. 
3.114.  Inspection fees are set at 0.1% of the cu stoms values (0.05% for wheat, barley, corn, and 
soy beans); quarantine authorities levy service charges for operations such as on-site inspection at a rate of NT$500 per batch of consignment
106; other (e.g. animal holding fees, carcass burning 
fees, document handling fees, etc.) are imposed at the actual cost price.107 
3.115.  Agricultural products (including processed products) marketed as "organic" must be 
certified by a certification body accredited by the COA.108 The certificate is product specific, and 
valid for three years, renewable. Imported organic agricultural products must be reviewed by the 
authority before being placed on the market. Foreign certificates of organic agricultural products 
are accepted for the review process if issued by a certification body accredited by the exporting 
country and approved by Chinese Taipei.109 Ingredients of organic agricultural products must come 
from not less than 95% of organic raw materials, and must be clearly labelled. Imported inputs of 
organic materials must be labelled with their country of origin, even after they have been substantially transformed within Chinese Taipei.
110 
                                               
103 BAPHIQ online information, Quaran tine Requirements for the Importation of Plants or Plant Products. 
Viewed at: http://www.baphiq.gov.tw/admin/upload/twgov_file_201311071146261.pdf  [28/11/13]. 
104 Plants and plant products originating from pest- free areas but transhipped through ports/airport in 
the pest-infected areas are considered as originating fro m infected area, and thus pr ohibited from importation. 
105 For the list of animals, animal products, and plants and plant products subject to inspection, see 
Bureau of Foreign Trade online information, "Commodity Export/Import Regulation Enquiries" with a regulation 
code B01. 
106 Multiple batches at the same site are counted as one batch. Service charges for on-site inspections 
are not applied to inspections conducted at warehous es, container terminals or other locations where the 
offices of the BAPHQ are located. See Article 10, Regula tions Governing Fees for An imal and Plant Quarantine, 
amended 20 February 2014. 
107 A cap is imposed on this service charge at 15% when carried out by private practitioners. 
108 Article 5, Agricultural Prod uction and Certification Act. 
109 Imported Organic Agricultural Product and Orga nic Agricultural Processed Product Management 
Regulations, amended 23 June 2011. 
110 See Article 26, Organic Agricultural Product and Or ganic Agricultural Proces sed Product Certification 
Management Regulations. This requirement entered into force on 23 June 2012. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.116.  Provisions pertaining to genetically modified organisms (GMOs) are scattered in various 
acts and regulations.111 GMOs require authorization before their marketing and sale. In order to 
obtain authorization, genetically modified organisms (including aquatic organisms, plants, and animals) must undergo field tests and pass bio-safety assessments. Field tests of GMOs must be 
conducted by field testing institutions accredited by the relevant competent authorities. Evaluation 
Committees within the competent authorities are responsible for reviewing field tests and relevant management matters, as well as for approving bio- safety assessment reports after the field tests. 
A genetic-characteristics investigation, an integrated part of a field test, must be carried out and 
serve as a pre-requisite for bio-safety assessm ent. For imported GMOs, reports of genetic-
characteristics investigations by the exporting countries may be accepted as reference documentation for the bio-safety assessment procedure. As of end-May 2014, only one GM-plant 
had been authorized. 
3.117.  GMOs as food raw materials must obtain approval from the food safety authorities. Since 
2002, 61 GMOs (out of 68 applications), have been approved as food raw materials. According to 
the authorities, the average processing time for approving GMOs as food raw materials is about 
two years. Under the recently amended Food Safety and Sanitation Act, importers of GMOs as food 
raw materials must establish a system for backward and forward tracking of the origin and 
dissemination of the ingredients. With regard to la belling, an approach of positive labelling is set 
out in the amended Act, i.e. food and food-additive ingredients that contain/are derived from GMOs must be listed. 
3.118.  Genetically modified plants that have been authorized for domestic promotion and sale 
must be labelled in accordance with provisions in the Commodity Labelling Act. Moreover, 
genetically modified plants on the market must  be clearly labelled "Genetically Modified" and 
display the unique GM plant identification number issued by the Council of Agriculture.
112 
3.119.  Genetically modified plants, breeding flocks/stocks, and aquatic products need approval 
from the competent authorities prior to their importation/exportation. Approvals of genetically modified plant imports/exports are issued by the Council of Agriculture. The competent authorities 
may take samples from the imported consignments for the purpose of verifying the nature of 
imported genetically modified plants.
113 
3.2  Measures Directly Affecting Exports 3.2.1  Export documentation and procedures 
3.120.  Registration and documentation requirements for exports, in general, are similar to those 
for imports. Exporters must be registered with the BOFT prior to engaging in any export business. There has been no major change in documentatio n requirements and procedures since the last 
Review. According to the World Bank's Doing Business Report , the export documentation and 
procedures in Chinese Taipei outperform the aver age in the region, and are better than the OECD 
average in terms of time and financial cost (Table 3.1).  
3.2.2  Export taxes, charges, and levies 
3.121.  Chinese Taipei does not levy export taxe s. Nonetheless, exports are subject to a trade 
promotion service fee and the harbour dues (secti on 3.1.5.2). Exported goods are exempted from 
the Commodity Tax, the Tobacco and Alcohol Tax, and the VAT. 
3.122.  Customs duties and taxes (i.e. tariff, Co mmodity Tax and the VAT) paid on imported raw 
materials used for exports are refundable.
114 For imported raw materials subject to TRQs, the 
                                               
111 These laws include the Food Safety and Sanitation Act, the Animal Industry Act, the Fisheries Act, 
and the Plant Variety and Plant Seed Act; and the relevant regulations include the Regulations on Field Trial of Transgenic Breeding Livestock (Fowl)  and the Bio-Safety Assessment, the Regulations on Field Testing of the 
Transgenic Plants, the Regulations on Packaging and Labe lling of the Transgenic Plants, and the Regulations on 
Approving Import/Export of Transgenic Plants. 
112 Regulations for Packaging and Labelling of Transgenic Plants, enacted 29 June 2005. 
113 Article 6, Regulations on Approving Import/Export of Transgenic Plants. 
114 Article 4, Regulations Governing the Offsetting or  Refund of Duties and Taxes on Raw Materials for 
Export Products, amended 30 August 2012. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  in-quota rates are applied in refunds regardless of whether the customs duties were paid at the 
in-quota rates. Payments of additional tariffs, su ch as SSG measures, are not eligible for refund. 
Commodity Tax and the VAT are fully refunded fo r the materials used as inputs for exports. 
Applications for refund must be made within 18 months of the date the imported raw material 
clears the customs. The authorities note that the criteria for tax refunds on raw materials are 
established by the MOEA on a case-by-case basis.115 
3.123.  Goods sold to the bonded areas are also eligible for tax refund. 
3.124.  According to the authorities, duty and ta x refunds have been "comprehensively resumed" 
in response to the export slump due to the global  economic crisis; previously, goods with a tariff 
rate of less than 5% were excluded from duty refunds. Currently, 51 products at HS 10-digit level, including Huku, buffalo and cow horn, and processed cheese, are ineligible for duty/tax refunds. In 
2013, NT$2,587 million were refunded to exporters (Table 3.11).
116 
3.125.  Other taxes and surcharges on imports collected at the border (e.g. Tobacco and Alcohol 
Tax) are not refunded. 
Table 3.11 Tax refunds on imported in puts for export manufactures, 2010-13 
(NT$ million) 
Industry 2010 2011 2012 2013 
Amount (%) Amount  (%) Amount  (%) Amount (%) 
Hardware and machinery 513 26 547 23.8 540 24.3 661 25.6 
Transport equipment 256 13 251 10.9 267 12 256 9.9 
Electronic products 173 8.8 215 9.4 212 9.6 303 11.7 
Food and canned foods 215 10.9 301 13.1 338 15.2 373 14.4 
Others 813 41.3 984 42.8 862 38.8 994 38.4 
Total 1,970 100 2,298 100 2,219 100 2,587 100 
Source: Information pr ovided by Customs. 
3.2.3  Export prohibitions, restrictions, and licensing 
3.126.  There has been no change in the legislation pertaining to export controls since its last TPR.  
3.2.3.1  Export prohibitions 
3.127.  Exports of 35 products at HS 10-digit level are prohibited (Table A3.5), most of these are 
banned under international conventions or to protect human health, culture, and the environment 
(e.g. toxic chemicals, warfare, and whale shark,  poisonous herbs, and antiques over 100 years 
old); in addition, sand pebbles and gravels are banned from export on the ground of environmental protection. 
3.128.  According to the authorities, no temporary or seasonal export bans were in place during 
the period under review. 
3.2.3.2  Export licensing 3.129.  Export licensing is applied to 37 products at the HS 10-digit level (Table A3.6). Besides 
controlled chemicals (e.g. CFC), diamonds and equipment for semi-conductors are also subject to 
export licensing. 
3.130.  In addition, exporters of endangered species of wild fauna and flora protected under CITES 
must apply to the BOFT for export licences; th e application must be accompanied by approvals 
from the Council of Agriculture.  
3.131.  Exports (and import) of strategic high-tech commodities (SHTCs) require licences issued 
by the BOFT; the export licensing procedures were  amended on 31 July 2012, to facilitate licence 
                                               
115 Article 9, Regulation Governing the Offsetting or Refund of Duti es and Taxes on Raw Materials for 
Export Products, amended 30 August 2012.  
116 Refunds of Commodity Tax, on average, acco unt for 3% of total ta x refunds from Customs. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  application procedures. Under the amendment, an exporter who has implemented the Internal 
Control Program may apply for an export licence that is valid for multiple countries, buyers, consignees and end-users; the licence is valid for three years. SHTCs are restricted on exports to 
Cuba, China
117, Iran, Iraq, North Korea, Syria, and Sudan; the list of restricted commodities 
adopts the European Union's Community Regime for the Control of Exports of Dual Use Items & 
Technology, Common Military List, and Sensitive Commodities List. 
3.2.3.3  Other export control 
3.132.  Products listed as "assisted by the Custom s for export examination" require approvals from 
relevant competent authorities before exportation. These products include certain foods, agricultural products, drugs and medical devices, chips and IP products including optical disc. 
3.2.4  Export operations of state enterprises 
3.133.  No information about state trading in exports has been notified to the WTO. According to 
the authorities, Taiwan Tobacco and Liquor Co rporation (TTLC) and Taiwan Sugar Corporation 
(TSC) do not have any exclusive rights or privileges over export operations of tobacco, wine, and 
sugar.
118 
3.2.5  Export finance, promotion, and assistance 3.134.  The government-owned Export-Import Bank (Eximbank) is the main institution that 
promotes exports and provides export credit, ex port insurance, re-lending, and other kinds of 
export finance facilities. Short-term export credit (i.e. less than one year) aims to assist firms with obtaining working capital; medium/long-term credit may cover a maximum 85% of the contract value of Chinese Taipei-made machinery.
119 Re-lending facility is provided to overseas banks in 
order to facilitate exports. Eximbank also provides domestic firms with a finance facility for 
overseas investment. 
3.135.  Interest rates for export credit are set at LIBOR or OECD Commercial Interest Reference 
Rates plus interest margin; credit applicants may request a grace period. The authorities note that 
finance by Eximbank is not conditional on export performance, and all the credit conditions are in line with the provisions of the OECD Arrang ement on Officially Supported Export Credit. 
3.136.  The MOEA implemented the New Cheng Ho Plan in 2008 to maintain export momentum by 
aiding exporters facing declining orders. According to the authorities, the Plan was phased out at 
the end of 2012. Plan integrated all existing ex port assistance measures under one umbrella, 
including export finance (credit, issuance, and re-lending) operated by the Eximbank, and other 
trade promotion projects commissioned to various trade and industrial associations targeting China 
and other emerging economies' markets. 
3.137.  Export promotion schemes are aimed at he lping exporters to explore and expand markets, 
improve product quality, and upgrade product image.  Trade promotion activities include organizing 
trade fairs and trade missions, providing market information, and establishing e-platforms for 
exporters. Taiwan External Trade Development Council (TAITRA), a non-profit organization, is 
responsible for implementing major trade promotion programmes and projects. In continuation of 
trade promoting measures in the New Cheng Ho Plan, the BOFT runs several specific programmes such as the Industrial Image Promotion Project, the Project to Promote Most-Value Products in 
Emerging Markets, and the Green Trade Promotio n Project. The authorities note there are no 
restrictions on industries and companies participating in these programmes. In 2012, 
NT$790 million was spent on trade promotion programmes run the BOFT. 
                                               
117 Export restrictions to China are limited to 12  categories of semi-con ductor wafer fabricating 
equipment for strategic high-tech commodities: chemical mechanical polishers, photo-resist strippers, photo-resist developers, rapid th ermal processors, deposition apparatus, cleaning equipment, dryers, electron 
microscopes, etchers, ion implanters, photo-resist coat ers, and lithography equipmen t. Exports of other SHTCs 
to China are considered as being export to non-restricted areas. 
118 WTO document WT/TPR/M/232/Add.1, page 40, 25 August 2010. 
119 Eximbank online information, "Medium an d long term Export Credit". Viewed at: 
http://www.eximbank.com.tw/en-us/BankServices/Loans/Pages/MLTEC.aspx  [10/12/13]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.2.6  Free zones 
3.138.  The export processing zones (EPZs) and free trade zones (FTZs), offer similar incentives 
for enterprises. EPZs are administered by the Export Processing Zone Administration under the Ministry of Economic Affairs; FTZs are administer ed by the Free Trade Zone Administration under 
the Ministry of Transport and Communication. 
3.139.  Businesses allowed to operate in FTZs include trading, collecting, transhipment, 
forwarding, customs clearance, assembling, pa ckaging, repair, manufacturing, testing, and 
technological services. Business allowed to operate in EPZs include manufacturing, financial 
services, management services, and information and communication. The authorities state that FTZs mainly aim at developing a global logistics industry, while EPZs focus on promoting investment and developing industries. 
3.140.  Both EPZs and FTZs are bonded areas. In addition to exemption from import duties, 
imports to EPZs and FTZs are exempt from other indirect taxes and charges collected at the border (section 3.1.5).
120 Preferential trade facilitation measures are also applied in these areas 
(section 3.1.1), for example, for manufacturing and warehousing enterprises that have valid 
AEO-S certificates, guarantee deposits are waived on bonded goods (including machinery) valued under NT$10 million shipping out of the bonded zones. 
3.141.  There are 568 enterprises operating in 10 EPZs; 68 enterprises are foreign-invested. Most 
enterprises are engaged in manufacturing electron ic parts and components; computers, electronic, 
and optical products; non-metallic mineral products ; and plastic products. In 2013, the turnover of 
enterprises in the EPZs was approximately US$12. 29 billion, with around US$5.69 billion sold to 
the domestic market. EPZ shares in total exports and imports were 4.18% and 3.34%, 
respectively, in 2013. 
3.3  Measures Affecting Production and Trade 
3.3.1  Taxation and incentives 
3.142.  More than half of tax revenue is sourced from direct taxes. The principal indirect taxes are 
Business Tax, Commodity Tax, and Tobacco and Alcohol Tax; customs duties contributed about 
5% of tax revenue (Table 3.12). 
Table 3.12 Direct and indirect tax revenues, 2009-13 
 2009  2010  2011  2012 2013a 
GDP (NT$ billion) 12,481.1 13,552.1 13,709.1 14,077.1 14,564.2 
Total tax revenue (NT$ billion) 1,530.3 1,622.2 1,764.6 1,796.7 1,834.1 
 % of total 
Direct taxes 62.4 58.5 59.4 60.3 59.5 
   Profit-seeking Enterprise Income Tax 21.8 17.6 20.8 20.5 19.1  
   Individual Income Tax 20.0 18.8 19.4 21.9 21.4 
   Estate and Gift Tax 1.5 2.5 1.3 1.6 1.3  
   Securities Transactions Tax 6.9 6.4 5.3 4.0 3.9 
   Futures Transactions Tax 0.2 0.3 0.3 0.2 0.1  
   Land Value Tax 3.9 3.9 3.6 3.5 3.9 
   Land Value Increment Tax 3.5 4.5 4.5 4.5 5.6  
   House Tax 3.7 3.6 3.4 3.4 3.4 
   Deed Tax 0.9 0.9 0.7 0.7 0.7  
Indirect taxes 37.6  41.5 40.6 39.7 40.5  
   Customs duties 4.5 5.5 5.5 5.3 5.3 
   Commodity Tax 8.4 9.3 9.3 9.0 8.9  
   Tobacco and Alcohol Tax 3.0 2.7 2.5 2.5 2.4 
                                               
120 Shipments from the bonded areas to non-bonded areas are subject to normal border measures, and 
the previously exempted duties and ta xes must be paid. The exempted duties  and taxes do not have to be paid 
on shipments of machinery and equipment that was imported  into the bonded area at least five years earlier. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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   2009  2010  2011  2012 2013a 
   Business Tax 14.6 16.5 16.1 15.7 16.5  
   Vehicle Licence Tax 3.5 3.3 3.1 3.1 3.1 
   Stamp Tax 0.6 0.6 0.5 0.6 0.6  
   Amusement Tax 0.1 0.1 0.1 0.1 0.1 
   Financial Enterprises Business Tax 1.4 1.3 1.3 1.4 1.4  
   Health and Welfare Surcharge on 
   tobacco 1.6 2.1 2.0 1.9 1.9 
   Specially Selected Goods and Services 
   Tax n.a. n.a. 0.1 0.2 0.3  
n.a. Not applicable. 
a GDP for 2013 is provisional. Source: Information provided by the authorities. 
3.3.1.1  Direct taxes 
3.143.  Revenue from Individual Income Tax and Profit-seeking Enterprise Income Tax accounted 
for 21.4% and 19.1% of total tax revenue, respectively, in 2013 (Table 3.12). In 2010, Profit-
seeking Enterprise Income Tax was reduced from 25% to 17%, and the lowest three marginal rates of Individual Income Tax were lowered by 1%. 
3.3.1.2  Indirect taxes 
3.144.  Business Tax is applied to sales of goods and services in two forms: non-value-added and 
value added. The non-value-added Business Tax is applied mainly to the services sector: 2% for enterprises engaging in banking, insurance, in vestment trust, securities, futures, commercial 
paper, and pawnshops
121; 15% or 25% for enterprises engaging in special beverage and food 
services; and 1% for small businesses. The value-added Business Tax (i.e. the VAT) is applied to all other businesses transactions in goods and services at the rate of 5%.
122 The Business Tax is 
calculated on the basis of actual sales (the customs valuation for imported goods) plus taxes and 
duties (e.g. customs duties, or Commodity Tax where applicable). 
3.145.  Commodity Tax is a special excise tax imposed equally on imported and domestic 
products. Goods subject to Commodity Tax include ru bber tyres, cement, beverages, flat glass, oil 
and gas, certain electric appliances, and motor vehicles. Depending on the product, the tax may 
be ad valorem  or specific. The base for Commodity Tax is the manufacturers' selling price less 
other Commodity Tax included in the price (for domestically produced goods), or the customs 
valuation price plus the corresponding customs duty (for imports).  
3.146.  The Tobacco and Alcohol Tax is imposed in  the form of specific duties: NT$590 per kg of 
tobacco products; and NT$2.5 per litre per degree of alcohol content.123 Manufacturers are 
required to register with tax collection authorities prior to commencing production. Tobacco 
products are also subject to the Health and Welfare Surcharge; the surcharge finances the health insurance programme and other programmes related to health and welfare. 
3.147.  All transport vehicles are subject to the annual Vehicle Licence Tax.
124 The tax rate was 
amended in January 2012, mainly to list the rates for fully electric-powered motor vehicles.125 
                                               
121 1% for reinsurance premiu ms of insurance business. 
122 Business Tax exemptions are granted on, inter alia , sales of land, medical and education services, 
and sales of financial derivative pr oducts. See Article 8, Value-Added an d non-Value-Added Business Tax Act, 
amended 23 November 2011. 
123 WTO document WT/TPR/M/232/Add.1, page 41, 25 August 2010. 
124 Exemptions of Vehicle Licence Tax are granted for, inter alia , emergency services vehicles and 
vehicles owned and used only by the mentally or physic ally disabled, that carry a Mental/Physical Disability 
Manual. See Article 7, Vehicle Licence Tax Act. 
125 For details of Vehicle Licence Tax rates, see the Laws and Regulation Database. Viewed at: 
http://law.moj.gov.tw/Eng/LawCla ss/LawContent.aspx?PCODE=G0340095  [20/01/14]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.3.1.3  Tax exemptions and incentives 
3.148.  Since June 2010, Profit-seeking Enterprise Income Tax has been reduced to 17% (from 
25%). The authorities note that this tax reduction was intended to create an internationally competitive environment, reduce the tax burden and benefit enterprises in all industries. In 
addition, companies may benefit from a 15% tax credit against the Business Income Tax for R&D 
expenditure. In the context of last TPR, the author ities noted that this tax credit was the only tax 
incentive maintained in the Statute for Industrial Innovation (SII), which replaced the Statute for 
Upgrading Industries (SUI).
126 
3.149.  The amendment of Business Tax Act in April 2011 allowed more types of transaction by 
enterprises operating in bonded areas to be zero-rated for VAT.127 The VAT on foreigners' 
purchases of goods and services may be eligible for refund within one year, if the purchases are 
for exhibition or temporary business activities in Chinese Taipei. 
3.150.  For the agriculture sector, primary agricultural products, fertilizer, pesticides, veterinary 
drugs, agricultural machinery, transportation eq uipment for farmland, and fuel oil and electricity 
used in such machinery and equipment, and sale s of rice and wheat flour and the service of 
husking rice are exempted from Business Tax (VAT).128 Inner tubes, solid rubber tyres, rubber 
tyres for use on man-powered/animal-powered vehicles and farming vehicles, tractors equipped 
with farming equipment, and cargo trucks/cars for exclusive use in farm land are exempt from 
Commodity Tax. 
3.151.  Completely electric-powered motor vehicles (including electric motor bikes) are exempted 
from Commodity Tax and Vehicle Licence Tax from end 2011 to 2017.129 Commodity Tax for other 
electric vehicles is reduced to half of the statutory rates, i.e. 12.5% or 15% for electric 
automobiles, and 8.5% for electric motor bikes.  Low-chassis buses, gas buses, hybrid-power 
buses, electric buses, and rehabilitation buses for the disabled, purchased and registered between 
5 June 2009 and 4 June 2014, are exempted from Commodity Tax; and from 30 December 2011 
to 29 December 2016, a reduction of NT$25,000 is granted per LPG car. 
3.152.  Exemptions from Commodity Tax are also granted for electrification glass and reinforced 
glass for use in producing moulds; dehumidifiers for use in factories; and hand-carry record 
players smaller than 32 cm. 
3.3.2  Non-tax incentives, subsidies, and other assistance 3.153.  At the time of the last TPR, the authorit ies stated that they did not provide prohibited 
subsidies within the meaning of Article 3 of the WTO Agreement on Subsidies and Countervailing 
Measures. Since then, the authorities submitted to the WTO two notifications on its support programmes covering the fiscal years 2008 to 2012.
130 
3.3.2.1  Subsidies to the agriculture sector 
3.154.  Subsidies are provided for the production of rice, sorghum and feed corn, sweet potatoes, 
beans, tobacco leaves, certain vegetables, and sugar. In fisheries, grants are provided for 
programmes for buy-back of fishing vessels, reduction of fishing vessels, closing the fishery 
season, water-recirculation devices used in aquacu lture, marine insurance for fishing vessels, and 
fish market (price) stabilization, as well as aquaculture facilities subsidized by loan programmes (section 4.1.1.4). 
                                               
126 WTO document WT/TPR/M/232/Add.1, page 64, 25 August 2010. 
127 Article 7, Value-Added and No n-Value-Added Business Tax Act. 
128 Imported rice and rice prod ucts are not exempt from VAT. 
129 Commodity Tax exemption is valid from 28 December 2011 through 27 January 2017, and Vehicle 
Licence Tax exemption is valid from 6 January 2012 through 5 January 2015. 
130 WTO documents G/SCM/N/220/TPKM/Rev.1, 18 August 2011; and G/SCM/N/253/TPKM, 17 July 
2013. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.3.2.2  Grants and loans for R&D 
3.155.  Established in 2006, the NDF131 main activities are to promote industrial upgrading and 
improvement of the structure of industry, by inve sting in start-up enterprises and projects, and 
supporting financial institutions' policy lending programmes. In recent years, the NDF has focused 
on financing newly emerging industries, such as information and communication technology, and 
bio-technology. The loans financed by the NDF are provided through assistance programmes administered by various authorities (e.g. New Industrial Product R&D Programme, managed by the 
MOEA). 
3.156.  Under the Statue for Industrial Innovation (SII), a number of measures have been adopted 
to encourage innovation and R&D activities. Sinc e June 2010, the Industrial Development Bureau 
under the MOEA has launched a "special project for subsidizing development of major market-
comprehensive product". This project together wi th the "Grant for development of new leading 
industries" provides grants to cover no more than 50% of the expenses incurred exclusively for the development of new leading products.
132 In addition, non-enterprise entities may be eligible to 
apply for grants and assistance with an aim to promote "industry-academia-research-organization 
collaboration". Between 2010 and 2013, 263 pr ojects were approved, and a total of 
NT$3,366.52 million was provided under this scheme (Table 3.13). 
Table 3.13 Sectoral allocation of grants  for developing new leading industries 
(NT$ '000) 
  2010  2011  2012 2013  
3C industry 133,395 92,468 31,000 208,044 
Medical and health care 84,788 40,780 n.a. 30,091 
Precision machinery and automation 85,954 585,853 96,991 467,553 
Precision machinery 52,351 286,913 106,400 136,934 
Pollution Prevention 44,009 41,364 7,500 10,000 
Specialty chemicals and pharmaceuticals 94,407 113,228 79,320 16,000 
Aerospace 46,159 n. a. n.a. n.a. 
Advanced materials 80,898 129,810 4,000 4,500 
Semi-conductors 145,924 n.a. 50,000 25,700 
Culture industry 32,017 n.a. n.a. 2,170 
Total 799,902  1,290,416  375,211 900,992  
n.a. Not applicable. 
Source: Information provided by the authorities. 
3.157.  Also under the SII, in order to achieve sustainable development, the MOEA provides 
manufacturers with assistance in, inter alia , energy conservation and carbon reduction in 
production processes; energy resources integration; clean production; green technology; 
corporate social responsibility; product information disclosure; green factories; and work 
environment improvement. Any company incorporated in Chinese Taipei is eligible to apply for grants.
133 In general, the approved grant covers no more than 50% of the project expenses, with 
a cap of NT$5 million within two years of project implementation.134 The authorities note that as of 
the end of 2013, guidance and assistance had been  provided to more than 3,800 manufacturers to 
push forward with a range of sustainable-development-related matters.  
3.158.  The Department of Industrial Technology  under the MOEA provides funding opportunities 
for domestic and foreign companies to carry out R&D activities under the Industrial Technology 
                                               
131 Online information available at: www.df.gov.tw. 
132 The eligible expenses are: costs incurred for full-time research personnel; costs of consumable 
instruments and raw materials; cost s for use and maintenance of R&D equipment; costs for technology 
transfer; and travel fees related to the project. 
133 Other eligibility requirements are listed in the Regulations Governing the Provision of Guidance, 
Assistance and Subsidies by the MOEA for Industry Sustainable Development. 
134 The eligible expenses are: costs incurred for full-time personnel; costs of consumable instruments 
and raw materials; costs for use and maintenance of R&D equipment; costs for technology transfer; and travel 
fees related to the project. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Development Programme.135 These include grants to cover up to 50% of R&D project expenses 
with a cap of NT$30 million, for a maximum of th ree years. Enterprises are encouraged to set up 
R&D centres through two incentive programmes136; grants are provided to cover personnel-related 
costs in relation to the R&D centre operations. Foreign applications for grants to support setting up 
R&D centres will no longer be accepted after 1 May 2014. 
3.3.2.3  Assistance to small- and-medium-sized enterprises 
3.159.  Assistance is provided for small-and-medium-sized enterprises (SMEs) in the form of 
loans. Under the SME Development Fund, established and managed by the MOEA, SMEs may apply 
for specific and urgent loans for recovery plans related to disaster damage, at a ceiling interest rate of 1% plus a flat rate of the 2-year postal fixed saving rate . SMEs may also apply for medium- 
and long-term loans for product marketing, overseas investment, and construction projects. 
3.160.  In addition to sponsoring R&D activities, the National Development Fund is a major 
financer of the Programme to Support Industries to Adjust to Trade Liberalization; the programme aims to provide support and reduce the negative  impact of liberalization on manufacturing and 
services sectors, in particular on SMEs. The Fund  provides a total of NT$20 billion in preferential 
loans to enterprises affected by liberalization for rejuvenant projects. The preferential loan, for a 
maximum of ten years, will cover not more than 90% of the project cost, with a cap of 
NT$100 million for each applicant. 
3.161.  Besides helping enterprises rebound from liberalization, the authorities provide low-
interest loans to help affected enterprises and workers to switch to new sectors and products. For instance, enterprises that suffer due to a surge of certain product imports may apply to the MOEA, 
for loans up to NT$5 million as working capital,  and up to NT$10 million as capital finance. 
3.3.2.4  Other subsidies and assistance 3.162.  The Industrial Development Bureau under the MOEA provides assistance to develop the 
venture capital investment industry, including provision of reference letters on behalf of the 
venture funds to facilitate the sourcing of fi nance from government-operated funds (e.g. the 
National Development Fund) and from the private sector.
137 
3.163.  With the aim of attracting investment, in 2002 the Industrial Development Bureau 
introduced the incentives programme for lease and purchase of land in industrial parks (also called the 006688 programme). This programme exempts firms from land lease fees for the first two years, requires payment of 60% of full lease fees  during the third and fourth years, payment of 
80% of full lease fees during the fifth and sixth years, and payment of full lease fees starting in 
the seventh year. If a company applies to purchase the land before the lease period expires, the firm's guarantee deposit and lease fees already paid may be deducted from the price. The 
programme, after several extensions, is expected to be phased out by end 2014. According to the 
authorities, as of end 2010, 952 companies rented 778 hectares of land and had created NT$655.5 billion in output value, while providing 84,398 jobs.
138 
3.164.  The government provides grants to enco urage exploration and development of oil and gas 
reserves (section 4.2). This aims to secure oil supply and stabilize the domestic market, through supporting geo-surveys, drilling, and other related activities. The grant covers not more than 50% of the expense of each exploration, and not more  than 12% of the expense of each development 
project. Between 2010 and 2012, this scheme paid out grants totalling NT$958.94 million.  
                                               
135 Department of Investme nt Services online information, "Industrial Technology Development 
Program". Viewed at: http://investtaiwan.nat.gov.tw/eng/show.jsp?ID=38&MID=2 . 
136 The Industrial Technology Innovation Center Prog ram (MNCD) for domestic enterprises, viewed at: 
http://innovation4.tdp.org.tw/ ; and the Multinational Innovative R&D Centers in Taiwan (MNCF) for foreign 
enterprises. Viewed at: http://innovation5.tdp.org.tw/ . 
137 The criteria for venture investme nt fund support are contained in  Article 3, Regulations for the 
Guidelines for Venture Capi tal Investment Industry. 
138 Department of Investment  Services online information, "Invest in Taiwan – Land Lease Incentives in 
Industrial Parks". Viewed at: http://investtaiwan.nat.gov.tw/eng/show.jsp?ID=40&MID=2 . WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.3.3  Government-owned enterprises 
3.165.  Government-owned enterprises are mainly involved in petroleum, aerospace, finance, 
transport, and utilities. They have market monopoli es in utilities and postal services. There is no 
institutional framework overarching government-own ed enterprises. They are managed separately 
under various relevant ministries; CPC Corporatio n, Taiwan Power Company, Aerospace Industrial 
Development Corporation, Taiwan Sugar Corporation, and Taiwan Water Corporation are under the Ministry of Economic Affairs; Taiwan Railways Administration, and Chunghwa Post are under the 
Ministry of Transport and Communications; and the Ministry of Finance owns Taiwan Tobacco and 
Liquor Corporation, and a few banks. 
3.166.  Privatization of government-owned enterp rises began in 1992; however, the privatization 
schedule is suspended or under re-evaluation. In the context of last TPR, the authorities stated 
that privatization of government-owned enterprises remains at the top of the policy priorities.
139 
During the period under review, the five govern ment-owned enterprises under the MOEA were in 
the process of privatization, all at different st ages. The authorities consider that a government-
owned firm is privatized once it loses its mono poly rights and/or the government reduces its 
shareholding. Public listing of the government-share of Aerospace Industrial Development Corporation was approved by the Taiwan Stock Exchange (TSEC) on 12 May 2014, and is expected 
to be completed by end 2014; the MOEA is offering more than 50% government shares.
140 
However the authorities note that government-s hare offerings will no longer be used for 
privatization in the future. 
3.3.4  Government procurement 
3.167.  Government procurement accounted for 7% of GDP in 2013, down from 10% of GDP in 
2008.141 It remains regulated under the Government Procurement Act, most recently amended in 
2011. The amendments were mainly on price da tabase; the award procedure for professional, 
technical, or information service; and on model contracts prescribed by the responsible entity 
(Table 3.14). The Act applies to procurement by any government agency, public school, and government-owned enterprises, for the contracting of construction work, the purchase or lease of 
property, and the retention or employment of services. 
Table 3.14 Major amendments to the GP Act in 2011 
Article Amendment Background note 
Article 11 Where there is any property and service item 
that requires a price database to be set up, the regulations for establishing price database of construction must apply mutatis mutandis  The price database of manpower for 
information services has been in operation since 2012, and the information therein can be used by procuring entities as a reference for evaluating budget amounts and government estimates  
Article 52 Where the value of a procurement reaches the 
threshold for publication (NT$1 million), and the 
subject of procurement is a professional service, 
technical service or in formation service, the 
award procedure of most advantageous tender 
without setting a government estimate, may be 
applied 
 Purpose:  to promote the award to the 
most advantageous tender for such 
services, instead of the lowest tender 
                                               
