WORLD TRADE  
ORGANIZATION  G/SCM/N/186/TPKM 
7 July 2009 
 (09-3320) 
Committee on Subsidies and 
Countervailing Measures Original:   English 
 
 
 
SUBSIDIES 
 
New and Full Notification Pursuant to Article XVI:1 of the  
GATT 1994 and Article 25 of the Agreement on  
Subsidies and Countervailing Measures  
 
THE SEPARATE CUSTOMS TERRITORY OF TAIWAN,  
PENGHU, KINMEN AND MATSU 
 
 
 The following notification, dated 1 July 2009, is being circulated at the request of the Delegation of the Separate Customs Territory  of Taiwan, Penghu, Kinmen And Matsu.   
 
_______________ 
 G/SCM/N/186/TPKM 
Page 2  
 
  TABLE OF CONTENTS 
 
   Page
 
I. AGRICULTURE.................................................................................................................... ...4 
A. SUPPORT FOR RICE......................................................................................................................4  
B. SUPPORT FOR SORGHUM AND FEED CORN .................................................................................5  
C. MEASURES FOR SWEET POTATOES , ADZUKI BEANS , MUNG BEANS , AND OTHER 
MISCELLANEOUS CROPS .............................................................................................................6  
D. SUPPORT FOR TOBACCO LEA VES ................................................................................................7  
E. SUPPORT FOR SUGAR ..................................................................................................................8  
F. INTEREST SUBSIDY ......................................................................................................................9  
II. FISHERIES ...................................................................................................................... .......11  
A. FISHING VESSELS BUY-BACK PROGRAMME .............................................................................11  
B. REWARD FOR CLOSING FISHERY SEASON ................................................................................13  
C. EXTENSION OF RE-USE OF POND WATER USED IN AQUACULTURE ..........................................14  
D. FISHING VESSELS MARINE INSURANCE REWARD .....................................................................15  
E. FISHING VESSELS REDUCTION PROGRAMME ............................................................................16  
III. INDUSTRY....................................................................................................................... .......17  
A. TAX CREDITS OR TAX EXEMPTIONS FOR DESIGNATED ENTERPRISES ......................................17  
1. Five-year tax exemption for the emerging , important and strategic industries................17  
2. Tax credit for investment in a disadvantaged region ..........................................................18  
B. LOANS - LOANS FOR SMALL AND MEDIUM -SIZED ENTERPRISES (SME S)...............................20  
1. Specific and urgent financing and loans intended for working capital needed 
during periods of economic crisis and recession, and for recovery plans from 
damage caused by majo r natural disasters...........................................................................20  
2. Medium- and long-term loans for pro duct marketing and loans for overseas 
investment and construction projects ...................................................................................22  
C. LOANS FOR PRIVATE ENTERPRISES ..........................................................................................23  
1. Loans for small and medium-sized ent erprises and private enterprises ...........................23  
D. DUTY AND TAX EXEMPTIONS GRANTED TO ENTERPRISES LOCATED WITHIN A 
DESIGNATED ZONE...................................................................................................................24  
1. Duty and tax exemptions for high-technology industries....................................................24  
2. Duty and tax exemptions for in-zone enterprises.................................................................26  
E. SUBSIDIES FOR THE ESTABLISHMENT AND OPERATION OF PETROLEUM FACILITIES 
IN MOUNTAIN AND OFFSHORE AREAS .....................................................................................28  
IV. RESEARCH AND DEVELOPMENT ..................................................................................29  
A. FUNDS GRANTED FOR DEVELOPMENT OF PRODUCTS OF THE NEW LEADING 
INDUSTRIES ............................................................................................................................... 29  G/SCM/N/186/TPKM 
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  B. FUNDS GRANTED FOR PROMOTING DEVELOPMENT OF INDUSTRIAL TECHNOLOGY ...............31  
C. FUND GRANTED FOR ENCOURAGING EXPLORATION AND DEVELOPMENT OF OIL 
AND NATURAL GAS RESERVES ................................................................................................33  
 G/SCM/N/186/TPKM 
Page 4  
 
  I. AGRICULTURE 
A. S
UPPORT FOR RICE 
1. Title of the programme  
 
 Support for rice.   
 
2. Period covered by the notification  
  2005-2007.   
 
3. Policy objective and/or purpose
 
 
 The policy objectives are to en sure the security of the food supply by balancing supply and 
demand for rice, and to stabilize rice prices fo r the maintenance of farmers' income.   
 
4. Background and responsible authorities  
  (a) Law and regulation:   Agriculture Development Act.   
    Food Administration Act.   
  (b) Responsible authority: Council of Agriculture.   
 
5. Form of the subsidy/to whom and how the subsidy is provided
 
 
 There are three types of rice purchase - planned purchase, supplementary purchase and 
additional purchase.  The planned purchase is made  at guaranteed prices which are determined by 
taking into account production costs.  The prices have been set at NT$21 per kilogram for Japonica-
type rice and NT$20 for Indica-type rice.  The qua ntity of the planned purchase has been limited 
to 1,920kg per hectare for the first crop and 1,440kg for the second crop respectively.  Supplementary 
purchases have been made to supplement shortag es on the planned purchase quantity.  Supplementary 
rice purchase prices are set at NT$18 per kilogram for Japonica-type rice and NT$17 for Indica-type rice respectively.  The quantity of the supplementa ry purchase has been limited to 1,200kg per hectare 
for the first crop and 800kg for the second crop resp ectively.  An additional purchase was made from 
the second crop in 2003.  The prices for additional purchase are set at NT$16.6 per kilogram for Japonica-type rice and NT$15.6 for Indica-type rice.  The quantity of the additional purchase has been 
limited to 3,000kg per hectare for the first cr op and 2,360kg per hectare for the second crop 
respectively.    
 Planned, supplementary and additional rice purchases are made only for the farmers who 
produce rice in paddy fields and follow the irrigational rotation scheme for planting and not planting.  For those who produce rice in the upland areas or pr oduce in the paddy fields but do not follow the 
government scheduling for planting, are only eligib le for supplementary and additional purchases.  
Farmers are free to decide whether they want to sell products to the Government or not.   
 
6. Amount of the subsidy
 
 
 NT$558 million, NT$588 million and NT$563 million for 2005, 2006 and 2007 respectively.   
 7. Duration of the subsidy and/or any other time-limits attached to it
 
 
 The duration of the subsidy is not specified.    G/SCM/N/186/TPKM 
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  8. Statistical data  
Unit:  1,000 MT. 
Item Year Production Consumption Import Export 
2005 1,187.6 1,329.8 144.6 8.1 
2006 1,261.8 1,315.9 144.7 5.7 Rice 
2007 1,098.3 1,304.5 106.7 3.4 
 
B. SUPPORT FOR SORGHUM AND FEED CORN 
1. Title of the programme  
 
 Support for sorghum and feed corn.    2. Period covered by the notification
 
 
 2005-2007.    
3. Policy objective and/or purpose
 
 
 The policy objectives are to ma intain sorghum and feed corn production and to facilitate the 
adjustment of paddy field utilization.    
4. Background and responsible authorities
 
  (a) Law and regulation:   
Regulation for the Purchase and the Sale of Dry-land Food Crops.   
  (b) Responsible authority:  Council of Agriculture.   
 
5. Form of the subsidy/to whom and how the subsidy is provided
 
 
 Purchase prices are determined by adding the net profits on rice to the production costs of 
each.  The purchase prices have been set at NT $15 per kilogram for feed corn and NT$14 for 
sorghum.  The purchase quantities are limited to 5, 000 kilograms per hectare for feed corn and 
sorghum.  When the actual yield per hectare is above the purchase quantity ceiling, farmers may sell 
their products to the Government at the import prices.   
 
