The Committee, formerly the Private Equity Committee, changed its name to reflect its broader scope to include venture capital, hedge funds, family offices and other such activities.

The Committee sincerely appreciates the government’s efforts to improve the business environment in the financial sector and specifically its responses to our recommendations in the 2025 Taiwan White Paper. We are pleased to note some of those issues have already shown positive and concrete progress.

We are grateful to the government, especially the National Development Council and Financial Supervisory Commission (FSC), for convening meetings for relevant agencies to review existing regulations and institutional frameworks, soliciting views from various stakeholders, and refining policy planning and implementation. We are encouraged to see these efforts translate into a more investor-friendly environment.

Building upon the strong foundation of cooperation and our shared vision, the Committee respectfully submits the following recommendations for the 2026 White Paper.

Suggestion 1: Amend the Act for Investment by Foreign Nationals to streamline the foreign investment approval process.

Foreign equity investments made in Taiwan for operational purposes are primarily governed by the Act for Investment by Foreign Nationals and require prior approval from the Department of Investment Review (DIR) under the Ministry of Economic Affairs (MOEA). However, the Act has remained largely unchanged for nearly 30 years. The framework lacks flexibility and as a result does not adequately reflect rapidly changing economic conditions or meet the evolving needs of foreign direct investment.

Although amending the Act would require approval by the Legislative Yuan, the development of draft amendments generally begins within the executive branch. As the frontline authority responsible for reviewing foreign investment, the DIR is best positioned to take the lead in developing and advancing such amendments. In addition, regulatory changes within the authority of the executive branch can be advanced in parallel with legislative amendments to the Act.

Recommendations:

1. Lower approval thresholds for foreign direct investment and divestment, and establish a more flexible, investor-friendly registration and reporting regime. The current regulations and restrictions are in many respects outdated. They were established 30 years ago and are no longer aligned with modern transaction practices or application efficiency. Some rules are also overly stringent, leaving room for improvement to enhance efficiency. Particularly, any amount of a foreign investment is currently subject to the DIR’s prior approval, which may not be time and cost efficient for foreign investors. We suggest establishing a certain threshold of foreign investment that may be registered or reported post-investment.
2. Provide greater flexibility in forms of capital contribution. Article 6 of the Act currently permits capital contributions only in the following forms: (i) cash; (ii) machinery or raw materials for self-use; (iii) patent rights, trademark rights, copyrights, proprietary technologies, or other intellectual property rights; and (iv) other assets approved by the MOEA as the competent authority. This limitation in the forms of capital contribution does not adequately accommodate emerging transaction structures and diversified commercial needs. For example, it is very common to use shares as consideration for investments. However, foreign shares cannot be used as consideration in share acquisitions of Taiwanese companies or share exchanges.
3. Introduce a bundled application mechanism. For transactions conducted in multiple stages, investors should be allowed to submit a single pre-filing application covering the overall transaction structure, with post-closing adjustments reported afterward, rather than requiring separate filings for each stage. Modern M&A transactions often involve complex structures. Under the current system, each step must be submitted as a separate application. This prevents regulators from seeing the overall transaction context, and requires additional efforts and time to complete the transaction.
4. Adopt a risk-based mechanism to accelerate the review process. The Committee recognizes the government’s need to carefully review matters such as beneficial ownership involving investors from the People’s Republic of China (PRC), sources of funds, and investments in sensitive industries. However, applying the same level of scrutiny to all applications, particularly applications with no apparent PRC connection, by requiring disclosure of the entire corporate structure and all directors and supervisors of upstream affiliated entities, creates a substantial burden for large multinational groups and significantly prolongs the review process. The application of a uniform level of scrutiny to all applications is inefficient. The Committee therefore recommends adopting a risk-based review mechanism.
5. Relax restrictions on the remittance of investment funds. Currently, foreign investment remittances must be made in cash and remitted directly by the investor in its own name. Such restrictions do not reflect the diverse structures commonly used in international M&A transactions. In particular, within corporate groups there are legitimate needs for affiliated entities to remit funds on behalf of the investor. Subject to appropriate disclosure and risk-based safeguards, the Committee recommends allowing group companies to remit investment funds on behalf of the investor.

Suggestion 2: Establish a comprehensive framework to support family office development.

The Committee appreciates the responses and initiatives of the FSC relating to the establishment of family offices in Taiwan. In recent years, securities investment consulting enterprises have been permitted to provide integrated advisory services for family offices. This was further expanded in 2025, when banks and asset management institutions were permitted to conduct family office-related business within the Asian Asset Management Center in Kaohsiung. These developments demonstrate the regulator’s commitment to advancing this sector, which is particularly relevant given Taiwan’s high proportion of family-run enterprises, many of which are increasingly establishing investment vehicles both domestically and globally. Taiwan’s strong technology and industrial sectors also continue to attract global investors, further supporting the case for a more developed family office ecosystem.

