ELECTRONIC COMMENCE ENTERPRISES INCLUDED AMONG IMPORTANT TECHNOLOGY ENTERPRISES UNDER THE SUI

03/01/1999

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The Ministry of Finance (MOF) and the Ministry of Economic Affairs (MOEA) agreed in late January this year to include electronic commence enterprises among important technology enterprises eligible for 20% investment tax credits under the Statute for Upgrading Industries (SUI). The MOEA also completed a draft of the Criteria for Eligibility of as an Important Technology Enterprise of Electronic Commence Enterprises, which define electronic commence as commercial activities conducted over the Internet. This includes sales and marketing, trading, service, and payment activities.

To apply for eligibility as important technology enterprises, electronic commence enterprises must have at least NT$50 million of paid-in capital or added paid-in capital, and their investment plans must include the purchase of at least NT$15 million in brand-new equipment. These thresholds are vastly lower than those for important technology enterprises in the manufacturing category.

Electronic commence enterprises that receive tax incentives under the SUI must invest in one of three areas:

the operation of type II telecommunications services, including Internet access, packet switched data communications, on-line information, electronic mail, electronic bulletin boards, electronic data switching, data networks, trading services, facsimile storage and transmission, domestic satellite ground data, broadband switched communications, and data switched communications.

the operation of companies or other institutions offering public notarization and related authentication services; and

internet content provision, such as electronic media, electronic catalogues, brokering, and database services.