 Purchases at the set prices are made for the farmers whose production of sorghum or feed corn had been purchased by the Government in the base year (1994-96) or the year preceding the 
current year.  The purchase of sorghum has been lim ited to the first crop grown in the western plain 
area of Taiwan.  The first and second crops of f eed corn have been pur chased for the western 
mountainous area and the eastern region, while on ly the second crop has been purchased for the 
western plain area.  The farmers are free to decide whether or not they want to sell products to the 
Government.   
 
6. Amount of the subsidy
 
 
 NT$409 million, NT$263 million and NT$218 million for 2005, 2006 and 2007 respectively.   
 7. Duration of the subsidy and/or any other time-limits attached to it
 
 
 The duration of the subsidy is not specified.   G/SCM/N/186/TPKM 
Page 6  
 
  8. Statistical data
 
  Unit:  1,000 MT. 
Item Year Production Consumption Import Export 
2005 41.8 4,749.4 5,059.1 0.5 
2006 37.4 4,926.4 5,111.9 3.3 Feed corn 
2007 33.9 4,644.3 4,427.8 0.4 
2005 8.3 83.9 75.6 0.0 
2006 4.7 62.7 57.9 0.0 Sorghum 
2007 4.9 72.8 67.9 0.0 
 
C. MEASURES FOR SWEET POTATOES , ADZUKI BEANS , MUNG BEANS , AND OTHER 
MISCELLANEOUS CROPS  
1. Title of the programme  
  Measures on sweet potatoes, adzuki beans, mung beans and other miscellaneous crops.   
 
2. Period covered by the notification
 
 
 2005-2007.   
 3. Policy objective and/or purpose
 
 
 The policy objectives are to facilitate the adju stment of paddy field utilization and to 
strengthen the farmland environmen tal conservation plan for sustainable use of farmland as the 
structure of agricultural production undergoes adjustment.   
 4. Background and responsible authorities
 
 
 (a) Law and regulation:  Agriculture Development Act.   
 
 (b) Responsible authority:  Council of Agriculture.    
5. Form of the subsidy/to whom and how the subsidy is provided
 
  (1) Diversion payment:   
 
 The diversion payment is granted to the fa rmers who follow the diversion programme from 
rice production to the production of diversion crops  and cohere with any of the following case:   
 
a. Growing rice in the base year (1994-2003);  or, b. Growing guaranteed price purchase crops of f eed corn, sorghum or sugarcane in the base 
year;  or, 
c. Registering as set-aside or diversion under "Rice Production and Rice field Diversion 
Projects" in the base year.   
 
 Diversion crops are selected according to s upply and demand conditions for such crops as 
sweet potatoes, adzuki beans, mung beans and ot her miscellaneous crops (yam, buck wheat, millet, 
sesame, etc.).  Diversion payments are made at NT$22,000 per hectare.    G/SCM/N/186/TPKM 
 Page 7 
 
 
   (2) Bonus payment:   
  In addition to the diversion payment, there is a bonus payment of NT$4,000 per hectare for 
the group diversion.   
 6. Amount of the subsidy
 
 
 NT$961 million, NT$962 million and NT$880 million for 2005, 2006 and 2007 respectively.   
 
7. Duration of the subsidy and/or any other time-limits attached to it  
 
 The duration of the subsidy is not specified.   
 8. Trade effect
 
 
 After the three stages of the rice diversion programme as well as set-aside programme had been implemented, the acreage planted in rice went down from 645,855 hectares to 260,159 hectares;  
that is a decrease of 59.7 per cent between 1983 (the year prior to the implementation of the projects) 
and 2007.  The production of rice was also down from 2.48 million tons to 1.10 million tons, a decline 
of 55.6 per cent.  The quantity of rice purchased  by the Government was reduced from 1.1 million 
tons to 0.22 million tons, a decrease of 80 per cent.   Measures relating to sweet potatoes, adzuki 
beans, mung beans and other miscellaneous crops ha d contributed to reductions in the production of 
rice.   
 
D. S
UPPORT FOR TOBACCO LEA VES  
1. Title of the subsidy programme  
  Support for tobacco leaves.   
 
2. Period covered by the notification
 
 
 Crop years 2004/05-2006/2007   
 3. Policy objective and/or purpose
 
 
 The purposes of the programme are to mainta in the tobacco farmers' income level and 
improve the quality of tobacco leaves produced.   
 
4. Background and responsible authorities  
 
 (a) Law and regulation:   
  The Tobacco and Alcohol Administration Act (The former is The Provisional Statute  
for Monopoly of Tobacco and Wine in Taiwan Province).   
 
 (b) Authorities:  Taiwan Tobacco & Liquor Corporation (The former is the Taiwan  
Tobacco and Wine Monopoly Bureau ), Ministry of Finance.   
 Note
:  The Provisional Statute for the Monopoly of Tobacco and Wine in Taiwan Province was 
abolished on 1 January 2002.  The Taiwan Tobacco and Wine Monopoly Bureau was replaced by the 
Taiwan Tobacco & Liquor Corporation from 1 July 2002.   G/SCM/N/186/TPKM 
Page 8  
 
  5. Form of the subsidy/to whom and how the subsidy is provided
 
  A purchase under restricted price tendering:   
 
 The Taiwan Tobacco & Liquor Corporation now makes a purchase under restricted price 
tendering according to the Government Procuremen t Act.  The amount of subsidy is the price 
difference between the purchase pr ice and external reference price multiplied purchase amount.  The 
external reference price is based on average of the price in 1990-1992.   
 
6. Amount of the subsidy
 
 
 NT$ 250.49 million, NT$ 206.85 million and NT$ 174.9million for the crop years 2004/05, 
2005/2006 and 2006/2007 respectively.    
7. Duration of the subsidy and/or any other time-limits attached to it
 
  The duration of the subsidy is not specified.   
 
8. Statistical data
 
 
 Unit:  MT. 
Item Year Production 
(Crop year) Consumption Import Export 
2005 2,743 3,528 6,744 5,959 
2006 2,193 10,455 10,648 2,386 Tobacco leaves 
2007 1,672 12,271 12,826 2,227 
 
E. SUPPORT FOR SUGAR  
1. Title of the subsidy programme  
 
 Support for sugar.    
2. Period covered by the notification
 
  Crop years 2004/05-2006/2007.   
 
3. Policy objective and/or purpose
 
 
 The purpose of the programme is to develop the sugar industry in cooperation with the 
farmers.   
 
4. Background and responsible authorities  
 
 (a) Law and regulation:  Regulation for the Sugarcane Planting Contract.   
  (b) Authorities:   The Taiwan Sugar Corporation.   
    Ministry of Economic Affairs.    G/SCM/N/186/TPKM 
 Page 9 
 
 
  5. Form of the subsidy/to whom and how the subsidy is provided  
  (1) Guaranteed purchase:   
 
 The Taiwan Sugar Corporation made contract s with farmers for the purchase of sugarcane 
and sugar sharing.  The sugarcane farmers obtain 55 per cent of the sugar made from sugarcane.  If 
the domestic selling price of sugar is higher than the prepaid contract price, the sugarcane farmers are 
paid the domestic selling price.  If the domestic selling price is lower than the prepaid contract price, 
the farmers are paid the prepaid contract price.  The contract price was set after taking domestic 
selling price and the marketing costs into account.  It has been frozen since 1990.    
 (2) Other grants:  
  The corporation provides grants to sugarcane fa rmers such as interest subsidy for loans for the 
purchase of inputs, insurance premium for sugar cane farms, fees for pest and disease control, 
inspection fees for sugar brix, and others.    
6. Amount of the subsidy
 
  NT$ 250.7 million, NT$ 102.3 million and NT $ 120.8 million for the fiscal years 2004/05, 
2005/06 and 2006/07 respectively.   
 7. Duration of the subsidy and/or any other time-limits attached to it
 
 
 The duration of the subsidy is not specified.   
 