However, under the current regulatory framework, family office services are still primarily provided within the existing licensing structures of traditional financial institutions, which do not adequately accommodate the full scope and complexity of family office functions. A dedicated and comprehensive regulatory framework for family offices has yet to be established, resulting in a less integrated regulatory approach and limiting the development of a comprehensive family office ecosystem, and constraining Taiwan’s ability to attract and retain global capital.

The Committee recommends designing a comprehensive family office framework centered on Taiwan’s local assets and industrial development. This framework should address pressing needs arising from demographic changes, including an aging population and declining birth rates, particularly in areas such as corporate succession, retirement planning, and inheritance planning, as well as the growing importance of corporate transformation. These issues require long-term and cross-disciplinary policy planning to build a comprehensive ecosystem integrating expertise in law, finance, taxation, asset management, investment, and healthcare.

At the same time, future improvements to the regulatory framework will require coordinated legislative amendments and policy initiatives, driven by collaboration among multiple government agencies and institutions, including but not limited to the FSC, the National Taxation Bureau, Ministry of Health and Welfare, Taiwan Stock Exchange, and Ministry of Justice, as well as close coordination with the Legislative Yuan. Therefore, the Committee recommends establishing a cross-ministerial coordination platform or dedicated task force with a medium- to long-term mandate to plan and promote relevant policies.

The Committee recommends explicitly exempting offices that manage wealth for a single family from licensing requirements applicable to investment trust, investment advisory, or discretionary investment management businesses. Similar exemptions exist in jurisdictions such as Hong Kong and Singapore for asset management services provided exclusively within a corporate group or among affiliated entities, reflecting the more limited regulatory concerns associated with services confined to a single economic group.

The Committee also continues to recommend allowing entities that are not securities investment trust enterprises or securities investment consulting enterprises to apply for a dedicated asset management license. For example, drawing on the concept of Type 9 regulated activities under Hong Kong’s Securities and Futures Ordinance, which permits asset management services to be provided under a dedicated licensing regime, non-trust and non-advisory asset managers holding such a license should be permitted to provide services to multi-family offices, subject to appropriate regulatory oversight.

Recommendations:

1. Establish a cross-ministerial coordination platform to develop an industry-oriented family office ecosystem in Taiwan.
2. Relax and clarify licensing requirements applicable to family offices.

Suggestion 3: Relax private placement rules to allow more investors greater access to private market products.

We are encouraged by Taiwan’s ongoing efforts to reform regulations to develop the Asian Asset Management Center. This pilot program has great potential to broaden access to high-quality, global private markets products to Taiwan’s investors.

The Committee understands that the authorities are actively considering the relaxing of “99-investor limits” and single distributor requirements for private placement of non-securities funds. However, at present, offshore funds that are classified as non-securities funds remain limited to a maximum of 99 investors, comprising defined categories of qualified investors, including “professional institutional investors,” “high net worth entities,” and/or “high asset customers,” but excluding professional investors (individuals with a financial capacity of NT$30 million). Offshore managers of such funds are also prohibited from directly engaging multiple onshore distributors. These restrictions, in practice, limit participation by offshore fund managers to a single fundraising cycle in Taiwan.

Given the upfront time, cost, and effort required to establish compliant local partnerships and distribution arrangements, as well as the ongoing obligations to service investors, such constraints may deter high-quality global asset managers from participating in Taiwan’s market.

The anticipated relaxation of these rules will enable Taiwan to achieve its goal of creating a leading asset management hub. Such reforms would help to foster an environment that:

• Facilitates access to high-quality private markets investment products for a broader range of investors beyond high-net-worth individuals. High-quality, global private markets products have historically demonstrated strong risk-adjusted returns. These products also feature high levels of disclosure and transparency, promoting good governance standards.
• Attracts leading global asset managers to make long-term, sustainable investments in Taiwan. These asset managers can bring their global expertise to the local market, helping to train the next generation of Taiwan’s financial services professionals. They can also contribute best practices in the responsible management of capital and serve as positive contributors to the local community, supporting the development of the broader ecosystem for both domestic and global asset managers in Taiwan.
• Extends comparable relaxation to private placements of offshore securities funds, which are subject to similar (but not identical) 99-investor limits.
• Promotes capital retention and broadens investable assets in Taiwan. Offering more investment opportunities promotes capital retention in the local asset management ecosystem over alternative offshore routes such as Singapore and Hong Kong, and can help alleviate upward pressures on the local property sector and stock market, while maximizing returns for retirement savings.

Markets like Japan, the United States, and Singapore have adopted best practices regarding private markets products, including lifting the investor limit entirely, broadening the eligibility of investors to access private market products, and allowing offshore fund managers to engage multiple licensed qualified onshore placement agents, trust banks, or securities brokers. These markets could serve as a useful reference for Taiwan as it works toward its strategic goals.