139 WTO document WT/TPR/M/232/Add.1, 25 August 2010. 
140 Ministry of Economic Affairs online information, "Press re lease". Viewed at: 
http://www.moea.gov.tw/Mns/populace/news/News.aspx?kind=1&menu_id=40&news_id=36805 . 
141 In 2013, the main procurement items for goods we re: electrical machinery and apparatus; medical 
appliances, precision and optical instruments, watches and clocks; office, accounting and computing machinery; special purpose machinery; transport equipmen t. The main services procured were: architectural, 
engineering and other technical services; repair services incidental to metal products, machinery and equipment; sewage and refuse disposal, sanitati on, and other environmenta l protection services; 
administrative services of the Go vernment; placement and supply se rvices of personnel. The major 
construction contracts covered construction work for civil engineering; construction work for buildings; 
installation work; special trade construction work; and building completion and finishing. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Article Amendment Background note 
Article 63 The model contracts prescribed by the 
responsible entity must, in principle, be adopted by the entity Purpose: to reduce contract disputes 
resulting from the contract clauses prescribed by the procuring entities 
Source: Information provided by the authorities. 
3.168.  Chinese Taipei became a member of the WTO plurilateral Agreement on Government 
Procurement (GPA) on 15 July 2009. The share of  non-local suppliers in the total value awarded 
fluctuated widely (between 10.6% and 26.5%), from 2009 to 2013 (Table 3.15), while their share in the number of contracts awarded increased from 7% to about 11%. The authorities indicated 
that GPA membership affected the efficiency of  the government procurement regime, due to the 
lengthened time-limit for tendering. Moreover, a summary tender notice is required for each GPA-covered procurement in one of the WTO official  languages, which is an additional requirement 
for the procurement entities. On the other hand, as the annual procurement statistics provided by 
the other GPA parties in recent years did not include information on awards to Chinese Taipei 
enterprises, the authorities cannot evaluate the effect of GPA membership on its enterprises. 
Table 3.15 Procurement by origin, 2009-13 
 2009  2010  2011  2012 2013  
Total value (NT$ billion) 1,148.9 1,211.5 1,255.3 1,220.9 1,006.4 
Percentage of GDP (%) 9.2 8.9 9.2 8.7 6.9 
Share (%) 
Domestic 89.4 81 79.4 73.5 82.5 
Non-local 10.6 19 20.6 26.5 17.5 
Suppliers originating in GPA parties  9.9 15.6 17.1 22.8 14 
Number of contracts awarded 206,793 200,245 185,227 180,551 180,998 
Share (%) 
Domestic 96.3 89.7 88.7 88.7 89.1 
Non-local 3.7 10.3 11.3 11.3 10.9 
Suppliers originating in GPA parties 3.5 9.5 10.3 10.3 9.7 
Note: The statistics include procurement not covere d by the WTO/GPA and with a value of more than 
NT$100,000. 
Source: Information provided by the authorities. 
3.169.  Chinese Taipei participated in and contributed to the renegotiation of the GPA, which 
entered into force on 6 April 2014.142 As Kaohsiung County Government was merged into the 
Kaohsiung Municipality Government in December 2010, Chinese Taipei has committed to include 
procurement by the Kaohsiung County Government and its subordinated administrative units for the revised GPA. It is estimated that the additional market access opportunities amount to 
NT$3 billion per year. Pursuant to the GP Act, a procuring entity must conduct a GPA-covered 
procurement in conformity with th e requirements of the Agreement, thus the authorities consider 
that there is no need to modify the Act to reflect the revised GPA. 
3.170.  Chinese Taipei has signed two ECAs that contain market-access commitments on 
government procurement: the Agreement with Ne w Zealand on Economic Cooperation (ANZTEC), 
which entered into force on 1 December 2013, and the Agreement with Singapore on Economic Partnership (ASTEP), effective 17 April 2014. 
3.171.  The institutional framework on government procurement remains unchanged: the Public 
Construction Commission (PCC) formulates, coordinates, and monitors the implementation of government procurement policies on goods, services, and construction works. Its website contains 
laws and regulations on government procurement, tendering notices and awards, and the 
electronic procurement system (GPIS - government procurement information system).
143 Tenders 
                                               
142 WTO online news at: http://www.wto.org/english/news_e/news14_e/gpro_07apr14_e.htm  
[08/04/14]. 
143 PCC online information. Viewed at: http://www.pcc.gov.tw . WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  covered by the GPA have summary notices in English, as required by Article 9 of the GPA.144 
Procurement notices, invitations to tender, and contract awards are also published in the daily Government Procurement Gazette . There is no registration system for suppliers in government 
procurement. 
3.172.  According to Articles 17, 43 and 44 of the Act, domestic suppliers may be accorded 
preferential treatment, except where prohibited by  agreements to which Chinese Taipei is a party. 
Such treatment may include local-content, technology transfer, investment, export facilitation, or 
price preference of 3% maximum.
145 The margin of the price preference and the starting/expiry 
dates of the price preference period for particul ar tenders must be published by the responsible 
entity in the Government Procurement Gazette . The authorities state that no price preference has 
been published since 1999 when the GP Act became effective. According to the authorities, this is 
because there is no incentive for domestic suppliers to adopt the 3% price preference pursuant to 
Article 44 of the GP Act. The government procurement regime also contains secondary policy goals, such as to encourage the procurement of environment-friendly green products; to support 
indigenous suppliers; and to give priority to th e goods and services produced and provided by 
people with disabilities. 
3.173.  There has been no change in the procurement methods, bidding procedures or 
procurement thresholds since 2010. Procurement contracts of not less than NT$1 million are 
awarded through open, selective, or limited tendering procedures (Table 3.16). According to the authorities, the same requirements in tendering apply to domestic and non-local suppliers. 
Table 3.16 Procurement methods and procedures 
Procurement 
methods Procedure 
Open tendering Public notice is given and all in terested suppliers are invited to submit tenders 
Selective tendering Pre-qualification selection among interested suppliers who submit their qualification 
documents upon public notice; only suppliers selected through this process are 
invited to tender 
Limited tendering No public notice; only a few suppliers are invited to compete or only one supplier is 
invited to tender 
Source: Information provided by the PCC. 
3.174.  In 2013, about 80% of all procurement was awarded through open tendering; 9% through 
limited tendering; and about 11% through selective tendering (Table 3.17). In principle, open 
tendering must be used for all procurement contracts of a value of NT$1 million or over. Selective 
tendering may be used when there is a recurring demand; the review of tenders is lengthy; the suppliers' cost of preparing a tender is high; the suppliers' qualification requirements are 
complicated; or the procurement concerns research and development. The selective tendering 
procedures are also applicable for electronic procurement practices. Limited tendering is used, inter alia , when: there is no eligible tender in response to open and selective procedures; the 
subject of procurement is an exclusive right; there is extreme urgency; or the procurement 
involves follow-up maintenance by the current supplier. 
3.175.  For procurements over the NT$1 million threshold, in case of any dispute arising from the 
invitation to tender, the evaluation of tender, or the award of contract, suppliers may file 
complaints to the Complaint Review Board for Government Procurement (CRBGP). Contract 
disputes relating to government procurement may also be referred to CRBGP for mediation. To ensure impartiality, the CRBGP must consist of 7-25 members selected from impartial persons of 
professional knowledge in legal or procurement a ffairs and appointed by the responsible entity or 
the municipal or county (city) governments. Three members may be high-ranking officials of the responsible entity or the municipal or county (city) governments provided that the number of 
these officials does not exceed one fifth of the total number of members.
146 The CRBGP was 
established in May 1999; from then to the end of 2013, there were 4,605 mediation cases, of which 65 were filed by non-local suppliers (1.4%). Mediation cases accounted for 64% of 
                                               
144 WTO document, WT/TPR/M/232/Add.1, p.83, 25 August 2010. 
145 Articles 43 and 44 of the Act.  
146 WTO document WT/TPR/M/232/Add.1, p.118, 25 August 2010. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  substantively resolved cases. During the same period, 3,189 complaints were filed with the 
CRBGP, of which 98 were filed by non-local suppliers, accounting for 3% of total cases. 
3.176.  In case of objection to the decision by the CRBGP, the unsatisfied supplier may refer the 
case to the administrative court within two months from the date of receipt of the review decision. 
From 2009 to 2012, more than 600 cases for procurem ents over the NT$1 million threshold, were 
substantively resolved by the CRBGP (relating to invitation to tender, evaluation of tender, or award of contract), and 138 of the CRBGP review decisions were referred to the administrative 
court. 
3.177.  A dispute arising from the performance of a contract may also be taken to an arbitration 
institution. These include the Arbitration A ssociation (http://www.arbitration.org.tw); the 
Construction Arbitration Association (http://www. tcaa.org.tw/); and the Construction Industry 
Association (http://www.cciaa.org.tw/). According to the authorities, in 2012 and 2013, there were 
61 cases of contract disputes regarding construction, and 100 cases regarding professional engineering services. 
Table 3.17 Procurement share by type of procedure, 2009-13 
Year Item Open tendering 
(%) Selective 
tendering 
(%) Limited tendering 
(%) 
2009 Share of total value 79.6 8.7 11.7 
 Construction 90.6 4.8 4.6 
 Goods 57.6 21 21.3 
 Services 83.5 1 15.5 
2010 Share of total value 72.4 10.4 17.2 
 Construction 94.6 1.4 4.0 
 Goods 47.1 24.7 28.2 
 Services 78.2 0.9 20.8 
2011 Share of total value 67.7 22.4 10.0 
 Construction 95.6 0.2 4.1 
 Goods 39.5 47.8 12.7 
 Services 85.8 1.1 13.1 
2012 Share of total value 70.8 8.1 21.0a 
 Construction 95.0 0.8 4.2 
 Goods 45.9 18.3 35.9 
 Services 79.6 0.8 19.6 
2013 Share of total value 80.1 11.1 8.8 
 Construction 94.2 1.8 4.1 
 Goods 56.1 32.3 11.7 
 Services 85.9 1.3 12.8 
a The authorities indicated that the higher share of limited tendering in 2012 was due to expenditures 
on military procurement in 2012. 
Note: The statistics include procurement not covere d by the WTO/GPA and with a value of more than 
NT$100,000. 
Source: Information provided by the authorities. 
3.3.5  Competition policy and regulatory issues 
3.3.5.1  Competition policy 
3.178.  The Fair Trade Commission (FTC) remains the implementing authority for competition 
policy. The Organic Act of the Fair Trade Commission, effective in 2012 granted independent 
status of the FTC since 2012. During the review period, the main legislation on competition policy, WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  the Fair Trade Act (FTA), was amended twice (in 2010 and 2011).147 Amendments mainly concern 
the introduction of a leniency programme, the increase of maximum administrative fines for abuse of dominance and concerted actions, and the imposi tion of civil liabilities for false endorsements 
(Table 3.18). The authorities state that the lenien cy programme is an invaluable tool to detect 
cartels. In 2012, the FTC had its first leniency ap plication and then fined four optical disk drive 
manufacturers for their international cartel. 
3.179.  The FTA does not apply to any proper conduct in connection with the exercise of IP rights 
pursuant to the provisions of the Copyright La w, Trademark Law, or Patent Law (Article 45). 
Article 46 stipulates that where there is any other law governing competition, such other law will apply provided that there is no conflict with the legislative purposes of the FTA. Examples include 
the Banking Law, the Financial Holding Company Law, the Financial Institutions Merger Act, the 
Insurance Law, the telecommunications rules, and la ws regulating professionals and the practice of 
fee standards set by professional associations (Chapter 4). 
Table 3.18 Amendments to the Fair Trade Act 
Article Content Relevant regulations 
Article 35-1: 
leniency 
programme Reduction or immunity from fines to cartel members 
who report illegal concer ted actions to the FTC Regulations on Immunity and 
Reductions of Administrative Fines in Illegal Concerted Actions, enacted on 6 January 2012 
Article 41: 
administrative 
fines The FTC may impose an admini strative fine of up to 
10% of the total sales income of an enterprise in the 
previous fiscal year without being subject to the 
limit of the administrative fine, if the enterprise is 
considered by the FTC as being in serious violation 
of Articles 10 on abuse of dominance, and 14 on 
concerted actions Regulations for Calculation of 
Administrative Fines for Serious 
Violations of Articles 10 and 14 of the 
Fair Trade Act, enacted on 5 April 
2012 
Article 21: 
civil liabilities 
for false 
endorsement False endorsers may be held jointly liable with the 
advertiser for up to 10 ti mes the reward they have 
received from the advertiser Fair Trade Commission Disposal 
Directions (Policy Statements) on Use of Endorsements and Testimonials in Advertising 
Source: Information provided by the authorities. 
3.180.  The FTA applies to all enterprises, including companies, sole proprietorships or 
partnerships, trade associations, and any other persons or organizations engaging in transactions 
through the provision of goods or services. Comm ercial operations of government agencies are 
also subject to the FTA. It regulates not only monopolistic actions, mergers, and concerted actions, but also unfair competition (Table 3.19). 
Table 3.19 Key characteristic s of the Fair Trade Act 
Subject Exceptions 
Monopolistic enterprises are prohibited from 
abusing their market power, including by: No exception 
- preventing any other enterprises from competing 
by unfair means  
- improperly setting, mainta ining or changing prices 
for goods or services  
- requiring preferential treatment from trading 
partners without justification  
Mergers must be notified to the FTC if:  
- as a result of the merg er the enterprise(s) will 
have 1/3 of the market share; Where any enterprise holds no less than 50% of the 
voting shares or capital contribution of another 
enterprise, and merges with  such other enterprise 
- one of the enterprises in  the merger has 1/4 of 
the market share; Where enterprises of which 50% or more of the 
voting shares or capital contribution are held by the 
same enterprise merge 
                                               
147 FTC online information. Viewed at:  
http://www.ftc.gov.tw/internet/english/doc/docDetail.aspx?uid=644&docid=12106  [26/06/13]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Subject Exceptions 
- sales for the preceding fiscal year of one of the 
enterprises in the merger exceeds the threshold 
amount publicly announced by the FTC (the 
thresholds may be differe nt for financial and non-
financial enterprises.a Where an enterprise assigns all or a principal part of 
its business or assets, or all or part of any part of its 
business that could be se parately operated, to 
another enterprise that it has newly established 
 Where an enterprise, pursuant to the proviso of 
Article 167, Paragraph 1 of the Company Law or 
Article 28-2 of the Securities and Exchange Law, 
redeems its shares held by shareholders so that its original shareholders’ shareholding falls within the circumstances provided for in  Article 6, Paragraph 1, 
Subparagraph 2 
Price fixing, market sharing, and other 
"concerted actions" are prohibited:  
"concerted actions" are an y form of mutual action 
or understanding with competitors on prices, quantity, technology, prod ucts, facilities, trading 
counterparts or trading areas - unifying the specifications or models of goods for 
cost reduction, quality improvement, or efficiency 
increasing purposes 
 - joint research and development  on goods or 
markets to upgrade techno logy, improve quality, 
reduce costs, or increase efficiency 
 - each developing a separate and specialized area to 
rationalize operations 
 - entering into agreements concerning the 
competition in foreign markets to secure or promote 
exports, i.e. export cartels 
 - joint acts regarding the importation of goods, i.e. 
import cartels 
 - joint acts limiting the quantity of production and 
sales, equipment, or prices in economic downturn, 
when the market price of products is lower than the 
average production costs so that the enterprises in a 
particular industry have difficulty maintaining their 
business or encounter a situation of overproduction, 
actions to meet economic downturns  
 - actions by small and medi um-sized enterprises to 
jointly improve efficiency 
Unfair competition is prohibited:   
Resale price maintenance for goods 
Actions likely to lessen or to impede competition 
Using in the same/similar manner the names, trademar ks, containers, packaging, appearances, symbols of 
other enterprises' goods or services to cause confusion 
Using in the same/similar manner the marks that are id entical or similar to an internationally well-known 
trademark that has not been registered in Chinese Ta ipei; selling, transporting, exporting, or importing 
goods bearing such trademark 
Making or using false or mislea ding representations or symbols 
Making or disseminating any false statement that is able to damage the business reputation of another; 
Multi-level sale, if the participants receive economic benefits mainly from introducing others to participate, 
rather than from marketing or selling of the goods/services 
Any deceptive or obviously unfair conduct that is able to affect trading order 
a Any merger that falls within th e following circumstances must be filed with the FTC in advance: 
where an enterprise in a merger is a non-financial enterprise, the total sales value for the preceding fiscal year exceeds NT$10 billion, and the enterprise it merges with, has a sales value exceeding NT$1 billion in the preceding fiscal year. Where an enterprise in a merger is  a financial enterprise, 
the sales value for the preceding fiscal year exceed s NT$20 billion, and the enterprise it merges 
with, has a sales value exceeding NT$1 billion in the preceding fiscal year. 
Source: Fair Trade Act; WTO document WT/TPR/M/232/Add.1, p.91, 25 August 2010; and information 
provided by the authorities. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.181.  Article 14 stipulates that the FTC may approve export or import cartels "for the benefit of 
the economy and in the public interest", with a time limit. By January 2014, there had been no applications for an export cartel, and ten import  cartels had been approved by the FTC under its 
consideration of improving efficiency. Most of these are agreements between food manufacturers 
on joint purchasing and shipping of imported bulk cargos such as soybeans, wheat, and corn. 
Because undertakings not participating in the import or export cartels may be injured parties of these approved actions, Article 15 stipulates that the FTC may attach conditions to the cartel 
participants. The conditions may include allowing any one participant to import a specific 
commodity, but not to exclude any other participant without justification to prevent any discrimination. The FTC has received one complaint for discrimination from one undertaking not participating in the import cartels; this case is still under investigation. 
3.182.  The FTC is a ministerial-level agency responsible for policy and legislation as well as 
enforcement of competition policy. The FTC may initiate investigations in response to complaints (from enterprises, customers, or consumers) abou t alleged violations of the FTA, or open an 
investigation ex officio for a matter that involves  the "public interest". In 2013, the FTC opened 
investigations into 2,279 cases, among which 306 were self-initiated and 1,973 were reported, comprising 1,621 complaints, 4 applications for concerted actions, 51 merger notifications, and 
297 "requests of opinion" (Table 3.20). 
Table 3.20 Enforcement statistics on competition policy, 2009-13 
 2009  2010  2011  2012 2013  
Cases opened 1,612 1,438 1,863 2,555 2,279 
  Cases received 1,501 1,299 1,517 2,114 1,973 
    Complaints 1,402 1,206 1,361 1,955 1,621 
    Applications for concerted action 6 - 7 10 4 
    Mergers 58 45 57 52 51 
    Requests for opinion 35 48 92 97 297 
  Self-initiated investigations 111 139 346 441 306 
Cases processed      
Cases concluded in current year 1,456 1,243 1,346 1,895 1,641 
Ruling on violation of the FTA  140 109 110 86 102 
No-action decision  352 291 278 316 276 
Administrative action  3 1 15 6 1 
Review terminated  909 793 898 1,340 1,158 
Cases consolidated  52 49 45 147 104 
Fines (NT$ million) 202 65.8 233.1 366.6 6,182.1 
   Anti-competitive practice 119.6 28 104.1 307.8 6,123.4 
   Unfair trade practice 78.6 32.9 119.1 46.6 49.6 
   Improper multi-level sales 3.3 2.7 9.3 12.1 5.2 
   Others 0.5 2.3 0.7 0.15 0.95 
Appeals      
Cases concluded in current year  140 144 83 147 112 
Rejected  123 100 69 119 81 
Original decision repealed  3 1 4 17 8 
Not accepted  12 15 9 11 11 
Withdrawn  2 - 1 - 1 
Partially rejected (or not accepted)  - 28 - - 2 
Cases pending 73 30 31 39 25 
Source: FTC (2013), and information provided by the FTC. 
3.183.  Remedies for substantive infringement include fines and orders to cease and correct 
conduct. Administrative fines range between NT$50,000 and NT$25 million, and may be doubled in 
case of repeated offences. In cases of serious violation of Articles 10 and 14 of the FTA, an 
administrative fine of up to 10% of the total sales income of an enterprise in the previous fiscal year may be imposed. Failure to comply with FTC orders is subject to: imprisonment of up to three WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  years and a fine of up to NT$100 million for violating orders on monopolization, concerted action, 
or trademark; and imprisonment of up to two years with a fine of NT$50 million for violating orders on unfair practices. FTC decisions may be appealed in the Appeal and Petition Committee of the executive, and if necessary, further to the Administrative Court. 
3.184.  The FTC has competition cooperation arrangements/agreements with its counterparts in 
Australia, Canada, France, Hungary, Mongolia, New Zealand, and Panama.
148 
3.185.  There has been no major change to consumer protection legislation since 2010.149 In 
January 2012, the Consumer Protection Commission was absorbed into the executive and 
reorganized into the Department of Consumer Protection. At the same time, the executive set up a Consumer Protection Committee, which is responsible for organizing consultations and conducting reviews of consumer protection related policies, enforcement of regulations, and other relevant 
issues. In 2013, the five leading categories of consumer disputes were related to 
telecommunication services, mobile phone and peripheral products, cram schools, automobiles, and real estate. 
3.3.5.2  Price controls and price-stabilization measures 
3.186.  According to the authorities, only a few utility services, including energy (electricity, 
petroleum and gas), and telecom services are subject to price controls (section 4). 
3.187.  A Price Stabilization Committee was set up under the executive in 2008, to monitor prices 
of certain commodities and products and to coordinate their supply and demand, when necessary, with a view to stabilizing their prices.
150 Members of the Committee include the Ministries of 
Economic Affairs, Finance, Interior, Transportation and Communication, Justice, the Central Bank 
(CBC), the Council of Agriculture (COA), the Fair Trade Commission (FTC), and the National 
Development Council (NDC). Prices of the following products are monitored: energy products (gasoline, diesel, gas, and natural gas, etc.), construction materials (iron and steel, sands and 
stones etc.), and bulk commodities (e.g. wheat, corn, soybeans, flour, milk powder, cooking oil). 
Trade-related measures may be adopted with a view to stabilizing prices.
151 
3.188.  Price-stabilization measures have been adopted at upstream, mid-stream, and 
downstream levels, as well as some supporting measures (Table 3.21). 
Table 3.21 Price-stabilization measures 
Commodities Measures 
Upstream: 
Imported bulk commodities, and farm-gate prices of agricultural products - monitoring price changes in the intern ational market for bulk commodities  
- reducing tariffs "dynamically" on some m ilk powder, butter, corn flour, soy flour 
- exempting from business tax (corn) - limiting price increases of some state- owned enterprise products: for example, 
Taiwan Sugar Corporation was required to freeze the price of its small packets of 
sugar, and keeping its salad oil prices at the lowest level in the market - keeping track of daily movements in farm-gate and wholesale prices of "sensitive" agricultural products
a 
 
Mid-stream: 
Reducing transportation 
costs, and strictly 
investigating cartels - subsidizing oil used by farmers and fishermen: exempted from the 5% Business 
Tax; 50% of the above-baseline price of gasoline and diesel is subsidized  
- conducting cost-price analysis on commodi ties that are important in people's daily 
life, to deter businesses fro m raising prices unreasonably 
- strengthening investigation of mid-stream cartels or illegal hoarding 
 
                                               
148 Online information viewed at: http://www.ftc.gov.tw/internet/english/doc/docList.aspx?uid=1075  
[09/04/14]. 
149 For details, please see WTO (2010) p. 74. 
150 Online information available at: http://www.ey.gov.tw/cp.aspx?n=64D0CD86E9048B7B  
[02/07/2013]. 
151 Online information available at: http://www.ey.gov.tw . WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Commodities Measures 
Downstream: 
Monitoring market prices, setting up special anti-inflation areas, and strictly punishing illegal hoarding or price gouging  - stabilizing market prices of agricultural products 
- setting up mechanisms for checking mark et prices: price checks by the DGBAS, 
MOEA, the Consumer Protection Committee, and the FTC - setting up special anti-inflation areas in stores, and working in coordination with businesses to fight inflation - strengthening the investigation of cartels, illegal hoarding, and price gouging 
Supporting measures: 
Central Bank (CBC) The CBC closely watches price trends, and adopts monetary policies: when 
domestic gasoline and electr icity price increases caused inflation expectations, the 
CBC strengthened its conduct of open mark et operations, withdrew excess liquidity 
in the money market and required banks to keep excess reserves  at a modest level 
a Sensitive agricultural products include vegetables  (such as green leafy, roots, bulbs and tubers), 
fruits (such as bananas, pineapples, citrus, melons ), and meat and fish and seafood (such as pork, 
poultry, fish, shrimps, crabs, cephalopods, shell fish). 
Source: NDC online information. Viewed at: http://www.ndc.gov.tw/dn.aspx?uid=11589  [09/04/14]. 
3.189.  On 31 May 2012, the executive approved a draft amendment of Article 251 of the Criminal 
Code, to impose a penalty of up to three years' im prisonment or detention, and/or a fine of up to 
NT$300,000 for hoarding behaviours with an intention to increase transaction prices of food, 
agricultural products, raw materials, or other nece ssary items of the peoples' diet. According to the 
Ministry of Justice, this was to prevent manipulation of market prices of agricultural and industrial products that are related to people’s livelihood and to avoid unfair trade (such as intending to raise 
the selling prices by hoarding food, agricultural products or other daily necessities, or seedlings, 
fertilizers, ingredients or other agricultural or industrial essentials, not selling them without a good cause, and intending to affect the selling prices  of these products by means of spreading false 
information). In addition, obstruction of the sale or transportation of these agricultural or industrial 
products by threats, violence, or fraud is subj ect to severe sentencing so as to curb the 
manipulation of market prices and avoid the impact on people caused by abnormal price 
fluctuations. 
3.3.6  Intellectual property rights 3.3.6.1  Overview 3.190.  The MOEA's Intellectual Property Office (T IPO) is in charge of formulating IPR-related 
policies, both as regards intellectual and industri al property rights, and their implementation. It 
also ensures inter-agency cooperation on IPR enforcement related matters. All IPR legislation is available on TIPO's website.
152 There have been a number of amendments to IPR legislation since 
2010. The Copyright Act was amended in 2010 an d in 2014, and the Copyright Intermediary 
Organization Act was amended in 2010. The new Trademark Act entered into force in July 2012, amendments to the Patent Act went into force in 2013 and 2014, and amendments were made to 
the Trade Secrets Act in February 2013.
153 
3.191.  Chinese Taipei committed to fully apply the TRIPS Agreement by the date of its accession 
to the WTO; the authorities consider that they have fully implemented the Agreement. At the WTO, it participates in the work of the Council on TRIPS, including on issues such as the 
establishment of a multilateral system of notificati on and registration of geographical indications 
(GIs) for wines and spirits, GI extension, and the Convention on Biological Diversity (CBD).
154 TIPO 
also participates in APEC/IPEG meetings, and exchanges experiences with other attending APEC 
members. Chinese Taipei is not a Member of WIPO, or a signatory to any WIPO convention. 
3.192.  There are bilateral instruments in place on  IPR protection and enforcement with Austria, 
Australia, Chile, Costa Rica, El Salvador, the EU, France, Germany, Guatemala, Japan, 
                                               
152 TIPO online information. Viewed at: http://www.tipo.gov.tw/np.asp?ctNode=7105&mp=2 . 
153 For an overview of the main dedicated IPR laws and regulations, as well as other relevant laws and 
regulations notified during the review period, see WTO documents IP/N/1/TPKM/6, 22 April 2014; 
IP/N/1/TPKM/5, 11 March 2014; IP/N/1/TPKM/4, 21 Ja nuary 2014; and IP/N/1/TPKM/3, 27 August 2012. 
154 TIPO (2013). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Liechtenstein, the Netherlands, Paraguay, the Philip pines, Spain, Switzerland, the United Kingdom, 
and the United States. The IPR MOU with Nicaragua was incorporated in the FTA signed in June 2006. The bilateral instruments with New Zealand were terminated by Chapter 10, Article 9 of the ANZTEC Agreement with New Zealand conclu ded in 2013. Its Chapter 10 contains provisions 
on IPR protection. More recently, new or renewed agreements or MOUs have been signed with 
China (2010), the Czech Republic (2010), Italy (2011), Spain (2013) and the United Kingdom (2013).
155 The Cross-Strait Agreement on IPR Protection and Cooperation that took effect on 
12 September 2010 aims at enhancing cooperation on the protection of IP rights. In particular, it 
recognizes priority rights of both sides with resp ect to patents, trademarks, and plant varieties. It 
also provides that both sides will accept applications for plant variety rights and will consult to expand the scope of it. To fight cross-border illegal activities involving IP rights, a communication 
platform was established for competent IP auth orities to facilitate information exchange.
156 
3.193.  Both the Patent Act (Article 59.1.6) and the Trademark Act (Article 36.2) adopt the 
principle of international exhaustion, thus allowing for parallel imports of goods that are protected 
by patents or trademarks. Parallel imports of co pyright-protected products are prohibited, under 
the Copyright Act (Article 87.1.4.), subject to  the exceptions listed in its Article 87bis. 
3.194.  Between its establishment in July 2008 an d end 2013, the Intellectual Property Court dealt 
with 8,323 cases, of which 94% (7,797 cases) has been closed. Half of the cases were either 
first or second instance civil cases, while th e remaining cases were evenly spread between 
administrative and criminal cases. The Court's jurisdiction covers first instance and second instance civil action for the protection of intellectual property rights. Criminal cases are 
dealt with by district courts in the first instance and by the IP Court in the second instance. For 
administrative action, the Court acts as first instance, and appeals are made to the Supreme Administrative Court. 
3.3.6.2  Copyright 
3.195.  The major changes to the Copyright Act, amended in 2010 and 2014
157, include: 
 Rebroadcasting at business venues and the broadcasting or simultaneous transmission of 
copyright-protected works to the public whic h were reproduced under authorization in 
advertisements are exempted from criminal liability. The purpose is to reduce the high number of criminal lawsuits faced by business venues and broadcasting organizations; 
 Copyright-protected works may be reproduced exclusively for use by those with "learning 
disability". This amendment aims at facilitating access to such works for disabled persons; 
and 
 Registered schools of all levels, non-profit organizations and local or central agencies are 
authorized to produce and share accessible-fo rmat copies of copyright-protected works 
without permission of the right holders in order to facilitate access to such works by individuals with visual and hearing impair ments. For this purpose, producers may 
circumvent technological protection measures adopted by right holders. This latest 
amendment, adopted in January 2014, aims at ensuring equal access opportunities by mirroring the exceptions and limitations pr ovided for by the WIPO Marrakesh Treaty 
concluded in June 2013. 
3.196.  The Copyright Intermediary Organization Act was amended in 2010
158, and its name was 
changed to Copyright Collective Management Organization Act. Relevant amendments include the introduction of a "joint royalty rate" and a "one-stop shop" system. The joint royalty rate is a 
single rate jointly adopted by two or more collective management organizations (CMOs) with 
                                               