8. Statistical data  
 
  Unit:  1,000 MT.  
Item Year Production Consumption Import Export 
2005 79.8 588.7 766.5 27.4 
2006 55.0 519.0 680.4 19.5 Raw Sugar 
2007 63.1 511.8 600.0 32.2 
 
F. INTEREST SUBSIDY  
1. Title of the subsidy programme  
  The policy-oriented special agricultural loan.   
 
2. Period covered by the notification
 
 
 2005-2007.   
 3. Policy objective and/or purpose
 
 
 The overall objective is to assist farmers and businesses in agricultural industries to raise the 
funds needed for them to be able to operate smoot hly.  This plan was devised to help them update 
their equipment, improve developmental skills a nd innovation, increase the added-value in their 
products, and strengthen product sales and their competitiv eness in the world.  In addition, the plan 
helped farmers who were affected by natural di sasters to rebuild their homes and their livelihoods, 
thus helping to raise their standard of living.   G/SCM/N/186/TPKM 
Page 10  
 
  4. Background and responsible authorities
 
  (a) Law and regulation:   Agriculture Development Act.   
Agriculture Finance Act. 
Regulation of Agricultural Development Fund 
 
 (b) Authorities:  Council of agriculture.   
 5. Form of the subsidy/to whom and how the subsidy is provided
 
 
 Preferential interest rate loans:  the loan capital was provided from credit departments of 
farmers' and fishermen's associations or The Agricultural Bank of Taiwan.  The source of finance for the interest subsidies is the Agricultural Development Fund.   
 
6. To whom and how assistance is provided
 
 
(a) These lower interest rate loans are available to all farmers and fishermen, and are not 
limited to a specific industry or  enterprise of agriculture.   
 
(b) Different ceilings are set for different typ es of loan.  In addition, only a percentage of 
the total procurement amount is eligible for the loan.  The amount of loan granted is decided by the bank, based on the financial situation of the applicant.   
 7. Amount of the subsidy
 
 
 The amount of interest subsidy w as NT$650.9 million, NT$1,697.4 million and 
NT$ 2,081.3 million for the fiscal year s 2005, 2006 and 2007 respectively.   
 8. Duration
 
 
 The duration of the subsidy is not clearly specified.    9. Trade effects or related statistical data
 
 
 (a) Trade effects:   
   The programme is mainly used to promot e the upgrading of the industry.  Given the 
scope and nature of the programme, it is not possible to determine what, if any, trade effects may result directly from this programme.    G/SCM/N/186/TPKM 
 Page 11 
 
 
  (b) Related statistical data:   
 
Interest subsidy for loans granted in 2005, 2006 and 2007  
   Unit:  1,000 NT$ 
Name of Project 2005 2006 2007 
Loans for expanding the family farm;  to support 
farmers buying land 37,608 58,149 76,831 
Loans for farm machinery 107,018 124,801 141,938 
Loans for natural agricultural disasters 72,497 72,665 60,388 
Loans for accelerating rural construction 433,824 1,441,828 1,803,937 
Total 650,947 1,697,443 2,083,094 
 
Note :  Loans for accelerating rural construction include such items as:   
 
1. Loans in the agricultural food industry to provide guidance and assistance to 
management.   
2. Loans in the livestock and poultry indust ry for improving management efficiency.   
3. Loans to farmers to provide guidance, assistance and management improvement.   4. Preferential loans extended to those businesses that move into the agricultural 
technology park.   
5. Loans for agriculture production and marketing groups.   
 II. FISHERIES 
A. F
ISHING VESSELS BUY-BACK PROGRAMME  
1. Title of the programme  
 
 Fishing Vessels Buy-back Program.   
 2. Period covered by the notification
 
 
 January 2007-December 2008.    
3. Policy objective and/or purpose
  
  Due to severe overfishing worl dwide, the UN has been urgently calling on nations to reduce 
their fishing capacities.  This programme seeks to  alleviate pressures on the fishery resources and 
ensure their sustainability.    
4. Background and responsible authorities
 
 
 (a) Law and regulation:   
 Regulation for the Fishing Vessels Buy-back Procedures (2007-2008).    
 (b) Authority:  Fisheries Agency, Council of Agriculture.   G/SCM/N/186/TPKM 
Page 12  
 
  5. Form
 
  Grant.   
 
6. To whom and how assistance is provided
 
 
 (a) Beneficiaries:  Owners of all varieties of fishing vessels with valid fishing licences, 
including recreational fishing vessels.   
 
 (b) Content:   
 (1) the following are the buy-back amounts of fishing vessels of deep-sea fishery, 
calculated and accumulated in 2007-2008:   
   (a) NT $70,000 for each gross ton for the 1
st to 5th ton; 
   (b) NT $60,000 for each gross ton for the 6th to 10th ton; 
   (c) NT $50,000 for each gross ton for the 11th to 20th ton; 
   (d) NT $40,000 for each gross ton for the 21st to 50th ton; 
   (e) NT $35,000 for each gross ton for the 51st to 100th ton; 
   (f) NT $18,000 for each gross ton over 100 tons;    (g) Total amount for each eligible vessel is unlimited. 
 
 (2) the following is the buy-back amount of fishing vessels of inshore fisheries, 
calculated and accumulated in 2007-2008:   
   (a) NT $50,000 for each gross ton for the 1
st to 5th ton; 
   (b) NT $40,000 for each gross ton for the 6th to 10th ton; 
   (c) NT $30,000 for each gross ton for the 11th to 20th ton; 
   (d) NT $25,000 for each gross ton for the 21st to 50th ton; 
   (e) NT $20,000 for each gross ton for the 51st to 100th ton; 
   (f) NT $18,000 for each gross ton over 100 tons;  with 
   (g) the highest total amount for each eligible vessel being NT $7.9 million.    
 (3) the following is the buy-back amount of fishing rafts calculated in 2007:   
   (a) NT $200,000 for below 6 M;    (b) NT $300,000 for 6-below 10 M; 
   (c) NT $450,000 for 10-below 15 M; 
   (d) NT $600,000 for 15-below 20 M;    (e) NT $700,000 for 20 M and over. 
 
(4) since 2008, the buy-back of fishing rafts were calculated according to the length of 
raft, the pipe diameter and the power of main engine respectively.   
 
7. Amount
 
 
 Funds spent on buying back 90 fishing v essels and 262 fishing rafts in 2007 totalled 
NT $485.53million;  funds spent on buying back 127 fishing vessels and 333 fishing rafts in 2008 
totalled NT $ 741.314 million.   
 8. Duration
 
 
 The duration of the subsidy is not clearly specified.    G/SCM/N/186/TPKM 
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  9. Trade effects or related statistical data  
 
Fishery production, consumption and trade  
 
 Unit:  metric ton 
Classification 2005 2006 2007 
Production 1,314,225 1,283,587 1,499,524 
Import 381,967 345,431 320,374 
Export 650,476 637,430 673,957 
Consumption 1,045,716 991,588 1,145,941 
 
 (Fisheries production includes catch fisheries and aquaculture fisheries production.) 
 B. R
EWARD FOR CLOSING FISHERY SEASON  
1. Title of the programme   
  Reward for Closing Fishery Season.   
 
