G/SCM/Q2/TPKM/19  
 
26 March 2014  
(14-1899)  Page: 1/2  
Committee on Subsidies and Countervailing Measures  Original: English  
 
 SUBSIDIES 
REPLIES TO QUESTIONS FROM MEXICO1 REGARDING THE NEW AND FULL NOTIFICATION OF THE 
SEPARATE CUSTOMS TERRITORY OF TAIWAN, PENGHU, KINMEN AND MATSU2 
The following communication, dated 24 March 2014, is being circulated at the request of the 
delegation of the Separate Customs Territo ry of Taiwan, Penghu, Kinmen and Matsu. 
 
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  Question 1 
 
With regard to the "Medium- and long-term loans for product marketing and loans for overseas investment and construction projects ", Chinese Taipei is requested to provide 
further details on the implementation of this programme, including: 
a. The proportion of programme funds used for "product marketing" and 
"overseas investment and construction projects"; 
b. The criteria that enterprises must m eet in order to receive the loans for 
"product marketing" and "overseas inve stment and construction projects"; 
c. The factors to be considered when determining the duration of the loans 
(medium- or long-term) and the contro l mechanisms established to monitor 
use of the funds provided by these loans. 
Reply 
 
1. Recently, we have focused on providing support in the form of loans for product marketing. 
No businesses to date have been provided with support for overseas investment or construction projects. 
 
2. Firms meeting one of the following criteria may apply for a loan:  
(1) An SME as defined by Standards for Identifying Small and Medium-sized Enterprises. 
 
(2) A client eligible for a credit guarantee from the Small and Medium Sized Enterprise 
Credit Guarantee Fund of Taiwan (Taiwan SMEG). 
 
Qualifying uses of loans include turnkey services  exports, and exports of machinery and related 
materials. 
 
3. The criteria are set by the banks supporting  the SMEG programme. They evaluate a firm’s 
financial situation, the risks associated with its export markets, and other related factors. Supported firms must repay the loan plus interest on time. The loan must be used for its originally 
stated purpose. If the firm violates the terms agre ed upon by both parties, the bank has the right 
to withdraw funding. 
                                               
1 G/SCM/Q2/TPKM/18.  
2 G/SCM/N/253/TPKM. G/SCM/Q2/TPKM/19 
 
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  Question 2 
 Concerning the "Duty and tax exemptions for in-zone enterprises" specified on page 18, 
Chinese Taipei is requested to elaborate on: 
a. The type of zones to which these exem ptions apply and the number of zones 
which benefit from the measure; 
b. The main type of economic activity in these zones. 
Reply 
 
1. Industries permitted in the zones:  
(1) Computer, electronic and optical products manufacturing. 
(2) Electrical and equipment manufacturing. 
(3) Electrical parts and components manufacturing. 
(4) Fabricated metal products manufacturing. 
(5) Machinery and equipment manufacturing. 
(6) Chemical materials and products manufacturing. 
(7) Textile, apparel and clothing accessories manufacturing.  
(8) Food and beverage manufacturing. 
(9) Motor vehicle and parts manufacturing. 
(10)  Other transport equipment manufacturing.  
(11)  Other manufacturing. 
(12)  Repair and installation of indu strial machinery and equipment. 
(13)  Electricity and gas supplies. 
(14)  Transportation, warehousing and storage. 
(15)  Information and communications. 
(16)  Financial and insurance services. 
(17)  International trade services. 
(18)  Head office and management consultancy services. 
(19)  Linked industrial services. 
(20)  Other approved high-tech, capital-intensive, high quality or high value-added businesses. 
 
There are currently 568 enterprises operating in the zones.  
2. Main economic activities carried out by the in-zone enterprises:  
 Economic activities include manufacturing, IT serv ices, linked industrial services, transportation, 
warehousing and storage services, international trade services, etc. 
 The range of industries in the zones includes semiconductor packaging and testing, optoelectronic and linked industries, optics, precision tools and parts, solar photovoltaic, water refining, digital 
content, software, R&D, design, etc. 
  
 
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