Thu, Mar 28, 2002 - Page 1 News List

Cabinet proposes lifting restrictions on investors from China, high schools

By Ko Shu-ling  /  STAFF REPORTER

The Cabinet yesterday approved draft amendments to the Statute Governing the Relations between the People of the Taiwan Area and the Mainland Area (台灣地區與大陸地區人民關係條例) and the Statute Governing Relations with Hong Kong and Macau (香港澳門關係條例) to allow Chinese investment into Taiwan and high schools to be established in China for the children of Taiwanese living there.

"To adjust cross-strait trade policies after WTO entry and to realize decisions made at the Economic Development Advisory Conference (經發會) last August, it's necessary to relax certain measures regulating Chinese investment in Taiwan," said Chen Ming-tong (陳明通), chairman of the Cabinet's Mainland Affairs Council.

Chen made the remark after the weekly closed-door Cabinet affairs meeting yesterday morning.

Schools for Taiwanese in China are currently permitted up to the junior high school level.

Also at present, any company based in China in which Chinese individuals, legal citizens, groups, or institutions own 20 percent or more of the company's shares are not allowed to invest in Taiwan.

Under yesterday's amendments, Article 63 of the Statute Governing the Relations between the People of the Taiwan Area and the Mainland Area would require any company based in China and owned by Chinese individuals, legal citizens, groups, or institutions to obtain the Taiwanese government's approval before investing in Taiwan.

Violators would face a fine of between NT$120,000 and NT$600,000.

The authorized company would also be required to file a financial and a shareholder's report upon the request of the supervising party.

The authorized company should not shun, hamper or refuse the supervising party's request to review such documents, if there is a need to do so.

Those who refuse to cooperate would face a fine of between NT$60,000 and NT$300,000.

In addition, when an authorized investor transfers his or her company to a different person, both the original owner and the transferee would be required to inform the supervising party of the matter and complete certain procedures.

Violators would face a fine of between NT$60,000 and NT$300,000.

In addition, to make the taxation system fairer between Chinese investors and Taiwanese nationals, amendments to Article 25 of the same statute would require Chinese nationals who have stayed or resided in Taiwan for a consecutive 183 days over the past taxation year to pay income taxes as do Taiwan nationals.

Chinese investors who have a steady business operation or a business agent in Taiwan would have to pay business taxes.

In a bid to solve the education problem of the children of Taiwanese businessmen in China, amendments to Article 22 of the same statute would allow Taiwanese individuals, legal citizens, groups, or institutions to establish schools up to the high school level.

Finally, Chinese people would find it easier to apply for a Taiwanese residency as amendments to Article 16 of the same statute would simplify the potential applicant's qualifications.

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