Business entities in Taiwan
- The most popular vehicle for doing business in Taiwan is the limited company;
- The “limited” in the entity name refers to the company’s limited liability, which means that claims against the company are limited to just the company’s assets, rather than those of its owners. This limitation on liability arises by virtue of the company’s status as a separate legal entity from its shareholders. This is also how LLCs operate in other jurisdictions;
- One shareholder and one director, who may be of any nationality and residence, can set up a private company in Taiwan in just three weeks;
- The minimum paid up share capital of Taiwanese private companies is US$1, but for a public company a significantly higher threshold of TW$1,000,000 must be reached;
- Foreign-owned companies in Taiwan may operate in any sector, meaning that this vehicle is extremely flexible in what it may be used for. Since it is a distinct legal person from its owners, it is not restricted to the business activities of its parent company (unlike a branch);
- Taiwanese company law does not require a registered agent or company secretary, although a local must be appointed to submit the incorporation package. Healy Consultants provides this service to our Clients as part of our company setup services.
- Foreign companies may establish a branch office in Taiwan to conduct business, provided that they obtain a certificate of recognition and successfully complete the procedures for branch office setup;
- Unlike a company, the branch does not have its own legal personality. Instead, it is merely an extension of the foreign company establishing it. Consequently, the parent company is responsible for any liabilities incurred by its Taiwanese operation;
- Foreign businesses must appoint a local agent and a branch manager in order to register a branch in Taiwan. There is no requirement for these appointments if an LLC is set up.
- A representative office can be used by foreign companies to conduct limited, non-commercial activities in Taiwan. These establishments may be used to carry out market research, brand marketing activities and research & development, but they may not generate any revenue of their own;
- Rep offices require the appointment of a designated local representative with the right to reside in Taiwan.
General purpose – Setting up an LLC in Taiwan is the best option for most foreign investors due to its flexibility and low administrative requirements. Multi-national companies favour the LLC when establishing a subsidiary of their foreign company in Taiwan. A public limited company is better if there are expected to be a large number of investors or if greater liquidity of shares is required, but the standard LLC is perfect for most entrepreneurial ventures and international expansions.