Limited Company Registration in Taiwan - Business Starting & Setup

Taiwan is a civil law country with some elements of common law. Meanwhile, sense of justice and law culture of the country are based on Confucianism.

Today’s legal system of Taiwan inherited legal system of mainland China before 1949. Almost all Guomindang laws, which ceased to be in force on mainland China after establishment of PRC, continued to be valid on the island. Since 1949 Guomindan legislation was modified according to the needs of accelerated capitalist development of Taiwan.

Since 1980s democratization of Taiwan legal system took place. Alongside liberalization of political life, repeal of military law (1987), draconian criminal laws which were aimed to fight with communist acitivites became invalid.

The main sources of law are legislative acts and other regulatory acts with Constitution of 1947 at the head. ROC law is well systematized. All the acts can be divided into several groups: constitutional, civil, criminal, criminally-remedial, administrative (including labor, financial and land law).

According ROC law there are following types of business entities in Taiwan:

• Unlimited Company;
• Limited Company;
• Company Limited by Shares;
• Unlimited Company with Limited Liability Shareholders;
• Partnership;
• Sole Proprietorship;
• Representative Office;
• Foreign Branch.

Unlimited companies are registered more rarely than other types of business entities. Foreign investors usually choose limited company, company limited by shares, foreign branch or representative office.

*If the business entity engages in activities that require a special permit or approval, the authorities may set a higher capital requirement.

* If the business entity engages in activities that require a special permit or approval, the authorities may set a higher capital requirement.

There are several steps of registration of a limited company in Taiwan:

1. Apply for search and reservation of company name and business scope (please provide 1 to 5 company names in Chinese in their order of priority and proposed business scope).

2. Apply for Foreign Investment approval.

Required documents (a Chinese translation of these documents shall be attached):

• Application Form;
• the originally approved application form for Reservation of Company Name and Business Scope;
• Confirmed roster of shareholders and capital amount;
• Power of Attorney authorizing a Juristic Person Stockholder as the Representative of a corporate investor(if needed);
• Certificate of Incorporation;
• Power of Attorney from an investor appointing and authorizing a local agent to deal with the application process to obtain government approval of foreign investment;
• a copy of passport of corporate representative or individual investor.

3. Apply for Examination of Investment Capital.

Required documents:

• Application Form;
• Letter of Approval of foreign investment issued by the Investment Commission;
• a copy of the bank's Inward Remittance Advice;
• a copy of the bank’s Foreign Exchange Memorandum;
• a copy of bank account passbook).

4. Apply for company registration (a pre-approval is required before applying for company registration if the company intends to conduct special business which is subject to additional requirements and regulations ruled by the competent authority).

Required documents:

• Application Form;
• Articles of Incorporation;
• Original consent letter signed by all shareholder(s) consenting to the approval of the Articles of Incorporation;
• Consent letter from director consenting to act in such capacity;
• Power of attorney for appointing individuals as the corporate shareholders' representatives (if needed);
• ID Documents required from incorporator(s);
• The original consent letter from the owner of the building to agree the use of the building as the registered address of the branch or the signed leasing contract and the photocopy of the latest property tax statement;

A CPA's report for verifying the paid-in capital and related supporting documents.

5. Apply for business registration.

6. Apply for factory registration (this is not applicable to a non-manufacturing business).

7. Apply for registration of importer/exporter (for trading business only).

The name of a foreign company should be translated into Chinese, contain type of business entity and nationality. Companies cannot use identical names. Company name should not mislead people, contain words associated with state agencies or social organizations, have an implication of offending against public order or good customs.

Company should have a local registered office. Articles of Incorporation must be kept in the office. In case of violation a fine of not less than TWD 10 000 and not more than TWD 50 000 shall be imposed.

To seal all registration documents and acts company should get a set of seals, including a seal with a company name, a seal with a name of a chairman of board of directors. Each seal costs TWD 450 - 1000 depending on a quantity of used material.

Company cannot be redomiciled in Taiwan.

Limited Company should have at least one director, but not more than three directors. Directors are elected from shareholders (corporate or individual shareholder). If there are several directors, one of them represents a company externally. All directors can be foreign nationals residing outside of Taiwan.

There are no requirements for board of directors of limited company.

Secretary is not required. However, company should have at least one managing director who should be a resident of Taiwan.

Limited Company shall be incorporated by at least one shareholder (individual or corporate). Shareholders should unanimously adopt the Articles of Incorporation, copy of which must be kept by every shareholder.

The information on beneficiary is not disclosed.

Minimum capital requirement was canceled by Ministry of Economy. But the capital still needs to be examined and certified by a local CPA and covers at least the incorporation cost.

Registered capital shall be paid in full by all shareholders without installments and use of external sources.

The following particulars of company registration shall be made open to the public by the competent authority:

• The name of the company;
• The scope of business of the company;
• The location of the company;
• The shareholder(s) executing the business operations or representing the company;
• The name of directors and supervisors and their respective shareholdings in the company;
• The name of the manager;
• The amount of authorized capital stock or of the paid-in capital;
• The Articles of Incorporation of the company.

Any person may apply to the competent authority for a charged access to the above information.