Newsletter
FOREIGN COMPANY'S TAIWAN BRANCH CAN BE TRANSFORMED INTO A TAIWAN COMPANY'S BRANCH
Shortly after the Corporate Mergers and Acquisitions Act (CMAA) took effect, on 2 May 2002 the Ministry of Economic Affairs convened a discussion meeting with other ministries at which a number of resolutions were passed regarding company registrations after closing of M&A transactions between Taiwan and foreign companies. One of the resolutions stated that when a Taiwan company made a general assumption of the business of the Taiwan branch of a foreign company, the foreign company's Taiwan branch could not be directly renamed as a branch of the Taiwan company; instead, the Taiwan company had to establish a new branch to carry on the business.
In practice, the above resolution made it necessary on the one hand to establish a new branch of the Taiwan company, and on the other hand to wind up and liquidate the branch of the foreign company. This was clearly at odds with the aim of simplifying M&A procedures. In view of this, on 2 January 2008 the MOEA changed its position, to allow that when a Taiwan company makes a general assumption of the business of the Taiwan branch of foreign company, the acquired branch can be directly renamed as a branch of the Taiwan company.