2. Period covered by the notification
 
 
 January 2007-December 2008.   
 3. Policy objective and/or purpose
  
 
 Due to the global overfishing problem, the UN is calling on nations to reduce their catches.  This programme seeks to alleviate pressures on fish ery resources and ensure their sustainability.   
 
4. Background and responsible authorities
 
 
 (a) Law and regulation:  Regulation for the Voluntary Closing Fishery in 2008.   
  (b) Authority:  Fisheries Agency, Council of Agriculture.   
 
5. Form
 
 
 Grant.   
 6. To whom and how assistance is provided
 
 
 Any fishing vessels with valid fishing licences that correspond with the related regulations of 
closing fishery except recreational fishing charter boats.   
 
7. Amount  
 
 The budget for the programme totalled NT$428 million for the 2007 to 2008 fiscal period 
(NT$214 million for 2007, NT$214 million in 2008).    
8. Duration
 
  The duration of the subsidy is not clearly specified.   G/SCM/N/186/TPKM 
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  9. Trade effects or related statistical data
 
 
Fishery production, consumption and trade  
 
  Unit:  metric ton 
Classification 2005 2006 2007 
Production 1,314,225 1,283,587 1,499,524 
Import 381,967 345,431 320,374 
Export 650,476 637,430 673,957 
Consumption 1,045,716 991,588 1,145,941 
 
 (Fisheries production includes catch fisheries and aquaculture fisheries production) 
 C. E
XTENSION OF RE-USE OF POND WATER USED IN AQUACULTURE  
1. Title of the programme  
 
 Extension of Reuse of Pond Water Used in Aquaculture.    
2. Period covered by the notification
 
  January 2007 to December 2008.   
 
3. Policy objective and/or purpose
  
 
 Reduce groundwater consumption in order to prevent land subsidence.    
4. Background and responsible authorities
 
  (a) Law and regulation:  Agriculture  Development Act, Article 62.   
 
 (b) Authority:  Fisheries Agency, Council of Agriculture.    
5. Form
 
  Grant.   
 
6. To whom and how assistance is provided
 
 
 (a) Beneficiaries:  Fishermen who rear fish.   
  (b) Content:  Government provides grants to offset by 35 per cent the total amount of the 
cost of water re-circulation devices (e.g., mechanical filters).   
 
7. Amount
 
  The amount of subsidies for 2007, and 2008 totalled NT$2 million.   
 
8. Duration 
 
 
 Ongoing since 1984.    G/SCM/N/186/TPKM 
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  9. Trade effects or related statistical data  
 
Fishery Production, Consumption and Trade  
 
  Unit:  metric ton 
Classification 2005 2006 2007 
Production 1,314,225 1,283,587 1,499,524 
Import 381,967 345,431 320,374 
Export 650,476 637,430 673,957 
Consumption 1,045,716 991,588 1,145,941 
 
 (Fisheries production includes catch fisheries and aquaculture fisheries production.) 
 D. F
ISHING VESSELS MARINE INSURANCE REWARD  
1. Title of the programme  
 
 Fishing Vessels Marine Insurance Reward.    
2. Period covered by the notification
  
  January 2007-December 2008.   
 
3. Policy objective and/or purpose
 
 
 Insure fishing vessels against marine disasters.    
4. Background and responsible authorities
 
  (a) Law and regulation:   
  Regulation for the Insurance Reward for Owners of Fishing Vessels.   
  (b) Authority:  Fisheries Agency, Council of Agriculture.   
 
5. Form
 
 
 Grant.   
 6. To whom and how assistance is provided
 
 
 (a) Beneficiaries:  Owners of fishing vessels  (b) Content:  The programme provides grants to cover part of the costs of insurance for 
fishing  vessels in case of damage at sea.   
 
7. Amount
 
  The budget for the programme totalled NT $78.4 million for 2007 and NT$83.5 million 
in 2008.   
 8. Duration
 
 
 Ongoing since 1987.   G/SCM/N/186/TPKM 
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  9. Trade effects or related statistical data
  
 
Fishery production, consumption and trade  
 
  Unit:  metric ton 
Classification 2005 2006 2007 
Production 1,314,225 1,283,587 1,499,524 
Import 381,967 345,431 320,374 
Export 650,476 637,430 673,957 
Consumption 1,045,716 991,588 1,145,941 
 
 (Fisheries production includes catch fisheries and aquaculture fisheries production.) 
 E. F
ISHING VESSELS REDUCTION PROGRAMME  
1. Title of the programme  
 
 Government compensation for fishing vessels reduction plan.    
2. Period covered by the notification
 
  January-December 2007.   
 
3. Policy objective and/or purpose
  
 
 Due to severe overfishing worl dwide, the UN has been urgently calling on nations to reduce 
their fishing capacities.  This programme seeks to  alleviate pressures on the fishery resources and 
ensure their sustainability.   
 4. Background and responsible authorities
 
 
 (a) Law and regulation:  Article 37, 38and 44 of Fisheries Act.    
 (b) Authority:  Fisheries Agency, Council of Agriculture.   
 5. Form
 
 
 Grant.    
6. To whom and how assistance is provided
 
  (a) Beneficiaries:  Owners of big-eye tuna long-line fishing vessels with valid fishing 
licences and freezing equipment of ultra-low temperature. 
  (b) Content:  NT $30,000 for each gross ton.   
 
7. Amount
 
 
 Funds spent on reducing 23 fishing vessel s in 2007 totalled NT $451.26 million.    G/SCM/N/186/TPKM 
 Page 17 
 
 
  8. Duration   
  The duration of the subsidy is not clearly specified.   
 
9. Trade effects or related statistical data
 
 
Fishery production, consumption and trade  
 
  Unit:  metric ton 
Classification 2005 2006 2007 
Production 1,314,225 1,283,587 1,499,524 
Import 381,967 345,431 320,374 
Export 650,476 637,430 673,957 
Consumption 1,045,716 991,588 1,145,941 
 
 (Fisheries production includes catch fisheries and aquaculture fisheries production.)  III. INDUSTRY 
A. T
AX CREDITS OR TAX EXEMPTIONS FOR DESIGNATED ENTERPRISES  
1. Five-year tax exemption for the emergi ng, important and strategic industries 
1. Title of the programme  
 
 Five-year tax exemption for the emerging,  important and strategic industries.   
 2. Period covered by the notification
 
 
 Fiscal years 2006-2007.   
 3. Policy objective and/or purpose
 
  The primary goal of the tax incentives is to promote the development of hi-tech and high 
value-added industries.   
 
4. Background and responsible authority
 
  (a) Law and regulation:     1999 amendment to the Statute for Upgradi ng Industries (the SUI), Article 9 on five-
year tax exemption.   
  (b) Authorities:     The Industrial Development Bureau, the Ministry of Economic Affairs and the 
Ministry of Finance.   
 
Note
:  The SUI was promulgated on 29 Decemb er 1990, and amended on 10 January 1995, 
31 December 1999, and 6 February 2003.    5. Form
 
 
 Tax exemption.   G/SCM/N/186/TPKM 
Page 18  
 
  6. To whom and how assistance is provided
 
  An emerging, important and strategic industry w ithin two years of its start-up date, may apply 
for payment of the capital contributions by its sharehol ders and, with the approval of its shareholders 
meeting, to be exempted from corporate income tax.   
 
 To qualify as an "emerging, important and st rategic industry", the following three criteria 
should be met:  (1) products to be produced under th e investment plan should belong to the emerging, 
important and strategic industry;  (2) the paid-in or  increased paid-in capital for the investment plan 
should be more than NT$ 200 million;  and, (3) the funds available for the purchase of brand-new 
machinery/equipment in the investment plan should be in excess of NT$ 100 million.   
 
