“Memo from Taipei” Goes to International Contacts

This month AmCham Taipei sent out the latest edition of our periodic Memo from Taipei designed to update the Chamber’s friends and contacts abroad about the latest developments here. The Memo went to a mailing list of about 135 people, including Washington-based government affairs representatives from our member companies, as well as U.S. government officials, think tank scholars, and others who follow U.S.-Taiwan relations closely.

If your company has a Washington representative that you would like added to the mailing list, please let us know.

The latest Memo announced the appointment of William Foreman as the new President of AmCham Taipei, Albert Chang’s reelection as Chairman for 2018, and the list of other Standing Officers for this year. It also conveyed the following information:

Progress in 2017

  • The Legislative Yuan finished the year on a high note by passing long-awaited amendments to the Pharmaceutical Affairs Act instituting a system of Patent Linkage for pharmaceuticals for the first time. The proposal had been in AmCham Taipei’s Taiwan White Paper for more than a decade, as well as on the agenda of the bilateral TIFA talks between Taiwan and the U.S. The new law creates a mechanism to ensure that generic forms of drugs still under valid patent in Taiwan cannot legally enter the market, and represents a major advance for Taiwan’s intellectual property rights protection.
  • At AmCham Taipei’s urging, the Executive Yuan in October 2016 increased the notice and comment period for new regulations and trade-related legislation from a mere 14 days to a full 60 days, except in cases of emergency. During the past year the Chamber, working together with the National Development Council (NDC), has been tracking the degree of adherence to that provision – and has seen a steady increase in compliance. AmCham’s emphasis is now on encouraging stakeholders to submit their comments and government agencies to provide meaningful feedback. If such dialogue can become the norm, many of the past difficulties in the regulatory regime could be prevented, the Chamber believes.
  • When the 2017 Taiwan White Paper was issued last June, it was disclosed that none of the 80 White Paper issues from the previous edition had been fully resolved. In response, the Taiwan government scheduled a series of quarterly meetings with AmCham committee representatives to discuss outstanding White Paper items in hopes of raising the success rate. So far two such meetings have been held, presided over by an NDC Vice Minister. Final results will be analyzed at the end of a one-year cycle.

 

2018 Advocacy Items

  • AmCham Taipei was disappointed that President Trump chose to withdraw the U.S. from the Trans-Pacific Partnership, as the Chamber viewed the TPP as important for American leadership in the Asia Pacific and hoped that Washington would support Taiwan’s desire to entire the TPP in a second round. Given the President’s aversion to multilateral trade agreements, however, we now urge the United States to consider entering into a bilateral trade agreement with Taiwan, its 10th largest trading partner. We are convinced that such negotiations are the best way to resolve existing bilateral trade issues and to deepen the economic cooperation between the two countries. From both an economic and strategic point of view, this step would be in the best interests of the U.S. At the same time, AmCham Taipei encourages Taiwan to seek eventual membership in the apparent successor to the TPP, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
  • The Chamber’s member companies, particularly those engaged in high-tech manufacturing, continue to be concerned about the future sufficiency, reliability, and cost of electricity in this market. The Taiwan government has committed itself to shutting down all nuclear power plants by 2025, at the same time sharply cutting back on carbon emissions. AmCham Taipei does not take issue with the aims of the policy, but questions remain as to whether it can be implemented within the designated timeframe given the many challenges involved in rapidly expanding reliance on wind and solar power, as well as the infrastructure to receive imported LNG. For their business planning, both multinational and domestic companies need a clearer energy roadmap from the authorities.
  • The amended Labor Standards Act that took effect last year – instituting new rules for working hours, overtime, and other working conditions – was highly controversial and left both employers and employees dissatisfied. A revised version now before the Legislative Yuan may be a slight improvement but does not tackle what AmCham Taipei considers to be the crux of the problem – the failure to distinguish between professional/managerial personnel and blue-collar workers. Taiwan’s avowed aspiration to develop an innovation-driven economy will not be furthered by treating knowledge workers the same way as those on a factory production line, for example requiring them to clock in and clock out. In fact, that requirement is wholly impractical in an age of global interconnectedness and will constitute a deterrent to investment.