Recommendations:

1. Expand investor eligibility beyond “High Net Worth Entities” and “High Asset Customers” (HACs) to also include “Professional Investors” (PIs) for non-securities funds, and exempt these categories of investors from numerical limit on investment in non-securities funds, recognizing best practices adopted in Japan and the United States, where banks determine investor suitability.
2. Adopt a regime that, where a numerical investor limit is maintained, resets the limit on an annual or semi-annual basis, with a clear roadmap toward lifting the limit entirely, recognizing that a resettable limit can create regulatory uncertainty for asset managers seeking to make long-term commitments to Taiwan’s market.
3. Allow offshore fund managers to directly engage multiple licensed, qualified onshore distributors, including banks and securities firms, for the private placement of offshore funds.

Suggestion 4: Harmonize identification requirements for foreign responsible persons to streamline corporate bank account opening.

The Committee appreciates the government’s continued dedication to creating an investor-friendly environment and its strategic goal of transforming Taiwan into an Asian asset management hub. However, a significant operational bottleneck remains for foreign direct investment (FDI) and cross-border M&A. Foreign-invested companies encounter systemic difficulties when attempting to open corporate bank accounts if their designated responsible person is a foreign national who resides offshore and who does not have a Taiwan-issued Alien Resident Certificate (ARC).

Under current practices, despite obtaining foreign investment approval from the DIR, commercial banks almost uniformly require the corporate responsible person to present a valid physical ARC to open a preparatory or corporate bank account. While the FSC permits the use of alternative forms of identification, such as a foreign passport combined with a uniform identification number (UIN), frontline bank branches rarely honor this pathway in practice. While a UIN is theoretically accepted, the approval process is subject to such extensive documentation checks that it functions as a de facto ARC requirement.

Because senior executives of global private equity funds and multinational corporations often reside in international financial hubs and do not possess ARCs, this rigid requirement creates a critical bottleneck in the investment lifecycle. Without a corporate bank account, foreign investors cannot remit their approved capital contributions, complete certified public accountant capital verification, or finalize corporate registration. This friction delays time-sensitive M&A transactions, degrades closing certainty, and actively deters capital investments and allocations to Taiwan.

To truly align Taiwan’s regulatory environment with international standards, the banking sector must transition from relying on arbitrary physical residency documents to assessing the actual commercial legitimacy of the corporate entity.

Recommendations:

1. Issue explicit and binding FSC guidance to all commercial banks permitting the acceptance of a valid foreign passport or a copy of a foreign passport authenticated by a Taipei Economic and Cultural Office within the past three months, combined with a UIN, as sufficient identification for non-resident corporate responsible persons, strictly prohibiting branch-level deviations or de facto ARC requirements.
2. Convene a formal meeting with the FSC and the Bankers Association of the Republic of China to address and resolve specific concerns held by financial institutions regarding the acceptance of passports and UINs as primary identification for non-resident corporate responsible persons.
3. Establish a streamlined “Green Lane” account-opening procedure for foreign entities that have already secured DIR approval, allowing banks to rely on the government’s rigorous FDI vetting to satisfy core elements of corporate know-your-customer and anti-money laundering due diligence.

Suggestion 5: Abolish arbitrary personal account tenure prerequisites and enforce digital corporate onboarding for foreign investors.

Beyond the ARC requirement, an equally prohibitive barrier for foreign-invested companies is the arbitrary imposition of personal account tenure rules by local commercial banks. Currently, several major financial institutions demand that a foreign responsible person maintain a personal retail bank account with their institution for a period ranging from 6-12 months before considering an application for a corporate bank account.

This requirement is incompatible with international corporate governance practices. Non-resident directors appointed to Taiwanese subsidiaries are acting in a professional fiduciary capacity for global institutions; they are not retail banking consumers seeking local employment. Expecting an offshore managing director to establish a retail checking account in Taiwan and wait a full year simply to open a corporate bank account for a multi-million-dollar acquisition is commercially unfeasible and forces companies into sub-optimal regulatory workarounds.

Furthermore, while the Committee highly commends the FSC’s August 2024 approval of the “Guideline for Banks Accepting Customers Opening Digital Deposit Accounts Online,” which explicitly expanded online account opening to non-individual customers and relaxed regulations for non-ROC responsible persons to verify identities remotely, practical implementation at the commercial branch level remains severely lacking.

Taiwan’s regional competitors, such as Singapore and Hong Kong, have successfully integrated robust digital-first onboarding and risk-based approaches that evaluate the corporate entity rather than penalizing the individual representative’s lack of local retail history. If Taiwan is to realize its macroeconomic objectives and attract top-tier global capital, these archaic tenure requirements should be eliminated.

Recommendations:

1. Prohibit commercial banks from requiring a foreign responsible person to have a pre-existing personal retail banking relationship (e.g., the six- to 12-month tenure rule) as a prerequisite for opening a corporate bank account.
2. Actively audit and enforce the implementation of the August 2024 digital deposit account guidelines, ensuring that commercial banks deploy functional digital onboarding portals capable of processing foreign corporate clients and their non-resident responsible persons remotely via video conference.