 In the case of a newly incorporated enterp rise, the tax exemption is for a period of 
five consecutive years from the date on which it begins  to market its products or to render services.   
  In the case of the expansion of an existing en terprise, the exemption applies to the corporate 
income tax levied on the increased income derive d as a result of such expansion for a period of 
five consecutive years from the date the newly-added equipment starts to operate or the rendition of 
services begins;  provided, however, that the exempti on applies only to an expansion in the form of 
the establishment of additional independent producti on or service units, or to an increase in major 
production or service equipment.    
 An eligible enterprise applying the tax exempti on may, within two years of the date on which 
it starts to market its products or to render service s, defer, at its own discretion, the commencement 
date of the tax exemption period.  The maximu m period for such deferment is four years.  
Furthermore, the commencement date of such deferre d tax exemption period should be the beginning 
date of a fiscal year.   
 
7. Amount
 
   Unit:  thousand NT$ 
Fiscal Year 2006 Fiscal Year 2007 
6,305,539 19,575,149 
 8. Duration
 
  The programme was initiated in the year 2000.  Chapter 2 of the SUI concerning tax benefits 
will expire in 2009.   
 
9. Trade effects or related statistical data
 
  In light of the scope and nature of the progra mme, it is not yet possible to determine what, if 
any, trade effects may result from this programme.   
 
2. Tax credit for investment in a disadvantaged region 
1. Title of the programme
 
  Tax credit for investment in a disadvantaged region.    G/SCM/N/186/TPKM 
 Page 19 
 
 
  2. Period covered by the notification  
  The fiscal year 2006-2007.    3. Policy objective and/or purpose
 
 
 With the overall objective of achieving bala nced economic growth within the Separate 
Customs Territory of Taiwan, Penghu, Kinmen and Ma tsu, the aim of the tax credit programme is to 
encourage investment in disadvantaged geographic regions.    
4. Background and responsible authorities
 
  (a) Law and regulation:  Statute for Upgr ading Industries (the SUI), Article 7.   
  (b) Responsible authority:   
The Industrial Development Bureau, Mi nistry of Economic Affairs.   
 Note
:  The SUI was promulgated on 29 December  1990, and amended on 10 January 1995, 
31 December 1999, and 6 February 2003.    5. Form
 
 
 Tax credit against corporate income tax.    6. To whom and how assistance is provided
 
 
 Any company incorporated under the Company La w, which makes an investment in a region 
with scant natural resources or with slow developm ent, may gain credits of up to 20 per cent of the 
total amount of its investment against the corporat e income tax levied in the then current year, 
provided it meets the threshold of capital or the threshold number of employees.  If the amount of corporate income tax levied in that year is less than  the tax credit, the balance of the tax credit may be 
applied against the corporate income tax levied in the ensuing four years.   
 
 The "county or township areas with scanty natu ral resources or slow development" referred to 
in Article 7 of the SUI, with the exception of the villages in Kinmen County, Lien-chiang County, 
Penghu County, and the Lanyu Village  and the Green Island Village of Taitung County, as well as 
Ryukyu Village of Pingtung County, must satisfy  either of the following requirements:   
 
(a) A village in the first eight (8) counties as arranged in sequence based on the aggregate 
score of each of the 16 counties, from the lowest to the highest, as calculated on the 
basis of the following ten index items available in the preceding two years:  population growth rate, society increase ra te, proportion of secondary and tertiary 
workers to total employed population, ta x revenue, average regular income of each 
household, proportion of urba n population to total population, availability of tap 
water supply, availability of telephone to every one hundred households in the city, 
highway density, and number of educational facilities of college level or higher.   
 
(b) A village whose average cons olidated income filed in the last three years fell within 
the lower half of all the average national consolidated incomes filed by all villages 
island-wide in the same period.   
  The threshold capital means the total amount used in procuring brand-new machinery, 
equipment and building aggregates up to NT$ 25 million.  The term minimum number of employees G/SCM/N/186/TPKM 
Page 20  
 
  means the monthly average of the number of newl y employed employees in a full year, amounting to 
fifty (50) persons or more.     The criteria used by the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu 
are more stringent than those under Article 8 of  the SCM Agreement.  The main reason for the 
adoption of factors other than the two economic indi cators prescribed by the SCM Agreement is that 
these criteria reflect the real condition of scant r esources and the slow economic development in the 
areas concerned.  If the SCM index were applied,  more regional zones would be eligible for tax 
credits.    
7. Amount
 
   Unit:  thousand NT$.   
FY 2006 FY 2007 
19,699,144 30,981,779 
 
8. Duration  
  The programme was initiated in 1990 and Chapte r 2 of the SUI concerning tax benefits will 
expire in 2009.    
9. Trade effects or related statistical data
 
  In light of the scope and nature of the progra mme, it is not yet possible to determine what, if 
any, trade effects may result from this programme.    
B. L
OANS - LOANS FOR SMALL AND MEDIUM -SIZED ENTERPRISES (SME S) 
1. Specific and urgent financing and loans intended for working capital needed during 
periods of economic crisis and recession, and for recovery plans from damage caused by 
major natural disasters 
1. Title of the programme  
 
 Specific and urgent financing and loans intende d for working capital needed during periods of 
economic crisis and recession, and for recovery plans from damage caused by major natural disasters.   
 2. Period covered by the notification
 
 
 Fiscal year 2007-2008.   
 3. Policy objective and or/purpose
 
  Qualified SMEs in circumstances meeting th e following conditions are entitled to apply for 
the financing and loans:   
 
(a) Urgent financing is provided for the pr ovision of working capital during periods of 
significant financial crisis, recession and major natural disasters.   
 
(b) The loans are provided for helping enterprises restructure during periods of economic 
crisis and recession, replacing machinery a nd purchasing new automated equipment.    G/SCM/N/186/TPKM 
 Page 21 
 
 
  4. Background and responsible authorities  
  (a) Law and regulation:   
Statute for Development of Small and Medium-Sized Enterprises (Articles 9, 15, 17 and 18).   
  Procedure for Income-Expenditure Safeguarding and Utilization of the SME 
Development Fund.   
  The SME Development Fund was established based on Article 9 of the Statute for 
Development of Small and Medium-Sized Enterprises.   
 
 (b) Authority:  The Ministry of Economic Affairs.   
 Note:
  The cumulative amount reached by the end of  fiscal year 2008 for the SME Development Fund 
was NT$ 7.1 billion.    
5. Form
 
  Financing and loan.    6. To whom and how assistance is provided
 
 
 All enterprises which meet the "Standards for Identifying a Small and Medium-Sized 
Enterprise" are eligible to apply.     According to the "Standards for Identifying a Small and Medium-Sized Enterprise" published 
by the Ministry of Economic Affairs, an SME is a company or commercial enterprise registered in 
accordance with the law with capital or operati ng revenue below the following thresholds:   
 
(a) For enterprises engaged in manufacturing, construction, mining or  excavating, paid-in 
capital of less than NT$ 80 million.   
 