155 For the complete list of bilatera l agreements see TIPO website at: 
http://www.tipo.gov.tw/ct.asp?xItem=175779&ctNode=6842&mp=2 . 
156 WTO document WT/TPR/M/232, p.37, para. 261, 30 July 2010. 
157 The text of the Copyright Act as amended in 2014 is available in WTO document IP/N/1/TPKM/C/10, 
8 May 2014. 
158 The text of the amended Copyri ght Collective Management Organization Act is available in WTO 
document IP/N/1/TPKM/C/11, 8 May 2014. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  respect to the same type of exploi tation. TIPO designated three CMOs159 to adopt a joint royalty 
rate for computer karaoke machines. Negotiations to determine the joint royalty rate and the CMO with the authority to collect royalties (the one-stop shop) are still ongoing.
160 The purpose of these 
amendments is to simplify licensing procedures and to balance the interests of users and collective 
societies. The authorities expect the amendment to provide a simpler way for users to obtain 
complete and full licences from CMOs and to lower transaction costs for CMOs. Another important amendment is the revision of the rate review system: instead of a mandatory prior review of 
collective societies' rates by TIPO, which was applied before, TIPO now only reviews disputes 
regarding royalty rates that have been submitted to it. In addition, the "per user rate" was introduced as another option beside the "percent age rate or lump sum". Users may make interim 
payment to legally use works managed by CMOs while the rate is being reviewed. 
3.197.  Copyright is granted for oral and literary works, musical works, dramatic and 
choreographic works, artistic works, photograph ic works, pictorial and graphical works, audio 
visual works, sound recordings, architectural works, computer programs, derivative works, 
compilation works, and artists' (performers') pe rformances. In general, copyright protection 
commences from the point of accomplishment of th e work and is extended for the lifetime of the 
author plus 50 years, except photographic works, audio visual works, sound recordings, and 
artists' (performers') performances, for which copyright is granted for 50 years from the time of 
public release. Copyright does not need to be registered to be protected. 
3.198.  Under Article 4 of the Copyright Act copyright protection for non-local right holders is 
provided when there is a reciprocal arrangement wi th TIPO contained in a bilateral or multilateral 
agreement.
161 Nationals of WTO Members benefit from copyright protection in Chinese Taipei 
because of the non-discrimination rules that apply under the TRIPS Agreement. Works of citizens originating in countries without these reciprocity arrangements are also protected, provided they 
are published first in Chinese Taipei, or within 30 days of being published elsewhere. 
3.199.  According to the authorities, the Copyright Act is consistent with the TRIPS Agreement. 
Among others, it has implemented protection and enforcement standards as stipulated by the 
WIPO Internet Treaties, i.e. the WIPO Copy right Treaty and the WIPO Performances and 
Phonogram Treaty, as well as provisions on exce ptions and limitations as established by WIPO's 
Marrakesh Treaty to Facilitate Access to Published Works by Visually Impaired Persons and Persons with Print Disabilities. 
3.3.6.3  Patents 
3.200.  The Patent Act has been substantially reviewed in 2011 and in 2013, and most recently in 
2014.
162 Reflecting the amendments, eight regulation s were modified, including the Enforcement 
Rules of the Patent Act.163 Major amendments are listed in Table 3.22. Most recently, the 
Regulations Governing Customs Detaining Goods Suspected of Patent Infringement complemented the provisions on border protection measures of  the Patent Act. The Regulations, promulgated 
jointly by the MOEA and the Ministry of Financed, became effective on 24 March 2014. 
                                               
159 Before the amendment of the Act, since there was no  limitation specified to the number of collective 
societies, more than one collective society in the same  category of work was allo wed, which made licensing 
procedures complicated. 
160 If an agreement cannot be reached by negotiat ion, any of the CMOs may apply to TIPO for 
determination. Before the joint royalt y rate is determined, users who subm itted written requests to CMOs to 
adopt a royalty rate may be exempted from crimin al liabilities for the type of exploitation. 
161 The Agreement for the Protection  of Copyright between the Coordi nation Council for North American 
Affairs and the American Institute in Taiwan is the only bilateral agreement containing reciprocal arrangements. 
162 For the latest amendments, see the Patent Act as notified to the WTO in document IP/N/1/TPKM/P/5, 
8 May 2014. The Enforcement Rules of the Patent Act that entered into force on 1 January 2013 are reproduced in WTO documents IP/N/1/TPKM/P/4, and IP/N/1/TPKM/E/3, 28 January 2014. 
163 Other modified regulations include:  the Regula tions Governing Submission of Foreign Language 
Application Documents, the Regulati ons Governing the Implementation of  Filing Patent Applications by 
Electronic Means, the Regulations for the Deposit of Biol ogical Material for Patent Application, the Regulations 
of Patent Fees, the Regulations for Reduction and Exemption of Patent Annuities, the Regulations Governing Invention and Creation Awards, and the Regulati ons for Ratifying Patent Term Extension.  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.201.  Patents are granted for inventions, utility models, and designs. Protection for patent rights 
is for 20 years from the date of filling of the application for inventions, ten years for utility models, and 12 years for designs. While applications for invention patents and designs are subject to substantive examination, a formality examination applies to utility model applications, which were 
concluded within less than four months on average in 2012. Since the previous Review, no 
compulsory licences have been granted. 
Table 3.22 Major amendments to the Patent Act from 2011 to 2014 
Subject Details 
Scope Design patents may cover partial designs,  computer-generated icons and graphical user 
interfaces (icons & GUIs),  and sets of articles. 
Application 
procedures A patent applicant who discloses the invention in printed publications on his/her own accord 
may also claim grace period thereof; 
Submission of proof of application right is no longer required; 
Applications may be submitted in the following foreign languages: Arabic, English, French, 
German, Japanese, Korean, Portuguese, Russian, and Spanish; 
A certificate proving both depo sit and viability of biological materials shall be issued; 
“Reinstatement of rights” mechanism was introduced: applicants who unintentionally fail to 
claim priority rights at the time of application or patent owners who fail to pay patent 
annuities on time may apply fo r the reinstatement of rights; 
Time limit for applicants wishing to amend applications has been removed; 
Divisional applications may be filed within 30 days from the date  of approval of the original 
patent application. 
Substantive 
examination A "final notice" mechanism and procedures to co rrect translation errors have been introduced; 
Limits on the extension of patent term have been relaxed; Provisions regarding the processing of both invention patent and utility model patent filed separately in respect of the sa me creation have been added; 
An examination requirement on a post-grant amendment of utility model patent has been 
introduced. 
Exceptions 
and 
limitations A regime of international exha ustion applies to patents; 
Private acts that are for non-commercial purpos es and acts that are necessary for obtaining 
drug regulatory approvals fall within the scope of exceptions to patent rights. 
Compulsory 
licensing The following was changed from a ground for co mpulsory licensing to a prerequisite: an 
agreement cannot be reached between parties in respect of a voluntary licence; in the event of national emergency or other extreme urgency,  TIPO may grant the compulsory licence of a 
needed patent pursuant to an emergency orde r or upon notice from the central government 
authorities in charge of such matters; Remuneration of compulsory licensing shall be carried out in a single-phase process by TIPO; 
Compulsory licences may be gr anted to produce pharmaceutical products needed to treat 
HIV/AIDS, tuberculosis, malaria, and other epidemics for export to countries with insufficient manufacturing capacities in the pharmaceutical sector. 
Patent 
invalidation Examination by ex officio  action has been abolished; 
Invalidation actions may be fi led against parts of claims; 
Examining and deciding invalidation shal l be made on a claim-by-claim basis; 
Examining invalidation action and amendment shall be conducted jointly and the decisions 
thereof shall be rendered jointly. 
Remedies for 
infringement The infringer's intentional or negligent act must be clarified for the patentee to claim the 
damages of patent infringement; A method of calculating damages on the basis of reasonable royalties has been introduced; A maximum punitive damage of triple the su ffered damage has been restored and may be 
awarded by the court upon request by the right holder, depending on the circumstances of the intentional infringement. 
Border 
measures Conditional upon depositing a security, the righ t holder may request detention by Customs of 
imported goods suspected of infringing patent  rights. Detention shall be repealed, among 
others, if a civil infringement litigation has not been filed within 12 days counting from the 
date of requesting action by Customs or if th e owner of the detained goods deposits a counter 
security. In case of a final and binding court ruling that finds that the detained goods are not 
infringing patents, the right hold er shall be liable for the dama ges caused by the detention. 
Source: Information provided by the authorities.  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.202.  In 2013, TIPO received 49,218 invention patent applications (Table 3.23). In 
February 2014, it took on average 36 months for a patent to be granted, down from 41 months in 2013 and 46 months in 2012. This reflected the authorities' efforts to reduce patent backlog. To accelerate the patent examination process and to shorten the average time of pendency, TIPO put 
in place a Patent Backlog Reduction Project in June  2010. As part of this project, the number of 
patent examiners was increased from around 350 to  more than 500. Furthermore, a Patent Search 
Centre was officially inaugurated in April 2012, with a view to assisting TIPO in handling prior art 
research and sustaining examination efficacy.
164 
Table 3.23 Patents applied for and granted, 2009-13 
 2009  2010  2011  2012 2013  
Patent applications      
  Invention 46,654 47,442 50,082 51,189 49,218 
    Domestic (%) 49 48 47 45 44 
    Foreign (%) 51 52 53 55 56% 
  Utility model 25,032 25,832 25,170 25,636 25,025 
    Domestic (%) 97 96 96 95 95 
    Foreign (%) 3 4 4 5 5 
  Design 6,739 7,220 7,736 8,248 8,968 
    Domestic (%) 63 59 60 61 57 
    Foreign (%) 37 41 40 39 43 
Total 78,425 80,494 82,988 85,073 83,211 
    Domestic (%) 65 65 63 62 61 
    Foreign (%) 35 35 37 38 39 
Patents granted      
  Invention 14,138 16,345 20,025 25,536 40,251 
    Domestic (%) 53 52 50 48 49 
    Foreign (%) 47 48 50 52 51 
  Utility model 23,591 23,935 24,037 24,643 24,847 
    Domestic (%) 97 97 96 95 95 
    Foreign (%) 3 3 4 5 5 
  Design 5,995 5,686 6,243 6,431 7,050 
    Domestic (%) 53 61 60 61 61 
    Foreign (%) 47 39 40 39 39 
Total 43,724 45,966 50,305 56,610 72,148 
    Domestic (%) 77 76 73 70 66 
    Foreign (%) 23 24 27 30 34 
Source: TIPO (2013), and information provided by TIPO. 
3.203.  In addition, TIPO adopted an Accelerated Examination Programme (AEP) under which 
applicants may request an accelerated procedure provided that one of the following conditions is 
met: (i) the application's foreign counterpart ha s been granted under substantive examination by 
a foreign patent office; (ii) while the patent has not been granted, the application's foreign counterpart has received an OA (office action) fr om the EPO, JPO or USPTO during the substantive 
examination; and (iii) the application is essential to the commercial exploitation of the invention. 
In January 2014, another condition was added: the technical field involves energy conservation, 
new energy or new energy vehicles or the invent ion involves carbon emission reduction or saves 
natural resources. The purpose is to support investment in R&D and development of green 
technology. In total, more than 5,000 requests for the AEP were received from 2009 to 2013, with an average pendency to obtain a final decision of 141 days. 
3.204.  Other efforts by TIPO to shorten the ex amination process include the establishment of 
Patent Prosecution Highway (PPH) programmes with USPTO and JPO. PPHs aim at allowing the 
applicant to seek an advanced examination by TIPO  as the Office of Second Filing (OSF), if the 
                                               
164 TIPO (2013). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  USPTO or JPO as the Office of First Filling (OFF) has determined the claim is allowable or 
patentable. Up to February 2014, 604 PPH requests have been made to USPTO and 772 to JPO. A PPH Mottainai Pilot programme was agreed with the Spanish Patent and Trademark Office (SPTO) in October 2013 for two years; no request had been made under this programme as of 
February 2014.  
3.205.  Most foreign applications are for invention patents, while domestic applications are divided 
almost equally between invention and utility model patents (Chart 3.3). Among the non-local 
patent applicants, Japan and the United States are the top two foreign sources. 
Chart 3.3 Patent applications, 2013 
Number 
05,00010,00015,00020,00025,00030,00035,00040,00045,00050,000
Invention Utility model DesignForeign
Domestic
 
Source: Information provided by TIPO. 
3.3.6.4  Trademarks and geographical indications 
3.206.  A new Trademark Act was promulgated in June 2011 and entered into force on 
1 July 2012.165 Over half of the articles in the Trademark Act were amended. Major amendments 
include: 
 expanding the scope of protected subject matter through the coverage of motions, 
holograms and any signs with distinctiveness; 
 stipulating the types of trademark use; 
 abolishing the two-instalment payment of trademark registration fee; 
 allowing reinstatement of rights if the registration fee was unintentionally unpaid; 
 requesting submission of supporting evidence, wh ere an invalidation or revocation action is 
filed on a trade mark, to show the use of such trade mark in three years; 
 increasing protection for well-known trademarks against the likelihood of dilution; 
 inserting liability for contributory trademark infringement, including manufacturing, 
processing, displaying, selling, exporting or importing counterfeit labels, tags, packaging or 
containers;  
                                               
165 Notified to the WTO in document IP/N/1/TPKM/ T/4, 27 August 2012. The Enforcement Rules of the 
Trademark Act were circulated in WTO document IP/N/1/TPKM/T/5, 11 March 2014. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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   stipulating that Customs shall provide information to the right holder, upon his request, of 
the names and addresses of the importer/exporter, the consignor/consignee, and the quantity of the suspected goods for investigation or prosecution purposes, and to hand out samples of the suspected goods to the trademark owner against provision of a security; and 
 putting in place a registration mechanism and related infringement liabilities for 
geographical certification marks and geographical collective trademarks.
166 
3.207.  The Enforcement Rules of the Trademark Act, Standards of Trademark Fees, 
Implementation Regulations for Customs to Detain Ar ticles Infringing the Rights in the Trademark, 
and Regulations for e-Filling of Trademark Applications were also revised, as well as all 11 examination guidelines and other notices.
167 
3.208.  Trademarks protection is for ten years, and is renewable. Application for trademark 
registration is made to the Registrar Office in the TIPO. Applications are examined with regard to 
the formalities, and absolute/relative grounds for refusal. An application for trademark registration is accepted if none of the grounds for refusal is found to exist. A registered trade mark must be 
published and a certificate is issued once the registration fee has been paid. It takes about six to 
seven months to register a trademark. 
3.209.  Well-known trademarks are protected both under the Trademark Act, which prevents the 
distinctiveness or reputation of well-known trade marks from being diluted, and the Fair Trade Act, 
which prevents well-known trademarks from being confused. For example, if a well-known trade 
mark is registered in Chinese Taipei, using or registering similar marks or using words contained in the registered well-known trademark as the business name is prohibited, and considered as 
violation of the Trademark Act. If the well-known  trademark is not registered, the Fair Trade Act 
prevents any acts considered to bring unfair competition. 
3.210.  In 2013, TIPO received a total of 74,031 applications for trademark registration, mostly 
from residents (Table 3.24). 
Table 3.24 Trademark and related data, 2009-13 
 2009  2010  2011  2012 2013  
Trademark      
  Application 59,669 66,496 67,620 74,357 74,031 
    Domestic 47,009 50,998 50,895 55,696 55,338 
    Foreign 12,677 15,498 16,725 18,661 18,693 
  Registration 48,075 54,292 48,315 61,918 60,557 
    Domestic 35,650 41,410 36,687 45,659 44,174 
    Foreign 12,425 12,882 11,628 16,259 16,383 
  Rejection 7,728 8,356 6,480 8,724 8,581 
Certification mark      
  Application 43 33 64 37 41 
  Registration 27 39 21 42 30 
Collective 
membership mark      
  Application 57 83 70 71 64 
  Registration 41 55 56 39 54 
Source: TIPO (2013), Intellectual Property Office Annual Report 2012,  Taipei, June. 
3.211.  Geographical indications (GIs) may be registered as geographical certification marks, or 
geographical collective trademarks. Under the Trademark Act and other relevant legislation168, 
third parties are prohibited from applying for registration as trademarks and from abusing 
                                               
166 TIPO (2013). 
167 TIPO (2013. 
168 These include the Fair Trade Act, the Tobacco and Alcohol Administration Act, the Regulations 
Governing the Labelling of the Alcohol Products, the Co mmodity Labelling Act, and other related regulations. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  indications of origin, which constitutes an act of unfair competition. The authorities support a 
multilateral system of notification and registrati on of GIs for wines and spirits that is based on 
voluntary participation. With regard to the exte nsion of other products to the higher level of 
protection for wines and spirits required under the TRIPS Agreement, the authorities consider that 
neither the necessity nor urgency for such  an extension has been demonstrated. 
3.3.6.5  Layout-designs of integrated circuits, plant varieties, trade secrets 
3.212.  In accordance with the Integrated Circuit Layout Protection Act, most recently amended in 
2002169, protection for layouts of integrated circuits is for 10 years from the date of application, or 
the date of first commercial exploitation, whichever is first. The Plant Variety and Plant Seed Act provides protection for plant varieties that have  the characteristics of novelty, distinctness, 
uniformity, and stability, as well as an appropriate plant variety denomination. 
3.213.  In response to a number of recent cases of violation of trade secrets which led to huge 
losses for domestic companies and severely affected fair competition among industries, the Trade Secret Act was amended in January 2013.
170 The amendments that entered into force in February 
2013 focus on the introduction of criminal liability for infringement. Among others, a number of 
unlawful acts listed are punishable by imprisonment or detention not exceeding five years and an additional fine of NT$1 million to NT$10 million. In addition, increased penalties of up to ten years 
imprisonment and an additional fine from NT$3 million to NT$50 million apply for infringement of a 
trade secret for the purpose of using it in a foreign jurisdiction. 
3.3.6.6  Enforcement of IPRs 3.214.   The authorities recognize IPR protection  as an essential contribution to economic 
development and overall competitiveness, as well as to efforts in attracting foreign investment.
171 
IPR enforcement at the border is conducted by Customs, which may suspend ex officio the release of goods suspected of infringing IPRs (Table 3.25). 
Table 3.25 IPR enforcement at the border by Customs, 2009-13 
IPR enforcement by Customs on imports and exports 
Enforcement on imported goods 
(a) Commodities infringing trademarks 
Commodities infringed by type of item 
Year Cases Car 
parts Leather 
products  Watches  Shoes  Clothes  Cigarettes  Cell 
phones Medicines Others  
2009 270 4,221 3,221 488 16,987 41,511 1,026,680 0 39,000 83,174 
2010 210 1,519 3,611 812 4,016 13,863 3,957,050 196,199 182,487 130,928 
2011 91 497 754 96 1,571 1,362 0 205 9,151 47,820 
2012 74 1,364 1,494 219 3,549 3,476 450,000 480 4,603 51,013 
2013 89 0 2,697 383 358 12,604 0 660 0 24,212 
(b) Commodities infringing copyright 
Pirated optical discs 
Year Cases Game software  
(or game CDs) Pirated optical discs  
(or movie DVDs) Others Total 
2009 45 24,856 4,569 0 29,425 
2010 44 11,719 5,938 68 17,725 
2011 18 595 3,995 0 4,590 
2012 13 353 930 0 1,283 
2013 8 16 499 0 515 
Enforcement on exported goods 
(a) Export commodities infringing 
 trademarks (b) Trademarks in the export declaration not in conformity 
 with the commodity trademark and referred to the ACC 
Year Cases Quantities of commodities 
infringed  
2009 3 102,672 513 
2010 1 620 561 
2011 4 17,200 510 
2012 1 64,800 255 
2013 2 54,960 181 
Source: Information provided by the authorities. 
                                               
169 As notified to the WTO in document IP/N/1/TPKM/L/3, 8 May 2014. 
170 For the text of the Trade Secret Act see WTO document IP/N/1/TPKM/U/2, 8 May 2014. 
171 TIPO (2013). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  3.215.  During the review period, the number of  cases of imported commodities infringing 
trademarks generally declined; the main commodities concerned included car parts, leather products, watches, shoes, clothes, cigarettes, cell phones, and medicines. Cases of imported 
commodities infringing copyright declined significantly. The authorities consider that this was 
because: 
 the government's efforts in promoting IPR awareness have been effective in reducing the 
 import and export of counterfeits and pirated goods; 
 law enforcement agencies have adopted measures to deter the import and export of 
 counterfeits and pirated goods; and 
 the Trademark Act imposes a penalty on traders who import or export counterfeits. 
3.216.  The authorities note that online trading an d the delivery of counterfeits and pirated articles 
by express cargo or mail parcels have made Customs enforcement more difficult. The decreasing 
quantities of pirated optical discs may be attribut ed to copyright infringement being conducted in 
the digital environment. Furthermore, some suspected infringement cases cannot be sustained 
because the right holder, based on a cost-benefit analysis, is reluctant to help with on-site 
inspection. 
3.217.  The decline in cases of counterfeit auto parts and medicines may be attributed to greater 
public awareness of safety and health. The variat ion of the number of cigarettes seized by the 
Customs is because cigarette smuggling is moving from counterfeit to white brands.
172 
3.218.  At the same time, export commodities infringing trademarks increased between 2010 and 
2012. Most of the seized articles were counterfeited memory cards or mobile phones, which are 
small in size and weight, but large in quantity. 
3.219.  Within the border, the Police Force of the Ministry of the Interior and the High Prosecutors 
Office implement IPR legislation. In particular, the IPR Police in the National Police Agency 
undertakes counterfeit and piracy investigation. In 2013, the IPR Police investigated 2,754 cases, 
an increase of 7% from 2012 (Table 3.26). The Jo int Optical Disk Enforcement Taskforce (JODE) 
conducts periodic and random inspections of optical disc plants, printing plate factories, and other 
related facilities. The JODE also facilitates the IPR Police in strengthening Internet inspection. 
3.220.  The infringement of trademarks, copyrights, and trade secrets may lead to the imposition 
of criminal liability whereas the infringement of patents, layout-designs of integrated circuits, and plant varieties does not involve criminal liability. Provisions on criminal liability in patent 
infringement were deleted in 2001 (for invention) and 2003 (for utility model and design); 
according to the authorities, this was partly because the initiation of criminal investigation and prosecution might be abused to interfere with the operation of business and the development of 
industries. As registration of layout-designs of integrated circuits requires only formality 
examination, according to the authorities, it is likely to draw public concern if criminal liability is imposed against the infringement. The COA stated that, as criminal investigation and prosecution 
might be abused to interfere with the operation of business and the development of industries, 
criminal liability of plant variety infringement was deleted from the Plant Variety and Plant Seed Act in 2004. 
3.221.  An Inter-agency Coordination Taskforc e for IP Enforcement has been established to 
combat IPR infringement.
173 Many authorities, such as the NPA174, including IPR Police, the 
Customs Administration, the High Court Prosecutors Office, the judicial branch, the Bureau of Foreign Trade, the Joint Optical Disk Enforcement Task Force, the Ministry of Education and TIPO, 
work together in the Inter-agency Coor dination Taskforce for IP Enforcement. 
                                               
172 "White brands" are cigarettes made in legitimate factories overseas but smuggled into Chinese Taipei 
in large shipping containers without payment of relevant taxes, such as excise duty. 
173 WTO document WT/TPR/M/232, p.5, 30 July 2010. 
174 Online information available at: www.npa.gov.tw. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Table 3.26 IPR enforcement within the border, 2009-13 
IPR enforcement 
High Prosecutors Office  
Year Investigations 
concluded Outcome (case) 
Indicted 
(ordinary 
procedure) Indicted 
(summary 
judgement) Deferred Not indicted Others 
2009 7,414 655 1,263 1,933 2,699 863 
2010 7,107 768 975 1,882 2,524 958 
2011 7,991 861 1,263 2,049 2,575 1,243 
2012 7,763 799 995 2,073 2,754 1,142 
2013 7,794 712 1,057 2,077 2,900 1,048 
National police  
 Total Trademark 
violations Copyright violations ODs 
seized Internet 
cases 
 Cases Suspects Cases Suspects Cases Suspects No. of 
discs Cases 
2009 5,543 6,115 2,620 2,919 2,923 3,196 785,806 3,046 
2010 5,161 5,988 2,890 3,377 2,271 2,611 1,348,523 2,646 
2011 5,633 6,505 3,382 3,867 2,251 2,638 615,528 2,986 
2012 5,484 6,342 3,260 3,716 2,224 2,626 131,648 2,892 
2013 5,730 6,623 3,475 3,983 2,255 2,640 99,608 3,535 
IPR police 
 Total cases Types of cases 
Internet Markets Storefronts Flyers Factories Others 
2009 2,010 1,263 430 174 13 2 128 
2010 1,948 1,008 289 480 10 12 149 
2011 2,243 1,355 205 456 5 9 213 
2012 2,576 1,570 402 562 3 6 24 
2013 2,754 1,803 370 551 2 2 27 
IP adjudication findings 
Adjudication Total Imprisonment Detention Fines Acquitted Others 
2009 2,250 985  719 64 161 321 
2010 1,949 906 632 35 130 246 
2011 1,925 878  604 40 176 227 
2012 1,915 818 677 62 125 233 
2013 1,699 628 694 55 93 229 
Source: TIPO (2013), and information provided by TIPO. 
 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  4  TRADE POLICIES BY SECTOR 
4.1  Agriculture, fisheries and forestry 4.1.1  Agriculture 4.1.1.1  Overview 
4.1.  The share of agriculture, together with fore stry and fishery, accounted for only 1.7% of GDP 
in 2013 and its contribution to total employment fell to 5% (Table 1.2). Nevertheless, it is 
considered by the government to be fundamental to the economy of the Separate Customs 
Territory of Taiwan, Penghu, Kinmen and Matsu (C hinese Taipei). Since the previous Review in 
2010, there have been no major changes to the legislative or institutional framework of the 
agriculture sector. The main legislation remains the Agricultural Development Act of 1973, and the Council of Agriculture (COA) is still responsible for the administration of agriculture, forestry, 
fishery, livestock, and other affairs concerning foodstuffs. 
4.2.  The value of agricultural production wa s NT$371 billion (US$12.5 billion) in 2012. The main 
contributors are fruits (21% of the total value of agricultural production), pig rearing, and 
vegetables (Table 4.1). Although paddy rice accounts for a lower share of the total value, it has 
attracted disproportionate attention from the government. 
Table 4.1 Value of agri culture production, 2009-12
 
(NT$ million and %) 
 2009  2010  2011 2012  
Total agriculture, forestry and fishing 407,169 426,913 475,897 477,913 
Forestry production 416 390 388 375 
Fishery production 85,901 92,499 106,322  106,174 
  Agriculture 320,852 334,024 369,187 371,364 
 (%) 
    Crop production 55.7 56.5 56.9 60.0 
    Paddy rice 10.5 9.1 10.3 10.7 
    Coarse grain 2.4 2.5 2.4 2.3 
    Special crops 2.6 3.2 3.3 3.3 
    Vegetables 14.8 15.3 15.1 16.6 
    "Mildew" 1.1 1.2 1.3 1.5 
    Fruit 20.5 21.2 20.1 21.3 
    Ornamental plants 3.8 4.0 4.3 4.4 
    Livestock production 44.3 43.5 43.1 40.0 
    Hogs 20.5 21.2 20.4 18.0 
    Broiler 4.7 4.7 4.8 4.3 
    "Colourful broiler" 6.6 6.2 6.5 5.6 
    Mule & Muscovy duck 1.6 1.6 1.5 1.4 
    Cow milk 2.3 2.4 2.5 2.5 
    Hen eggs 5.7 4.6 4.7 5.2 
Source: COA (2013), Statistics Yearbook 2012 . Viewed at:  
http://agrstat.coa.gov.tw/sdweb/public/book/Book .aspx [28/01/14]; and information provided by 
the COA. 
4.3.  Agriculture is characterized by small landholdings (Table 4.2). The average farm size is 
1.1 hectares and holdings are often fragmented, which increases production costs and difficulties for achieving economies of scale. In 2012, there were about 779,375 farming families, 4.7% more 
than in 2009. The increase was due mainly to the ageing of the rural population, which may result 
in further fragmentation of farm land. On average,  the income from farming for these families is 
only about a quarter of their total income. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Table 4.2 Agricultural land, 2009-12  
 Year No land  < 0.1 
hectare  0.1 ~ 0.5 
hectares  > 0.5 
hectares  Total  
2009 Farming households 3,931 21,053 358,438 360,725 744,147 
 Share in total agricultural 
household 0.5% 2.8% 48.2% 48.5% 100% 
2010 Farming households 5,451 16,615 410,112 348,210 780,388 
 Share in total agricultural 
household 0.7% 2.1% 52.6% 44.6% 100% 
2011 Farming households 5,399 23,556 401,531 346,987 777,473 
 Share in total agricultural 
household 0.7% 3.0% 51.7% 44.6% 100% 
2012 Farming households 4,754 26,260 405,450 342,911 779,375 
 Share in total agricultural 
household 0.6% 3.4% 52% 44% 100% 
Source: COA online information. Viewed at: http://www.coa.gov.tw/view.php?catid=2447512 (in Chinese) 
[10/10/13]; the Taiwan Area Farming Household Surv ey by Agriculture and Food Agency, COA (for 
2009 and 2011 data); the Agricultural, Forestry, Fishery and Husbandry Census by Directorate-General of Budget, Accounting and Statistics (for 2010 data); and information provided by the COA. 
4.4.  Chinese Taipei has a trade deficit in food, and imports supply a significant part of 
consumption. Imports of food (excluding fish) re presented about 4% of total merchandise imports 
in 2012, the major products being: soybeans, corn, food preparations, cigarettes, wheat, and spirits. In 2012, the import share of food supply was 85.1% for cereals (104.3% for wheat, 
100.5% for corn, 99.9% for sorghum), 117.5% for sugar, and 98.3% for soybean.
1 It seems a 
large part of these grains are for animal feed. The import share of rice supply was 11.3% in 2012, 
while the self-sufficiency ratio for rice was 106.9%.2 Food is imported mainly from the 
United States, Brazil, Japan, and Australia. 
4.5.  Exports of food (excluding fish) comprised about 0.6% of total merchandise exports in 2012, 
and major exported products include food preparations and non-alcoholic beverages. It exports its food products mainly to China, the Unit ed States, Hong Kong, China, and Japan. 
4.1.1.2  Agricultural policy objectives 
4.6.  According to the COA, the policy objectives are: safeguarding food security, creating an 
ecological environment, improving farmers' welfare,  constructing a culture system that replenishes 
agricultural resources, and ensuring agriculture's sustainable development. The COA intends to 
develop scientific agriculture and promote agricultur al exports, so as to build agriculture as one 
part of the global value chain and green industry. 
4.7.  The transfer of land ownership is based on the property right regulations set out in the Civil 
Code. In order to address fragmentation, the CO A has promoted the policy of “Small Landlords, 
Large Tenants”, whereby the government encourages young professional tenant farmers
3 or 
farmer groups to rent farms (from owners unable or disinclined to farm), through measures such 
as: interest-free loans for renting land, farming equipment grants, platform for renting brokerage, 
low-interest (1%) business loans, and disaster relief assistance. The young farmers are encouraged to plant import substitution crops (including corn, non-genetically modified soybeans, 
pasture and forage corn, and other feed an d forage), to expand the scale of farms.
4 Technical 
training and mentorship programmes (such as case-by-case supply chain counselling) are provided to assist young farmers. According to the authorit ies, if young farmers choose not to plant import 
                                               
