Foreign Investment
Types of Companies under Taiwan law
 Types of Companies under Taiwan law

If you decide to set up a company, two most common choices are limited company and company limited by shares. A company limited by shares can be further set up as a closely-held company limited by shares.  The table below summarizes the main differences among each other.
 
  limited company company limited by shares closely-held company limited by shares
Shareholder Requirements    Shareholders can be corporations or natural persons, local or foreign.

Minimum capital required
  No minimum capital requirement

Shareholders have limited liabilities?
 		  Yes                                           
Minimum number of shareholders   1 2 (Note 1)  2 (Note 1)

Maximum number of shareholders		   No restrictions No restrictions             
         50

Minimum number of key personnel		   1 director 1 director, 1 supervisor
(Note 2)		 1 director, 1 supervisor
(Note 2)

Maximum number of key personnel		   3 directors No restrictions
No restrictions

Allowed to issue shares?		   No Yes Yes
Allowed to prohibit share transfer under the constitutional documents? No. But a shareholder must obtain consent from 1/2 or 2/3 of the other shareholders before he can transfer his capital contribution 
No
Yes. It’s a compulsory requirement for a closely-held company limited by shares to provide share transfer restrictions in the constitutional documents.
Having the shareholders’ meeting as a governing body? No
Yes
Yes
Having the shareholders’ meeting as a governing body? No
Yes
Yes
 
  • Allowed to have only 1 shareholder
  • Easy to understand because its structure is similar to a corporation under Delaware law.
  • Suitable for a company which may have many shareholders
  • Allowed to impose share transfer restrictions under the constitutional documents.

Note 1: A company limited by shares is allowed to have only 1 shareholder if the shareholder is a company, corporation or any other form of legal person.  
Note 2: A company limited by shares is allowed to have only 1 director and sets up no position of supervisor if the company has a sole company shareholder. 

Company laws in Taiwan are sometimes complicated and investing into Taiwan requires approval from the Taiwan government.  Please consult independent advice before you seek to apply the information above. If you require further assistance, please contact aliciahsulawyer@gmail.com. (August 2020)