(b) For enterprises engaged in other economic  activities such as agriculture, logging, 
fishing, the raising of livestock, utiliti es, commerce, transport, warehousing, 
communications, finance, insurance, real estate, commercial, social or individual 
services, an annual operating revenue of less than NT$ 100 million.   
  The loan granted is shared by the SME Deve lopment Fund and other pa rticipating banks on 
a 50/50 basis.  The ceiling interest rate is 1.5 per cent plus a flat rate of the 2-year postal fixed savings 
rate.    7. Amount
 
  Statistics for Specific Programmes:   
 
Loaned by the SME Development Fund
 
   Unit:  million NT$.   
Title of Programme 2007-2008 
Urgent financing for the provision of working capital during 
periods of significant financial crisis, or recession 0 
Urgent financing for major natural disasters 0 
 G/SCM/N/186/TPKM 
Page 22  
 
  8. Duration
 
  The above-mentioned two programmes loaned by the SME Development Fund ceased to apply after 2005.    
9. Trade effects or related statistical data
 
  Given the fact that in the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu, 
98 per cent of enterprises can meet the criteria and t hus be termed SMEs, it is difficult to estimate the 
trade effects of these programmes.   
 
2. Medium- and long-term loans for product ma rketing and loans for overseas investment 
and construction projects 
1. Title of the programme
 
 
 Medium- and long-term loans for product mark eting, and loans for overseas investment and 
construction projects.    2. Period covered by the notification
 
  Fiscal year 2007-2008.   
 
3. Policy objective and or/purpose
 
  Those programmes are implemented with th e purpose of providing SMEs with financial 
assistance in exploring new markets for their machin ery and equipment, in investing and establishing 
plants in foreign countries, and in undertaki ng overseas contracts for construction projects.   
 4. Background and responsible authorities
 
  (a) Law and regulation:     Statute for Development of Small and Medium-Sized Enterprises (Articles 9, 15, 
and 16).   
 Procedure for Income-Expenditure, Sa feguarding and Utilization of the SME 
Development Fund.   
  (b) Authority:  The Ministry of Economic Affairs.   
 
5. Form
 
  Loan.    6. To whom and how assistance is provided
 
 
(a) All enterprises which meet the "Standard s for Identifying a Small and Medium-Sized 
Enterprise" are eligible for application.   
 
(b) The approval of loan applications is pe rformed by commercial banks.  However, the 
capital needed is provided entirely by the SME Development Fund.    G/SCM/N/186/TPKM 
 Page 23 
 
 
  7. Amount  
  Loaned by the SME Development Fund.    FY 2007-2008:  NT$ 1.07 billion.    
8. Duration of subsidy
 
  The programmes are not subject to any fixed completion date.    9. Trade effects or related statistical data
 
 
 Given the fact that in the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu, 
98 per cent of enterprises can meet the criteria and t hus be termed SMEs, it is difficult to estimate the 
trade effects of these programmes.    
C. L
OANS FOR PRIVATE ENTERPRISES  
1. Loans for small and medium-sized enterprises and private enterprises 
1. Title of the programme  
  Loans for small and medium-sized en terprises and private enterprises.   
 
2. Period covered by the notification
 
  The fiscal years 2007 and 2008.    3. Policy objective and/or purpose
 
 
 The programme is implemented with the purpose of improving production technology and 
product quality, promoting industria l upgrading and to assist in the upgrading of small and medium-
sized enterprises and private enterprises.    4. Background and responsible authorities
 
 
 (a) Law and regulation:     The Statute for Upgrading Industries (the SUI), sub-paragraphs (2) and (3), 
paragraph 1 of Article 21.   
 
 (b) Authorities:   
 The guidelines for the loan programme are produced by the Development Fund.   
 5. Form
 
  Loans:  each loan is provided by the Development Fund (25 per cent) and the bank 
(75 per cent). 
 6. To whom and how assistance is provided
 
 
The loans are available to all enterprises a nd are not limited to a specific industry or 
enterprise.   G/SCM/N/186/TPKM 
Page 24  
 
  7. Amount
 
  There are no official statistics with respect to the programme.    8. Duration
 
 
 The projects will be implemented until the expiration of the SUI.    9. Trade effects or related statistical data
 
 
(a) Trade effects: 
 
 The programme is mainly used to promote industry upgrading.  In light of the scope 
and nature of the programme, it is not possible to determine what, if any, trade effects may result.   
 
(b) Related statistical data:   
 
Total amount of loans granted in 2007
 
 
 
Name of Project Number of granted cases Total amount of  
granted loans  
(hundred million NT$) 
Loans to assist in the upgrading of small 
and medium-sized enterprises 338 2.592 
 
Total amount of loans granted in 2008  
 
Name of Project Number of granted cases Total amount of granted 
loans  
(hundred million NT$) 
Loans to assist in the upgrading of small and medium-sized enterprises 291 3.031 
 
D. DUTY AND TAX EXEMPTIONS GRANTED TO ENTERPRISES LOCATED WITHIN A DESIGNATED 
ZONE 
1. Duty and tax exemptions for high-technology industries 
1. Title of the programme  
  Duty and tax exemptions for high-technology industries.    
2. Period covered by the notification
 
  Fiscal year 2007-2008.    3. Policy objective and/or purpose
 
 
 This programme is implemented with a view  to stimulating the research and innovation of 
industrial technology and to promote the developm ent of advanced technology in the Separate  G/SCM/N/186/TPKM 
 Page 25 
 
 
  Customs Territory of Taiwan, Penghu, Kinmen and Ma tsu.  The "Science-Based Industrial Park"("the 
Park") has been established by introducing sophi sticated industries and personnel with advanced 
technological backgrounds into a designated zone.    4. Background and responsible authorities
 
 
 (a) Law and regulation:   
 Statute for the Establishment and Administ ration of a Science-Based Industrial Park 
(Article 20);   
 Implementing Regulation of Statute for th e Establishment and Administration of a 
Science-Based Industrial Park (Article 17).   
  (b) Authorities:   The Park is managed by the Science Park Administration;       The policy-making body is the National Science Council.    
5. Form
 
  The subsidy programme will be implemented in  the form of duty and tax exemptions.   
 6. To whom and how assistance is provided
 
 
 (a) Effective from 1 January 2000, the merged  Park entities in acco rdance with domestic 
Company Law, or surviving or new Park entities after mergers, shall succeed to the 
tax benefits, which are not yet terminated nor fully offset, originally enjoyed by the dissolving science-based industry before mergers.  As for succeeding to the 
exemption of profit-seeking income tax as investment incentives from the dissolving 
Park entities, the surviving Park entities with in the scope of science-based industries 
under the merger/consolidation projects sha ll continue to produce products or to 
provide services identical to those produced or provided by the dissolving Park entities and such tax benefits shall apply onl y to the portion of income derived from 
products or services independently produced or provided by the original dissolving 
Park entities.  If the tax benefits are provide d in the manner of investment offset or 
deduction, such tax benefits shall appl y only to the payable tax portion of the 
surviving or new Park entities after merger s of the dissolving science-based industries 
(Article 18).   
  (b) All Park enterprises are entitle d to the following exemptions:   
 
(i) Customs duties, commodity tax, and business tax on imported machinery and 
equipment, raw materials, commodities, fuel, and semi-finished products, and 
  (ii) Commodity tax and business tax on exported goods or labour services.    Note 1
:  Park enterprise refers to the science-bas ed industry and to an enterprise approved and 
established in the Park able to provide services in respect of operational, management or technical 
support to science-based industries.     A research and development institution or a ve nture capital investment incubatory centre may 
also apply for establishment and operation in the Park.   
 
 The venture capital investment incubatory centr e eligible for establishm ent in the Park shall 
be limited to one that engages in research and development activities, does not engage in mass 
production and has been approved by the Park Administra tion.  It will stay in the Park for a period of 
not more than three years.   G/SCM/N/186/TPKM 
Page 26  
 
  Note 2
:  According to Section 2, paragraph 1, Article 3 of the Commodity Tax Statute and Article 7 of 
the Value-added and Non Value-a dded Law, exports can be exempt ed from commodity tax and the 
business tax rate on exported goods is zero.  These tax treatments are not specific to enterprises 
located in the Park, as they are generally availabl e for exported goods, regardless of whether or not 
the manufacturers are located in the Park.   
 