1 COA (2013), Food Supply & Utilization 2012. Viewed at: 
http://agrstat.coa.gov.tw/sdweb/public/book/Book.aspx  [10/10/13]. 
2 COA (2013), Food Supply & Utilization 2012. Viewed at: 
http://agrstat.coa.gov.tw/sdweb/public/book/Book.aspx  [10/10/13]. 
3 The authorities state that "young professional fa rmers are defined as farmers who are 18-55 years old 
with agricultural diploma or received  agricultural-related training".  
4 COA online information viewed at: http://eng.coa.gov.tw/list.php?catid=8799  [09/10/13]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  substitution crops, they may still benefit from these support measures, apart from supply chain 
counselling.  By the end of 2013, the average size of large tenant holdings was 8.4 hectares. 
4.8.  With the aim of developing a competitive,  market-oriented agriculture, the COA implemented 
a "Quality Agriculture Development Programme (2009-12)" to promote value added in 
agriculture.5 Detailed measures included: 
 healthful agriculture: provided training programmes to help farmers to adopt and 
implement good agricultural practice (GAP) and to participate in the certification of 
Traceable Agriculture Product (TAP), and Certified Agricultural Standards (CAS) 
products; 
 excellent agriculture: provided research support and technology incubator 
programmes to accelerate the integration of new innovations and business model and 
to develop new agricultural start-ups and high-tech industries, such as orchids, 
ornamental fish, groupers, plant seedlings, and breeding livestock; and 
 LOHAS (lifestyle of health and sustainability) agriculture: developed agri-tourism and 
eco-friendly products to create a sustai nable environment for rural communities and 
agriculture-oriented tourism.  
4.1.1.3  Border measures 
4.1.1.3.1  Tariffs 
4.9.  Tariffs on some agricultural products rema in high: 37 tariff lines have tariff rates over 100%, 
of which 6 lines are ad valorem  (other deer velvet - 500%, crude ground-nut (peanut) oil - 338%, 
refined ground-nut (peanut) oil - 338%, pomelos - 184%, pineapples - 173%, and other coconuts 
- 120%). About 7.5% of tariff lines for agricultural products are subject to non- ad valorem  rates, 
with a simple average AVE of 132.3%. The highest MFN tariffs (AVEs) apply to: rolled or flaked 
rice (1069.87%), areca (betel) nuts (822.08%), rice in the husk (800.71%), flours and meals of 
ground nuts (744.19%). The average applied MFN tariff for agricultural products (WTO definition), 
including ad valorem  equivalents (AVEs), was 22.1% in 2013, unchanged from  2009 (Table 3.3). 
4.1.1.3.2  Tariff quotas 
4.10.  Tariff quotas (TQs) apply to 16 agricultural products: deer velvet, fresh pears (excluding 
European pears), bananas, red beans, liquid milk, peanuts, garlic bulbs, dried shiitake mushrooms, 
dried day lily, young coconut, betel nuts, pineapples, mangoes, shaddocks, dried longans and longan pulp, and rice (including rice products).
6 The  Bank of T aiwan (BOT ) is  e ntrus ted  b y the 
Finance Ministry to administer the allocation of TQs for these items; it allocates the quotas and 
issues certificates, which serve as import licence s. The TQs for 15 agricultural products (except 
rice) may be allocated to any enterprise registered with the authorities as importer/exporter, 
including non-local enterprises. The in- and out-of-quota tariff rates on agricultural products, and 
the quota filling rate are listed in Table 3.7. Th ere were no in-quota imports of banana, mango, 
and shaddocks during the review period; according to the authorities, this was because the 
products did not meet the SPS requirements at the border inspections.  
4.11.  TQs for rice are divided between government (65%, imported by the government) and the 
private sector TQs (35%, imported by the priv ate sector). The government TQs, imported 
exclusively by the Agricultural and Food Agency (AFA) (section 4.1.3), are further allocated on a 
country-specific basis: 64,634 tonnes from the United States, 18,634 tonnes from Australia, 
8,300 tonnes from Thailand, and 2,500 tonnes from Egypt. The private-sector quota is allocated through a bidding process; any enterprise registered as an importer/exporter and food dealer with 
the authorities, including non-local firms, are eligible to apply for a certificate under the quota 
allocation system.  
                                               
5 WTO document, WT/TPR/M/232, p.38, 30 July 2010. 
6 WTO documents, G/AG/N/TPKM/75, 15 March 2010; G/AG/N/TPKM/87, 25 March 2011; 
G/AG/N/TPKM/94, 29 Feb 2012; and G/ AG/N/TPKM/102, 28 February 2013. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  4.1.1.3.3  Special safeguard measures (SSGs) 
4.12.  Special safeguard measures were taken during the review period; most were volume based 
(Table A4.1).  
4.13.  The number of price-based SSGs increased significantly in 2013 (Table A4.1). According to 
the authorities, once the import price falls below the trigger price, additional duty may be imposed 
on a batch-by-batch basis according to Article 5 of the Agreement on Agriculture (Table A4.2). 
4.1.1.3.4  State trading 
4.14.  Rice remains the only agricultural produc t subject to state-trading. The Agricultural and 
Food Agency (AFA) under the COA regulates the production, purchase, warehousing, export, and 
import of rice, with a view to ensuring food security, market stability, and income security for farmers.
7 The AFA purchases a portion of the paddy rice owned by farmers for food security stock, 
while most of the rice produced enters the market freely (Table 4.3). The authorities state that to 
ensure food security, the AFA must procure at least three months' consumption of paddy rice as public stock-holding. As noted, the AFA has the exclusive right to import the government portion 
of the TQ on rice, i.e., 65% of the TQ. 
Table 4.3 State-trading a rrangement for rice, 2009-12 
('000 tonnes) 
Rice 2009  2010  2011 2012  
Total quantity imported  103.3 181.5 131.7 156.8 
  Quantity imported by the AFA  47.9 94.1 72.9 103.5 
Total quantity exported 8.4 9.8 19.2 24.8 
  Quantity exported by the AFA 0 0 0 0 
National production (brown rice) 1,276.5 1,168.0 1,347.8 1,368.2 
  Domestic purchases by the AFA (paddies) 183 191 386 442 
National supply (brown rice) 1,317.9 1,270.7 1,246.1 1,279.4 
  Domestic sales by the AFA (brown rice) 156.3 132.6 201.7 328.1 
Source: WTO documents, G/STR/N/13/TPKM, 25 June 2010; G/STR/N/14/TPKM, 25 June 2012; and 
G/SCM/N/253/TPKM, 17 July 2013; and information provided by the authorities. 
4.1.1.3.5  Export promotion,  restriction and prohibition 
4.15.  According to the authorities' export subsidy notifications to the WTO Committee on 
Agriculture, it does not use export subsidies for agricultural products.8 In acceding to the WTO, it 
undertook not to use export subsidies. According to the authorities, there is no export credit, 
guarantee or insurance programme for agricultural products. 
4.16.  The government helps farmers to export their products by conducting and facilitating 
international marketing programmes, holding overse as exhibitions, and building brand images.  
4.17.  According to the authorities, there is no re striction on the re-export of rice imported under 
the TQ. The COA prohibits re-exports of subsidized fertilizers (section 4.1.1.4.2.4).  
4.1.1.4  Domestic support measures 4.1.1.4.1  Support levels 
4.18.  The most recent notification of domestic support from the authorities is for 2010. Total 
domestic support for agriculture, including Green Box, and Amber Box (i.e., including de minimis  
levels), amounted to NT$51 billion in 2010 (Table 4.4). 
                                               
7 WTO document G/STR/N/14/TPKM, 25 June 2012. 
8 WTO documents G/AG/N/TPKM/105, 19 July 2013; G/AG/N/TPKM/93, 24 February 2012; 
G/AG/N/TPKM/83, 20 January 2011; G/AG/N/TPKM/72, 2 February 2010; G/AG/N/TPKM/64, 6 March 2009, 
G/AG/N/TOPKM/54, 18 January 2008; and G/AG/N/TPKM/44, 21 February 2007. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Table 4.4 Domestic support to agriculture and livestock, 2007-10 
(NT$ million and %) 
 2007  2008  2009 2010  
Total domestic support  38,890.7 44,432.5 57,130.3 51,495.2 
Equivalent to GDP (%) 0.3 0.4 0.5 0.4 
Equivalent to total tax revenue (%) 2.3 2.6 3.9 3.3 
Equivalent to total government expenditure (%) 1.7 1.9 2.1 2.0 
Source: WTO Secretariat calculations, based on WT O documents G/AG/N/TPKM/106 (28 August 2013) and 
G/AG/N/TPKM/79 (31 August 2010); and information from the authorities.  
4.19.  Support notified under the Green Box reached a peak in 2009 (NT$44 billion), mainly 
reflecting an increase in paymen ts for relief from natural disasters (up from NT$3.7 billion in 2008 
to NT$11 billion in 2009), and an increase in genera l services (Chart 4.1). General services have 
been increasing, to a large extent because of increased expenditures on infrastructure services. 
Expenditures on environmental programmes remained  relatively stable during the review period, 
and the dominant component - land conservation subsidy - decreased slightly. 
Chart 4.1 Green box support, 2007-10 
(NT$ million) 
05,00010,00015,00020,00025,00030,000
2007 2008 2009 2010General services
Payments for relief from natural disasters
Structural adjustment assistance provided
through resource retirement programmes
Environmental programmes
Regional assistance programmes
 
Source: WTO documents G/AG/N/TPKM/106, 28 August 2013; and G/AG/N/TPKM/79, 31 August 2010. 
4.20.  The current total Aggregate Measurement of Support (AMS) reached NT$4 billion in 2008, 
and fell in 2009 and 2010. Total support notified under the Amber Box, that is, including the de 
minimis  levels, rose from about NT$7 billion in 2007 to more than NT$13 billion in 2009, then fell 
to NT$10 billion in 2010. This is due to the increase in non-product-specific support, which was less than the de minimis  limit of 5% of the value of production, and therefore not included in the 
current total AMS figure (Chart 4.2). 
4.21.  The non-product-specific AMS reached NT$9 billion in 2009, mainly attributed to the 
increase in agricultural fertilizer price-differenc e subsidy, which rose from NT$43 million in 2007 to 
NT$4.7 billion in 2008 and NT$5 billion in 2009. The authorities indicate that this was because of 
the surge in global prices of fertilizers and crude oil in 2008. The total non-product-specific support 
fell to NT$6 billion in 2010, most of this was for the fertilizer subsidy (NT$2 billion) and interest 
rate subsidies (NT$3 billion). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 89 - 
 
  Chart 4.2 Amber box support, 2007-10 
(NT$ million) 
01,0002,0003,0004,0005,0006,0007,0008,0009,00010,000
2007 2008 2009 2010Rice (paddy)
Corn
Sorghum
Peanuts
Sugar
Tobacco leaves
Vegetables
Table sugarcane
Sweet potatoes
Forage crops
Other crops
Non-product-specific AMS
 
Source: WTO documents G/AG/N/TPKM/106, 28 August 2013; and G/AG/N/TPKM/79, 31 August 2010. 
4.1.1.4.2  Selected support measures 
4.1.1.4.2.1  Direct payments under the adjustment programme 
4.22.  The government has been trying to encourage farmers to convert rice paddies to other 
crops, mainly through the "adjustment program of paddy and upland field utilization". Under this 
programme, farmers who convert their rice paddies to the production of peanuts, vegetables, 
ornamental plants, forage, or other crops receive NT$22,000 or NT$45,000 (with a contract for feed corn) per hectare of land converted.
9 
4.23.  There are several sub-programmes under the adjustment programme, including the "land 
conservation programme", the "set-aside programme", and the "land retirement programme". 
4.24.  Under the "land conservation programme", payments have been given to farmers for 
maintaining farmland in environmentally good condition by growing green manure crops or setting 
it aside. According to the authorities, to comply  with the WTO Agreements, the amount of payment 
is lower than the extra costs or loss of in come. Under the programme, the COA provided 
assistance for a total area of 221,679 hectares in 2008, 213,697 hectares in 2009, and 
206,467 hectares in 2010.10 
4.25.  The set-aside programme encourages farmers to set their marginal land aside with an 
ecologically sound purpose. Most of the set-aside land was marginal land with low productivity. According to the authorities, it is difficult to lease this kind of land to other farmers and thus it has 
limited effect on the price (or rent) of farm land. The authorities consider that the set-aside 
programme contributed to resource conservation and soil productivity restoration. 
4.26.  The "land retirement programme" aims to convert farmland into forestry, to achieve island-
wide reforestation. Between 2002 and 2013, more than 13,000 hectares of uncompetitive 
farmland was converted into forest. These forests have several functions such as timber production, carbon sequestration, clean air, and environmental protection. 
4.1.1.4.2.2  Price support - guaranteed purchase 
4.27.  Most product-specific support has taken the form of price support: the AFA and/or 
government-owned enterprises buy products such as rice, tobacco leaves, and sugar  at 
                                               
9 WTO document G/AG/N/TPKM/106, 28 August 2013. 
10 WTO document G/AG/N/TPKM/106, 28 August 2013. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  guaranteed prices, which are higher than market prices. Guaranteed-price purchases of sorghum 
and feed corn were terminated in 2011 and 2013 respectively. The difference between the guaranteed price (applied administered price) and the actual market prices represents a 
government subsidy. 
4.28.  There are three types of guaranteed pu rchases of rice by the government: planned, 
supplementary, and additional (Table 4.5). Tabl e 4.3 reflects the volumes purchased by the 
government through the AFA. All three forms are available only to farmers who produce rice in 
paddy fields. There is a limit on the quantity of crops farmers may sell to the government under 
the guaranteed purchase programme: the maximum is 6.2 tonne/ha for the first crop, and 4.7 tonne/ha for the second crop. However, farmers are not allowed to mix different types of rice. 
According to the authorities, the "planned" purchase  price is usually higher than the market price, 
while “additional” purchase prices are not, and the "supplementary" purchase prices depend on 
demand. Therefore, farmers usually sell part of their harvest to the government under the "planned" purchase price; the amount is restricted  based on their registered cultivation area and a 
per-hectare limit. In order to prevent abuses of the system, participating rice farmers must 
register their cultivated land area and location befo re each harvest to ensure that the rice sold is 
actually grown by them. 
Table 4.5 Guaranteed purchases of rice 
 Guaranteed prices Quantity limit 
Planned 
purchase NT$26/kg for Japonica-type rice 
NT$25/kg for Indica-type rice and glutinous rice 2,000 kg/hectare for the first crop 
1,500 kg/hectare for the second crop 
Supplementary 
purchase  NT$23/kg for Japonica-type rice 
NT$22/kg for Indica-type rice and glutinous rice 1,200 kg/hectare for the first crop 
800 kg/hectare for the second crop 
Additional 
purchase NT$21.6/kg for Japonica-type rice 
NT$20.6/kg for Indica-type rice and glutinous rice 3,000 kg/hectare for the first crop 
2,400 kg/hectare for the second crop 
Source: WTO document G/SCM/N/253/TPKM, 17 July 2013. 
4.29.  The government also maintains price stabilization measures on agricultural products, 
including monitoring price, temporarily adjusting tariffs (Table 3.6), exemptions from tax, and limiting price increases by some SOEs. 
4.1.1.4.2.3  Interest subsidy 
4.30.  Loans with subsidized interest rates are prov ided to farmers (Chart 4.3). The loan capital is 
provided by credit departments of farmers' associations, fishermen's associations, or the Agricultural Bank. The source of finance for the interest subsidy is the Agricultural Development 
Fund.
11 A major portion of the Fund comes from th e government's budget. The Fund is mainly 
used to provide: interest differential subsidies for specific agricultural loans; government administrative overhead on food-related programmes; promotion of rational fertilizer use; grants 
to farmers or fishermen whose children study in universities or senior high schools; structural 
adjustment on agricultural production and market ing; and agricultural research, experiment, and 
technology improvement. 
4.31.  Loans to expand family farms, i.e ., to support land purchases by farmers, are smaller than 
loans for farm machinery. The authorities stated that, loan applications on land purchases 
accounted for a small portion because of the ageing farming population; most farm land has been transferred to the younger generations through inheritance.  
                                               
11 WTO document G/SCM/N/253/TPKM, 17 July 2013. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Chart 4.3 Interest subsidy for loans granted, 2007-11 
(NT$ million) 
05001,0001,5002,0002,5003,000
2007 2008 2009 2010 2011Loans to expand family farms; to
support land purchases by farmers
Loans for farm machinery
Loans for natural agricultural disasters
Loans for accelerating rural construction
 
Note: Loans for accelerating rural co nstruction include such items as: 
 - loans in the agricultural f ood industry to provide guidance  and assistance to management; 
 - loans in the livestock and poultry indu stry for improving management efficiency; 
 - loans to farmers to provide guidance , assistance, and management improvement; 
 - preferential loans for businesses that move  into the agricultural technology park; and  
 - loans for agricultural production and marketing groups. 
Source: WTO documents G/SCM/N/253/TPKM, 17 July  2013; and G/SCM/N/220/TPKM/Rev.1, 18 August 
2011. 
4.1.1.4.2.4  Other assistance 
4.32.  Several subsidies have been provided for production inputs, such as the agricultural 
machinery price subsidy, fuel subsidy for agricult ural machinery, and agricultural fertilizer price 
difference subsidy. In particular, since May 2008 the COA has subsidized 85% of price increases of 
fertilizers, with farmers paying the pre-May 2008 price plus 15% of the price increase.12 The total 
cost of the subsidy programme from May 2008 to end 2011 was NT$15 billion, due to the dramatic increase of fertilizer prices globally. Because of the subsidies, prices of fertilizers in this economy are lower than in some neighbouring countries: for example, the urea price is only 50% of that in 
Japan, and close to that in China. For this reason, the COA prohibits the re-export of subsidized 
fertilizers. 
4.33.  Under the Agricultural Development Act and the Livestock Insurance Regulations, livestock 
insurance is the only policy-based insurance among all forms of agricultural insurance. The 
insurance system is operated by the local farmers’ associations, with the government providing guidance. The authorities state that there are more  incentives for farmers to insure their animals 
because hogs and dairy cows have higher values, an d it is easier for insurers to validate claims. 
4.34.  Although the incomes of individuals engaged in farming is taxable, such income is defined 
as gross yearly revenue less costs and necessary expenses, and the costs and necessary expenses are currently deemed as 100% of the gross yearly revenue. Thus, the farming income of 
individuals is de facto  exempt from tax. In addition, business tax (VAT) on primary agricultural 
products, both domestically produced and imported , is exempted (i.e., farmers pay VAT on their 
purchases, but are not charged on their sales of primary agricultural products). 
4.1.1.5  Key subsectors 
4.1.1.5.1  Fruits 4.35.  Fruit production is the largest agricultural industry in terms of output value; contributing 
more than 20% of the total value of agricultural  production (Table 4.1). Its fruits are mainly 
consumed domestically, with exports represen ting about 5% of production. Major export 
                                               
12 COA (2012), p.44. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  destinations are Japan; China; and Hong Kong, China. It imports around 16% of domestic supply 
of fruits13, mainly from the United States, Chile, and New Zealand. 
4.36.  The tariff schedule contains 106 tariff lines (HS 8-digit) on fruits and nuts (HS Chapter 08). 
The simple average tariff rate is 36%, ranging from 2.5% to 822.1%; 12 lines are non- ad 
valorem , with the highest AVE being 822.1% on acrea nuts. The highest ad valorem  rate is 184%, 
for pomelo. Tariff quotas apply on eight lines: coconuts, areca nuts, bananas, pineapples, mangoes, pomelos, other fresh pears, dried longans and longan pulp. 
4.37.  According to the authorities, no specific subsidy is given to fruit farmers. The current 
policies focus on improving quality and enhancing competitiveness by providing research, technical assistance, and training courses on product quality and safety. 
4.1.1.5.2  Pig rearing 
4.38.  Pig rearing is a major contributor to agricultural production although its share fell from 21% 
in 2008 to 18% in 2012 (Table 4.1). Pork is mainly  consumed domestically, and only 0.4% of the 
output is exported. The main export destinations include Hong Kong, China; Japan; and China. The 
share of imports in domestic supply was 6% in 2012, and the main import origins were Canada, 
the United States, Denmark, and the Netherlands. Th ree tariff lines apply to live swine, with tariff 
rates ranging from 2.5% to 5%; the simple average is 4.2%. 
4.39.  According to the authorities, no subsidy is given to pig farmers. The major policies are to 
support local government and animal science experts to enhance disease quarantine and inspection services, to establish product quality and safety certification systems, and to accelerate structural adjustment by promoting value-added business networks. The main focus is to maintain 
the sustainability of the pig industry, stabiliz e the domestic pork production and marketing 
systems, and to ensure consumers’ confidence in domestic pork. 
4.40.  Pig rearing is an import-dependent subsector. The main feeds for pigs are formula feeds, 
more than 99% of which are manufactured loca l l y .  H o w e v e r ,  m o r e  t h a n  9 9 %  o f  t h e  f e e d  
ingredients, such as corn, wheat, and soybeans are imported. Importers of feed ingredients must 
register to receive manufacturing licences. Tariff rates for corn, wheat, and soybeans are 0%, 
6.5%, and 0%, respectively. 
4.1.1.5.3  Vegetables 4.41.  Vegetable production makes up the third-larg est agricultural subsector, in terms of output 
value, accounting for 17% of total production value in 2012 (Table 4.1). Less than 5% of the 
production is exported, as most is consumed do mestically. Major export markets are Japan, the 
United States, and Hong Kong, China. The import share of vegetables in domestic supply was about 15% in 2012. Imports mainly come from  the United States, China, and Thailand. 
4.42.  In 2013, the simple average of the 101 tariff lines on edible vegetables and certain roots 
and tubers (HS Chapter 07) was 27.8%, ranging from 0% to 328%. Among these seven lines are subject to tariff quota: garlic (three lines), frozen red beans, dried shitake, dried day lily, and dried 
red beans. The same seven lines also have non- ad valorem  rates, which are all specific and 
correspond to the out-of-quota rates. The highest non- ad valorem  rate is 328% (on dried shitake), 
and the highest ad-valorem  rate is 30% (on some mushrooms).  
4.43.  According to the authorities, no specific subsidy is given to vegetable farmers. Current 
policies focus on stabilizing domestic supply, increasing farmers' income, and developing export 
potential through research, technical assistance , and training courses on product quality and 
safety certification systems.  
4.1.1.5.4  Rice 
4.44.  Rice is considered the most important crop although it is only the fourth largest sector and 
represents 10% of the total value of agricultur e production (Table 4.1). The government uses 
                                               
13 COA (2013a). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  border measures including high tariffs, TQs, and SSGs to protect rice from import competition, and 
rice is subject to state-trading arrangements. There are also domestic support measures for rice, mainly price support through minimum prices, which reinforce the border measures. According to the authorities, taking into consideration the increased costs of production, the price for public 
purchases of rice was increased by NT$3 per kg st arting with the first growing season of 2011, and 
from the second season of 2011 the COA subsidiz ed farmers NT$2 per kg on the basis of dry 
paddy for the costs of drying, packaging, and storing, thus allowing farmers to sell wet paddy to 
the government.
14 
4.45.  In order to encourage farmers to switch from paddy to other crops, the government has 
been implementing the set-aside programme (such as the "Adjustment Program of Paddy and Upland Field Utilization"), and other diversion programmes. The acreage planted to rice dropped 
by more than half between 1983 and 2011, from 645,855 to 254,292 hectares.
15 However, 
production increased from 1.4 million tonnes to 1.7 million from 2007 to 2012, as yields have improved.
16 
4.1.1.5.5  Sugar 
4.46.  The government has been supporting the deve lopment of the sugar industry, with a view to 
developing the industry in cooperation with farmers. The Taiwan Sugar Cooperation (TSC), a 
government-owned enterprise, regulates the sugar industry. The TSC made contracts with farmers 
for the purchase of sugarcane and sugar sharing.  The sugarcane farmers obtain 55% of the sugar 
made from sugarcane, and are paid either the dome stic sugar selling price, or the prepaid contract 
price, whichever is higher. The contract price takes into account the domestic selling cost and 
marketing cost, and  it has been frozen since 1990.17 According to the authorities, the prepaid 
contract price of NT$24,878 per ton has been high er than the domestic selling price since 1990 
(except in 2010 and 2011), and the latter is based on the international sugar price. The difference 
between the contract price and the domestic selling price, i.e., the subsidy, is borne by the TSC. 
4.47.  The average tariff on sugar is 16.4%, wi th rates ranging from 0 to 27.5%. The TSC also 
provides grants to sugarcane farmers, in the form of interest subsidies for loans for the purchase 
of inputs, insurance premiums for sugarcane farms,  fees for pest and disease control, inspection 
for sugar brix, and others.18 
4.1.2  Fishery 4.48.  Fishing has an important role in the economy, and Chinese Taipei has unique oceanographic 
traits and biodiversity. In 2012, fishing accounted  for 0.7% of GDP and 3% of total employment.  
Fishery is an exporting sector, accounting for 0.7% of merchandise exports in 2012, equivalent to 29% of combined agriculture, fishing and forestry exports. 
4.49.  The tariff schedule contains 282 tariff lines for fish and fishery products, with a simple 
average tariff rate at 23.8%. Among them, 53 lines are non- ad valorem , and the average of the 
AVEs was 46.6%. The highest MFN tariff (AVE) is 753.6%, on squid (dried, salted, in brine). In 
2012, imports accounted for about 47% of domestic consumption level (Table 4.6). 
Table 4.6 Fishery production, consumption, and trade, 2009-12 (Tonnes) 
Classification 2009 2010  2011 2012  
Production 1,090,218 1,169,825 1,222,655 1,256082 
Import 480,435 475,817 484,007 539,497 
Export 577,470 613,908 610,913 654,458 
Consumption 993,183 1,031,734 1,095,749 1,141,121 
Note: Fisheries production includes catch fisheries and aquaculture fisheries production. 
Source: Information provided by the COA. 
                                               
14 COA (2012). 
15 WTO document G/SCM/N/253/TPKM, 17 July 2013. 
16 COA (2013b). 
17 WTO document G/SCM/N/253/TPKM, 17 July 2013. 
18 WTO document G/SCM/N/253/TPKM, 17 July 2013. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  4.50.  The Fisheries Agency (FA) under the COA regulates the fishing sector. The core fishing 
policy is to maintain the sustainability of fish ery resources, and to improve the livelihood and 
welfare of fishermen. According to the authorit ies, the future fishing policies intend to, inter alia , 
enhance the competitiveness of the fishing industry, promote value-added development, and 
ensure and enhance food security of fishery products. 
4.51.  In order to avoid overfishing, the FA has b een providing grants to fishermen to reduce their 
fishing capacities (Table 4.7). The fishing vessel and raft buy-back programme has been 
implemented since 1991; to date, the government has bought 3,272 vessels and 1,723 rafts. To 
reduce fishing capacity while protecting the environment and maintaining sustainable fishery resources, all vessels bought back under this programme are dismantled.
19 In September 2002, 
the government introduced a reward system for closing the fishing season20; according to the 
authorities, the number of fishing vessels participating in this programme has grown gradually, 
and totalled 9,830 in 2012. In order to improve the social security and welfare of fishermen, the 
government provides marine insurance subsidies for small-scale and artisanal fishing vessels 
weighing less than 100 tons.21 
Table 4.7 Subsidies to the fishing sector, 2009-12 
(NT$ million) 
Title 2009  2010 2011 2012  
Fishing vessel buy-back programme: grants to fishing 
vessels depending on the tonn age, and to fishing rafts 
depending on the length of ra ft, the pipe diameter, and the 
power of main engine  607.6 118.2 66.5 86.8 
Reward for closing fishery season 159.2 166.7 171.8 173.5 
Fishing vessels marine insurance reward: grants 
provided to cover a portion of the insurance costs for fishing 
vessels if damaged at sea 87.4 103.7 82.8 45.4 
Source: WTO documents, G/SCM/N/253/TPKM, 17 July  2013; G/SCM/N/220/TPKM/Rev.1, 18 August 2011; 
and information provided by the COA. 
4.52.  To control illegal, unreported, unregulated (IUU) fishing, the government of TKPM has 
established various legal frameworks and measures, including: participating in the RFMOs 
(regional fisheries management organizations) and cooperating with member economies bilaterally; establishing a record of licensed fishing vessels (white list); requiring fishing vessels to 
implement a vessel monitoring system (VMS); requ iring fishing vessels to report their catches 
either through VMS or by fax; implementing management measures on transhipment in the port or at sea; dispatching patrol vessels to conduct boarding and inspection; implementing the 
Observer Program and the Statistical Document and Catch Document Scheme; controlling fishing 
capacity of the fleet; allocating fishing quotas and limitations on the fishing area; and promulgating the National Plan of Action to Prev ent, Deter and Eliminate Illegal, Unregulated and 
Unreported Fishing, in 2013, in response to the ad option of the FAO International Plan of Action on 
IUU. 
4.1.3  Forestry 4.53.  Chinese Taipei has prohibited the logging of its natural forest since 1985. Most forest 
products are imported: average annual imports of forest products were around 6 million cubic 
meters between 2007 and 2011. Most imported wood products (106 of the 123 tariff lines) face zero tariffs, and the simple average tariff is 1.5%. 
4.54.  The Forestry Bureau under the COA regulates the development of forestry. The current 
forestry policy focuses on fostering the sustainability of the forestry industry, promoting production restructure, and extending the value chain of forestry production. Major policy tools include: encouraging the local governments to set up forestry production cooperatives to establish the 
supply chain through production to marketing of timber/bamboo products; and promoting research 
                                               
19 WTO document WT/TPR/M/232, p.38, 30 July 2010. 
20 Fisheries Agency (2012). 
21 WTO document WT/TPR/M/232, p.38, 30 July 2010. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  and development of new innovative product lines for manufacturers to use forestry products as 
raw materials. The authorities hope that, by improving the economic value of forestry, and encouraging the upgrading towards modern forestry enterprises, timber production will move from a primary industry to a higher quality secondary processing industry. The COA is also promoting 
forestry tourism and other tertiary industry, to  improve the added value potential of forestry. 
4.55.  The COA is promoting the screening of su itable tree species for short-term economical 
forests to replace the imported timber needed in the pulp and mushroom industries. There are also 
indications that the forest products processing industry will use domestic forestry products to 
develop innovative products with local characteristics, thereby helping to expand into overseas markets. 
4.56.  According to the authorities, the Forest ry Bureau does not provide any subsidy to the 
forestry industry. Instead, the authorities aim to urge the local governments to set up forestry 
production cooperatives under their jurisdiction, for which timber/bamboo producers, processors, and marketing sectors can be connected to form a supply chain. The authorities expect that the 
forestry production cooperatives will thus be financially independent and sustainable. 
4.2  Energy 4.2.1  Overview 
4.57.  The economy depends heavily on energy impo rts, with fuels accounting for over 25% of the 
overall import bill. In 2013, 98% of the total ener gy supply was imported (Chart 4.4). The largest 
source of domestic energy production is biomass and waste; coal has not been produced since 2001.
22 
4.58.  In accordance with the Energy Management Act, most recently amended in 2009, the MOEA 
is responsible for formulating energy policy and implementing the Electricity Act, the Petroleum Administration Act, and other energy-related legi slation. The Bureau of Energy, under the MOEA, 
regulates the natural gas utilities, petroleum and LPG filling stations, and the importation, 
exportation, production, and sale of petroleum products. 
4.59.  Policy objectives are specified in the Strategy Framework of Sustainable Energy Policy, 
approved in 2008. According to the Framework, su stainable energy development must balance the 
objectives of energy security, economic deve lopment, and environmental protection, while 
considering the need of future generations.
23 The specific targets include: 
 improving energy efficiency by more than 2% per annum from 2008, so that the 
energy intensity level is to decrease by 20% in 2015 compared with the 2005 level, 
and with further technological breakthroughs and proper matching administrative measures, the energy intensity level is to decrease by 50% in 2025 compared with the 
2005 level; 
 developing clean energy by: reducing CO
2 emissions to their 2008 level between 2016 
and 2020, and further to their 2000 level in 2025; increasing the share of low-carbon 
energy in electricity generation from the current 40% to 55% in 2025; and 
 securing stable energy supply by building  a secure energy supply system to meet 
economic development goals. 
                                               
22 Bureau of Energy online in formation, "Productivity scale of coal mines". Viewed at:  
http://web3.moeaboe.gov.tw/ECW/english/content/ContentLink.aspx?menu_id=1540  [20/11/13]. 
23 MOEA online information. Viewed at: 
http://web3.moeaboe.gov.tw/ECW/english/content/Content.aspx?menu_id=1524  [14/10/2013]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Chart 4.4 Total energy supply, 2013 
Imported liquefied 
natural gas
11.7%
Imported coal
30.2%Domestic production
2.1%Imported 
nuclear energy
8.4%Imported crude oil & 
petroleum products
47.6%
Solar thermal
0.08%Geothermal, solar & wind power
0.13%Hydroelectric power
0.36%Biomass & waste
1.28%Natural gas
0.24%Crude oil
0.01%
 
