A Guide for Foreign Companies Establishing a Subsidiary or Branch in Taiwan

Want to expand into the Taiwan market and establish a brand presence, but don’t know where to start? Many foreign companies choose to set up subsidiaries or branch offices in Taiwan as an important springboard into the Asian market. 

Whether it’s for business expansion or to improve local operational efficiency, setting up a subsidiary is a solid and flexible option. This article will take you step-by-step through the branch establishment procedure, explaining the requirements for establishing a branch, and discussing the practical operations of setting up subsidiaries and branches of foreign companies in Taiwan.

What Kind of Foreign Company Can Set Up a Subsidiary in Taiwan?

Following the branch establishment procedure in Taiwan, as long as a company is legally registered in its country of origin, regardless of size or industry, it can set up a subsidiary or branch in Taiwan in accordance with the Company Law and the Business Registration Law. 

Typical companies include multinational conglomerates, technology manufacturing companies, financial institutions, and brand name retailers. Whether they wish to enter the local market, establish an operational base, or strengthen their Asia-Pacific presence, as long as they meet the requirements of Taiwan’s authorities, they will have the opportunity to establish themselves with no hiccups.

Steps for Establishing a Subsidiary

The subsidiary establishment procedure is a legally-protected and market-flexible model for foreign companies planning to expand their business in Taiwan. According to Taiwan’s regulations, the branch establishment procedure requires the parent company to formally file an application and complete administrative procedures such as company name verification, permit application, and capital remittance in order to obtain legal business qualifications. 

As long as you follow the steps, you will be able to successfully complete the registration and set up a solid subsidiary in Taiwan. Below is a step-by-step description of the key points and points to note at each stage of the process.

1. Branch Name Check

Before setting up a foreign branch, the first step is to conduct a pre-check of the Chinese name of your branch to make sure that the chosen name is not duplicated or illegal. Please prepare the following information and pay the application fee of NT$150: 

• Chinese name of the branch (one to three potential names are recommended) 
• Copy of ID card of the responsible person 
• Expected business items (can be found in the government’s ‘Code List of Company Numbers and Limited Partnership Business Items’) 

The name check can be done via the Business Registration Public Notice Inquiry System, and the name should indicate the nationality and type of the company, e.g., USBSI Taiwan Co. Taiwan Branch. This is the first step in establishing a legal business identity and brand recognition.

2. Application for Licensing Documents

After completing the name check, the next step of the branch establishment procedure is to apply for a licensing document issued by the relevant authority. Please prepare the following information: 

• A copy of the permission letter issued by the competent authority 
• A copy of the investment permit letter issued by the Investment Commission of the Ministry of Economic Affairs (MOEA) 

If an individual, legal entity, corporation, or other organisation from Mainland China directly or indirectly owns more than 30% of the shares of a foreign company or has substantial control over a foreign company, you will be required to apply for an investment permit from the Investment Commission of the Ministry of Economic Affairs (MOEA) before proceeding with the company registration process.

3. Company Registration and Investment Verification

The next step of the branch establishment procedure is to submit the application for company registration. In order to do so, you will need to prepare the following documents:

• Application for Company Establishment (Change) Registration 
• 2 copies of Branch Registration Form 
• Letter of Appointment (if represented by an accountant or a lawyer) 
• Letter of Investment Permit issued by the Investment Commission (for Mainland China) Investment Permit Letter issued by the Investment Commission (for domestic investors) 
• Photocopies of documents proving the qualifications of the legal person (subject to verification) 
• Foreign Company Registration Form 
• Photocopies of Remittance Advice and Purchase Order 
• Photocopies of Authorisation Letter of the Responsible Person and Manager and proof of Identity (subject to verification with address, signature/seal) 
• Photocopies of Certificate of Ownership of the Building and Consent of the Owners 
• Company Seal 
• Fee (minimum $1,000) 

If necessary, additional information such as Articles of Incorporation, shareholders’ register, list of directors, investment structure and relevant passports should also be available.

