An important but sometimes overlooked factor in China’s explosive economic growth has been the over US$150 billion invested in China by Taiwanese businesspeople and the 750,000 Taiwanese who have followed those investments and settled in China. Despite a lack of direct air and sea links between China and Taiwan, and significant restrictions on who can travel to Taiwan from China, the flow of human resources in the other direction is set to increase after a series of incremental liberalizations and policy shifts by the Taiwanese government.
Under Taiwan’s Act Governing Relations between Peoples of the Taiwan Area and the Mainland Area, Chinese citizens resident in Chinese jurisdictions other than in Hong Kong or Macao require special approval to travel to Taiwan. In general, three classes of PRC nationals may receive approval to travel to Taiwan: relatives of Taiwanese citizens, tourists, and professionals. This last class is of special interest to international business and Taiwanese tech businesses with operations in China because it includes business professionals, tech professionals, and management and professional employees of multinationals.
Short-term Business Visits
Current regulations make it fairly straightforward for Chinese business professionals to make multiple (up to 12) short trips to Taiwan each year for business purposes at the invitation of an approved sponsor. Acceptable purposes for a visit include:
- business visits to customers and suppliers
- factory visits
- business conferences
- performance of contract
- exhibits at trade shows
- visiting trade shows
Each trip to Taiwan may be for up to two weeks with the exceptions those for training and contract performance. Business trips for training may last for up to three months as can business trips to inspect goods, provide post-sale service, and give technical training to fulfill contractual obligations. The qualifications for business professionals are quite liberal. In addition to managers, any employee with demonstrable professional or technical skills can be invited by a Taiwanese or Taiwan-based foreign sponsor. Previous minimum length of employment requirements have now been dropped, meaning that qualified business professionals who have only recently joined their employer are now eligible to visit Taiwan on business trips.
Sponsors may be any of the following:
- A Taiwanese firm or a foreign-invested subsidiary with annual revenue of at least NT$10 million (c. US$310,000) or start-up with working capital of at least NT$5 million (c. US$155,000)
- A foreign branch office with annual revenue of at least NT$10 million (c. US$310,000) or start-up with working capital of at least NT$5 million (c. US$155,000)
- A foreign representative office with annual procurement in Taiwan of at least US$1 million (representative offices of financial services firms are exempt from this minimum procurement requirement)
- Certain businesses set up in one of Taiwan’s Free Trade Zones
The number of Chinese business professionals who may be sponsored depends primarily on the size of the sponsor:
- Firms with annual revenue of up to NT$30 million (c. US$920,000) may sponsor up to 15 Chinese business professionals each year
- Firms with an annual revenue of over NT$30 million may sponsor up to 50 Chinese business professionals each year
- Multinationals with a presence in Taiwan and worldwide assets of US$2 billion may sponsor up to 100 Chinese business professionals each year
- Operational headquarters, operations centers, supply chain centers, and R&D centers may also sponsor up to 100 Chinese business professionals each year
In addition, with approval from the Mainland Affairs Commission, multinationals holding regional or international business conferences in Taiwan may, on a case-by-case basis, invite an unlimited number of Chinese business professionals. Similar special provision is made for events that have special significance for Taiwan’s economic or social policies. During 2005 and 2006, more than 50,000 Chinese business professionals were permitted to make short-term visits.
Chinese technology professionals are divided into three classes: Class A, Class B, and Class C technology professionals.
Class A technology professionals must have the following educational qualifications and work experience:
- MA and at least two years work experience
- BA at least three years work experience
Class A technology professionals may visit Taiwan to attend conferences, give lectures, or provide training. They may stay in Taiwan for up to two months and may extend with approval for another two months. Their sponsors must be IT manufacturers or technology service providers with annual revenue of at least NT$10 million
Class B technology professionals must have the following educational qualifications and work experience:
- MA and at least three years work experience
- BA at least five years work experience
Class B technology professionals may reside in Taiwan for up to one year to do R&D or give training in production technologies. Their residence may be extended for each year for a total maximum stay of six years. Their sponsors must be
- IT manufacturers with annual revenue or capitalization of at least NT$30 million (c. US$920,000)
- technology service providers with annual revenue or capitalization of at least NT$15 million (c. US$461,000)
Class B technology professionals are of special interest since Taiwan’s increasingly globalized tech manufacturers are expected to take advantage of this opportunity to move human resources between China and Taiwan thereby further integrating their operations across the Taiwan Strait. The parallels between Chinese tech professionals and the hundreds of thousands of blue collar migrant workers from southeast Asian countries already in Taiwan working in traditional industry are notable since for many years blue collar workers were allowed a maximum stay of six years in Taiwan. Currently there is no cap on the number of Chinese tech professionals who may be brought into Taiwan although each one must be approved by the Ministry of Economic Affairs.
Class C technology professionals are similar to Class B in that they may reside and work in Taiwan for up to six years. Class C technology professionals must hold at least an MA degree and they must have obtained work authorization (such an H-1 visa) or permanent residence in a third country. There is no work experience requirement for Class C technology professionals and the capitalization/revenue requirement for the sponsor is only NT$10 million (c. US$310,000). The sponsor may be an IT manufacturer or a technology service provider.
Despite the great importance attached to Class B and Class C technology professionals by the Ministry, less than 70 have actually come to Taiwan. Winkler Partners has been assured by officials in the Ministry that this has been because of a lack of applications, not strict requirements for approval. The Ministry is especially keen to attract Class C technology professionals.
Multinationals may transfer management and other professionals from their Chinese subsidiaries to their Taiwan subsidiaries if the candidate has been employed by the Chinese subsidiary for at least one year. Multinationals are defined as the Taiwanese subsidiaries of multinationals with any one of the following:
- Worldwide assets of at least US$2 billion
- A letter from the Ministry of Economic Affairs certifying that the Taiwan subsidiary is a corporate operations center
- the Taiwan subsidiary has at least 100 employees, 50 of whom hold at least polytechnic degrees
- Taiwan annual net revenue is at least NT$1 billion (c. US$30 million)
- Regional net revenue is at least NT$1.5 billion (c. US$45 million)
The transferred employee may reside and work in Taiwan for up to three years. This period of residence may be extended yearly thereafter. Significantly, immediate family members may now accompany the transferred employee, and in a recent liberalization may attend either Taiwanese schools or international schools. The latter are normally only open to children holding foreign passports. Eighty-five Chinese employees of multinationals received approval for transfer to Taiwan in 2006 with another 36 arriving in the first four months of 2007.
For further information on application procedures to bring Chinese professionals to Taiwan, please contact Christine Chen at +886-2-2311-8307.