Source: Data provided by the authorities. 
4.60.  To achieve these objectives, the government has been adopting measures in: first, setting 
up a comprehensive regulatory framework such as  on the implementation of the "Greenhouse Gas 
Emissions Reduction Act", and the "Renewable Energy Development Act", and formulating the 
"Regulations on Energy Tax" to reflect the external cost of energy consumption, amending the 
"Energy Management Act" to promote energy saving measures24; and second, providing cleaner 
energy supply by developing carbon-free renewa ble energy, and rationalizing energy demand, by 
reforming the industries towards a low-energy intensive structure. 
4.61.  The authorities notified that subsidies ha ve been granted to the energy sector to, among 
others, encourage petroleum facility operators to maintain product supplies in the mountain and offshore island areas, reduce the pricing diffe rences between cities and such areas, and to 
encourage the exploration and development of oil and natural gas reserves (Table 4.8). Subsidies 
have also been given to the electricity sector in offshore island areas, to reduce the price 
difference between cities and these areas. 
4.62.  Import tariffs on energy products are rela tively low. In 2013, among the 74 tariff lines on 
energy products, 32 lines had a tariff rate of 0. The average tariff for energy products is 1.5%, 
while rates range from 0 to 7.5%. Import and export licensing is required for hydrocarbons. According to the authorities, there are no quantita tive restrictions on the import/export of energy 
products, and there is no state monopoly on these products. Prices of hydrocarbons and natural 
gas must be reviewed by the MOEA. The govern ment has been adopting price stabilization 
measures on some energy products: for example, oil used by farmers and fishermen is subsidized, 
and 50% of the above-baseline price of gasoline and diesel is subsidized (section 3.3.5.2). 
Table 4.8 Subsidies to the energy sector, 2009-12 
(NT$ '000) 
 2009 2010 2011 2012 
Subsidy for the establishment of petroleum facilities 
in mountain and offshore island areas 2 6,948 5,684 13,321 
Subsidy for the maintenance costs of petroleum 
facilities in mountain an d offshore island areas 8,593 7,834 6,243 7,190 
Subsidy to offset the cost of shipping petroleum or 
LPG to mountain and offshore island areas 141,287 149,353 173,396 159,128 
Subsidy for extra personnel costs in the operation 
of petroleum facilities in  mountain or offshore 
island areas 28,671 28,160 33,789 25,970 
Subsidy to diminish the price difference of - 2,252 12,884 27,998 
                                               
24 In line with the international trends of enco uraging energy saving an d reducing environmental 
pollution, the government is contemplating introducing an energy tax on oil, gas, and coal, to replace the 
commodity tax and related fees levied on oil and gas. The authorities consider that  t h i s  w i l l  n e e d  t o  b e  
considered within the broader energy and environmental pr otection policy frameworks, also taking into account 
the potential impact on domestic oil and electricity prices, as well as implications for the economy, industries, and the environment as a whole. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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   2009 2010 2011 2012 
household LPG between the mountain areas and 
urban or/and suburban areas 
Total 178,553 194,547 231,996 233,607 
Fund to encourage exploration and 
development of oil and natural gas reserves 294,125 308,751 398,648 251,542 
Source: WTO documents G/SCM/N/220/TPKM/Rev .1, 18 August 2011; and G/SCM/N/253/TPKM, 
17 July 2013. 
4.2.2  Key subsectors 
4.2.2.1  Electricity 4.63.  Chinese Taipei does not import or export electricity.  4.64.  More than half of electricity is gene rated by Taipower (TPC), a government-owned 
enterprise under the Ministry of Economic Af fairs (MOEA). Its major businesses include power 
development, generation, transmission, and distri bution. Less than one fifth of electricity is 
produced by independent power producers (IPPs) (Table A4.3), and non-local investors are 
allowed to own 100% of an IPP. Although thermal energy remains the biggest source for electricity 
generation, electricity generated by renewable energy, in particular solar and wind power, has increased rapidly. This reflects partly the government's efforts to increase domestic energy supply 
to reduce Chinese Taipei's reliance on imported energy. 
4.65.  Electricity generated by IPPs must be sold to the TPC, which distributes power to 
consumers. According to the authorities, the purcha se price is determined either by a competitive 
bidding process tendered by IPPs, or as announced by the TPC. 
4.66.  In accordance with the Electricity Act, most recently amended in 2012, electricity prices (to 
end-users) must be approved by the MOEA. The prices must reflect the cost plus a reasonable profit. Electricity prices, despite a recent increase, remain relatively low in the region (Table 4.9). 
However, the TPC has been running a loss, as the cost of electricity generation and purchase has 
exceeded revenue from sales. The net loss increa sed to NT$62 billion in 2012, from NT$43 billion 
in 2011.
25 According to the authorities, the TPC does not receive any government subsidy. 
4.67.  It seems that the government wishes to continue its initiative to privatize the TPC. A draft 
amendment to the Electricity Act, with an intention to liberalize the electricity industry, has been submitted to the executive
26 for review. According to the author ities, pending the adoption of the 
Electricity Act, the privatization plan for the TPC will be submitted to the legislature for approval. 
Table 4.9 Electricity tariffs, 2013 
(NT$/kwh) 
Residential use Industrial use 
Country/region Average unit price Country/region Average unit price 
Malaysia 2.5762 Republic of Korea 2.3079 
Shanghai, China  2.8837 Malaysia 2.6487 
Republic of Korea 2.8998 Chinese Taipei 2.8020 
Chinese Taipei 3.1165 Thailand 2.8174 
Thailand 3.1545 Hong Kong, China 3.2023 
Shenzhen, China 3.1781 Shenzhen, China 3.7763 
Hong Kong, China  4.1421 Shanghai, China 3.8303 
Singapore 5.2500 Singapore 3.8960 
The Philippines 6.1095 The Philippines  4.3273 
Japan 7.3409 Japan 4.8729 
Source: Information provided by the Bureau of Energy.  
                                               
25 Taipower (2013). 
26 Online information available at: www.ey.gov.tw. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  4.2.2.2  Hydrocarbons and natural gas 
4.68.  The oil industry is regulated by the Petrol eum Administration Act, effective 11 October 2001 
and amended on 26 January 2011.27 The natural gas industry is regulated under the Natural Gas 
Enterprise Act, effective 1 February 2011.28 The Bureau of Energy is in charge of implementing 
these laws. 
4.69.  Chinese Taipei imports almost all crude oil requirements. Import tariffs for crude oil are 
zero, and those for petroleum and petroleum products are low (0-5%). The Middle East is the 
major supplier, accounting for 85% of total imports of crude oil. No quantitative restrictions are in 
place for the importation of crude oil, petroleum, and petroleum products, but licences are required in line with the Petroleum Administration Act. Enterprises wishing to import hydrocarbons must apply for approval from the MOEA, and pay fees to the Petroleum Fund based on import 
quantities. Currently, two enterprises are licence d importers, the Chinese Petroleum Corporation 
(CPC), and the Formosa Petrochemical Corporation (FPCC). In 2013, 46.04% of crude oil was imported by the CPC, and 53.96% by the FPCC. The MOEA issues import licences and import 
approvals (to licensed importers for each import pr oduct, after payment of fees to the Petroleum 
Fund), and manages the Petroleum Fund to support petroleum and gas supply and market management. 
4.70.  To stabilize oil supply and prevent suppl y disruption, the Petroleum Administration Act 
requires the refiners and importers to maintain stocks of more than 60 days of sales volumes (calculated from the average domestic sales and private consumption over the preceding 
12 months). In addition, the government uses the Petroleum Fund to finance the storage of oil, 
and is responsible for stockpiling 30 days of oil demand and 25 days of LPG demand. 
4.71.  Two companies have been granted petroleum refining business licences: the CPC 
(accounting for 79% of the domestic refining capacity in 2012), and the FPCC (accounting for the 
remainder). In addition, 204 companies have been granted gasoline and diesel wholesale licences. 
4.72.  The CPC, a 100% government-owned company, remains dominant in the oil industry, 
including exploration, production, importation, refining, transportation, and marketing. The CPC 
has been running a loss, and the government has been making efforts to privatize the CPC. 
According to the resolution made by the legislature (10 January 2003), the CPC shares must not be released unless there is consultation with the labour union, and approval of the privatization programme by the legislature. The CPC is negotiat ing with the petroleum labour union concerning 
the release of shares and employees' rights and in terests after privatization, and the privatization 
timetable is undergoing re-evaluation. 
4.73.  According to the authorities, the CPC adjusts prices for petroleum and gas (gasoline, diesel, 
fuel oil, LPG, and LNG); based on floating pricing mechanisms that reflect fluctuations in 
international petroleum and gas prices. The MOEA conducts regular reviews of pricing mechanisms. Private companies may set their own prices for petroleum products in accordance 
with costs and production/sales conditions. 
4.74.  The authorities notified to the WTO that subsidies have been given to establish and maintain 
the operation of petroleum facilities in the mountain and offshore island areas, and to encourage the exploration and development of oil and natura l gas reserves (Table 4.8). However, according 
to the authorities, no subsidies (direct or indirect) are given to the petroleum and gas sector. 
4.75.  Since natural gas resources are very limited, its demand is met almost entirely by imports 
of liquefied natural gas (LNG). The import tariff on natural gas is zero. In 2012, Qatar, Malaysia, 
Indonesia, and Nigeria were Chinese Taipei's major suppliers, accounting for about 90% of total 
LNG imports. 
4.76.  Currently, only the CPC has a licence to import natural gas pursuant to the Natural Gas 
Enterprise Act. Other enterprises may apply for such licences. Twenty-five natural gas utility 
                                               
27 Petroleum Administration Act on line information. Viewed at: 
http://law.moj.gov.tw/Eng/La wClass/LawAll.aspx?PCode=J0020019 . 
28 Natural Gas Law online information. Viewed at: 
http://law.moj.gov.tw/LawClass/LawAll.aspx?PCode=J0130045   [20/11/13, in Chinese]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  enterprises provide natural gas to about 3.2 million users (residential, business, service, and 
partial industry customers). The market coverage rate is about 44%.29 The CPC sets wholesale 
prices in accordance with the natural gas pricing formula based on the full-cost-recovery principle, 
and prices must be approved by the MOEA. Retail  gas prices are regulated by both the MOEA and 
the local governments, and are based on the principle of full cost recovery. 
4.2.2.3  Renewable energy 4.77.  Renewable energy (solar, biomass, geothermal, ocean and wind energy) accounts for a 
small share of total electricity generation (Table A4.3). Nevertheless, wind and solar power 
generation has been increasing fast. The government expects that power generation capacity from renewable sources will account for 16.1% of total power generation capacity by 2030.
30 
4.78.  In accordance with the Renewable Energy Development Act (promulgated in 2009), the TPC 
and IPPs must contribute to a renewable energy fund. The contribution is based on their annual 
power generation units, except the electricity gene rated by renewable energy. The fund is used to 
subsidize utilities when they produce or purcha se electricity generated by renewable energy, 
mainly because the cost of generating electricity using non-renewable energy is lower than the 
cost using renewable energy. Under the Renewable Energy Development Act, the importation of equipment for use in generating renewable energy is exempt from import tariffs, provided that 
such intended use is verified and there is no domestic production of such equipment. 
4.3  Manufacturing 4.3.1  Overview 4.79.  Manufacturing's contribution to GDP and employment remained stable during the period 
under review. It accounted for 24.8% of GDP and 27.2% of employment in 2013; however, it 
accounted for about 90% of total merchandise exports. 
4.80.  In terms of output, manufacturers of comp uters, electronics, and optical products account 
for the largest share (24.6% of total value-added in manufacturing); followed by metal and 
machineries; and chemicals.  
4.81.  The Industrial Development Bureau (IDB) under  the Ministry of Economic Affairs is the main 
competent authority that formulates policies, strategies, and measures for industrial development, 
promotes industrial upgrade, and administers industrial parks.
31 
4.3.2  Recent developments 4.82.  The authorities have identified six "newly emerging industries" and four "intelligent 
industries" in the industrial development plan. In November 2011, the executive approved the 
2020 Industrial Development Strategy, which covers manufacturing and certain services sectors related to manufacturing.
32 The Strategy aims, inter alia , to increase added value and intangible 
assets of manufacturing, and the output share of  newly emerging industries (Table 4.10). The 
focus is on metal and machinery; information and electronics; and chemicals. The authorities envision that these sectors have potential to upgrade the production chain, producing higher 
value-added contents such as services embedded in the products. 
                                               
29 The market coverage rate is the ratio of the num ber of households with natural gas supply to the 
number of registered households. 
30 The MOEA has a target that by 2030, 13,750 MW of renewable power generation units will be 
installed, of which 4,200 MW will be wind power units through the "Thousand Wind Turbines" scheme, and 6,200 MW will be solar power units thro ugh the "Million Rooftop PVs" scheme. 
31 Industrial parks include export processing zones (E PZs) and science-industrial parks (SIPs). SIPs are 
administered by the Ministry of Science and Technology. EPZs are administered by the Export Processing Zone 
Administration. 
32 The Industry Upgrading and Transf ormation Action Plan focuses on: reforming traditional industries; 
consolidating main-strength industries; and cultivating emerging industries. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Table 4.10 2020 Industry development objectives 
 2009 2015 2020 
Value-added ratio of manufacturing 23% 25% 28% 
Share of intangible assets in gross fixed 
capital formation in manufacturing 8% 12% 15% 
Output share of newly emerging industries 
in manufacturing 4% 14% 30% 
Source: Ministry of Economic Affairs; 2020 Industrial Development Strategy. Viewed at: 
http://www.moeaidb.gov.tw/external/ctlr?PRO=filepath.DownloadFile&f=policy&t=f&id=3084 . 
4.83.  In September 2012, the MOEA published an Action Plan for Industrial Structure 
Optimization, and announced the "Three Industries, Four Reforms" programme, which aims to enhance the competitiveness of its industries. The programme intends to break through the 
conventional division of industry, and intertwine the electronic sector with other sectors, such as 
services, and green energy. "Servicification" of manufacturing is one of the key themes in the 
programme, under which "smart life services" and "smart tool equipment manufacturing" are 
identified as key industries. 
4.84.  Encouragement of R&D activities has been at the heart of the government's policies towards 
manufacturing (section 3.3.2.2.). During the implementation of the Statute for Upgrading 
Industries, R&D spending increased from 1.71% of GDP in 1992 to 2.91% in 2010; meanwhile 
annual R&D spending by the private sector rose  from NT$51.8 billion to NTD 286.3 billion. 
Information and communication technology accounted for 13.65% of GDP in 2010, up from 5.4% in 1992. The Statute for Innovative Industries (SII) replaced the SUI, and has been the major 
legal instrument for industrial policies since mid-2010. 
4.85.  Industrial parks, including export proce ssing zones (EPZs) and science industrial parks 
(SIPs), have played an important role in industri al policies. There are a total of 328 manufacturing 
enterprises in the export processing zones, of which 56 are foreign-invested enterprises. While 
EPZs comprise mainly conventional manufacturing enterprises, SIPs attract more high-tech industries and start-up enterprises. The three cluste rs of science industrial parks, (Hsinchu Science 
Parks, Central Taiwan Science Parks, and Southern Taiwan Science Parks), with a total of 
757 manufacturing firms, include 208 companies manufacturing integrated circuits, 175 in optoelectronics, and 120 in precision machinery.  In 2013, 61.25% of output from SIPs were 
exported, accounting for 14.82% of total merchand ise exports; total turnover grew 9.15% on a 
year-on-year basis, whereas total trade grew 7.83%.
33 
4.86.  Green energy was identified as one of the "newly emerging industries". The authorities plan 
to focus on the development of the main industries, including solar photovoltaic energy, wind 
power (in the renewable-energy field) and LED lighting energy information and communications (in 
the energy-conservation field). 
4.87.  The government aims to further promote its manufactures of electric motor vehicles 
including "smart" electric cars. Electrical vehicles are exempt from Commodity Tax and the Licence 
Tax. The authorities intend to "promote key components" such as batteries, motors and controllers to be made locally by sponsoring th ematic R&D plans and subsidy provision.
34 The output value of 
electrical vehicles was NT$3.84 billion in 2012, with investments of NT$16.2 billion; the authorities 
target is to increase output to NT$65 billion in 2020. Smart electrical vehicles are given priority 
consideration when public entities procure/rent vehicles. According to the authorities, local governments have purchased 42 EVs, while state-owned enterprises have purchased 54 on a trial 
basis. 
                                               
33 Ministry of Science and Technology online informat ion, "Statistical Database - Science Industrial 
Parks". Viewed at: https://ap0512.most.gov.tw/WAS2/sciencepark/AsSciencePark.aspx  [in Chinese]. 
34 Industrial Development Bureau online informat ion, "Industrial Development, 2013". Viewed at: 
http://www.moeaidb.gov.tw/extern al/download/en/about/moeaidb.pdf  [24/02/14]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  4.4  Services 
4.4.1  Overview 4.88.  Services accounted for about 65% of GDP during the review period, and about 59% of total 
employment (Table 1.2). In 2013, the most important services subsectors were wholesale and 
retail trade (18.5%), real estate (8.8%), public  administration and defence (7.0%), and finance 
and insurance (6.5%). It is a net services exporter (Table 1.3). 
4.89.  Chinese Taipei's GATS commitments cover about 120 of the 160-odd services subsectors. It 
lists MFN treatment exemptions for the acquisition of land and air transport services, which are to 
be regulated on the basis of reciprocal treatm ent and/or bilateral arrangements. Market access 
limitations concern, inter alia , financial services (including banking, insurance, and asset 
management), telecommunications (including satellite communications, land-based mobile 
communications, radio, and TV), and some prof essional services (such as legal services, 
accounting, and taxation).
35 
4.90.  According to the authorities, "unless otherwise provided", the government grants "national 
treatment" to the services and services provid ers of any other WTO Member. Restrictions on 
"national treatment" include limitations on commercial presence (mode 3) in telecommunications, and on the presence of natural persons (mod e 4) in human health services. Horizontal 
commitments as regards mode 4 refer to conditio ns for the entry and temporary stay of natural 
persons (business visitors and intra-corporate transferees). There is also a horizontal limitation on "national treatment" in mode 3 concerning the acquisition of land for certain uses. 
4.91.  The government selected ten key services industries, and other industries, as the main 
focus, to promote its industrial development policy. The services industries are: medical tourism, 
music and digital content, international logistics,  fundraising for high-tech and innovation-oriented 
industries, urban renewal, international promotion of its cuisine, the MICE (meetings, incentives, 
conferencing, and exhibition) industry, WiMAX technology, Chinese-language e-commerce, and 
expanded recruitment of overseas students. A numbe r of key strategies were set out in the action 
plans for these industries, including developing international markets, cultivating talent with 
foreign language and international marketing expertise, and providing loans, guidance, and 
assistance for overseas market expansion.  
4.92.  In 2012 the government launched the "Three Industries, Four Reforms" programme to 
accelerate the adjustment of the industrial structure. The programme aims at promoting industrial 
optimization and restructuring, as the economy was experiencing critical issues such as excessive 
concentration on ICT industries, low value-added, and insufficient innovation of its products. In addition, rapid integration among other East Asian countries brought more international 
competition. The main strategies include incorporating service elements into the manufacturing 
sector, "technologizing" and "internationalizing" service industries, and adding innovative, aesthetic, and green elements into traditional industries, to create distinctive products. 
4.93.  The government is establishing free economic pilot zones (FEPZs), where market access and 
other trade-related regulations are to be relaxed substantially, and where high-end services (such as smart logistics, international health care, financial services, and education innovation) will be the focal industries. Initially eight FEPZs have been approved (section 3.2.6). The authorities 
consider that this project is helpful for its participation in regional integration schemes, such as the 
Trans-Pacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP) programmes. 
4.4.2  Banking, finance and insurance 
4.4.2.1  Overview 4.94.  The share of financial services in GDP was about 6.5% in 2013, and the share in total 
employment was 3.8% (Table 1.2). The Fina ncial Supervisory Commission (FSC) remains 
responsible for the supervision of banking, insurance, securities institutions, and financial holding 
                                               
35 WTO document GATS/SC/136/Rev.1, 2 July 2002. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  companies. The Organic Act Governing the Establishment of the Financial Supervisory Commission 
was most recently amended on 1 July 2012. According to this Act, The FSC's duties and functions remain the same, but its Board of Commissioners was reconfigured: in addition to the existing Commissioners with financial expertise, the Minister of Finance, the Minister of Economic Affairs, 
the Minister of Justice, and the Minister of the National Development Council are also included as 
ex officio  commissioners to facilitate communication and coordination on financial supervisory 
matters. 
4.95.  The Financial Consumer Protection Act ente red into force on 30 December 2011, providing a 
legal basis for the establishment of a financial consumer dispute ombudsman body. The Financial Ombudsman Institution (FOI) began operation on 2 January 2012. The FOI has a set of standard 
operating procedures to ensure effective resolution of complaints and ombudsman cases involving 
disputes between financial institutions and consumers. On the other hand, the authorities consider 
that there is no urgency for the draft Financial Services Act to be enacted in the near future.
36  
4.96.  The Financial Restructuring Fund, set up in July 2001 by the FSC and closed in 
December 2011, helped the market exit of 56 financ ial institutions and encouraged three others to 
either merge with a stronger competitor, or achieve a turnaround, by either paying off the liabilities and taking over the assets not assumed by other financial institutions, or by paying off 
the difference by which the liabilities to be settl ed exceeded the assets. The Fund was owned and 
managed by the government. As a result, the average NPL ratio of all financial institutions was reduced from the peak of 8.16% in 2001 to 3.28 % in 2004. The ratio of the domestic banks was 
lowered from 2.95% in 2004 to 0.42% at the end of 2011. 
4.4.2.2  Banking 
4.97.  There have been no major changes in th e banking sector's legislative and institutional 
framework since 2010. However, the Banking Act was amended a few times, including on 
mortgage loans (Article 12), and on the removal of the 25% cap on total shares with voting rights 
for each investor.
37 The Banking Bureau of the FSC is responsible for the development of financial 
policies and regulations, and the supervision of ba nking and bills markets. The Bureau issues bank 
licences, reviews applications for new branches and banking activities, sets regulations for bank 
lending, investments, and other activities, and takes disciplinary action against banks that fail to comply with relevant laws. 
4.98.  The banking sector remains dominated by domestic banks, which accounted for 76% of 
total banking assets. At the end of 2013, domestic banks (excluding the postal savings bank) 
accounted for 78% of total deposits and 92% of total loans, while local branches of non-local 
banks accounted for 0.8% of total deposits and 2.5% of total loans, respectively (Table 4.11). 
Table 4.11 Banking indicators, 2009-13 
Title 2009 2010 2011 2012 2013 
Number of banks 405 401 400 402 405 
   Domestic banks 37 37 37 38 39 
   Local branches of non-local banks 32 28 28 30 31 
   Credit cooperatives 26 26 25 24 24 
   Credit departments of farmers' and fishermen's 
associations 300 301 302 302 303 
     Bill finance companies 10 9 8 8 8 
Total deposit (NT$ trillion) 28.6 30.2 31.5 32.7 34.5 
   Domestic banks (%) 75.7 77 77.1 77.4 77.8 
   Local branches of non-local banks (%) 2.0 1.3 1.5 1.0 0.8 
   Postal savings (%) 15.4 14.9 14.8 15.1 14.9 
Total loans (NT$ trillion) 18.6 19.8 21 21.6 22.4 
                                               
36 The draft of the Financial Services Act was completed by the FSC in 2009, with the intention to 
provide a single legal instrument for the financial servic es industries.  
37 Currently, a person or concerned party who intends to  singly, jointly or collectively acquire more than 
10%, 25% or 50% of a bank’s outstanding voting sh ares, must apply for prior approval from the FSC. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Title 2009 2010 2011 2012 2013 
   Domestic banks (%) 91.8 92.3 91.8 92.1 91.8 
   Local branches of non-local banks (%) 2.7 2.4 3 2.5 2.5 
Non-performing loan ratio (%) 1.15 0.60 0.42 0.39 0.37 
   Domestic banks (%) 1.15 0.61 0.43 0.40 0.38 
   Local branches of non-local banks (%) 0.91 0.22 0.13 0.01 0.01 
Profitability      
   Return on assets (ROA) - domestic banks 0.28 0.58 0.59 0.68 0.68 
   Return on equity (ROE) - domestic banks 4.49 9.1 9.3 10.4 10.26 
Source: FSC statistics. Viewed at: http://www.banking.gov.tw/en/  [31/10/2013]; and information provided 
by the authorities.  
4.99.  Currently there are five non-local bank su bsidiaries operating in the market, and there are 
no equity ownership limits for non-local financial institutions in local banks. Non-local banks must establish a commercial presence to provide services in the territory. A non-local bank may apply to 
establish a branch office, a representative office or a subsidiary, subject to prior approval of the 
FSC. Non-local bank branches may conduct th e full range of banking businesses including 
accepting deposits from the public as defined in the Banking Act. They are not separate legal entities and thus not subject to the minimum capi tal requirement, paid-in capital requirement, and 
other regulations set for domestic banks as prescrib ed in the Banking Act. Representative offices of 
a non-local bank are limited to collecting commercial and market information and business liaison. A subsidiary of a non-local bank must comply with the same minimum capital adequacy ratios and 
paid-in capital requirements as a domestic bank. 
4.100.  The postal savings system, which remains fully government owned, accounted for 15% of 
total deposits. The upper deposit limit for generating interest in postal passbook savings account is 
NT$1 million. Total deposits in excess of this limi t do not generate interest. Interest earned from a 
postal savings passbook account is tax exempt. 
4.101.  The government share (excluding the postal savings system) in the banking sector 
remains large. The Bank of Taiwan, the Land Bank, and the EXIM Bank are fully government 
owned. The government holds majority shares in six other banks: the Taiwan Cooperative Bank, 
the First Commercial Bank, the Hua Nan Commercial Bank, the Chang Hwa Commercial Bank, the Mega International Commercial Bank, and the Taiw an Business Bank. At the end of February 2014, 
these banks held 50.9% of total bank assets, down from 52% in 2010. 
4.102.  The Regulations Governing the Capital Adequacy Ratio and Capital Category of Banks were 
amended in November 2012 to implement the Basel III rules. In accordance with the amendment, 
the minimum common equity ratio, the Tier I ratio,  and the total capital ratio of domestic banks 
were to reach 3.5%, 4.5%, and 8%, respectively, in 2013, and 7%, 8.5%, and 10.5%, respectively, by the end of 2019. At the end of Se ptember 2013, the overall capital adequacy ratio 
of domestic banks was 9.03%, 9.12%, and 11.77%  respectively, higher than the 8% legal 
requirement. Partly reflecting the adoption of th e Basel III, the average non-performing loan (NPL) 
ratio of the banking sector fell from 1.1% in 2009 to 0.37% at the end of 2013 (Table 4.11). 
4.103.  The interest rate spread of domestic banks remains at around 2% (Table 4.12). The 
authorities consider that the domestic market has too many financial institutions relative to the 
size of the economy, resulting in fierce competitio n in the banking sector. Since the global financial 
crisis, loan interest rates have been generally incr easing, reflecting stronger demand for funds as a 
result of the economic recovery. At the same time , deposit interest rates have stayed at a lower 
level owning to the increased portion of demand deposits. 
Table 4.12 Weighted average interest rates on deposits and loans and spreads, 2009-13
 
Year 2009 2010 2011 2012 2013 
Domestic banks      
Deposits (%) 0.85 0.61 0.75 0.82 0.80 
Loans (%) 2.07 1.97 2.16 2.24 2.23 
Spread (%) 1.22 1.36 1.41 1.42 1.43 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Year 2009 2010 2011 2012 2013 
Local branches of non-local banks      
Deposits (%) 0.44 0.34 0.50 0.46 0.44 
Loans (%) 2.01 1.42 1.47 1.31 1.18 
Spread (%) 1.57 1.08 0.97 0.85 0.74 
Credit cooperatives      
Deposits (%) 0.88 0.64 0.76 0.82 0.82 
Loans (%) 2.38 2.32 2.52 2.53 2.50 
Spread (%) 1.50 1.68 1.76 1.71 1.68 
Credit department of farmers' and fishermen's 
association      
Deposit (%) 0.71 0.56 0.64 0.68 0.68 
Loans (%) 2.27 2.13 2.38 2.42 2.37 
Spread (%) 1.56 1.57 1.74 1.74 1.69 
Source: Central Bank,  Financial statistics monthly, various issues. 
4.104.  At the end of 2013, 63 offshore banking units (OBUs) commenced operation, with total 
assets of US$169.6 billion. During 2013-14, the au thorities further relaxed the rules for OBUs 
providing non-NT$ services to offshore clients, including: relaxing the product scope under trust 
and derivatives businesses OBUs may offer; removing statutory thresholds of clients' 
classifications; and allowing OBUs meeting statutory conditions to conduct new-type business without obtaining the authority’s prior approval. 
4.105.  The blanket deposit insurance mechanism, in response to the 2008 global financial crisis, 
was terminated in 2010. The authorities consider  that the scheme successfully restored local 
market confidence during 2008-10. 
4.106.  Financial services were included in the ECFA with China. 
4.4.2.3  Insurance 4.107.  The share of insurance in the total assets of financial institutions increased from 24.6% in 
2009 to 29% in 2013 (Table 4.13). The authorities indicated that this was mainly because of the 
increases in premium income, the appreciation of real estate interest, and profits from disposing of 
real estate. 
4.108.  Since the previous Review, there has been no major change to the legislative and 
institutional framework on insurance. The Insurance Act was amended in 2011 to, inter alia , allow 
an insurer that sells non-investment-linked insurance products denominated in a non-local currency, if it meets certain conditions, to apply for permission not to count investments in 
connection with these products against its cap on total overseas investments.
38 The cap was 
defined in accordance with Article 146-4 of the Insurance Act: the competent authority must set limits on the aggregate dollar amount of foreig n investments of insurance enterprise funds based 
on the state of the business of each individual  insurance enterprise; such investments may not 
exceed 45% of the funds of any individual insurance enterprise. 
Table 4.13 Performance of th e insurance sector, 2009-13 
 2009  2010  2011 2012 2013  
Percentage in the total assets of financial institutions (%) 24.6 26.2 26.4 28.1 28.9 
  Non-life insurance 0.6 0.6 0.5 0.5 0.5 
  Life insurance 24 25.7 25.9 27.6 28.4 
Insurance penetration (%) 16.9 17.9 16.9 18.5 18.6 
  Non-life insurance 0.8 0.8 0.8 0.9 0.9 
  Life insurance 16.1 17.1 16.1 17.6 17.7 
Number of insurance companies an d branches - total 58 57 57 57 56 
                                               
38 Financial Supervisory Commission (2012), p.13. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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   2009  2010  2011 2012 2013  
  Reinsurance 4 3 3 3 3 
  Non-life insurance - domestic 17 17 17 17 17 
  Non-life insurance - branches of non-local companies 6 6 6 6 6 
  Life insurance - domestic 22 23 24 24 24 
  Life insurance - branches of non-local companies 9 8 7 7 6 
Total premium income of insurance industry (NT$ trillion) 2.1 2.4 2.3 2.6 2.7 
  Non-life 0.1 0.1 0.1 0.1 0.1 
  Life 2 2.3 2.2 2.5 2.6 
Source: FSC statistics. Viewed at: http://www.ib.gov.tw/en/  [31/10/2013]; and information provided by the 
FSC. 
4.109.  Under the Insurance Law, life insurance companies may not offer non-life insurance 
services and vice versa, except where a non-life insurance enterprise is authorized by the competent authority to engage in accident or health insurance. Insurance firms may not engage 
directly in banking. However, any domestic or overseas insurance company registered with the 
authorities may sell insurance products through banking channels, provided that it has obtained approval from the competent authority to jointly promote insurance products or provide relevant services with a bank. 
4.110.  The authorities stated that the regulations for non-local and local investment in the 
insurance sector are the same, and there are no equity restrictions for non-local investment. Establishment of a commercial presence is necessary to access the insurance market, except for 
reinsurance, maritime shipping insurance, and commercial aviation insurance.
39 For a non-local 
insurance company to establish a branch, it mu st have a minimum capital of NT$50 million. The 
minimum paid-in capital required for the establishment of domestic insurance companies and 
subsidiaries of non-local insurance firms is NT$2 billion. From 2013, all insurance firms (domestic 
and non-local) are required to adopt the IFRS (International Financial Reporting Standards). 
4.4.2.4  Securities 4.111.  The Securities and Futures Bureau of th e FSC regulates securities and capital markets. 
Policy objectives of the securities subsector are: to foster the sound development of the capital 
markets and to encourage fund-raising through public offering of securities; to improve the operation of the securities and futures markets and to ensure a fair and efficient market 
environment; to promote the development of the secu rities service industries and to facilitate the 
flow from savings into investment. During th e review period, the FSC continued working to 
develop Chinese Taipei into a regional fund-raising platform for high-tech and innovative 
companies: from 2010 to the end of 2013, there were 289 newly listed companies, of which 180 in 
the high-tech and biotechnology industries. 
4.112.  The Securities and Exchange Act, most recently amended in 2012, regulates public 
offering, issuing, and trading of securities. Key amendments include: accommodating the efforts of 
public companies to adopt IFRSs; improving the quality and timeliness of corporate information 
disclosure; safeguarding minority shareholders
40; adding a special chapter to address matters 
pertaining to non-local companies so as to flesh-out legislative provisions governing non-local 
companies seeking to list their securities in Chinese Taipei. 
4.113.  The percentage of non-local investors in total market capitalization increased from 29.8% 
in 2009 to 33.1% in 2013 (Table 4.14). As in the previous Review, non-local securities firms may 
                                               