4. Opening a Preparation Account

When opening a branch preparation account, the following documents should be prepared: 

• Dual certificates for the person in charge of the branch (if foreigners, they must first apply for a unified ID number) 
• Official letter of establishment application issued by the Department of Commerce 
• Pre-approval of name 
• Company seal 

Note: After the opening of the Preparation Account, the company must remit the operating capital into the account for the purpose of subsequent capital verification and registration.

5. Remittance of Working Capital to Be Used within the ROC and Settlement of Remittance

To proceed with the branch establishment procedure or subsidiary establishment procedure in Taiwan, after a preparatory account has been opened, the foreign parent company must remit the declared working capital into this account as a single, lump-sum transfer. 

Details for the remittance are as follows:

• Currency of Remittance: New Taiwan Dollars (NTD)
• Remitter: The exact name of the foreign parent company.
• Beneficiary: The designated “Taiwan Preparatory Account.”
• Purpose of Remittance: This must be clearly marked as ‘310 Overseas Chinese and Foreign Investment’.
• Amount: The remitted amount must precisely match the working capital amount specified in the original application for establishment.

6. Certified Public Accountant (CPA) to issue capital verification report

The next step in the branch establishment procedure is to establish financial security and compliance with statutory requirements, a Certified Public Accountant (CPA) in Taiwan must issue a capital verification report. 

The documents required for the CPA to issue the capital verification report include:

• Inward remittance advice (original)
• Purchase of remittance statement (original)
• Copy of the preparer’s bank passbook
• Certificate of balance of deposits or details of deposits (to be obtained on the day following the remittance)

7. Capital Audit and Correction

Upon approval of the establishment of a foreign company’s branch in Taiwan, the foreign company must, within 30 days, complete a capital “correction” procedure with the Commercial Affairs Division of the Ministry of Economic Affairs. 

This procedure certifies that the capital has been duly remitted to Taiwan as required and finalises the auditing process. The necessary steps for this correction are:

• Complete and submit a copy of the ‘Application for Foreign Company (Change) Registration and Branch (Change) Registration’.
• Attach the remittance advice and the “water bill” (proof of foreign exchange purchase) for the remittance.
• Submit the capital amount checking visa report for the branch office.

8. Tax Registration

Once the application for branch registration has been approved and the funds have been verified, the tax registration procedure can be carried out. To do so, the applicant must submit: 

• The application for business registration
• Copy of the approval letter issued by the Department of Commerce and Ministry of Economic Affairs
• Copy of the office lease agreement
• Copy of the landlord’s consent letter
• Copy of the housing tax bill to the National Tax Agency for tax registration. 

After the IRS approves the establishment of the branch, the person in charge of the branch must report to the IRS in person and apply for an invoice purchase certificate. A copy of the invoice stamp and the approval letter of establishment must be prepared when purchasing the invoices in order to start official operations.

9. Conversion of Preparatory Account to Regular Account

Upon successful completion of tax registration and receipt of the relevant approval documents, the preparatory bank account can be converted into a regular operating bank account. This conversion allows the branch to start daily financial transactions for general business operations.

The bank will typically require the following documents for this conversion:

• Letter of approval for the establishment of the branch issued by the Department of Commerce, Ministry of Economic Affairs
• Letter of approval for business registration issued by the National Tax Agency
• Company seals (the official round seal and the responsible person’s seal)

It is highly recommended to confirm the specific requirements with your bank before initiating the account conversion to ensure a seamless process.

10. Application for Manufacturer’s Registration

If a branch engages in import/export or general trading business, it is mandatory to apply for a ‘Manufacturer’s Registration’ with the Department of International Trade (DIT) of the Ministry of Economic Affairs (MOEA). 

This application can be submitted online via the official website of the Bureau of Foreign Trade. Legal import and export of goods can only commence after obtaining this approval. Before applying, ensure that your company’s English name matches your registration and that all basic setup procedures are complete as this is a prerequisite for approval. 

This step is essential for initiating cross-border business and applies to all foreign branches involved in international trade.

If you are planning to establish a branch in Taiwan and do not yet have a permanent physical location, you may consider leveraging JustCo’s virtual office solutions and shared office spaces. Whether it’s securing a legally registered address, organising meetings, or requiring flexible office seating, JustCo can assist you in establishing your presence in Taiwan.