7. Amount  
 
2007-2008 Business Tax Exemption for all Imports  
 
  Unit:  NT$ million 
Year Total Import Value Total Amount of Business 
Tax Exemption 
2007 845,962 42,298 
2008 680,921 34,045 
 8. Duration
 
 
 There is no time limit attached to the programme.    9. Trade effects or related statistical data
 
   Unit:  NT$ million 
Year 2007 2008 
Number of approved park enterprises 
(accumulated numbers) 682 716 
Total import value 845,962 680,921 
Total export value 1,290,503 1,187,537 
 
 In light of the scope and nature of the progra mmes granted, it is not yet possible to determine 
what, if any, trade effects may resu lt from this subsidy programme.   
 2. Duty and tax exemptions for in-zone enterprises 
1. Title of the programme
 
  Duty and tax exemptions for in-zone enterprises.    
2. Period covered by the notification
 
  Calendar years 2007-2008.    3. Policy objective and/or purpose
 
 
 Export Processing Zones have been established for the purpose of promoting investment and international trade.    4. Background and responsible authorities
 
 
 (a) Law and regulation:   
 Statute for Establishment and Administration of Export Processing Zones (the 
EPZ Law), (Articles 1, 5 and 13).    G/SCM/N/186/TPKM 
 Page 27 
 
 
   Measures for the Screening of Application for Establishment of Enterprises in Export 
Processing Zones.   
  Categories of Industry eligible to be  established in Export Processing Zones.   
  (b) Authorities:   
  Export Processing Zones are managed by the Export Processing Zone Administration.   
  The policy-making body is the Ministry of Economic Affairs.     The task for reviewing the eligibility of enterprises established in Export Processing 
Zones shall be undertaken by the Export Processing Zone Administration together 
with the other government agencies involved.   
 
Note:
  In-zone enterprises include industries authori zed to be engaged in manufacturing, processing, 
assembly, research and development, trade, c onsulting, technical services, warehousing, 
transportation, stevedoring, packi ng, repairs and other related busin esses approved by the Ministry of 
Economic Affairs for Export Processing Zones.   
 
5. Form  
  Duty and tax exemptions.    6. To whom and how assistance is provided
 
 
 All in-zone enterprise industries are en titled to the following exemptions:   
  (a) Import duty, commodity tax and business tax on imported machiner y and equipment.   
(b) Import duty, commodity tax, and bus iness tax on imported raw and consumption 
materials, fuels, semi-finished products, samples, and finished products for 
transhipment by traders and warehousing operators.   
(c) Deed tax when acquiring a new standard plant building in the Export Processing Zone 
or acquiring a building from the Export Processing Zone Administration.   
  It should be noted that, within five years of import, all machinery and equipment is not 
entitled to duty and tax exemptions when shipped to  leviable areas from Export Processing Zones.  
Moreover, products manufactured by in-zone ente rprises shall be subject to customs duties, 
commodity taxes and business taxes when they are sh ipped to leviable areas.  While customs duties 
would be applied on the basis of ex-factory pri ces minus value-added resulting from manufacturing or 
processing activities in the EPZs, other taxes w ould be based on the ex-factory price.   
 
7. Amount
 
 
2007-2008 Tax Exemption  
  Unit:  US$ Thousand  
Year Import Value 
for Machinery and 
Equipment Amount of Import 
Duty Exemption for 
M & E Amount of Business Tax 
Exemption for 
M & E 
2007 541,413 3,194 27,070 
2008 479,637 4,125 23,981 
 Note
:  The amount of the import duty exemption for various tariff lines other than machinery and 
equipment is not available because of the lack of sta tistics for imports in to the zone by tariff line.  
Since the duty rate applied against each tariff lin e differs, we ca not calculate the exempted duty 
amount for all the imports in to the zone unless we ha ve the import statistics of the zone by tariff line. G/SCM/N/186/TPKM 
Page 28  
 
  2007-2008 Business Tax Exemption for all Imports
 
   Unit:  US$ Thousand 
Year Total Import Value Total Amount of Business 
Tax Exemption 
2007 7,270,788 363,539 
2008 7,139,319 356,966 
 8. Duration
 
  There is no time limit attached to the programme.    
9. Trade effects or related statistical data
 
  In light of the scope and nature of the progra mmes granted, it is not yet possible to determine 
what, if any, trade effects may r esult from this subsidy programme. 
 
E. S
UBSIDIES FOR THE ESTABLISHMENT AND OPERATION OF PETROLEUM FACILITIES IN 
MOUNTAIN AND OFFSHORE AREAS  
1. Title of the programme  
 
 Subsidies for the Establishment and Opera tion of Petroleum Facilities in Mountain and 
Offshore Island Areas.   
 
2. Period covered by notification   
  The years 2007-2008.    
3. Policy objective
 
  The policy objective of the programme is to maintain oil supplies from reserves located in 
mountain and offshore island areas.    
4. Background and responsible authorities
 
  (a) Law and regulation:  Petroleum Administration Law.     (b) Responsible authority:  Bureau of Energy, Ministry of Economic Affairs.    
5. Form
 
  Grant.    6. How assistance is provided and to whom
 
 
 Building contractors and/or operators of petr oleum facilities in mountain and offshore island 
areas are entitled to apply for the following subsidies:     (1) Subsidy for the establishment of petrol eum facilities in mountain and offshore island 
areas.    G/SCM/N/186/TPKM 
 Page 29 
 
 
   (2) Subsidy for maintenance cost of petrol eum facilities in mountain and offshore island 
areas.   
 (3) Subsidy to offset the cost of shipping petroleum or Liquefied Petroleum Gas to 
mountain and offshore island areas.   
 (4) Subsidy for extra personnel costs in th e operation of petroleum facilities in mountain 
or offshore island areas.   
 7. Amount for the past three years
 
  Statistics for specific subsidies:   
  Unit:  thousand NT$ 
                                       Year 
Title of Subsidy 2007 2008 
Subsidy for the establishment of petroleum 
facilities in mountain and offshore island areas9,830 20,676 
Subsidy for maintenance cost of petroleum 
facilities in mountain and offshore island areas6,824 11,323 
Subsidy to offset the cost of shipping 
petroleum or Liquefied Petroleum Gas to 
mountain and offshore island areas 154,765 175,255 
Subsidy for extra personnel costs in the 
operation of petroleum facilities in mountain or 
offshore island areas 28,256 38,154 
Total 199,765 245,408 
 
8. Duration  
 
 The program was initiated in 2002.  It is not subject to any fixed completion date.   
 9 Trade effects or related statistical data
 
 
 In light of the scope and nature of the activ ities that may be financially supported by these 
subsidies, it is not yet possible to determine what, if  any, trade effects may ev entually result from this 
programme.    
IV. RESEARCH AND DEVELOPMENT 
A. F
UNDS GRANTED FOR DEVELOPMENT OF PRODUCTS OF THE NEW LEADING INDUSTRIES  
1. Title of the programme  
  Grants for development of products of the new leading industries.    2. Period covered by the notification
 
 
 The fiscal years 2007 and 2008.   G/SCM/N/186/TPKM 
Page 30  
 
  3. Policy objective and/or purpose
 
  In order to encourage research and devel opment on new leading products and upgrade the 
technical capability of the leading newly-emerging, important and strategic industries, the programme grants funds for private enterprises.   
 