39 WTO document GATS/SCI/136/Rev.1, 2 July 2002. 
40 Any shareholder that has continuously held, for on e year or longer, 3% or more of the total number 
of the outstanding shares of a company listed on the Taiwan Stock Exchange (TWSE), the GreTai Securities 
Market (GTSM), or the Emerging Stock Market may - if they deem that a specific matter materially damages 
the interests of shareholders - apply (providing reasons, related evidence, and explanations of necessity) to 
have the competent authorities inspect certain specified matters pertaining to the securities issuer. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  establish subsidiaries, branches, and representative offices, with no ownership restrictions. The 
minimum paid-in capital requirements are the same for domestic and non-local securities firms.41  
Table 4.14 Performance of th e securities sector, 2009-13 
 2009  2010  2011 2012 2013  
TWSE listed companies: number 741 758 790 809 838 
  Capital issued (NT$ trillion) 5.9 5.9 6.2 6.4 6.6 
  Market capitalization (NT$ trillion) 21 23.8 19.2 21.4 24.5 
GTSM companies: number 546 564 607 638 658 
  Capital issued (NT$ trillion) 0.8 0.7 0.7 0.7 0.7 
  Market capitalization (NT$ trillion) 1.9 2.0 1.4 1.7 2.3 
Unlisted companies (number) 497 512 516 540 584 
  Capital issued (NT$ trillion) 1.8 1.7 1.6 1.7 1.8 
Non-local investment in stock market      
  Number of approved cases 1,626 1,488 1,420 1,278 1,357 
  Accumulated net inward remittance (US$ billion) 1.5 1.7 1.6 1.6 1.8 
  Percentage of market value held by non-local investors (%) 29.8 31.2 31.1 32.6 33.1 
Source: FSC statistics. Viewed at: http://www.sfb.gov.tw/en/  [31/10/2013]. 
4.114.  According to the authorities, the FSC has continuously eased restrictions on non-local 
investment in the domestic securities markets in recent years. For instance, as of 4 October 2010, overseas Chinese and foreign nationals have been permitted to invest in stocks or depositary 
receipts offered by a foreign enterprise before it obtained a primary or secondary listing on either 
the TWSE or the GreTai Securities Market, and stocks offered or depositary receipts reissued by such companies in connection with a cash capital increase. Since 16 November 2012, overseas Chinese and foreign nationals have been allowed to invest in offshore ETFs (exchange traded 
funds)  pursuant to the Regulations Governing Investment in Securities by Overseas Chinese and 
Foreign Nationals. 
4.115.  The FSC maintains limits on investment by Chinese investors. Qualified institutional 
investors approved by the competent securities, banking, and insurance authority of China are 
allowed to engage in securities investment and futures trading in Chinese Taipei. According to the authorities, the FSC has taken measures to further ease trade in financial services, based on 
bilateral negotiations. 
4.4.3  Telecommunications and postal services 4.4.3.1  Telecommunications 4.116.  There has been no significant change to  legislation in the telecommunication services 
sector since the previous Review. The Telecommunica tions Act is the main legislation. The National 
Communications Commission (NCC), an independent body established in 2006, is the regulatory agency for the telecommunications and broadcasti ng sectors. The Ministry of Transport and 
Communications (MOTC) is responsible for planning national communication resources and 
providing guidance for telecommunication industry development.  
4.117.  The telecommunication sector developed rapidly during the review period, greatly 
outpacing the GDP growth rate.
42 Total revenue from telecommunication services accounted for 
about 3% of GDP in 2013, of which mobile services represented the largest share (Chart 4.5). Reportedly, the NCC has permitted three companies to launch commercial 4G services: Chunghwa Telecom, Taiwan Mobile, and Far EasTone are expected to inaugurate their respective LTE 
networks in the coming months. 
                                               
41 NT$400 million for underwriting, NT$400 million for trading, NT$200 million for brokerage, and an 
additional NT$30 million for establishing a branch office. 
42 According to the Telecom Indust ry Update published by GlobalTr ade.net, the telecom sector has 
grown at an average annual rate of 20% in the past deca de (much higher than the GDP growth rate of 2% in 
2012-13). Viewed at: http://www.globaltrade.net/f/market -research/text/Taiwan/Computers-
Telecommunications-Internet-Telecom-Industry-Update.html  [02/06/2014]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Chart 4.5 Distribution of telecom revenue, 2013 
Long-distance telephone
1%
Local telephone
11%Mobile phone
58%Internet and value-added services
14%
International telephone
6%Multimedia-on-demand 
1%
Leased circuit
9%
 
Source: Data provided by NCC. 
4.118.  The penetration rates for telecom services, except for fixed telephony, have continued to 
rise (Table 4.15). 
Table 4.15 Telecommunications market, 2009-13 
Market 2009  2010  2011  2012 2013  
Mobile phone Penetration ratea (%) 116.7 120.4 124.8 126.9 127.6 
Subscribers (million) 27 27.9 29 29.6 29.8 
Fixed telephone Penetration rate (%) 55.5 54.8 54.6 53.2 52.3 
Subscribers (million) 12.8 12.7 12.7 12.4 12.2 
Internetb Penetration rate (%) 69.8 71.5 72 74.5 74.9 
Users (million) 16.1 16.5 16.7 17.4 17.5 
Mobile broadbandc Penetration rate (%) 61.5 71.2 76.9 76.4 77.4 
Subscribers (million) 14.2 16.5 17.9 17.8 18.1 
Fixed broadbandd Penetration rate (%) 21.6 22.9 23.8 27.7 30 
Subscribers (million) 5 5.3 5.5 6.4 7 
a Market penetration refers to service subscribers per 100 inhabitants. 
b Internet users refer to individuals who accessed the Internet during the year. 
c Mobile broadband subscribers are the 3G subscribers that can access the Internet. 
d Fixed broadband subscribers are the subscribers of ADSL, FTTx, cable modem, leased line and 
PWLAN that can access the Internet. 
Source: Data provided by the NCC. 
4.119.  The Telecommunications Act imposes limits on non-local investment in Type I operators, 
who own and operate network facilities. In accordan ce with Article 12, the chairman of the Board 
of a Type I telecommunications enterprise must be a citizen of Chinese Taipei. Non-local 
investment in a Type I enterprise (apart from Chunghwa Telecom) is limited to a maximum of 
49% of total shares (which is above the GATS lim it of 20%), and the sum of direct and indirect 
shareholding may not exceed 60%.43 Type I operators must obtain licences from the NCC, and are 
subject to minimum capital requirements. There is no equity restriction for non-local investment in 
Type II operators, who do not own network facilities. 
4.120.  Type I operators face price-cap regulati ons (Article 26 of the Telecommunications Act).44 
Cross-subsidization is not allowed. Type II operators determine their own tariffs. The NCC adjusted 
the pricing mechanism a number of times during the review period; according to the authorities, this is to protect consumer rights and encourage the sound development of the 
                                               
43 Telecommunications Act. Viewed at: 
http://law.moj.gov.tw/Eng/La wClass/LawAll.aspx?PCode=K0060001  [13/01/14]. 
44 Under the price-cap mechanism, tariffs charged by Type I teleco m operators must not exceed the 
Consumer Price Index minus the Production Efficiency Index (PEI). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  telecommunications industry. For example, in 2011, the right to determine the pricing of a local to 
mobile call was shifted from the mobile operators to the fixed-network operators; according to the 
authorities, this was estimated to save consumers NT$3.3 billion in 2011. Since 2012, a uniform-rate formula has been applied to local and long-distance calls domestically: long-distance calls now 
cost NT$1.6 per three minutes, the same as local calls down from NT$5.7 in the past. In January 
2013, the NCC announced a new adjustment of mob ile termination rates (MTRs) for four years 
(2013 to 2016). In February 2013, the NCC announced a new adjustment coefficient for wholesale 
prices for Type I telecom services of the SMP, running from 1 April 2013 to 31 March 2017. 
According to the authorities, in the future, the NCC intends to push for further rationalization of telecom tariffs.
45 
4.121.  The telecommunications market is still dominated by the partially government-owned 
Chunghwa Telecom (CHT). The largest shareholde r of the CHT is the MOTC, holding 35.29%. The 
CHT accounted for 95% of the fixed-line local telephone market (by subscribers), 77% of the domestic long-distance market (by minutes), 55% of the international telephone market (by 
minutes), 78% of the broadband market (by subscr ibers), and 35% of the mobile services market 
(by subscribers).
46 According to the authorities, the CHT does not receive any government 
support. 
4.122.  The Telecommunications Act and the relevant regulations forbid dominant carriers from 
rejecting interconnection requests, and require interconnection rates to be cost-oriented. Dominant carriers are prohibited from: improperly determining, maintaining, or changing their tariffs or methods of offering telecommunications services; rejecting, without due cause, requests 
for leasing network component, leasing circuits, negotiation or testing, and co-location 
negotiation; and discriminating against other telecommunications enterprises or users. 
4.123.  To develop the digital industry and enha nce the quality of broadband Internet, a Digital 
Convergence Policy Initiative was announced in De cember 2010. The government's definition of 
digital convergence refers to the convergence of the information technology industry, telecommunications services, the consumer electronics industry, and the entertainment industry. 
In accordance with the Initiative, the government revised relevant regulations in two stages: the 
first stage, from 2010 to 2012, included the amendment to the Radio and Television Act, the Cable Radio and Television Act, the Satellite Broadcasti ng Act, and the Telecommunications Act, to relax 
restrictions on cross-industry telecommunications, broadcasting, and internet operations. The 
second stage, from 2013 to 2014, is to complete the legislation on the digital convergence 
regulation framework.  
4.124.  CHT is responsible for providing universal service for fixed-line local telephone services. 
The universal service obligations for broadband services are assigned to CHT, Taiwan Fixed 
Network, Taiwan Optical Platform, and New Cent ury InfoComm Tech. Losses arising from providing 
the universal services are borne by the Telecommunications Universal Services Fund, financed by a 
proportion of the revenue of Type I telecommunications enterprises and Type II 
telecommunications enterprises publicly designated by NCC. 
4.125.  The aim of universal broadband service is to assure basic access to quality voice and data 
services at a reasonable price anywhere in th e territory. The NCC completed the projects of 
"Broadband for Villages" in 2007 and "Broadband for Tribes" in 2010. All tribes in remote areas 
now have 2Mbps broadband services. Since 2012, the NCC has been promoting broadband speeds from 2Mbps to 12Mbps; coverage of remote villages is estimated to reach 75% in 2013, 85% in 
2014, and 95% by 2015.  
4.4.3.2  Postal service 4.126.  Postal services are reserved for the go vernment-owned Chunghwa Post Co. Ltd and other 
entrusted companies; no others may engage in the business of delivering letters, postcards or 
other correspondence. Non-local investment is allowed in courier services, limited to the delivery of business correspondence documents, goods, and parcels. 
                                               
45 NCC adopted the bottom-up LRIC+ approach; according to the authorities, this would promote 
efficiency, and sustainable competition in the retail mobile  market, and confer the grea test possible benefits to 
consumers. 
46 Chunghwa Telecom (2013). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  4.127.  According to the Postal Act, the MOTC is  the regulatory agency for postal services. The 
MOTC set up the Chunghwa Post to manage postal services, including the delivery of mail, and other businesses such as postal savings, remittances, simple life insurance, philately, and related merchandise, and the management of postal assets.
47 
4.128.  Chunghwa Post provides universal postal services, and has the right to set postage fees 
subject to approval from the MOTC. Mail delivery  services provided by Chunghwa Post, as well as 
postal property and bills, receipts, and other docu ments used to provide such services, are exempt 
from taxes. According to the authorities, Chung hwa Post does not receive any other government 
support. However, with more than 15,000 staff providing postal services and with 1,322 postal offices, Chunghwa Post is operating at a loss according to the authorities. 
4.4.4  Transport 
4.4.4.1  Maritime transport 
4.129.  For Chinese Taipei, a chain of islands, ex ports and imports are mostly transported by sea. 
It has 174 shipping carriers (139 in 2008), including three major companies providing container 
transport services (Yangming Marine Transport Co rporation, Evergreen Marine Corporation, and 
Wan Hai Lines Ltd.), and three providing bulk transport services (China Steel Express, U-ming, and Ta-Ho Maritime Corporation).
48 Its fleet was the world's 10th largest in 2013, totalling 814 vessels 
of over 1,000 gross tonnes (102 vessels flying national flag).49 
4.130.  Chinese Taipei did not include maritime transport services in its GATS commitments. The 
applied regime on non-local investment and cross-border trade restrictions is specified under the Shipping Law and the Law of Ships, and is identical to the obligations under the ECA with New 
Zealand (Table A4.4). Both Laws were amended recently: the Shipping Law was amended in June 
2013 concerning, inter alia , the security of vessels and the penalties
50; the Law of Ships was most 
recently amended in December 2010, according to which the affairs administered by the shipping 
administration authorities are now determined by the executive.51 
4.131.  The Ministry of Transport (MOTC) remains responsible for regulating the maritime 
transport sector, including ports. There are seven international ports. The Commercial Port Law 
and the Organic Act Establishing the Taiwan International Ports Co., Ltd have been amended since 
2010. The functions of administrative and business operations of the MOTC were separated into a 
Maritime and Port Bureau under the MOTC (in charge  of shipping and navigation of harbours), and 
the Taiwan International Ports Corporation (TIPC) (in charge of all major commercial port 
operations). 
4.132.  Direct cross-strait shipping began on 15 December 2008 (before that, direct cross-Strait 
shipping was prohibited). As of the end of 2012,  the cargo volume of marine transport between 
both sides reached 349 million revenue tonnes and the container shipment volume was about 
7.58 million TEUs. Direct cross-Strait shipping reduces transportation time and cost significantly, and will enhance the competitiveness of Chinese Taipei's commercial ports.
52 
4.4.4.2  Air transport 
4.133.  The latest amendment to the Civil Aviation Act took effect in January 2012. The 
amendment contains, inter alia , the opening of private aviation: i.e., foreign private aircraft, with 
permission from MOTC or in accordance with a treaty or an agreement, may be allowed to engage 
in flights for non-profit activities in the territory. 
                                               
47 Postal Act. Viewed at: http://www.post.gov.tw/post/internet/U_english/index.jsp?ID=240104 . 
48 MOTC online information. Viewed at: 
http://www.motc.gov.tw/en/home.jsp?id=256&parentpath=0,150,250  [14/11/2013]. 
49 UNCTAD (2013). 
50 Shipping Law. Viewed at: http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=K0070001  
[24/01/14]. 
51 Law of Ships. Viewed at: http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=K0070004  
[24/01/14]. 
52 MOTC (2013). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  4.134.  Its GATS commitments and its RTA commitmen ts on air transport services are listed in 
Table A4.4. The foreign investment and market access restrictions are, in general, the same as the provisions contained in the ECA with New Zealand. There is a recommendation for its civil servants who travel overseas on official business to fly with Chinese Taipei carriers; however, according to 
the authorities, they frequently fly with foreign carriers. 
4.135.  Airlines are free to establish their prices for international flights, although the fares must 
be filed with the MOTC and the Civil Aeronautics Administration (CAA). The CAA, under the MOTC, 
is the air transport regulator. The MOTC is respon sible for approving new carriers, while the CAA is 
responsible for supervising existing carriers. 
4.136.  The liberalization of the cross-Strait air links and the development of tourism has increased 
passenger volumes at its airports. In 2013, there were 48.8 million passengers, an increase of 
7.5% over 2012. On the other hand, due to the weak economy around the world, cargo volume 
decreased 0.02% to 1.68 million tonnes in 2013. 
4.137.  At the end of 2013, 68 airlines (38 in 2008) provided flight services: 62 were non-local 
airlines operating to and from the territory, and 6 were domestic air carriers providing both 
international and domestic air services. At the en d of 2013, domestic airlines accounted for 57% of 
total passenger volumes and 61% of total cargo volumes. The leading carrier, China Airlines (36% 
of its shares are owned by the government-own ed China Aviation Development Foundation), 
accounted for 28% of market share in passenger volume and 34% in cargo volume; EVA Airways, 
accounted for 21% and 25%, respectively.
53 
4.138.  Chinese Taipei has 2 international airports and 15 domestic airports, all of which are 
owned and managed by the government. The largest,  the Taoyuan International Airport (TTIA), is 
managed by the Taoyuan International Airport Corporation Ltd, a state-owned company, and 
began operations on 1 November 2010. The TTIA and its surrounding areas are being developed 
into a Taoyuan Aerotropolis as part of the i-Taiwan project. Terminal 3 is to be completed in 2018 
and all the facilities of the Aerotropolis are expected to be finished in 2030. 
4.139.  At the end of 2013, Chinese Taipei had bilateral air services agreements based on 
reciprocity with 51 countries or areas. International scheduled services provided by domestic and 
non-local carriers covered 276 routes connecting 129 cities worldwide (up from 181 and 78 respectively in 2008). It has also launched an open skies regime with Japan and with the Republic of Korea. 
4.140.  Cross-Strait flights continued to increase during the review period (Chart 4.6). By the end 
of 2013, there were 828 scheduled passenger flig hts and 68 scheduled cargo flights per week (up 
from 270 and 56 in 2009), between 10 cities in Chinese Taipei and 54 cities in China (8 and 27 in 
2009).
54 
                                               
53 MOTC statistics. Viewed at: http://www.caa.gov.tw/APFile/big5/download/ao/1381995181651.pdf  
[18/11/13]. 
54 CAA (2013). Viewed at: http://www.caa.gov.tw/APFile/big5/download/pliad/1371635464037.pdf  
[18/11/13]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 111 - 
 
  Chart 4.6 Cross-Strait aviation:  number  of flights and passengers, 2008-13 
Number in '000 
 
Number of flightsNumber of passengers
01,0002,0003,0004,0005,0006,0007,0008,0009,00010,000
2008 2009 2010 2011 2012 20132.3 17.7 33.8 44.6 58.5 60.6 418.7 3,105.9 5,826.2 7,157.5 8,943.3 9,193.8 
 
Source: Data provided by the authorities. 
4.4.4.3  Road transport 
4.141.  The highway network totals about 20,000 km. In recent years the government has been 
making efforts to lengthen and maintain the network. The National Freeway No. 2 was completed in May 2012; and to enhance the freeway's connections with nearby roadways and relieve traffic bottlenecks, several interchanges were reconstructed.
55 
4.142.  The Directorate General of Highways is the regulatory authority for highway automobile 
and transport, tourist bus transport enterprises; car and pickup truck rental businesses; automobile cargo transport and container truck transportation enterprises. For metropolitan 
automobile transport enterprises, the responsibl e agencies are the municipal highway authority, 
the county/city highway authority, the special municipal city highway authority, or the central authorities for taxicab transport business. 
4.143.  Road transportation is regulated under the Highway Law, most recently amended on 
3 July 2013 (Table A4.4). According to Article 35 of the Law, non-local persons or legal persons 
are prohibited from investing in commercial automobile businesses within the boundaries of Chinese Taipei; however, those who are approved by the MOTC may apply to invest in: car and 
pickup truck rental, automobile cargo transport, and container truck transport.
56 According to the 
authorities, there are six non-local enterprises investing in car rental business, and 11 non-local enterprises investing in road freight business. Acco rding to the authorities, the government follows 
"national treatment" principles and applies the same criteria for local and non-local road transport 
enterprises. Investors must meet the regional tr ansportation needs, promote conveniences to the 
public, have adequate financial capability, have adequate vehicles, parking lots, and repair abilities (outsourcing is acceptable), and their equipment must meet operational needs.  
4.4.4.4  Rail transport 
4.144.  The MOTC is the regulator for rail transport. The Railway Law specifies that, in principle, 
railways must be state owned and managed (Table A4.4). State railways must be administered by 
the MOTC, while local/private/special railways must be supervised by the MOTC. The construction, 
                                               
55 MOTC online information. Viewed at: 
http://www.motc.gov.tw/en/home.jsp?id=255&parentpath=0,150,250  [18/11/13]. 
56 Highway Law. Viewed at: http://law.moj.gov.tw/eng/LawClass/LawAll.aspx?PCode=K0040001   
[18/11/13]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 112 - 
 
  extension, transfer, or management of local/private/special railways must be ratified by the 
MOTC.57 
4.145.  Railways comprise general railways, mass rapid transit, and high-speed rail. The general 
railways are operated by the Taiwan Railway Administration (TRA), and maintained by the Railway 
Reconstruction Bureau (RRB). At end 2013, th e total length of the general railways was 
1,061.3 km; total passengers carried reached 227.3 million (up 3% from 2012), with passenger revenues of NT$16.9 billion (up 4.7%). A total of 10.7 million tonnes of freight were transported in 
2013, 2% less than in 2012; freight revenues dropped 11.8% to NT$0.9 billion. 
4.146.  Private/non-local investment is allowed in the operation of the MRT system. Currently 
there are two mass rapid transit (MRT) systems in  operation. Taipei Rapid Transit Corporation 
(TRTC), owned by Taipei City Government, operates the MRT system in Taipei city. Kaohsiung 
Rapid Transit Corporation (KRTC), privately owned within a contract period, operates the MRT 
system in Kaohsiung city. 
4.147.  The high speed rail (HSR) has been in commercial operation since 2007. The HSR line is 
about 345 km, and is operated by the Taiwan High  Speed Rail Corporation (THSRC). According to 
the authorities, the THSRC is not a government-owned company, and private and non-local investment is allowed in the operation of th e HSR system. In 2013, the number of passengers 
transported by the HSR system reached 47.5 milli on, or an average of 130,000 passengers per 
day.  
4.4.5  Tourism 4.148.  The tourism sector is regulated mainly under the Statute for the Development of Tourism, 
last amended in 2011 on the business scope for tr avel enterprises. The Tourism Bureau of the 
MOTC is responsible for policy formulation and impl ementation in the sector. In general, there is 
no market access or "national treatment" restrict ions on non-local investment under GATS, FTAs, 
and the ECAs.
58 Non-local investors wishing to establish subsidiaries in the market must obtain 
approval from the Tourism Bureau, recognition and approval in accordance with Company Law, and a travel enterprise licence. Non-local travel enterprises intending to dispatch representatives 
must apply to the Tourism Bureau and notify the MOEA; such representatives may not engage in 
business outside the territory.
59 
4.149.  The tourism sector has been developing fast, and is one of the government designated key 
emerging industries to boost economic developmen t. In 2012, there were 7.3 million international 
travellers, an increase of 20% from 2011. The la rgest source of arrivals was China, followed by 
Japan, and Hong Kong, China. Total tourism receipts amounted to NT$348.5 billion in 2012 (2.3% of GDP). The Tourism Bureau formulates the tourism policy, which aims at attracting over 
10 million visitors a year and generating NT$470 billion tourism revenue before the end of 2016. 
4.150.  The fast growth of tourism reflects, among other things, the increase of cross-Strait flights, 
the opening up to groups and independent visitors from China, the launch of an open skies regime 
with Japan, and with the Republic of Korea. In addition, the government activated a NT$30 billion 
Tourism Development Fund from the Project Vanguard for Excellence in Tourism (2009-14) to build an international tourism base. About half of the total amount under this project (49.22%, or NT$14.771 billion) is being provided from the Treasury, and the remaining NT$15.236 billion from 
the Tourism Development Fund (the source is the Air Services Fee). Three action plans — Project 
Summit, Project Keystone, and Project Propeller — are being carried out through six core efforts: regional flagships, international spotlights, industrial regeneration, elite development, market 
development, and quality enhancement. 
4.151.  Accommodation capacity is important for tourism development. Most hotels are small or 
medium in size. To help upgrade the quality of tr avel and accommodation, hotels with 15 rooms or 
                                               
57 Railway Law. Viewed at: http://law.moj.gov.tw/eng/LawClass/LawAll.aspx?PCode=K0030001  
[18/11/13]. 
58 WTO document GATS/SC/136/Rev.1, 2 July 2002; FTAs with El Salvador and Honduras, Guatemala, 
Nicaragua, and Panama; and ECA with New Zealand. 
59 Statute for the Development of Tourism, Article 28. Viewed at: 
http://admin.taiwan.net.tw/law/law_d_en.aspx?no=9&d=317  [15/01/14]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  more are being offered medium and long-term government funding and bank loans for investment 
in renovation, expansion, or reconstruction. Currently 29 banks extend these loans; interest rates are negotiated between the banks and the borr owers, but may not exceed 1.65% over the 
medium and long-term capital rate. The Tourism Bureau is offering subsidies of up to NT$1 million 
to these hotels to help cover their hardware and software planning and design costs. 
4.4.6  Professional services 4.4.6.1  Legal services 
4.152.  The Ministry of Justice (MOJ) administers the provision of legal services, according to the 
Attorney Regulation Act.
60 Local attorneys and foreign legal affairs attorneys who are permitted to 
practice law by the MOJ may do so, in the form of sole proprietorship and partnerships, and receive remuneration. However, a foreign attorney who does not obtain permission from the MOJ 
to provide legal services in Chinese Taipei, may not establish a law firm or employ attorneys to 
practice law for profit, or enter a partnership with attorneys to practice law. 
4.153.  Non-citizens who take the Attorney Qualification Examinations in Chinese Taipei and 
receive the attorney licence, must obtain approval  from the MOJ before practicing as lawyers. A 
non-citizen licensed to practice law in Chinese Taipei must use the Chinese language during proceedings in court or when present at an inve stigation procedure. All documents submitted by 
such attorneys must be drafted in Chinese. 
4.154.  Non-local attorneys refer to those who have been licensed to practice law in a country or 
region other than Chinese Taipei. Non-local attorneys must obtain approval from the MOJ and join the Bar Association where his/her law firm is located to practice law. Non-local attorneys are 
allowed to practice the law of their home jurisdiction and international law; if they work in 
conjunction with a local attorney or receiving the latter's written opinion, they may provide legal services relating to marriage, parentage or inheritance, when a person from Chinese Taipei is 
involved or the inheritance property is located in Chinese Taipei. 
4.155.  A non-local attorney may apply to become an "attorney of foreign legal affairs (AFLA)" if 
he/she obtains permission from the Ministry of Justice before practicing law in Chinese Taipei, and 
is admitted to the Bar Association where the law firm is located.  
4.156.  Overall, the applied regime is consistent with its GATS commitment, according to which, 
provision of legal services by AFLAs is restricted to natural persons having established a law office in the form of sole proprietorship, and partnership in a law office is limited to persons registered as 
attorneys of foreign legal affairs.
61 The government has allowed AFLAs to establish partnerships 
with, or employ, licensed local lawyers since its accession to the WTO. Foreigners who are college graduates majoring in law-related subjects or have at least two years' law-related working 
experience, or who have passed the lawyer’s examination in any foreign country, may be 
employed by local lawyers or AFLAs to work as assistants or consultants. 
4.157.  Under its GATS commitments, Chinese Taipei will recognize an AFLA if: 
 the service provider is qualified as a lawyer in his/her home jurisdiction(s); 
 the service provider has practiced as a qualified lawyer for at least five years in 
his/her home jurisdiction(s). However, should a foreign lawyer be employed by a lawyer of Chinese Taipei as an assistant or consultant or have practiced his/her home jurisdiction laws elsewhere, the term up to a maximum of two years of employment or practice may be accredited to the said five year term; and 
 any foreign lawyer who is already employed by a local lawyer by the date of its 
accession to the WTO in accordance with the Regulation Concerning Chinese Taipei's Lawyers' Employment of Foreigners and Admi nistration Thereof, may apply to become 
an AFLA after the completion of the two years' employment period. 
                                               
60 Attorney Regulation Act. Viewed at: 
http://law.moj.gov.tw/Eng/LawC lass/LawAll.aspx?PCode=I0020006  [17/01/14]. 
61 WTO document GATS/SC/136/Rev.1, 2 July 2002. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  4.158.  From 2009 to 2013, 31 foreign attorneys app lied to the MOJ for approval to practise as 
foreign attorneys; 25 were registered at bar associations. 
4.4.6.2  Accounting services 4.159.  In accordance with the Certified Public Accountant Act, the Financial Supervisory 
Commission (FSC) is the regulatory authority for accounting services. Article 8 of the CPA Act 
stipulates that the holder of a CPA certificate may not practice as a CPA until he or she has established or joined a CPA firm, applied to the competent authority for registration, and joined a 
certified public accountants association (CPA association) as a practicing member; the CPA 
association may not refuse membership to such person.
62 
4.160.  A foreign national who has received permissi on to practise as a CPA must comply with the 
CPA Act, including the provisions stipulating the qualification of the assistant recruited by the CPA. 
For example, a CPA is required to establish an of fice locally to practise and perform professional 
services by himself/herself or establish a CPA pa rtnership and practice jointly with other CPAs; a 
CPA must not perform professional services without being admitted to membership of a CPA 
association after he/she has been registered with the local authority; a foreigner may take the CPA 
examination in Chinese Taipei. A foreigner who has passed the examination and acquired a CPA certificate must obtain permission from the Financial Supervisory Commission before practising as 
a CPA. To date, one foreign national has obtained a local CPA licence and is practising in Chinese 
Taipei. 
4.4.6.3  Architectural services 4.161.  Under the Building Act and the Architect Act,  the Ministry of the Interior governs architect 
services at the central level, and local governments are responsible at the local level. Currently no 
non-local architects are practising in Chinese Taipei. 
4.162.  Any citizen may act as an architect if qualified through the architect examination. A 
foreigner may take the architect examination. An architect may practise solely or organize an 
associate office for joint practice. The office should be registered with the respective municipality, county/city authority under which jurisdiction it is located. When practising in another municipality, 
county/city, an architect should be registered with  the respective local regulating authorities, but 
need not have a branch office there. 
4.163.  According to Article 28 of the Architect Ac t, after acquiring the necessary business practice 
licence, an architect must join the architect association organized in his/her chosen area of 
practice.
63 The association may not refuse or deny the membership application of a licensed 
architect. 
4.4.6.4  Professional engineering services 
4.164.  Professional engineering services are re gulated by the Professional Engineers Act (PEA)64, 
and the Act Governing the Administration of Pr ofessional Engineering Consulting Firms (PECF 
Act).65 The Public Construction Commission (PCC) is  the regulatory authority. At end 2013, there 
were two non-local PEs and 14 non-local PE firms in Chinese Taipei. 
4.165.  According to the laws and regulations, ther e are no limits on regions, cities, or number of 
offices for foreign services providers of engineering services. The qualification requirements for related personnel in engineering service are: 
                                               
62 CPA Act. Viewed at: http://law.moj.gov.tw/Eng/Law Class/LawAll.aspx?PCode=G0400067  [20/01/14]. 
63 Architect Act. Viewed at: http://law.moj.gov.tw/Eng/LawClass/LawAll.aspx?PCode=D0070112  
[20/01/14]. 
64 Professional Engineers Act. Viewed at: 
http://law.moj.gov.tw/eng/LawClass/LawSearchCont ent.aspx?pc=J0030022&k1=Professional+engineer&k2=&
k3=&k4 = [20/01/14]. 
65 Professional Engineering Consulting Firms Act. Viewed at: 
http://law.moj.gov.tw/eng/LawClass/LawAll.aspx?PCode=D0070073  [20/01/14]. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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   a professional engineer, possessing the prof essional engineer certificate, must not 
practise the profession until having gained at least two years of engineering experience and obtaining the profession al engineer licence from the PCC; 
 the chairperson of the board of director s or the statutory representative of a 
professional engineering consulting firm must be a licensed professional engineer, 
except when: (a) a firm hires a minimum of 20 licensed professional engineers; (b) a firm is listed on either the Taiwan Stock Exchange (TSE) or the Over-the-Counter 
(OTC); or (c) foreign firms have been in business in their mother countries for five 
years minimum since incorporation, and have undertaken domestic and overseas engineering consultation services amountin g to a minimum of NT$2 billion over the 
past five years;  
 have at least one third of the number of directors and shareholders taking charge of 
business operations or representing a professional engineering consulting firm, must be licensed professional engineers within the firm’s registered business scope, except: 
when a firm has a minimum of 20 licensed professional engineers or a firm is listed on 
either the TSE or the OTC; and 
 a professional engineering consulting firm's manager in charge of engineering services 
or the person in charge of the engineering department must be a licensed professional 
engineer. 
4.4.7  Other services 4.166.  Chinese Taipei's GATS Schedule includes commitments in, inter alia , construction and 
related engineer services, distribution services , education services, and environmental services. 
Some of these services sectors are incl uded its FTAs and ECAs (Table A4.5). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 116 - 
 
  REFERENCES 
Bureau of Foreign Trade (2013), 2012 Accounting Reports of Units under Trade Promotion Fund. 
Viewed at: http://www.trade.gov.tw/App_Ashx/File.ashx?F ilePath=../Files/PageFile/275_433287/%e4%b8%a
d%e8%8f%af%e6%b0%91%e5%9c%8b101%e5%b9%b4%e5%ba%a6%e6%8e%a8%e5%bb%a
3%e8%b2%bf%e6%98%93%e5%9f%ba%e9%87%91%e9%99%84%e5%b1%ac%e5%96%ae%
e4%bd%8d%e6%b1%ba%e7%ae%97.pdf  [20/05/14, in Chinese]. 
 
