Newsletter
CHANGES IN CALCULATION OF TOTAL AMOUNTS INVESTED IN MAINLAND CHINA
According to the Examination Principles for Investment and Technical Cooperation in the Mainland Area, firms are classified in different categories with different limits on the amounts and ratios of funds they may invest in mainland China. For example, sole proprietorships and small and medium businesses are limited to NT$60 million of total investments. The limit for listed companies, companies traded over-the-counter and companies which are capitalized or have net worth of NT$5 billion or less is 40% of their capital or net worth.
Under prior calculation methods, the Ministry of Economic Affairs (MOEA) included in the calculation of the total amounts of funds invested in mainland China profits on mainland China investments which were first remitted back to Taiwan and then remitted to mainland China for further investment. As a result, many firms were not willing to remit profits back to Taiwan. Therefore, the MOEA in June 1999 revised the calculation methods so that profits remitted to Taiwan and then remitted back to mainland China for further investment will no longer be calculated in the total amounts of funds invested in mainland China.