Law of the People's Republic of China on the Protection of the Investments of Taiwan Compatriots (Amended in 2016)
(Adopted on 5 March 1994 by the Sixth Session of the Standing Committee of the Eighth National People's Congress Revised on 3 September 2016 pursuant to the Decision of the Standing Committee of the National People's Congress on Revision of Four Laws Including the Law of the People's Republic of China on Wholly Foreign-owned Enterprises)
Article 1 This Law is enacted to protect and encourage investment by compatriots from Taiwan and promote economic development on both sides of the Straits.
Article 2 This Law shall apply to investment made by Taiwanese compatriots; where matters relating to investment by Taiwanese compatriots are not covered by this Law but have been stipulated in other related statutory regulations, such stipulations shall apply.
For the purposes of this Law, investment by Taiwanese compatriots shall refer to investments made within other provinces, autonomous regions and directly administered municipalities by companies, enterprises, other economic organisations or individuals from Taiwan.
Article 3 The State shall protect, by law, investments made by Taiwan investors, returns on their investments, and any other lawful rights and interests enjoyed by them.
In making investment, Taiwanese compatriots shall abide by State laws and regulations.
Article 4 The State will not nationalize or expropriate the investments of Taiwan investors. Under special circumstances, according to public need, the investments of Taiwan investors may be expropriated in accordance with the legal procedures that require investors to be fairly compensated.
Article 5 The invested property, industrial property rights, income derived from investments and other legal rights and interests of Taiwanese investors may be assigned or inherited in accordance with the Law.
Article 6 Taiwan investors can make investments in convertible currencies, machinery, equipment or other objects, industrial rights, or non-patent technology.
Taiwanese investors may reinvest the profits derived from their investments.
Article 7. Taiwanese compatriots may invest in and establish joint equity enterprises, cooperative enterprises and sole investment enterprises (hereinafter referred to as Taiwanese investment enterprises) and may also adopt other investment methods as stipulated in laws and statutory regulations.
The establishment of Taiwan investment enterprises shall conform to the industrial policies of the State, and shall be conducive to the development of the national economy.
Article 8. To establish a Taiwanese investment enterprise, an application shall be submitted to the department or to the local People's Government as designated by the State Council, and the examining and approving organ shall make a decision on whether or not to approve the application within 45 days of receiving all necessary application documents.
After an application to establish a Taiwanese investment enterprise has been approved, the applicant shall, within 30 days of receiving a document of approval, register with the enterprise registration authorities in accordance with the law and shall obtain a business licence.
Article 9. A Taiwanese enterprise shall conduct business operations and management activities in accordance with the law, statutory regulations and the contracts and articles of association approved by the examining and approving organ. There shall be no interference in the right to autonomy of business management.
Article 10. In areas where Taiwanese investment enterprises are concentrated, associations of Taiwanese investment enterprises may be established in accordance with the law, and the legal rights and interests of such associations shall receive the protection of the law.
Article 11 Profits legally acquired by Taiwanese investors from their investments and other legal income and funds retained after the settlement of accounts may be remitted back to Taiwan or remitted abroad in accordance with the law.
Article 12 Investors of Taiwan compatriots may appoint their relatives or friends as their agents.
Article 13. Taiwanese investment enterprises shall enjoy preferential treatment in accordance with relevant State Council regulations for encouraging investment by Taiwanese compatriots.
Article 14 For establishment of enterprises invested by Taiwan compatriots which are not subject to the implementation of special administrative measures for admission stipulated by the State, examination and approval matters stipulated in the first paragraph of Article 8 of this Law shall be subject to filing administration. Special administrative measures for admission stipulated by the State shall be promulgated by the State Council or promulgated with approval by the State Council.
Article 15 If a dispute arises which involves a Taiwanese investor and another company, enterprise, other economic organisation or individual in another province, autonomous region or directly administered municipality, the parties concerned may resolve the matter through consultation or mediation.
Where the parties concerned are unwilling to settle the dispute through consultation or mediation, or the consultation or mediation has failed, the parties concerned may, in accordance with the stipulation of the arbitration articles in the contract, or in accordance with the written arbitration agreement reached by the parties concerned after the dispute has arisen, submit their dispute to the arbitration authorities for settlement.
In the absence of an arbitration clause in a contract and failure to conclude a written arbitral agreement after a dispute has arisen, a suit may be filed in a people's court.
Article 16 This Law shall go into effect as of the date of promulgation.