CAA (2013), Annual Report 2012. Viewed at:   
http://www.caa.gov.tw/APFile/big5/ download/pliad/1371635464037.pdf  [18/11/13]. 
 
Chunghwa Telecom (2013), Annual Report 2012 . Viewed at:  
http://www.cht.com.tw/ir/upload/fil es/CHT_2012_Annual_Re port_CH_0524n.pdf   [13/01/14, in 
Chinese]. 
 
COA (2012), Annual Report 2011 . Viewed at: 
http://eng.coa.gov.tw/content_view.php?catid=2447808&hot_new=2447766  [7/10/2013]. 
 
COA (2013a), Food Supply & Utilization 2012.  Viewed at: 
http://agrstat.coa.gov.tw/sdweb/public/book/Book.aspx . [10/10/13]. 
 
COA (2013b), Statistics Yearbook 2012.  Viewed at:  
http://agrstat.coa.gov.tw/sdweb/public/book/Book.aspx  [28/01/14]. 
 
Fisheries Agency (2012), Annual Report 2011.  Viewed at:  
http://www.fa.gov.tw/upload /169/201211261 5023769988.pdf   [09/10/13]. 
 
Financial Supervisory Commission (2012), 2011-2012 Annual Report . Viewed at:  
http://www.fsc.gov.tw/en/home .jsp?id=56&parentpath=0,4  [03/06/14]. 
 
FTC (2013), Statistical Yearbook of Fair Trade Commission – 2012 , April. 
 
MOTC (2013), Annual Report 2012 . Viewed at:  http://www.motc.gov.tw  [03/06/14]. 
 
OECD: Trade Facilitation Indicators – Chinese Taipei . Viewed at: 
http://www.oecd.org/tad/facilitat ion/Chinese-Taipei_OECD-Trad e-Facilitation -Indicators.pdf  
[05/12/13]. 
 
Taipower Company (TPC) (2013), Annual Report 2012 . 
 TIPO (2013), Annual Report Intellectual Property Office 2012 , June. Viewed at: 
http://www.tipo.gov.tw  [04/07/13]. 
 
UNCTAD (2013), Review of Maritime Transport 2013 . Viewed at:  
http://unctad.org/en/publicationslibrary/rmt2013_en.pdf  [03/06/2014]. 
 
World Bank (2013), Doing Business 2014: Understanding Regulations for Small and Medium-Size 
Enterprises.  Viewed at: 
http://www.doingbusiness.org/~/media/GIAW B/Doing%20Business/Documents/Annual-
Reports/English/DB14-Full-Report.pdf  [03/06/14]. 
 
WTO (2010), Trade Policy Review - Separate Customs Territory of Taiwan, Penghu, Kinmen and 
Matsu , Geneva. 
 
 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 117 - 
 
  5  APPENDIX TABLES 
Table A1.1 Merchandise exports by group of products, 2009-13 
(US$ billion and %) 
  2009  2010  2011 2012 2013 
Total exports (US$ billion) 203.7 274.6 308.3 301.2 305.4 
 (% of total) 
Total primary products 9.8 9.5 10.4 12.0 11.7 
  Agriculture 2.1 2.0 2.2 2.3 2.2 
   Food 1.1 1.0 1.1 1.3 1.2 
   Agricultural raw material 1.1 1.0 1.1 1.1 1.0 
  Mining 7.7 7.5 8.2 9.6 9.5 
   Ores and other minerals 0.3 0.3 0.3 0.3 0.2 
   Non-ferrous metals 1.9 1.9 2.2 2.2 1.8 
   Fuels 5.5 5.2 5.7 7.2 7.5 
Manufactures 88.5 89.4 88.2 87.1 87.4 
  Iron and steel 4.2 4.0 4.2 3.8 3.7 
  Chemicals 12.7 13.0 13.2 12.6 12.9 
   5743 Polycarbonates, alkyd resins and other 
polyesters 0.9 0.9 0.9 1.0 1.0 
   5729 Other styrene polymers 1.0 1.1 1.0 0.9 0.8 
   5138 Polycarboxylic acids, and their anhydrides, 
derivatives 1.1 1.1 1.3 0.9 0.4 
   5822 Other plastics, flat shapes, non-cellular and 
not reinforced, etc. 0.6 0.6 0.6 0.6 0.6 
 Other semi-manufactures 5.7 5.7 5.9 6.2 6.0 
   6942 Screws, bolts, nuts and similar articles of 
iron or steel 0.9 1.1 1.2 1.2 1.2 
  Machinery and transport equipment 48.4 49.2 48.2 47.9 48.8 
  Power generating machines 0.4 0.4 0.5 0.5 0.5 
   Other non-electrical machinery 5.4 6.0 6.6 6.6 6.3 
   7284 Machinery and appliances for particular 
industries, n.e.s. 0.7 0.9 1.0 0.9 0.9 
   Agricultural machinery and tractors 0.1 0.1 0.1 0.1 0.0 
  Office machines & telecommunication equipment 30.4 31.7 31.4 30.7 31.7 
   7764 Electronic integrated circuits and micro-
assemblies 18.2 18.2 17.9 19.2 20.6 
   7763 Diodes, transistors, etc. 2.9 3.7 3.2 2.6 2.6 
   7643 Radio or television transmission apparatus 2.0 2.8 3.5 2.0 1.9 
   7599 Parts and accessories of 751.1, 751.2, 
751.9 and 752 3.0 2.8 2.0 1.7 1.8 
   7649 Parts and accessories for apparatus of 
division 76 0.8 0.9 1.2 1.5 1.4 
   7638 Sound/video recording/reproducing 
apparatus; video recording/reproducing apparatus 0.3 0.4 0.5 0.6 0.7 
Other electrical machines 8.0 7.2 5.9 6.0 6.1 
   7722 Printed circuits 2.0 2.0 2.0 2.0 1.9 
   7788 Electrical machinery and equipment, n.e.s. 2.6 2.1 1.1 1.2 1.4 
 Automotive products 1.8 1.8 1.9 2.1 2.1 
   7843 Other motor vehicle parts and accessories of 
722, 781 to 783 1.2 1.1 1.1 1.2 1.2 
 Other transport equipment 2.5 2.1 2.0 2.1 2.0 
   7853 Invalid carriages, parts of 785 0.8 0.7 0.7 0.8 0.8 
   Textiles 3.9 3.6 3.6 3.4 3.4 
   6552 Other knitted/crocheted fabrics, not 
impregnated/coated, etc. 0.7 0.6 0.7 0.7 0.8 
Clothing 0.4 0.4 0.3 0.3 0.3 
Other consumer goods 13.2 13.6 12.7 12.8 12.4 
   8719 Liquid crystal devices, n.e.s.; lasers (excl. 
laser diodes) 5.9 6.5 5.6 5.6 5.2 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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    2009  2010  2011 2012 2013 
   8841 Optical fibres and optical fibre bundles; 
optical fibre cables other than those of heading 
773.1; sheets and plates of polarising material; 
lenses, prisms, mirrors and other optical 
elements, unmounted, other than such elements 
of glass 0.7 0.8 0.7 0.7 0.7 
Other 1.6 1.1 1.4 0.9 0.9 
  Gold 0.9 0.7 1.0 0.4 0.2 
Source: UNSD, Comtrade database (SITC Rev.3). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 119 - 
 
  Table A1.2 Merchandise imports by group of products, 2009-13 
(US$ billion and %) 
  2009  2010  2011 2012 2013  
Total imports (US$ billion) 174.4 251.2 281.4 270.5 269.9 
 (% of total) 
Total primary products 33.7 33.2 35.6 38.3 37.1 
  Agriculture 5.9 5.2 5.5 5.5 5.4 
   Food 4.6 3.8 3.9 4.2 4.0 
   Agricultural raw material 1.3 1.5 1.5 1.4 1.4 
  Mining 27.8 28.0 30.1 32.8 31.7 
   Ores and other minerals 2.5 3.1 3.4 2.9 2.8 
    2815 Iron ores and concentrates, not agglomerated 0.5 0.7 0.9 0.8 0.8 
    2823 Other ferrous waste and scrap 0.6 0.8 0.8 0.7 0.6 
   Non-ferrous metals 3.9 4.3 4.4 4.0 3.4 
    6821 Copper anodes; alloys; unwrought 1.5 1.6 1.5 1.3 1.2 
    6811 Silver 0.5 0.4 0.8 1.0 0.4 
   Fuels 21.4 20.5 22.4 25.9 25.5 
    3330 Crude oils of petroleum and bituminous 
minerals 11.3 10.2 10.8 13.2 12.4 
    3431 Natural gas, liquefied 2.3 2.3 3.0 3.6 3.6 
    3212 Other coal, whether or pulverized, not 
agglomerated 3.3 2.6 3.1 2.9 2.5 
Manufactures 64.3 65.1 62.6 60.1 60.8 
  Iron and steel 3.1 3.6 3.7 3.3 3.2 
  Chemicals 13.7 13.7 14.2 13.2 13.3 
    5112 Cyclic hydrocarbons 1.4 1.4 1.7 1.4 1.6 
    5989 Chemical products and preparations, n.e.s. 1.0 1.0 0.9 1.0 1.0 
    5985 Chemical elements and compounds doped for 
use in electronics 1.3 1.5 1.3 0.9 1.0 
    5822 Other plastics, flat shapes, non-cellular and not 
reinforced, etc. 0.9 0.8 0.9 0.9 0.8 
  Other semi-manufactures 3.6 3.5 3.4 3.5 3.3 
  Machinery and transport equipment 35.5 36.1 33.4 32.3 33.2 
   Power generating machines 0.7 0.6 0.7 0.6 0.7 
   Other non-electrical machinery 8.1 10.1 8.3 7.4 8.1 
    7284 Machinery and appliances for particular 
industries, n.e.s. 3.7 5.4 3.7 3.6 4.0 
    7285 Parts, n.e.s. of machines/ appliances of 723.48, 
727.21, 728.41 to 728.49 0.8 1.1 0.9 0.8 1.0 
   Agricultural machinery and tractors 0.0 0.0 0.0 0.0 0.0 
   Office machines & telecommunication equipment 19.9 18.5 17.4 17.1 17.4 
    7764 Electronic integrated circuits and micro-
assemblies 13.9 13.0 12.0 11.5 11.6 
    7763 Diodes, transistors, etc. 1.1 1.2 1.0 1.0 0.9 
    7643 Radio or television transmission apparatus 0.6 0.5 0.5 0.8 0.9 
   Other electrical machines 4.1 4.1 4.1 4.0 3.7 
   Automotive products 1.5 1.7 2.0 2.0 2.1 
    7812 Motor vehicles for the transport of persons, 
n.e.s. 0.8 0.8 1.1 1.0 1.2 
   Other transport equipment 1.2 1.1 0.9 1.2 1.2 
  Textiles 0.5 0.5 0.5 0.5 0.5 
  Clothing 0.6 0.5 0.5 0.6 0.6 
  Other consumer goods 7.2 7.1 6.8 6.7 6.8 
    8747 Oscilloscopes, spectrum analysers and other 
instruments, etc. 0.8 1.0 0.8 0.9 0.9 
Other 2.0 1.7 1.8 1.6 2.1 
  Gold 1.0 0.9 0.9 0.8 0.8 
Source: UNSD, Comtrade database (SITC Rev.3). WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Table A1.3 Merchandise expo rts by destination, 2009-13  
(US$ billion and %) 
  2009  2010  2011  2012  2013  
Total exports (US$ billion) 203.7 274.6 308.3 301.2 305.4 
 (% of total) 
America 14.5 14.4 14.9 14.1 13.6 
  United States 11.6 11.5 11.8 11.0 10.7 
   Other America 2.9 2.9 3.1 3.1 2.9 
    Canada 0.7 0.7 0.8 0.8 0.8 
    Brazil 0.7 0.7 0.8 0.7 0.6 
    Mexico 0.5 0.6 0.5 0.6 0.6 
Europe 11.3 10.8 10.1 9.5 9.1 
  EU(27) 10.5 9.9 9.3 8.7 8.3 
  Germany 2.3 2.4 2.2 1.9 1.8 
  United Kingdom 1.5 1.3 1.5 1.7 1.4 
  The Netherlands 2.1 1.9 1.5 1.5 1.5 
  Italy 0.9 0.9 0.8 0.6 0.6 
EFTA 0.3 0.3 0.3 0.3 0.3 
  Other Europe 0.6 0.6 0.5 0.6 0.5 
Commonwealth of Independent States (CIS) 0.4 0.5 0.6 0.6 0.6 
Africa 1.1 0.8 1.0 1.0 1.1 
Kingdom of Saudi Arabia 0.3 0.4 0.5 0.6 0.6 
United Arab Emirates 0.5 0.5 0.5 0.5 0.6 
Middle East 1.7 1.7 1.9 1.9 1.9 
Asia 70.2 70.9 70.4 71.8 72.6 
  China 26.6 28.0 27.2 26.8 26.8 
  Japan 7.1 6.6 5.9 6.3 6.3 
  Six East Asian Traders 26.1 26.2 26.7 27.6 28.0 
   Hong Kong, China 14.5 13.8 13.0 12.6 12.9 
   Singapore 4.2 4.4 5.5 6.7 6.4 
   Korea, Rep. of 3.6 3.9 4.0 3.9 4.0 
   Thailand 1.9 1.9 2.0 2.2 2.1 
   Malaysia 2.0 2.2 2.2 2.2 2.7 
Other Asia 10.3 10.1 10.6 11.1 11.5 
  Philippines 2.2 2.2 2.3 2.9 3.2 
  Viet Nam 2.9 2.7 2.9 2.8 2.9 
  Indonesia 1.6 1.6 1.6 1.7 1.7 
  Australia 1.2 1.1 1.2 1.2 1.2 
  India 1.2 1.3 1.4 1.1 1.1 
Other 0.9 1.0 1.1 1.1 1.1 
Source: UNSD, Comtrade database (SITC Rev.3). 
 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Table A1.4 Merchandise imports by origin, 2009-13 
(US$ billion and %) 
  2009  2010  2011  2012 2013  
Total imports (US$ billion) 174.4 251.2 281.4 270.5 269.9 
 (% of total) 
America 13.3 13.5 12.6 12.0 12.5 
  United States 10.5 10.2 9.3 8.8 9.3 
Other America 2.9 3.3 3.3 3.2 3.1 
  Brazil 0.7 1.0 1.1 1.1 1.0 
Europe 9.9 9.4 9.6 9.3 9.9 
  EU(27) 9.0 8.5 8.5 8.3 8.8 
  Germany 3.2 3.3 3.3 2.9 3.1 
  The Netherlands 1.1 1.3 1.0 1.3 1.7 
  France 1.0 0.9 1.0 1.1 1.0 
EFTA 0.8 0.8 1.0 0.9 1.0 
  Other Europe 0.1 0.1 0.1 0.1 0.1 
Commonwealth of Independent States (CIS) 1.8 1.3 1.3 1.7 1.5 
  Russian Federation 1.3 0.9 0.8 1.2 1.2 
Africa 2.2 2.8 3.8 3.5 3.0 
  Angola 0.6 1.1 2.0 1.8 1.4 
Middle East 12.8 12.4 12.7 15.9 16.1 
  Kingdom of Saudi Arabia 5.0 4.7 4.9 5.5 5.8 
  Kuwait 2.6 2.4 2.7 3.2 3.1 
  Qatar 0.4 0.8 1.3 2.0 2.3 
  United Arab Emirates 1.4 1.4 1.5 1.7 1.7 
  Oman 0.6 0.7 0.5 1.6 1.3 
Asia 57.7 58.7 58.2 55.8 54.7 
  China 14.0 14.3 15.5 15.1 15.8 
  Japan 20.8 20.7 18.5 17.6 16.0 
  Six East Asian Traders 13.6 14.7 14.4 13.8 14.0 
    Korea, Rep. of 6.0 6.4 6.3 5.6 5.8 
    Singapore 2.8 3.0 2.8 3.0 3.2 
    Malaysia 2.7 3.1 3.1 2.9 3.0 
    Thailand 1.5 1.5 1.6 1.4 1.4 
    Hong Kong, China 0.6 0.6 0.6 1.0 0.6 
Other Asia 9.3 9.1 9.8 9.3 8.9 
  Australia 3.4 3.6 3.9 3.4 2.9 
  Indonesia 3.0 2.4 2.6 2.7 2.6 
  India 0.9 1.1 1.1 1.0 1.0 
Other 2.3 1.9 1.8 1.8 2.3 
 
Source: UNSD, Comtrade database (SITC Rev.3). 
 WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
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  Table A3.1 Tariff lines affected by schedule changes in 2010 and 2012 
Tariff 
number Products MFN rate applied 
after the change 
(%) MFN rates applied 
before the 
change 
(%) 
Schedule changed in June 2010   
07019000 Potatoes (other than seed), fresh or chilled 15 20 
23033000 Brewing or distilling dregs and waste 0 3 
27090090 Other petroleum oils and oils obtained from 
bituminous minerals, crude 0 2.5 
27101949 Other fuel oil 0 10 
27101967 Partly refined petroleum, including topped 
crudes 0 5 
84073490 Reciprocating spark-ignition internal 
combustion piston en gines for other motor 
vehicles, of a cylinder capacity exceeding 1,000cc 17.5 20 
84819090 Other parts of articles of heading 84.81 3 5 
85285910 Other colour non-cathode-ray tube monitors 0 10 
85285920 Other black and white or other monochrome 
non-cathode-ray tube monitors 0 7.5 
87029010 Gas bus 10 15 
90031100 Frames and mounting for spectacles, goggles or 
the like, of plastic 5 10 
90031920 Frames and mounting for spectacles, goggles or 
the like, of base metal 5 6.8 
90031930 Frames and mounting for spectacles, goggles or 
the like, of precious metal 5 6.8 
90031990 Frames and mounting for spectacles, goggles or 
the like, of other materials 5 6.8 
90039000 Parts of frames and mounting for spectacles, 
goggles or the like 5 6.8 
82090010a Plates, sticks, tips an d the like for tools, 
unmounted, of tungsten carbides 0 n.a. 
82090090a Other plates, sticks, tips and the like for tools, 
unmounted, of cermets 5 n.a. 
84183010a Freezers of the chest type, of exceeding low 
temperature (-70 ˚c and under) not exceeding 
800L capacity 0 n.a.  
84183090a Other freezers of the chest type, not exceeding 
800L capacity 3.5 n.a. 
84184010a Freezers of the upright type, of exceeding low 
temperature (-70 ˚c and under) not exceeding 
900L capacity 0 n.a.  
84184090a Other freezers of the upright type, not 
exceeding 900L capacity 3.5 n.a. 
84185010a Other freezers of exceeding low temperature   
(-70˚c and under) 0 n.a.  
84185090a Other furniture (chests, cabinets, display 
counters, show-cases and the like) for storage 
and display, incorporating refrigerating of 
freezing equipment 3.5 n.a. 
84186910a Refrigerating machines of electricity, for central 
system 2.5 n.a.  
84431920a Textile printing machines 4 n.a. 
84518000a Other machinery of heading 84.51 4 n.a.  
85059070a Other articles of heading 85.05 0 n.a. 
85059091a Flux conductor for articles of heading 85.05 0 n.a.  
85059092a Ferrite core and yoke for articles of heading 
85.05 0 n.a. 
85059099a Other parts of articles of heading 85.05 0 n.a.  
87021030a Hybrid electric-petroleum bus 25 n.a. 
87029020a Electric bus 25 n.a.  
90021110a Interchangeable lenses, for single lens reflex 
cameras 0 n.a. 
90021190a Other objective lenses, fo r cameras, projectors 
or photographic enlargers or reducers 5 n.a.  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 123 - 
 
  Tariff 
number Products MFN rate applied 
after the change 
(%) MFN rates applied 
before the 
change 
(%) 
Schedule changed in November 2012   
06021090 Other unrooted cuttings and slips 0 6 
84186100 Heating pumps other than air conditioning 
machines of heading 84.15 2.5 3.5 
14049080a Sphagnum moss, for plant growing media use 0 n.a. 
38249093a Mixture oligomer of diphenylmethane 
diisocyanate (excluding item 39093010) 1.2 n.a. 
70200013a Quartz crucibles, solely for the manufacture of 
semiconductor boules 5 n.a.  
84159010a Indoor or outdoor units for split-system air 
conditioning machines 10 n.a. 
84159090a Other parts of air conditioning machines 1.5 n.a.  
n.a. Not applicable. 
a New lines resulted from ch anges in nomenclatures. 
Source: Information provided by the authorities. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 124 - 
 
  Table A3.2 Tariff quotas utilization ratio, 2009-13 
(%) 
 2009  2010  2011  2012 2013  
Deer velvet 99.6 99.6 99.6 99.6 99.4 
Bananas 0.0 0.0 0.0 0.0 0.0 
Fresh pears 100.0 99.9 99.6 76.3 57.9  
Liquid milk 38.9 53.5 60.5 55.7 70.7 
Peanuts 99.5 100 99.9 99.7 98.5  
Red bean 87.0 99.8 99.9 99.9 100 
Garlic bulbs 74.5 89.6 54.1 99.3 22.6 
Dried shiitake 12.6 61.0 51.3 51.3 51.4 
Dried day lily 73.1 39.6 89.1 77.1 0.0  
Young coconut 27.3 52.3 84.2 28.1 66.6 
Betel nuts 0.0 0.2 0.1 0.3 0.2  
Pineapples 8.0 5.7 6.6 7.5 11.9 
Mangoes 0.0 0.0 0.0 0.0 0.0  
Shaddocks 0.0 0.0 0.0 0.0 0.0 
Dried longans and longan pulp 100 100 100 99.0 100  
Rice 100 99.9 99.9 99.9 92.7 
Source: WTO Secretariat, based on WTO document s G/AG/N/TPKM/75, 15 March 2010; G/AG/N/TPKM/87, 
25 March 2011; G/AG/N/TPKM/94, 29 February 2012; G/AG/N/TPKM/102, 28 February 2013; and information provided by the authorities. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 125 - 
 
  Table A3.3 Products subject to import prohibition, 2013 
HS code Product 
0208.90.29.20 Meat of dogs 
0301.99.29.50 Whale shark (Rhincodon typus), live 
0302.65.00.10 Whale shark, fresh or chilled  
0302.69.99.80 Puffer fish, fresh or chilled 
0303.75.00.10 Whale shark (Rhincodon typus), frozen 
0303.79.99.30 Puffer fish, frozen  
0304.19.90.40 Whale shark (Rhincodon typus) fillets and its meat, fresh or chilled 
0304.19.90.60 Puffer fish fillets and its meat (whether or not minced), fresh or chilled  
0304.29.90.41 Whale shark, fillets or steaks, frozen 
0304.29.90.70 Puffer fish fillets and its meat (whether or not minced), frozen 
0304.99.19.10 Puffer fish, minced (surimi), frozen 
0305.30.90.30 Ball puffer fillets, dried, salted or in brine, but not smoked 
0305.59.90.30 Puffer fish, dried 
0602.90.10.10 Mushroom spawn, containing narcotics 
1207.99.20.90 Other Huo Ma Jen (Cannabis Fructus) 
1404.90.99.50 Mushroom products, containing narcotics 
1604.19.90.31 Ball puffer fish, whole or in pieces, but not minced, prepared or preserved, frozen  
1604.19.90.32 Ball puffer fish, whole or in pieces, but not minced, prepared or preserved, canned 
1604.19.90.39 Other ball puffer fish, whole or in pieces, but not minced, prepared or preserved  
1604.19.90.71 Whale shark (Rhincodon typus), whole or in pieces, but not minced, prepared or 
preserved, frozen  
1604.19.90.72 Whale shark (Rhincodon typus), whole or in pieces, but not minced, prepared or 
preserved, canned  
1604.19.90.79 Other whale shark (Rhincodon typus), whole or in pieces, but not minced, prepared or 
preserved 
2710.19.51.21 Blending oils containing 70% or more by weight of petroleum products (containing 
polychlorobiphenyls)  
2710.91.10.00 Oil, electric transformer, containing poly chlorobiphenyls, polychlorinated naphthalene 
chloronaphthalen, polychlorinated terphrnyls or hexachloro benzene, perchlorobenzene 
2710.91.20.00 Condenser oil, electric, containing polych lorobiphenyls, polychlorinated naphthalene 
chloronaphthalen, polychlorinated terphrnyls or hexachloro benzene, perchloro benzene  
2710.91.90.00 Other oil containing polychlorinated biphenyls (PCBs), polychlorinated terphenyls (PCTs) or 
polybrominated biphenyls (PBBs) 
2830.90.90.10 Trinickel disulfide 
2852.00.00.90 Other Compounds, inorganic or organi c, of mercury, excluding amalgams. 
2903.14.00.00 Carbon tetrachloride  
2903.19.10.10 Trichloroethane, Methyl Chloroform, C2H3Cl3  
2903.41.00.00 Trichlorofluoromethane 
2903.42.00.00 Dichlorodifluoromethane  
2903.43.00.00 Trichlorotrifluoroethane  
2903.44.00.00 Dichlorotetrafluoroethane and Chloropentafluoroethane 
2903.45.00.11 Chlorotrifluoromethane (CFC-13)  
2903.45.00.21 Pentachlorofluoroethane (CFC-111)  
2903.45.00.22 Tetrachlorodifluoroethane (CFC-112)  
2903.45.00.31 Heptachlorofluoropropane (CFC-211)  
2903.45.00.32 Hexachlorodifluoropropane (CFC-212)  
2903.45.00.33 Pentachlorotrifluoropropane (CFC-213)  
2903.45.00.34 Tetrachlorotetrafluoropropane (CFC-214)  
2903.45.00.35 Trichloropentafluoropropane (CFC-215) 
2903.45.00.36 Dichlorohexafluoropropane (CFC-216)  
2903.45.00.37 Chloroheptafluoropropane (CFC-217) 
2903.46.00.00 Bromochlorodifluoromethane, bromotrifluoromethane and dibromotetrafluoroethanes  
2903.49.00.31 1,2-Dibromo-3-Chloro propane (DBCP)  
2903.51.00.00 1,2,3,4,5,6-Hexachlorocyclohexane (HCH (ISO)), including lindane (ISO, INN 
2903.62.10.00 Hexachlorobenzene (ISO)  
2903.62.20.00 DDT (ISO) (clofenotane (INN), 1,1,1-trichloro-2,2-bis(p-chlorophenyl)ethane)  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 126 - 
 
  HS code Product 
2904.20.00.14 P-nitrobiphenyl  
2908.11.00.00 Pentachlorophenol (ISO)  
2908.19.10.00 Salts of pentachlorophenol (ISO)  
2908.19.90.20 2,4,5-trichlorophenol  
2909.19.90.10 Dichloromethyl ether  
2909.19.90.30 Chloromethyl methyl ether  
2921.45.00.60 2-naphthylamine (beta-naphthylamine)  
2921.45.00.71 2-naphthylamine (beta-naphthylamine) acetate 
2921.45.00.72 2-naphthylamine (beta-naphthylamine) hcl 
2921.49.00.10 4-aminobiphenyl  
2921.49.00.20 4-aminobiphenyl hcl  
2925.29.00.10 Hydroxylimine HCL  
2929.90.00.10 Alpha-bromobenzyl cyanide (benzeneacetonitrile, bromo)  
3301.90.11.00 Extracted oleoresins of opium  
3403.19.90.10 Lubricating preparations, containing poly chlorinated biphenyls, polychlorinated 
naphthalene, chloronaphthalene, polychlorina ted terphenyls or  hexachloro benzene, 
perchlorobenzene,  
3404.90.90.10 Waxes composed of polychloro-biphenyls or polychloronaphthalenes  
3813.00.00.10 Preparations and charges for fire-extinguishe rs, containing bromotrifluoromethane (halon-
1301), bromochlorodifluoromethane (halon-1211)or dibromotetrafluoroethane (halon-
2402) 
3824.90.23.10 Condenser oil not of mineral oil origin, (containing polychlorinated biphenyls, 
polychlorinated naphthalene, chloronaphthalene, polychlorinated terphenyls or hexachloro benzene, perchlorobenzene) 
3824.90.99.11 Polychlorobiphenyls  
8424.10.00.10 Fire-extinguishers, containing bromotrifluoromethane (halon-1301), 
bromochlorodifluoromethane (halon-1211)or dibromotetrafluoroethane (halon-2402)  
8548.10.10.00 Waste lead-acid accumulators and spent lead-acid accumulators 
Source: Information provided by the authorities. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 127 - 
 
  Table A3.4 Anti-dumping measures, January 2002-November 2013a 
Partner 
affected Initiation In force Withdrawn Product description 
Measures in force 
China 01 Mar 06 19 Sep 06  Towelling products 
China 13 Oct 06 16 Mar 07  Certain footwear 
China 08 Dec 09 20 May 10  Benzoyl peroxide 
China 06 Feb 10 16 Jul 10  Sodium formaldehyde sulpoxylate 
China 06 Dec 10 30 May 11  Portland cement type I, II and its 
clinker 
China 20 Feb 13 15 Aug 13  Certain cold-rolled stainless steel 
Products 
Korea 20 Feb 13 15 Aug 13  Certain cold-rolle d stainless steel 
products 
Chinab 25 Nov 13   Thermal CTP 
Measures expired/expired after extension 
Korea 01 Jan 98 14 Dec-98 14 Dec 03 Uncoated stress-relieved steel wires 
India 01 Jan 98 14 Dec 98 14 Dec 03 Uncoated stress-relieved steel wires 
Australia 01 Jan 97 21 Mar 97 14 Jun 04 H-beam 
Korea 01 Jan 98 14 Dec 98 14 Jun 04 H-beam 
Poland 01 Jan 98 14 Dec-98 14 Jun 04 H-beam 
Russian 
Federation 01 Jan 98 14 Dec 98 14 Jun 04 H-beam 
Japan 01 Jan 98 10 Dec 99 22 Mar 05 H-beam 
Korea 19 Jul 01 19 Jul 02 05 May 08 Portland cement 
Philippines 19 Jul -01 01 Jul 02 05 May 08 Portland cement 
Japan 30 Dec 98 20 Jul 00 03 Mar 11 Art paper 
Measures terminated/withdrawn 
Indonesia 19 Sep 01  24 Jan 02 Uncoated stress-relieved steel wires 
Germany 13 Jan 03  30 Apr 03 Hot-rolled stainless steel coil - black 
Italy 13 Jan 03  30 Apr 03 Hot-rolled stainless steel coil - black 
Indonesia 14 Oct 06  22 Aug 07 Unco ated printing and writing paper 
China 14 Oct 06  22 Aug 07 Uncoated printing and writing paper 
Japan 14 Oct 06  22 Aug 07 Uncoated printing and writing paper 
China 26 Mar 12  03 Jul 12 Carbon steel cold rolled steel flat 
products 
Korea 26 Mar 12  03 Jul 12 Carbon steel cold rolled steel flat 
products 
India 26 Mar 12  03 Jul 12 Hot-rolled steel plate 
Korea 26 Mar 12  03 Jul 12 Hot-rolled steel plate 
Japan 26 Mar 12  03 Jul 12 Low grade non-grain-oriented 
electrical steel 
China 03 Feb 12  11 Dec 12 Coated paper 
Finland 03-Feb 12  11 Dec 12 Coated paper 
Japan 03 Feb 12  11 Dec 12 Coated paper 
Korea 11 Dec 12  03 Jul 12 Coated paper 
a The measures listed in this table are listed by trading partner affected. b Newly opened investigation with application of provisional measures. 
Source: WTO Secretariat; and on line information. Viewed at: 
http://www.moeaitc.gov.tw/ITCWEB/webform/wfr mNews.aspx?News=1&page style=2&programid=2
50. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 128 - 
 