Cross-Agency Meetings with NDC

Representatives of six AmCham Taipei committees had the opportunity on August 30 to discuss their key White Paper issues with their regulators at a meeting presided over by Deputy Minister Kung Ming-hsin of the National Development Council (NDC). The four-hour meeting in the NDC conference room was the first in what will be quarterly sessions until the 2018 White Paper is launched next June.

The government suggested holding the series of meetings to facilitate progress on White Paper issues after learning that none of the 80 issues from the 2016 White Paper had been totally resolved.

The committees and their issues were:

  • Travel and Tourism, regarding Taiwan’s policy of requiring refunds for canceled hotel reservations, even when customers agreed to non-cancellability as part of special promotional offers.
  • Intellectual Property, on proposed revisions to the Copyright Act.
  • Retail, concerning problems with mandatory inspection of various imported products in certified domestic laboratories.
  • Insurance, on suggested measures to incentivize insurers to offer protection insurance.
  • Capital Markets, on proposals to relax existing securities investment rules to permit broader participation.
  • Banking, regarding regulatory restrictions on the onshore wealth-management business. The Banking Bureau also agreed to a 2016 White Paper request for “double-hatting”: allowing bank personnel to take charge of bond agency and derivative information and advisory functions concurrently.

August 30, 2017 – The first quarterly meeting with the National Development Council

“The meeting was a great start for the new post-White Paper process, but much still remains in flux,” says AmCham Taipei President Andrea Wu. “We appreciate the Taiwan government’s efforts to actively address our issues, and hope to see early resolution to many of these longstanding challenges.”

2017 Doorknock Delegation to Washington

AmCham Taipei’s 2017 Doorknock visit to Washington D.C. from June 26 to 30 conducted a total of 45 meetings with U.S. government executive branch agencies (including the State Department, Commerce Department, and the Office of the U.S. Trade Representative), Congressional offices, think tanks, the U.S. Chamber of Commerce, the Taipei Economic & Cultural Representative office in the U.S. (TECRO), and others interested in the U.S.-Taiwan economic relationship.

Delegation members with U.S. House Foreign Affairs Committee Chairman, Congressman Ed Royce

The group was led by Chamber Chairman Albert Chang, Vice Chair Dan Silver, and President Andrea Wu, and also included Raghavendra Shenoy, co-chair of the Medical Devices Committee, Board Supervisor, and General Manager of Johnson & Johnson Medical Taiwan Ltd.; Jenny Zheng, co-chair of the Pharmaceutical Committee and Managing Director of Johnson & Johnson Taiwan Ltd.; Emily Chiang of Medtronic (Taiwan) Ltd.; Stephen Y. Tan of K&L Gates; William Vocke of the Foundation for Scholarly Exchange (Fulbright Taiwan); Lynn Cinelli of MSD Taiwan; Don Shapiro, AmCham Taipei Senior Director; and Amy Chang, AmCham Taipei Senior Director for Government & Public Affairs. They were joined for various meetings by the Washington representatives of such member companies as Bechtel, Cigna, Dell, Eli Lilly and Company, Merck, and Microsoft.

Delegation members with Congressman Ted Yoho

AmCham Taipei Chairman Albert Chang with Congressman Ted Yoho

“A lot has changed in Washington since the Trump administration took office, including a new emphasis on targeting U.S. trade deficits with its trading partners, so it was very useful for us to hear from people first-hand about their expectations for the U.S.-Taiwan relationship,” said Andrea Wu. “For the most part, we heard a hard line on outstanding trade issues from the executive agencies, but tempered by widespread expressions of support for Taiwan from members of Congress.”

Team members with U.S. Senator Ron Wyden

A full report on the Doorknock will appear in the August issue of Taiwan Business TOPICS, both the print and online editions.

