Setting Up a Company in Taiwan
— Which structure suits your business: Limited Company or Company Limited by Shares?
Taiwan is one of Asia’s most attractive markets for foreign investors — known for its stable economy, strong talent base, and growing innovation ecosystem.
When setting up a subsidiary in Taiwan, one of the first strategic questions foreign companies face is:
👉 Should we choose a Limited Company or a Company Limited by Shares?
Both are legitimate structures under Taiwan’s Company Act, but they differ in capital flexibility, governance, and long-term scalability.
🏢 Limited Company
Best for:
- Small to medium-sized enterprises entering Taiwan in an early stage.
- Companies with few shareholders who maintain close relationships (e.g., family-owned entities, internal subsidiaries).
- Businesses not planning to raise external capital or go public soon.
Advantages:
- Simple structure with low setup and maintenance costs.
- Flexible management and decision-making.
Limitations:
- Share transfers require approval from other shareholders (lower liquidity).
- Cannot issue public shares — limited fundraising capability.
💡 Ideal for companies seeking a lean, flexible structure to test the Taiwan market or operate a support office before large-scale expansion.
💼 Company Limited by Shares
Best for:
- Companies planning long-term operations and expansion in Taiwan.
- Businesses expecting multiple corporate or investor shareholders.
- Enterprises emphasizing corporate governance, transparency, and brand credibility.
Advantages:
- Can issue shares — highly flexible capital structure.
- Easier to attract investors or strategic partners.
- Suitable for future IPOs or joint ventures.
Limitations:
- More complex establishment procedures (board meetings, shareholder meetings required).
- Slightly higher administrative and compliance workload.
💬 Ideal for multinational corporations, venture-backed startups, or businesses seeking sustainable growth and investment opportunities in Taiwan.
⚖️ Practical Recommendation
From our advisory experience:
- Short-term or single-investor entities → Limited Company
- Long-term or growth-oriented investors → Company Limited by Shares
In both cases, the setup requires:
- Investment approval (ICF)
- Company registration (MOEA Department of Commerce)
- Capital verification and bank account opening
Before choosing the structure, clearly define your mid- to long-term strategy, capital plan, and investment objectives.
🌐 About Taiwan Connect
Taiwan Connect Inc. is a bilingual consulting firm helping Japanese and foreign companies establish and expand operations in Taiwan.
We collaborate with licensed accountants and tax professionals in Taiwan to provide end-to-end support — from company incorporation to accounting, tax, and visa services.