  Table A3.5 Products subject to export prohibition, 2013 
HS code Product 
0208.90.29.20 Meat of dogs 
0301.99.29.50 Whale shark (Rhincodon typus), live  
0302.65.00.10 Whale shark, fresh or chilled  
0303.75.00.10 Whale shark (Rhincodon typus), frozen  
0304.19.90.40 Whale shark (Rhincodon typus) fillets and its meat, fresh or chilled 
0304.29.90.41 Whale shark, fillets or steaks, frozen 
0602.90.10.10 Mushroom spawn, containing narcotics 
1211.90.60.00 Putchuck, new (Radix Saussureae)  
1211.90.91.41 Guang Fang Jee (Radix Aristolochiae Fangchi) 
1211.90.91.42 Guan Mu Tong (Caulis Aristolochiae Manshuriensis)  
1211.90.91.43 Mar Doe Ling (Fructus Aristolochiae)  
1211.90.91.44 Ten Shen Tirng (Caulis Aristolochiae)  
1404.90.99.50 Mushroom products, containing narcotics 
1604.19.90.71 Whale shark (Rhincodon typus), whole or in pieces, but not minced, prepared or 
preserved, frozen  
1604.19.90.72 Whale shark (Rhincodon typus), whole or in pieces, but not minced, prepared or 
preserved, canned 
1604.19.90.79 Other whale shark (Rhincodon typus), whole or in pieces, but not minced, prepared or 
preserved 
2505.90.00.00 Other natural sands of all kinds, whether or not coloured, other than metal-bearing sands 
of Chapter 26  
2517.10.90.00 Pebbles, gravels, broken or  crushed stone, of a kind commonly used for concrete 
aggregates, for road metalling or for railway or  other ballast, shingle and flint, whether or 
not heat-treated  
2903.51.00.00 1,2,3,4,5,6-Hexachlorocyclohexane (HCH (ISO)), including lindane (ISO, INN 
2921.45.00.60 2-naphthylamine (beta-naphthylamine) 
2921.45.00.71 2-naphthylamine (beta-naphthylamine) acetate  
2921.45.00.72 2-naphthylamine (beta-naphthylamine) hcl 
2921.49.00.10 4-aminobiphenyl  
2921.49.00.20 4-aminobiphenyl hcl  
2925.29.00.10 Hydroxylimine HCL  
8710.00.00.10 Tanks and other armoured fighting vehicles , motorized, whether or not fitted with 
weapons  
8710.00.00.20 Parts of tanks and other armoured fighting vehicles, motorized  
8906.10.00.00 Warships  
9301.11.00.00 Self-propelled, artillery weapons  
9301.19.00.00 Other artillery weapons  
9301.20.00.00 Rocket launchers; flame-throwers; grenade launchers; torpedo tubes and similar 
projectors  
9301.90.00.00 Other military weapons  
9705.00.00.20 Collections and collectors' pieces of weapon  
9705.00.00.90 Other collections and collectors pieces of zoological, botanica l, mineralogical, anatomical, 
historical, archaeological, palaeontological , ethnographic or numismatic interest  
9706.00.00.90 Other antiques of an age exceeding one hundred years 
Source: Information provided by the authorities. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 129 - 
 
  Table A3.6 Products subject to export licensing, 2013 
HS code Product 
2903.14.00.00 Carbon tetrachloride  
2903.19.10.10 1,1,1-Trichloroethane, Meth yl Chloroform, C2H3Cl3  
2903.41.00.00 Trichlorofluoromethane  
2903.42.00.00 Dichlorodifluoromethane  
2903.43.00.00 Trichlorotrifluoroethane  
2903.44.00.00 Dichlorotetrafluoroethane and Chloropentafluoroethane 
2903.45.00.11 Chlorotrifluoromethane (CFC-13) 
2903.45.00.21 Pentachlorofluoroethane (CFC-111) 
2903.45.00.22 Tetrachlorodifluoroethane (CFC-112)  
2903.45.00.31 Heptachlorofluoropropane (CFC-211) 
2903.45.00.32 Hexachlorodifluoropropane (CFC-212)  
2903.45.00.33 Pentachlorotrifluoropropane (CFC-213) 
2903.45.00.34 Tetrachlorotetrafluoropropane (CFC-214) 
2903.45.00.35 Trichloropentafluoropropane (CFC-215)  
2903.45.00.36 Dichlorohexafluoropropane (CFC-216)  
2903.45.00.37 Chloroheptafluoropropane (CFC-217) 
2903.46.00.00 Bromochlorodifluoromethane, bromotrifluoromethane and dibromotetrafluoroethanes  
7102.10.00.00 Diamond, unsorted 
7102.21.00.00 Industrial diamonds, unworked or simply sawn, cleaved or bruted 
7102.31.00.00 Non-industrial diamonds, unworked or  simply sawn, cleaved or bruted 
8486.10.00.20 Grinding, polishing and lapping machin es for processing of semiconductor wafers 
8486.20.00.11 Chemical vapour deposi tion apparatus for semiconductor production  
8486.20.00.12 Physical deposition apparatus for semiconductor production 
8486.20.00.31 Machine-tools for dry-etching patterns on semiconductor materials 
8486.20.00.32 Spraying appliances for etching, stripping or cleaning semiconductor wafers 
8486.20.00.33 Apparatus for wet etching, developing, stri pping or cleaning semiconductor wafers 
8486.20.00.40 Epitaxial deposition machines for semiconductor wafers  
8486.20.00.50 Ion implanters for doping semiconductor materials  
8486.20.00.61 Step and repeat aligners for semiconductor wafers  
8486.20.00.62 Scanning aligners for semiconductor wafers  
8486.20.00.63 Electron beam direct writers to produce patterns on semiconductor wafer  
8486.20.00.71 Spin dryers for semiconductor wafer processing  
8486.20.00.72 Spinners for coating photographic emulsions on semiconductor wafers  
8486.20.00.73 Photo-resist coaters for semiconductor wafers  
8486.20.00.80 Apparatus for rapid heating of oxidation, diffusion, annealing of semiconductor wafers 
9031.41.10.10 Photomicrographic microscopes fitted with equi pment specifically designed for the handling 
and transport of semiconduc tor wafers or reticles 
9031.80.00.20 Electron beam microscopes fitted with equipmen t specifically designed for the handling and 
transport of semiconductor wafers or reticles  
Source: Information provided by the authorities. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 130 - 
 
  Table A4.1 Special safeguard measures, 2009-13  
 Description of product Volume-based SSGsa Price-based SSGsa 
   Cases Quantity affected (KG) 
2009 Peanuts 27 Nov - 31 Dec  Not taken 
 Other liquid milk 3 Aug -31 Dec  Not taken  
 Pork offal 12 Nov - 31 Dec  Not taken  
 Dried shiitake 28 Oct - 31 Dec   Not taken  
 Shaddock 10 Feb - 31 Dec  Not taken  
 Dried day lilies 23 Nov - 31 Dec  Not taken  
 Pork belly 23 Dec - 31 Dec 4 15,904 
2010 Chicken legs and wings 10 July - 31 Dec 1 496 
 Fresh milk 28 July - 31 Dec  Not taken  
 Other liquid milk 29 Oct - 31 Dec  Not taken  
 Pork offal 20 Dec - 31 Dec  Not taken  
 Dried shiitake 24 Feb - 31 Dec  Not taken  
 Pork belly 3 Sept - 31 Dec 17 10,048.60 
 Rice  31 Decb   Not taken  
2011 Dried shiitake 28 Jan - 31 Dec  Not taken  
 Fresh milk 4 July - 31 Dec  Not taken  
 Chicken legs and wings 3 Aug - 31 Dec  Not taken  
 Other chicken cuts 2 Sept - 31 Dec 1 51 
 Pork belly 13 Sept - 31 Dec 10 12,348.9 
 Other liquid milk 25 Oct - 31 Dec  Not taken  
2012 Dried shiitake 22 March - 31 Dec  Not taken  
 Betel nuts 9 Apr - 31 Dec  Not taken  
 Chicken legs and wings 19 Sept - 31 Dec  Not taken  
 Fresh milk 26 Sept - 31 Dec  Not taken  
 Other liquid milk 27 Nov - 31 Dec  Not taken  
 Dried day lilies 17 Dec - 31 Dec  Not taken  
 Livestock offal 28 Aug - 31 Dec  Not taken  
2013 Rice Not taken 24 1,500 
 Peanuts Not taken 41 3,874 
 Pork belly Not taken 22 213,905.3 
 Other liquid milk Not taken 31 7,912.5 
 Betel nuts 26 Apr - 31 Dec  Not taken 
 Other chicken cuts Not taken 11 27,591 
 Poultry offal 12 Aug - 31 Dec  Not taken  
 Fresh milk 27 Sept - 31 Dec  Not taken  
 Chicken legs and wings 8 Nov - 31 Dec 17 686,276.1 
 Red beans Not taken 2 40.5 
 Dried shiitake 31 Dec  Not taken 
a If both the volume-based and price-based SSGs are applicable on an import  consignment, only one 
of them will be applied. 
b The volume based SSG on rice was applied on  31 December 2010, when the accumulated import 
volume of rice reached the trigger level. 
 Source: WTO documents G/AG/N/TPKM/74, 25 February 2010; G/AG/N/TPKM/86, 21 March 2011; 
G/AG/N/TPKM/95, 13 March 2012; G/AG/N/TPKM/104, 23 May 2013; G/AG/N/TPKM/97, 9 October 2012; G/AG/N/TPKM/103, 17 May 2013; G/AG/N/TPKM/107, 14 October 2013; G/AG/N/TPKM/108, 22 October 2013; G/AG/N/TPKM/109, 3 December 2013, G/AG/N/TPKM/111/Corr.1, 27 February 2014; and information provided by the COA. WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 131 - 
 
  Table A4.2 Trigger price of price-based SSGs, 2014 
Description of product Tariff number Trigger price 
(NT$/kg) 
Peanuts In shell 12023010, 12024100, 20081111, 20081191 11.8 
 Shelled, flours, and meals 12023020, 12024200, 12089011, 12089021, 
20081112, 20081192, 20081942 18.1 
 oil 15081000, 15089000 25.9 
Pears 08083090 54 
Garlic 07032010, 07032090, 07129040 9.7 
Betel nuts 08028000 50 
Chicken legs and wings 02071311, 02071411, 02109912, 16023210 30 
Other chicken cuts 02071100, 02071200, 02071319, 02071419, 
02109919, 16023220 42 
Liquid milk (NT$/l) 04011010, 04012010, 04014010, 04015010, 
04029910, 04011020, 04012020, 04014020, 
04015020, 04029920, 04029992, 04039029, 04039040, 04039059, 04039090, 18069053, 
18069055, 19019025, 19019027 17 
Red beans 07102910, 07133200, 11061010, 20049010, 
20055110, 20055910, 20060011, 20060025 14.4 
Dried shiitake 07123920 302.15 
Shaddock 08054020 10.4 
Persimmons 08107000 23.4 
Dry day lilies 07129050 13.7 
Pork belly 02031911, 02031991, 02032911, 02032991 30 
Rice In the husk 10061000 6 
 Husked 10062000 7 
 Polished, glutinous, semi-
milled or wholly milled 10063000, 10064000 8 
 Flour, meal, starch, other 
worked 11029011, 11029019, 11031930, 11032010, 
11041910, 11042920, 11081910 9 
Note: In principal, trigger prices equal the average 1990 to 1992 c.i.f. import prices of the product. Trigger 
prices of some products, which were not imported during the base period, are based on the c.i.f. 
prices of those products in neighbouring countries. 
Source: Information provided by the COA.  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu 
 
- 132 - 
 
  Table A4.3 Electricity prod uced and purchased, 2012-13 
Item Electricity 
produced & 
purchased (GWh) Share of 
total (%) Growth rate 
(%) 
Year 2012  2013  2012  2013 2012 2013  
P.S. Hydro 2,889 3,174 1.4 1.5 -5.2 8.6 
Thermal TPC 115,272 115,637 54.1 54.2 4.1 -2.1 
IPPs 39,558 37,522 18.6 17.6 1.8 0.5 
Cogeneration 9,255 9,698 4.3 4.5 -2.6 34.5 
Subtotal 164,085 162,857 77 76.3 3.1 0.1 
Nuclear 40,522 40,079 19 18.8 1.2 3.1 
Renewable 
energy Conventional 
hydro TPC 3,995 4,539 1.5 2.1 -9.9 -3.2 
IPPs 113 150 0.1 0.1 -2.3 -4.5 
Hydro entrusted 
to TPC 768 712 0.4 0.3 23.8 -11.4 
Wind power TPC 803 748 0.4 0.4 55.9 1.5 
IPPs 730 869 0.3 0.4 44.0 15.4 
Solar energy TPC 9 17 0.0 0.0 123.7 30.8 
IPPs 29 284 0.0 0.1 1,133 127.2 
Subtotal  5,546 7,319 2.6 3.4 6.7 0.6 
Total  213,042 213,429 100 100 2.7 0.8 
Source: TPC online info rmation. Viewed at: http://www.taipower.com.tw/e_content/content/mma/mma01-
1.aspx?sid=3  [19/11/13]; and information provided  by the Bureau of Energy, MOEA. 
  
  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu  
 
- 133 - Table A4.4 Summarized trade re gimes of transport services 
Subsectors GATS FTAs ECA with NZ Applied regime 
11.A. 
International maritime 
transport Not explicitly covered by 
GATS FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua : 
Foreign investment  restrictions: 
 - zero% for unlimited companies;  
 - ½ of the equity for a limited company or a 
company limited by shares. 
The representative director of the limited 
company must be a national of Chinese Taipei. 
The chairman and at least ½ of the board of 
directors must be its nationals  
 
FTA with Panama : same except the 
chairman/representative director and at least 
2/3 of the board of directors must be its 
nationals  
 Maritime transportation services and the 
operation of "vessels of Chinese Taipei": 
Cross-border trade in se rvices and investment: 
1. To transport passeng ers and cargos, foreign 
vessel carriers must: 
- set up a branch company and obtain the 
approval from competent authorities; 
- authorize a local shipping agency to handle the 
passenger or cargo transporting affairs on their 
behalf. 
2. People seeking to engage in maritime 
transport as a vessel carrier must own at least 
one of the Chinese Taipei vessels. 
3. To register as "vessels of Chinese Taipei": 
- the ship must be owned by its authorities; 
- the ship must be owned by its citizens; 
- the ship must be owned by companies 
incorporated under its laws, with principal offices 
situated within Chinese Taipeia; 
- the ship must be owned by a juridical person 
established under its laws, with its main office 
situated within Chinese Taipei and at least 2/3 of the members and the statutory representatives 
must be its citizens. 
4. Ship owners or operators must employ eligible 
local seafarers in the first priority. The employment of foreig n seafarers must be 
approved by the competent authority and the 
approval is subject to economic needs tests Shipping Law, 
Law of Ships, Seafarer Act, Guidelines of 
Permission and 
Administration for Employing 
Foreign Seafarers 
 
Overall regime 
identical to that 
provided in the ECA with NZ, via the obligations contained in Chapters 12 and 13 of this 
agreement 
  
  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu  
 
- 134 - Subsectors GATS FTAs ECA with NZ Applied regime 
11.A.(f) 
Supporting 
services for 
maritime 
transport  Not explicitly covered by 
GATS FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua/Panama : 
No restrictions  No restrictions Shipping Law, 
Law of Ships  
11.B. Internal 
waterway transport, cabotage, and 
pilotage Not explicitly covered by 
GATS FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua/Panama :  
 
Foreign investment  restrictions: 
 - zero% for unlimited companies; 
 - 1/3 of the equity for a limited company or a 
company limited by shares 
The representative director/chairman and at 
least 2/3 of the board of directors must be 
nationals of Chinese Taipei 
Cross-border trade in services: 
 - any non-local vessel may not navigate 
between the ports to transport passengers and 
cargos unless a franchise is granted; 
 - no person may be registered as a pilot if he 
loses his nationality of Chinese Taipei; 
 - unless otherwise specially approved by the 
government or for s eeking shelter, any 
non-local flag ship may not stay in any harbour or port other than those announced by the 
government as in ternational port Cross-border trade in se rvices and investment: 
- foreign vessels may not navigate between ports 
to transport passengers or cargos unless an 
approval is granted by the competent authority 
on an annual basis 
 - docking at ports other than the designated 
international ports is not permitted for foreign 
vessels unless seeking shelter or approved by the 
competent authority  
 Shipping Law, 
Law of Ships, 
Pilotage Law 
 
Overall regime 
identical to that 
provided in the 
ECA with NZ, via the obligations contained in Chapters 12 and 13 of this 
agreement  
11.C. Air 
transport 
services: 
(a) Maintenance 
and repair of 
aircraft, 
(b) Selling and 
marketing of air 
transport 
services,  
(c) Computer 
reservation 
system (a) Maintenance and 
repair of aircraft: (1) 
unbound; (2) none; (3) 
none; (4) unbound 
except as indicated in 
the horizontal section 
 
(b) Selling and 
marketing of air 
transport services: (1) 
none; (2) none; (3) 
none; (4) unbound 
except as indicated in 
the horizontal section 
 
 FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua/Panama : 
No restrictions No restrictions Civil Aviation Act, 
Regulations 
Governing 
General Aviation 
 
Overall regime 
identical to the 
FTAs and ECA, 
i.e., no 
restrictions   
  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu  
 
- 135 - Subsectors GATS FTAs ECA with NZ Applied regime 
(c) Computer reservation 
system: (1) none; (2) 
none; (3) none; (4) 
unbound except as 
indicated in the 
horizontal section 
Airport ground 
handling 
servicesb, 
catering services Not explicitly covered by 
GATS FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua/Panama: 
Foreign investment in an airport ground 
handling services or a catering service 
company:  
 - zero% for unlimited companies;  
 - ½ of the equity for a limited company or a 
company limited by shares. 
The representative director/chairman and at 
least ½ of the board of directors of a limited 
company or a company limited by shares must 
be Chinese Taipei nationals 
 Foreign investment in ground handling or 
catering services  must meet the following 
requirements: 
- unlimited company with the entire body of its 
shareholders being citizens of Chinese Taipei; 
- limited company with over 50% of capital 
owned by citizens or juridical persons of 
Chinese Taipei and repres ented by directors who 
are its citizens  
- company formed by shareholders of both 
limited and unlimited liabilities, whose unlimited 
liability shareholders are its citizens  
- company limited by shares with over 50% of its 
total shares owned by its citizens or juridical persons, whose chairman and over 50% of the directors are its citizens; and no single foreign citizen or juridical person may hold more than 
25% of its total shares 
 
Cross-border trade: Chin ese Taipei reserves the 
right to adopt or maintain any measure as part of 
the act of devolving baggage handling and hangar services that is provided by the government-owned airport at the time this Agreement enters into force.  A local responsible agent may be required for baggage handling 
services Civil Aviation Act, 
  
Overall regime 
identical to that 
provided in the 
ECA with NZ, via the obligations contained in Chapters 12 and 13 of this 
agreement  
  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu  
 
- 136 - Subsectors GATS FTAs ECA with NZ Applied regime 
Airfield 
management and 
operationb Not explicitly covered by 
GATS FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua/Panama :   
Foreign investment: 
 - zero% for unlimited companies;  
 - 1/3 of the equity for a limited company or a 
company limited by sharesc 
The representative director/chairman and at 
least 2/3 of the board of directors of a limited 
company or a company limited by shares must 
be nationals of Chinese Taipei; and the 
managers and operators of  the airfield must be 
its nationals  
 Foreign investment must  meet the following 
requirements: 
- unlimited company completely owned by 
Chinese Taipei citizens; 
- limited company with over 50%c of capital 
owned by its citizens or juridical persons and 
represented by director s who are its citizens; 
- company formed by shareholders of both 
limited and unlimited liabilities, whose unlimited 
liability shareholders must be its citizens; 
- company limited by shares with over 50% of its 
total shares owned by its citizens or juridical 
persons, whose chairman and over 50% of the 
directors are its citizens; and no single foreign 
citizen or juridical person may hold more than 
25% of its total shares; 
- other juridical persons whose representatives 
are its citizens  Civil Aviation Act 
 
Overall regime 
identical to that 
provided in the 
ECA with NZ, via 
the obligations 
contained in 
Chapter 12 of this 
agreement  
Airport operation 
and 
managementb Not explicitly covered by 
GATS FTAs with El Salvador and 
Honduras/Nicaragua : Investment and cross 
border trade in services:  
Only state, county, and city governments are 
allowed to establish and operate airports, 
including the air traffic control services 
 
FTAs with Guatemala/Panama :  airport 
operation and management, including terminal 
and air traffic control services, are reserved to 
the state Foreign investment in a private airport terminal 
company subject to:  
- company limited by shares with over 50% of its 
shares owned by citizens or juridical persons of 
Chinese Taipei, whose chairman and over 50% of 
the directors are its citizens;  
- and no single foreigner or juridical person may 
hold more than 25% of its total shares.  Civil Aviation Act 
 
Overall regime 
identical to that 
provided in the 
ECA with NZ, via the obligations contained in Chapter 12 of this 
agreement 
Air transport 
auxiliary services Not explicitly covered by 
GATS FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua/Panama : 
The aircraft pilot and other aeronautical 
technical personnel must be Chinese Taipei 
nationals, unless exclusively permitted by the 
Ministry of Transportation and Communication 
in accordance with relevant re gulations 
 Foreign natural persons may only be employed as 
aircraft pilot, flight engineer, mechanic, 
repairman, and aircraft dispatcher with the 
approval of the MOTC 
 Civil Aviation Act 
 
Overall regime 
identical to that 
provided in the 
ECA with NZ, via 
the obligations 
contained in 
Chapter 13 of this 
agreement 
  
  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu  
 
- 137 - Subsectors GATS FTAs ECA with NZ Applied regime 
General aviation 
services: 
business engaging in aerial tourism, survey, photographing, fire-fighting and searching, paramedic, hauling and lifting, spraying and dusting, and those authorized and other than air transport of passengers, cargo and mail flight operations 
for compensation 
or hire 
 Not explicitly covered by 
GATS FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua/Panama : 
Foreign investment in a civil air transport 
enterprise or a specialty air service company:  
 - zero% for unlimited companies;   - 1/3 of the equity for a limited company or a 
company limited by shares
c 
The representative director/chairman and at 
least 2/3 of the board of directors of a limited 
company or a company limited by shares must 
be Chinese Taipei nationals 
 
Cross-border trade in services: 
only its aircraft are allowed to provide general 
domestic aviation services 
 Cross-border trade: provision of specialty air 
services other than serv ices supplied by general 
aviation enterprises is prohibited in 
Chinese Taipei.  
General aviation enterpri ses must be established 
in Chinese Taipei, subject to approval by the 
MOTC. 
Foreign investment in civil air transport 
enterprise and general aviation enterprise must 
meet the following requirements: 
- unlimited company with the entire body of its 
shareholders being citizens of Chinese Taipei; 
- limited company with over 50%c of capital 
owned by its citizens or juridical persons and 
represented by directors who are its citizens  
- company formed by shareholders of both 
limited and unlimited liabilities, whose unlimited 
liability shareholders  are its citizens. 
- company limited by shares with over 50% of its 
total shares owned by its citizens of juridical 
persons, whose chairman and over 50% of the directors are its citizens; and no single foreign citizen or juridical person may hold more than 
25% of its total shares Civil Aviation Act, 
Regulations 
Governing 
General Aviation 
 
Overall regime 
identical to that 
provided in the ECA with NZ, via the obligations contained in Chapters 12 and 13 of this 
agreement  
Road transport 
(11F) (a) Passenger 
transportation: (1) 
unbound; (2) none; (3) 
none; (4) unbound 
except as indicated in 
the horizontal section. 
(b) Freight 
transportation (limited to 
ordinary trucking 
services and container 
trucking services), 
excluding regular route 
trucking services as 
currently defined in the 
Highway Law: (1) 
unbound; (2) none; (3) 
none; (4) unbound 
except as indicated in FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua : 
Foreign investment restrictions:  
foreigners or unincorpor ated legal entities may 
not invest in automobile transportation 
providers within the boundaries of 
Chinese Taipei, but those approved by the 
central highway authority may apply to invest 
in car rental transportation services and freight 
transportation servicesd 
 
FTA with Panama : 
foreigners or unincorpor ated legal entities may 
not invest in automobile transportation 
providers within the boundaries of 
Chinese Taipei, but those approved by the 
central highway authority may apply to invest Foreigners may not invest in the business of bus 
transportation, urban bus transportation, tour 
bus transportation, and taxicab transportation in 
Chinese Taipei 
 Highway Law 
 
Overall similar to 
the provisions 
contained in the 
FTAs  
  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu  
 
- 138 - Subsectors GATS FTAs ECA with NZ Applied regime 
the horizontal section. 
(d) Maintenance and 
repair of road transport 
equipment: (1) none; 
(2) none; (3) none; (4) 
unbound except as 
indicated in the 
horizontal section in car rental transportation services, general 
carrier transportation services, and container 
car transportation servicesd 
Rail transport 
services: (a) Passenger transport: 
(1) unbound; (2) none; (3) none; (4) unbound except as indicated in 
the horizontal section. 
(b) Freight transport: (1) 
unbound; (2) none; (3) 
none; (4) unbound except as indicated in 
the horizontal section. 
(c) Maintenance and 
repair of rail transport equipment: (1) none; (2) none; (3) none; (4) unbound except as indicated in the 
horizontal section FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua/Panama : 
No restriction 
 Foreigners may not invest in railway in 
Chinese Taipei 
 Railway Law: In 
principle, railways must be state owned and managed. The construction, extension, transfer, or management of local, private, and 
special railways, 
must be ratified by the Ministry of Transportation and Communications 
(MOTC) 
Overall regime 
identical to the 
ECA with NZ 
H. Services 
auxiliary to all 
modes of 
transport (a) Cargo handling 
services: (1) unbound; 
(2) none; (3) none; (4) 
unbound except as 
indicated in the 
horizontal section. 
(b) Storage and 
warehousing services: 
(1) unbound; (2) none; 
(3) none; (4) unbound 
except as indicated in 
the horizontal section. 
(c) Freight transport 
agency services: (1) 
none; (2) none; FTAs with El Salvador and 
Honduras/Guatemala/Nicaragua/Panama : 
No restriction No restriction 
   
  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu  
 
- 139 - Subsectors GATS FTAs ECA with NZ Applied regime 
(3) none; (4) unbound 
except as indicated in 
the horizontal section. 
(d) Other supporting and 
auxiliary transport 
services (excluding local 
pick-up and delivery): 
(1) none; (2) none; (3) 
none; (4) unbound 
except as indicated in 
the horizontal section 
 
a The authorities state that, 100% foreign-owned companies, incorp orated in Chinese Taipei, with principal offices there, are n ot allowed to fly Chinese Taipei 
flag. 
b According to the authorities, "airport gr ound handling services", "airfield manageme nt and operation services", and "airport operation and management" 
services are different. In accord ance with the Civil Aviation Act: 
 - “airport ground handling services” means a service that invo lves towing and guiding aircraft on the ramp, loading and unload ing of baggage, cargo 
 and meals, cleaning the aircra ft cabin, operating the air bri dge, and other associated tasks; 
 - “airfield” means any land or water that  is used for take-off, landing and surface movement by the aircraft, which must be es tablished and managed 
 after the approval of the Ministry of Transportation and Comm unications through Civil Aeronaut ics Administration. Currently, o nly central or local 
 governments, its citizens or legal persons specified in Article 10 of the Civil Aviation Act may apply to establish an airfiel d and offer airfield operations and 
 management services; 
 - “airport terminal” means an area of land that is used fo r the landing and take-off of aircraft, including its buildings and facilities to load/unload 
 passengers/goods, which must be planned, established and managed after approval by th e Ministry of Transportation and Communic ations through 
 Civil Aeronautics Administrati on. Currently, all airports are State-owned or State-operated. 
c According to the authorities, the foreign equity restrictions under the FTAs are mo re liberalized: instead of 1/3, foreign in vestment may not reach more than 
½ of the equity for a limited company or a company limited by shares.  
d In accordance with the Highway Law,   - "automobile transportation" services in clude passenger transportation, freight tran sportation, and vehicle rental transporta tion. 
 - "passenger transportation" includes bus transportation, urba n bus transportation, tour bus transportation, and taxi cab tran sportation. 
 - "freight transportation" includes carrier transportation, li ne carrier transportation, and co ntainer carrier transportation.  
 - "vehicle rental business" includes car rental business and pickup truck rental business.   Source: WTO Secretariat, WTO document GATS/SC/136/Rev.1, 2 July 2002; FTAs with El Salvador and Honduras, Guatemala, Nicaragua,  and Panama; and ECA with 
New Zealand; and information provided by the authorities.  
  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu  
 
- 140 - Table A4.5 Summarized trade regime s of other selected services 
Subsectors GATS FTAs (with El Salvador and 
Honduras/Guatemala/Nicaragua/ 
Panama) ECA with NZ Applied regime 
3. Construction and 
related engineering 
services (511 - 518) (1) unbound 
(2) none (3) none 
(4) unbound except as indicated in 
the horizontal section No restriction No restriction 
 Construction Industry Act  
4. Distribution 
services 
A. commission 
agents' services 
(621) (1) none 
(2) none 
(3) none 
(4) unbound except as indicated in 
the horizontal section No restriction 
 No restriction 
  
B. wholesale trade 
services (excluding 
firearms and military 
equipment) (622) 
C. retailing services 
(631, 632, 6111, 
6113, 6121) (excluding firearms and military 
equipment) 
D. franchising (8929) (1) none 
(2) none 
(3) none 
(4) unbound except as indicated in 
the horizontal section No restriction 
 No restriction 
 
Retail Market Management 
Regulation 
 
5. Education services  
Student placement 
services for overseas 
studies related for 
education services as 
described in CPC 
9222, 9223, 9224, 
923, 924, and 929 (1) none 
(2) none 
(3) none 
(4) unbound except as indicated in 
the horizontal section No restriction 
 No restriction 
 Private School Law 
Supplementary and Continuing 
Education Law 
 
Primary and 
secondary education (921, 922) Not explicitly covered by GATS Foreign investment is not allowed in 
primary and junior high schools  Foreign national schools: 
primary and secondary schools established by foreigners must not enrol students without foreign citizenship  Note: Foreign national primary and secondary Private School Law: 
primary schools and junior high schools, un der the current 
compulsory educ ation policy, 
must be free and foreign investment is not allowed    
  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu  
 
- 141 - Subsectors GATS FTAs (with El Salvador and 
Honduras/Guatemala/Nicaragua/ 
Panama) ECA with NZ Applied regime 
schools established by New 
Zealand investors may be for 
profit No more than two New Zealand for-profit schools can be permitted in Chinese Taipei   Local schools: New Zealand persons may not participate in primary or secondary schools, other than through financial contribution to an existing school board or in the establishment of a not-for-profit corporation in partnership / joint venture with local financial contributors in accordance with relevant laws and regulations  
Education services 
(9222, 9223, 9224, 
923, 924, 929) (1) none 
(2) none 
(3) none, except (a) the 
principal/president and chairman of 
the board must be national of 
Chinese Taipei; (b) the number of 
foreigners as director may not 
exceed one third of the board and 
may not exceed five directors 
(4) unbound except as indicated in 
the horizontal section  Adult and Other Education: 
foreign persons may not 
serve as a local manager for 
institutions providing adult 
education and/or other 
education services 
 Private School Law 
Supplementary and Continuing 
Education Law 
 
6. Environmental services A. sewage services (9401); refuse disposal services (9402); other (9404, 9405, 9409) (1) unbound 
(2) none (3) none (4) unbound except as indicated in the horizontal section No restriction No restrict ion Basic Environment Act  
  WT/TPR/S/302/Rev.1 • Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu  
 
- 142 - Subsectors GATS FTAs (with El Salvador and 
Honduras/Guatemala/Nicaragua/ 
Panama) ECA with NZ Applied regime 
6. Environmental 
services 
sanitation and similar 
services (9403);  (1) unbound 
(2) none 
(3) none 
(4) unbound except as indicated in 
the horizontal section No restriction No restriction Basic Environment Act  
6. B. consulting 
services incidental to nature and landscape 
protection (9406) (1) none 
(2) none (3) none (4) unbound except as indicated in 
the horizontal section No restriction No restrict ion Basic Environment Act 
 
Source: WTO Secretariat, WTO document GATS/SC/136/Rev.1 (2 July 2002), FTAs with El Salvador, Hond uras, Guatemala, Nicaragua, a nd Panama; and ECA with 
New Zealand; and information provided by the authorities. 
 
 
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