USEPA Meets with AmCham Taipei

During a recent visit to Taipei, the U.S. Environmental Protection Agency (USEPA) Acting Assistant Administrator Jane Nishida, met with AmCham Taipei on July 7th. Nishida has over 30 years of environmental experience working in federal and state government, and international and nongovernmental organizations. She currently leads EPA’s international and tribal engagements, and works closely with tribal governments, foreign governments, international organizations, and other U.S. agency partners on matters relating to environmental policy and program implementation in tribal lands and internationally.

Justin Harris, Senior Program Manager from the EPA, accompanied Nishida to meet with members from AmCham Taipei, including President Andrea Wu; Sustainable Development Committee Co-chair Kenny Jeng, A/P Product Stewardship Manager of DuPont Taiwan Ltd. and Co-chair Cosmas Lu, Strategy Adviser of Super Dragon Technology Co. Ltd.,; Public and Government Affairs Consultant Stella Lai from Dell Taiwan; and Senior Manager for APJ Environmental Affairs & Producer Responsibility Vivian Tai, also from Dell.

From left to right: Anna Wang, Economic Officer, AIT Econ Section; Kenny Jeng of DuPont Taiwan, AmCham Taipei Sustainable & Development Committee Co-chair; Andrea Wu, AmCham Taipei President; Jane Nishida, USEPA Acting Assistant Administrator; Cosmas Lu of Super Dragon, AmCham Taipei Sustainable Development Committee Co-chair; Stella Lai of Dell Taiwan, AmCham Taipei Tax Committee Co-chair; Vivian Tai, also from Dell Taiwan; and Justin Harris, USEPA Senior Program Manager

The purpose of the trip was to meet with the Taiwan government and U.S. business community to discuss the different elements of the U.S.-Taiwan and APEC regional environmental cooperation. Some of the key areas of discussion include 1) Monitoring Air Quality 2) Mercury Pollution 3) Circular Economy and 4) International E-Waste Network (IEWN). Members of AmCham Taipei also exchanged their views with the USEPA officials on corporate sustainability programs and challenges in the region, especially Taiwan.

Two Congresswomen Visit AmCham Taipei

Representative Brenda Lawrence (D-MI) and Representative Nanette Barragan (D-CA) called at the AmCham Taipei office on May 9 during their three-day stay in Taiwan. Accompanied by Congresswoman Lawrence’s legislative aide Alex Huang, a Taiwanese-American, they met with the Chamber’s Senior Director Don Shapiro, Senior Director for Government & Public Affairs Amy Chang, and Government & Public Affairs Manager Erica Lai. The group was joined by two representatives from Herbalife Nutrition, whose headquarters in the Los Angeles area is near Congresswoman Lawrence’s district: Taiwan General Manager Ceasar Chen and Senior Manager for Regulatory, Government & Industry Affairs Alex Lin.

Representative Lawrence explained that the main purpose of the trip was to make up for her inability to come last year for the inauguration of President Tsai Ing-wen and Vice President Chen Chien-jen. But she and Representative Barragan, whose district is in Detroit, were also looking for potential business opportunities in Taiwan for companies in their districts. As skilled manpower training and port operations are among their particular interests, their itinerary included Taiwan’s occupational training center and Kaohsiung Harbor.

From left to right: Amy Chang, Chamber’s Senior Director for Government & Public Affairs; Don Shapiro, Chamber’s Senior Director; Representative Nanette Barragan (D-CA); Representative Brenda Lawrence (D-MI); Ceasar Chen, General Manager, Herbalife Taiwan Inc.; Alex Lin, Senior Manager of Worldwide Regulatory, Government, & Industry Affairs at Herbalife Taiwan Inc.

Technology Licensing Expert Dialogue

The American Chamber of Commerce in Taipei (AmCham), in partnership with the American Institute in Taiwan (AIT) and the Taipei Economic and Cultural Representative Office in the United States (TECRO), and the Taiwan–USA Industrial Cooperation Office (TUSA), hosted a Technology Licensing Expert Dialogue on March 30.

