Taiwan government loosens restrictions on China investments
Taiwan's Executive Yuan (Cabinet) on July 17 eased restrictions on investment by Taiwan-based companies in China in a bid to allow local companies to utilize their capital more efficiently so as to improve their competitiveness, according to government officials.
Companies will be allowed to invest up to 60% of their net worth in China compared to the existing limits of 20-40%, said the officials, noting that the new rules will take effect starting August 1.
Under current rules, Taiwan-based firms with a net worth of at least NT$5 billion (US$164.8 million) can invest the equivalent of 40% of the amount in China, while the cap for companies with net worth of NT$5-10 billion and over NT$10 billion are limited at 30% and 20%, respectively.
A total of 52 listed-companies had exceeded the current investment ceiling and another 131 listed-companies were near the investment caps, the Chinese-language Commercial Times quoted data from the Ministry of Economic Affairs (MOEA) as indicating.
In addition, Taiwan's government will also waive any caps on China investments for Taiwan companies that keep their headquarters on the island as well as subsidiaries set up by multinational companies in Taiwan.
There are a total of 577 Taiwan-based companies that have kept their headquarters in Taiwan after making investments in China, with the number of such headquarters to reach 800 by year-end 2009 and to further expand to 1,100 by 2010, the Commercial Times quoted MOEA data as saying.
Meanwhile, the relaxation rules will also raise the cap on China-bound investment by small- and medium-size enterprises (SMEs) and by individuals.
SMEs can invest up to NT$80 million, or up to 60% of their net worth, depending on which is higher, in China, whereas individual investors will be allowed to invest up to US$5 million across the strait compared to current limit of NT$80 million.
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Companies will be allowed to invest up to 60% of their net worth in China compared to the existing limits of 20-40%, said the officials, noting that the new rules will take effect starting August 1.
Under current rules, Taiwan-based firms with a net worth of at least NT$5 billion (US$164.8 million) can invest the equivalent of 40% of the amount in China, while the cap for companies with net worth of NT$5-10 billion and over NT$10 billion are limited at 30% and 20%, respectively.
A total of 52 listed-companies had exceeded the current investment ceiling and another 131 listed-companies were near the investment caps, the Chinese-language Commercial Times quoted data from the Ministry of Economic Affairs (MOEA) as indicating.
In addition, Taiwan's government will also waive any caps on China investments for Taiwan companies that keep their headquarters on the island as well as subsidiaries set up by multinational companies in Taiwan.
There are a total of 577 Taiwan-based companies that have kept their headquarters in Taiwan after making investments in China, with the number of such headquarters to reach 800 by year-end 2009 and to further expand to 1,100 by 2010, the Commercial Times quoted MOEA data as saying.
Meanwhile, the relaxation rules will also raise the cap on China-bound investment by small- and medium-size enterprises (SMEs) and by individuals.
SMEs can invest up to NT$80 million, or up to 60% of their net worth, depending on which is higher, in China, whereas individual investors will be allowed to invest up to US$5 million across the strait compared to current limit of NT$80 million.
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