4. Background and responsible authorities
 
  (a) Law and regulation:   
 Measures for Assistance in the Development of New Leading Products was 
promulgated on 26 April 1991 and amended on 30 June 1995, 27 November 2002, 
23 July 2003, 20 October 2005, 20 June 2007, and 28 October 2008.   
  (b) Authority:   
  The Industrial Development Bureau, Ministry of Economic Affairs.   
 
5. Form
 
  Grant.    6. To whom and how assistance is provided
 
 
(a) Any company incorporated under the Co mpany Law with sound financial standing, 
whose book value is over 50 per cent of the cap ital, never having record of refusal or 
bounced cheque of the bank and possessing a research and development department with sufficient R&D specialists in the Sepa rate Customs Territory of Taiwan, Penghu, 
Kinmen and Matsu, may apply for the assist ance fund relating to the development of 
a product within the scope of the "emerging, important and strategic industry".
1 The 
product should possess great market potential and its core technology should surpass 
the current level of domestic industrial t echnology.  Besides, products within the 
scope of the "Digital Content Industry", and whose innovative content reaches the 
level of international-class products, are also  eligible for the use of the measures.   
 
(b) The assistance funds granted are a total of no more than fifty percent (50 per cent) of 
the amount of the following expenses incurred exclusively for the development of new leading products:   
 
1. Costs incurred for full-time and/or  part-time research personnel;   
2. Costs of consumable instruments and raw materials;   3. Costs for use and maintenance of R&D equipment;   4. Costs for technology transfer.   
 7. Amount
 
 
 (a) Since the programme's inception, the cumulative amount of grant stands at NT$ 
13,257,949,360 at the end of fiscal  year 2008 (fiscal years 1992-2008). 
  (b) For the fiscal year 2007:  the amount of grant was NT$ 1,141,660,000.  A breakdown 
of the products involved is shown below:   
                                                     
 
1 See page 18 for the definitions of the "emerging, important and strategic industry".    G/SCM/N/186/TPKM 
 Page 31 
 
 
   
  Unit:  thousand NT$ 
Name of Project (or Sector) Grant 
Precision machinery and automation 282,860 
Communication 60,630 
Information 126,280 
Consumer electronics 71,020 
Medical and health care 196,420 
Advanced materials 226,940 
Semi-conductors 157,480 
Specialty chemicals and pharmaceuticals 12,900 
Pollution Prevention 7,130 
Total 1,141,660 
 
 (c) For the fiscal year 2008:  the amount of grant was NT$ 626,663,000.  A breakdown 
of the products involved is shown below:   
   Unit:  thousand NT$ 
Name of Project (or Sector) Grant 
Precision machinery and automation 103,210 
Communication 9,500 
Information 137,548 
Consumer electronics 63,060 
Medical and health care 33,460 
Advanced materials 174,845 
Semi-conductors 43,160 
Specialty chemicals and pharmaceuticals 7,250 
Pollution Prevention 25,200 
Aerospace 29,430 
Total 626,663 
 
8. Duration  
 
 There is no time-limit attached to the programme.   
 9. Trade effects or related statistical data
 
  It is not yet possible to determine what, if any, trade effects may result from this subsidy 
programme.   
 B. F
UNDS GRANTED FOR PROMOTING DEVELOPMENT OF INDUSTRIAL TECHNOLOGY  
1. Title of the programme  
  Technology Development Programme for Enterprise.   
 
2. Period covered by the notification
 
  Fiscal year 2007-2008 (Jan 2007 to Dec 2008).   G/SCM/N/186/TPKM 
Page 32  
 
  3. Policy objective and/or purpose 
 
  The programme's objective is to encourage businesses to engage in the development of 
technological innovations and applications for th e purpose of reinforcing domestic enterprises' 
capabilities, especially in the field of research and development.   
 
4. Background and responsible authorities
 
  (a) Law and regulation:   
Regulations of Subsidization for En couraging Enterprise R & D Activities, 
promulgated 27 November 2002, amended 13 July 2006.   
  (b) Authority:   
Department of Industrial Technology, Ministry of Economic Affairs.   
 
5. Form
 
  Fund assistance for advanced research and development.    6. How assistance is provided and to whom
 
 
 (a) Any company established according to Co mpany Law with sound financial standing 
and a Research and Development Department that has made significant achievements in the past, and which is currently staffed by competent specialists, in the Separate 
Customs Territory of Taiwan, Penghu, Kinmen  and Matsu, may apply for this fund to 
offset the costs of the following activities:   
 
 1. The planning or development of i ndustrial technologies that may be aptly 
characterized as vital, innovative or integrative.   
 2. Development of innovative or integrat ive manufacturing technology by small and 
medium-sized businesses.   
 3. Development of innovative IT application systems.   
 4. Development of innovative business models  by strategic services-oriented research.   
 5. Cooperate with major national technology -related policies and cr eate an environment 
conducive to the development of technolog y and industry within civilian business 
enterprises.   
 
 (b) The assistance funds to be granted shall not exceed 50 per cent of the total amount of 
the following expenses: 
  1. Costs incurred for full-time and/ or part-time research personnel;   
 2. Costs of consumable instruments and raw materials;    3. Costs for use and maintenance of R&D equipment;   
 4. Costs for technology transfer;  and 
 5. Domestic and overseas travel expenses.  7. Amount
 
 
 The total amount of grant in the fiscal year 2007-2008 was NT$ 6,571,284,000.   
 8. Duration
 
  There is no time-limit attached to the programme.    G/SCM/N/186/TPKM 
 Page 33 
 
 
  9. Trade effects or related statistical data  
  It is not yet possible to determine what, if any, trade effects may result from this subsidy 
programme.    
C. F
UND GRANTED FOR ENCOURAGING EXPLORATION AND DEVELOPMENT OF OIL AND 
NATURAL GAS RESERVES  
1.  Title of the programme  
  Fund Granted for Encouraging Exploration and Development of Oil and Natural Gas 
Reserves.   
 2. Period covered by notification
  
   2005-2008.   
 
3. Policy objective and/or purpose
 
 
 The policy objectives of the pr ogramme are to secure oil suppl y and stabilize the domestic oil 
market.   
 
4.  Background and responsible authorities  
  (a) Law and regulation:  Petroleum Administration Law.    (b) Responsible authority:  Bureau of Energy, Ministry of Economic Affairs.   
 
5. Form
 
  Grant.    6. How assistance is provided and to whom
 
 
 Companies limited by shares incorporated under the Company Law that engage in the 
exploration and development of oil and natural gas reserves are eligible for the grant.   
  The grant is used only in support of the following activities: 
 
(1) The implementation of geological, geophysical, and/or geochemistry surveys and 
research necessary for the exploration of oil and natural gas.   
(2) Drilling for the exploration and/or developm ent of oil and/or natural gas reserves.   
(3) Any other necessary pertinent activities that have been reviewed and approved by the 
authorities.   
 
 The total subsidy allocated for an applicant's exploration proposal is not to exceed 50 per cent 
of the budget in the applicant's proposal.  The tota l subsidy allocated for an applicant's development 
proposal is not to exceed 12 per cent of the budget in the applicant's proposal.   G/SCM/N/186/TPKM 
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  7. Amount
 
   Unit:  thousand NT$ 
Year 2005 2006 2007 2008 
Total 192,380 194,380 150,510 212,250 
 
8. Duration  
  The programme was initiated in 2002.  It is not subject to any fixed completion date.   
 
9 Trade effects or related statistical data
 
 
 In light of the scope and nature of the activ ities that may be financially supported by the 
subsidy, it is not yet possible to determine what, if  any, trade effects may eventually result from this 
programme.   
 
  
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