Building on the success of the second Digital Economy Forum in October, 2016, the dialogue brought together legal and technology experts from the United States and Taiwan to discuss practical guidance on the booming US$5 billion trade in technology licensing. The esteemed speakers included Hong Shu-ming, Director General of the Taiwan Intellectual Protection Office (TIPO) and the Honorable Judge Sidney H. Stein of the United States District Court Southern District of New York, who opened the forum.

Hosted by Kris Kvols, economic officer at AIT, over 100 participants listened to presentations discussing myriad complexities of licensing technology between American, Taiwanese, and Chinese markets.

2017 Business Climate Survey Press Conference

Representatives of some 30 Taiwan media organizations came to AmCham Taipei’s Lincoln Room today for a briefing by Chamber chairman Albert Chang, managing partner in Taiwan for the global consulting firm McKinsey & Co., on the results of AmCham’s 2017 Business Climate Survey. The seventh annual survey was conducted between October and December last year, with 173 top executives of AmCham’s member companies responding.

Chang stressed that the survey respondents view Taiwan as a positive business environment. Most companies made money in 2016 and expect good revenue and profits in the year to come, and they are continuing to invest in this market and add more employment.

Albert_Chang_BCS_2017

Albert Chang, Chamber chairman Albert Chang, managing partner in Taiwan for the global consulting firm McKinsey & Co., presents AmCham’s 2017 Business Climate Survey.

“The problem is that the pace of improvement is not fast enough,” said Chang. He noted that three areas in particular stood out as needing government attention:

1) Government regulations and the rules-making process. Needed is more transparency, consistency, and prior consultation with stakeholders. Chang commended the government of Premier Lin Chuan for recently increasing the notice and comment period for new regulations from 14 to 60 days, and urged government agencies to fully utilize this platform by providing meaningful responses to public comments.

2) The new Labor Law provisions. Chang described the new amendments as a “big headache for many companies” both in terms of increased costs and continued lack of clarity about how to be in compliance.

3) Cross-Strait relations. “Investors value certainty and stability,” Chang observed.

Other points covered by the survey include:

  • Trade agreements. Although the Trump administration has withdrawn the U.S. from the Trans-Pacific Partnership, new opportunities may arise for strengthening U.S.-Taiwan economic relations through bilateral rather than multilateral channels, possibly including a “free and fair trade agreement” and/or a bilateral investment agreement, said Chang. He said the survey showed strong membership support for bilateral exchanges with the U.S. through the TIFA (Trade and Investment Framework Agreement) process.
  • Tsai administration’s priority objectives. The respondents reported that the five pillar industries that the new government has targeted for development are relevant to their businesses and offer good opportunities for public/private collaboration. Chang called the setting of the policy directions “a good start,” and urged the government to form task forces in each of the five sectors to reach out to the private sector on means of cooperation.
  • Role of the six major municipalities. For the first time, the survey asked members how their businesses are impacted by municipal governments. The results pointed to significant room for improvement in how local governments facilitate business, treat foreign companies, and align their rules with national-level regulations.
  • Personnel. As in past surveys, respondents highly applauded Taiwanese employees’ work ethic and trustworthiness. The main areas of weakness were innovation and creativity.
  • Life in Taiwan. Once again, respondents were enthusiastic about Taiwan as a safe and friendly place to live, with good-quality medical care. Problem areas cited included pedestrian traffic safety and air quality.

Chang noted that Taiwan has lagged behind most other countries in the region in recent years in attracting Foreign Direct Investment. But he said that if the “cloud” of the several key problem areas could be removed, Taiwan should be able to dramatically enhance its investment attractiveness.

To view the full press release, or download the 2017 BCS report, follow the links below:

2017 Business Climate Survey Press Release (English)

2017 Business Climate Survey Press Release (Chinese)

2017 Business Climate Survey Report (PDF) 

2017 Business Climate Survey Press Announcement

This morning, AmCham Taipei presented its 2017 Business Climate Survey report at a press conference held in AmCham Taipei’s Lincoln Room.

AmCham Chairman Albert Chang introduced the Business Climate Survey, highlighting key reasons why this year’s report is more meaningful than those of previous years: Taiwan is at a precipice of uncertainty in the international arena, and now it needs more than ever to pick up the pace in improving regulatory issues and attracting foreign investment.

Live video of the press conference, courtesy of McKinsey Taiwan

For this year’s survey, AmCham Taipei invited 412 voting representatives (usually the top executive) of the Chamber’s member companies to answer a series of questions about the business environment in an online questionnaire. In conducting the survey and analyzing the data, the Chamber was grateful for the professional guidance of Independent Marketing & Research.

Each year, we have intentionally asked our business leaders the same, or nearly the same, set of questions. As a result, we have been able to track the degree of progress – or the lack thereof – across key issues over that period.

amcham-taipei-mckinsey-present-business-climate-survey-2017

AmCham President Andrea Wu and Albert Chang, Managing Partner, McKinsey & Company, co-present the 2017 Business Climate Survey Report to media representatives at the February 20 press conference.

To view the full press release, or download the 2017 BCS report, follow the links below:

2017 Business Climate Survey Press Release (English)

2017 Business Climate Survey Press Release (Chinese)

2017 Business Climate Survey Report (PDF) 

 

Participate on Join.gov.tw to Make Taiwan Better

Recently, the Executive Yuan instructed that all draft regulations of trade, investment, and intellectual property rights laws must be given a 60 day commenting period to allow feedback to be gathered from industry and the public. Furthermore, in order to generate the widest possible coverage, the Executive Yuan has instructed that such draft regulations should not only be announced through existing channels but also on its online portal, “Join,” accessible at ( https://join.gov.tw/ ).

Join, developed by National Development Council (NDC) with assistance from the office of Digital Minister Audrey Tang, facilitates two-way communication between government offices and members of the public on regulatory matters.

AmCham-Leaders-with-Minister-Tang

AmCham leaders paid a visit to Audrey Tang, Taiwan’s Digital Minister, last year to encourage the enhancement of the Government’s web-based regulatory commenting system.

AmCham Taipei is calling  on its member companies, especially those in highly regulated sectors of the economy, to participate in carefully tracking the status of new regulations through join.gov.tw and to work through the Chamber’s industry committees to help prepare well-considered comments for posting on Join.

Through effective use of this platform, Taiwan has an opportunity to boost government efficiency, promote broader participation in public affairs, and create a sounder business environment that may stimulate increased investment leading to stronger economic growth.

For more information, you may also read our Editorial in the latest issue of Taiwan Business TOPICS Magazine here.

Notice: Executive Yuan Extends Notice & Comment Period for Draft Regulations to 60 Days

Earlier this month, the Executive Yuan (EY) issued a directive to extend the Notice & Comment period for all draft regulations from 14 days to 60 days. Further, effective 10/1/2016, the new 60-day rule will also apply to EY drafts of proposed legislation applicable to trade, investment or IPR matters. Below, please find the original document in Mandarin Chinese and an unofficial English translation for your reference:

Original Mandarin Chinese Document

Unofficial English Translation

For the business community, this promising regulatory improvement has been the change that AmCham Taipei actively pursued as one of our top priorities for the past two years. We see this reform as a sign of the current Administration’s willingness to proactively engage the public and industry stakeholders to improve the regulatory transparency.
AmCham Taipei strongly encourages you and your business partners in Taiwan to take advantage of this great opportunity and whenever possible, make frequent and meaningful comment submission on new and/or existing draft regulations and/or laws.

We are very excited about this new change. If you have any questions, please feel free to contact our Government Affairs department using the contact form on this website or by phone. Contact info available here.

Thank you very much for your support.