Scenario: a Vietnamese enterprise wants to acquire an operating electronics company in Taipei. Taiwan differs from the whole region: investment approval is fused with technology control — buying a technology company without clearing the “technology gate” means the purchase is not really done.
Taiwan: investment approval and technology screening are one
Foreign investment into Taiwan is governed by the Statute for Investment by Foreign Nationals, with the Investment Commission of the Ministry of Economic Affairs (MOEAIC) as reviewer. The distinctive point: for deals involving sensitive technology, semiconductors and strategic supply chains, investment review embeds technology-security screening — effectively “two gates in one”. Many technology deals drag not because of general investment procedure but because of this technology layer. Acquiring an operating company in ordinary sectors (trading, services) is much lighter procedurally.
Merger control: the TFTC — pre-filing at thresholds
The Taiwan Fair Trade Commission (TFTC) enforces the Fair Trade Act: deals above market-share/turnover thresholds must be notified in advance and await approval/non-objection before closing — mirroring Vietnam’s concentration notification in its “file first, close later” principle.
Vietnam: capital-contribution registration plus concentration notification
In Vietnam, a foreign investor buying shares or stakes must complete registration of capital contribution, share or stake purchase under the Law on Investment 143/2025/QH15 (effective 1 March 2026, replacing Law 61/2020/QH14) in prescribed cases; register member/shareholder changes under the Enterprise Law 2020 (amended by Law 76/2025/QH15, effective 1 July 2025); and file the economic concentration notification under the Competition Law 23/2018/QH14 + Decree 35/2020/ND-CP above thresholds.
Due diligence: Taiwan is hardest on IP and export control
Taiwanese technology DD has its signature items: the intellectual property portfolio (patents, trade secrets) — real ownership and transfer restrictions must be verified; technology export controls — certain technologies may not be transferred out under applicable rules; and supply chains with majors whose contracts carry change-of-control clauses letting counterparties terminate. In Vietnam, DD typically snags on land, sub-licences and tax exposures.
Quick comparison
| Criterion | Taiwan | Vietnam |
|---|---|---|
| Foreign-investment approval | MOEAIC under the Statute for Investment by Foreign Nationals; embedded technology screening for sensitive sectors | Registration of capital contribution/share purchase in prescribed cases (Law 143/2025) |
| Merger control | TFTC: advance notification at thresholds (Fair Trade Act) | Pre-closing notification above thresholds (Law 23/2018 + Decree 35/2020) |
| Capital-transfer tax | Non-resident sellers may be taxed in Taiwan; check applicable tax treaties/arrangements | Organisations: CIT (Law 67/2025/QH15 + Decree 320/2025/ND-CP); individuals: PIT |
| Typical closing timeline | 3–6 months; sensitive-technology deals take longer | 1–3 months |
Recommended actions
1. Classify the target’s technology at the outset — it decides whether the technology-screening gate applies. 2. DD the IP portfolio and change-of-control clauses in key contracts. 3. Check technology transfer/export-control restrictions. 4. Confirm with local counsel.
Frequently Asked Questions
Does buying shares in Taiwan need investment approval like M&A in Vietnam?
Yes, under the Statute for Investment by Foreign Nationals, reviewed by the Investment Commission of the Ministry of Economic Affairs (MOEAIC). The distinctive point: for sensitive-technology deals, the review embeds technology-security screening — effectively “two gates in one”. In Vietnam, the corresponding gate is registration of capital contribution, share or stake purchase under the Law on Investment 143/2025.
Which deals does Taiwan’s technology screening catch?
Deals involving sensitive technology, semiconductors and strategic supply chains. This layer stretches timelines the most — classify the target’s technology at the screening stage.
What are Taiwan’s merger-control thresholds?
The TFTC enforces the Fair Trade Act: above market-share/turnover thresholds, parties must notify in advance and await approval or non-objection before closing.
What is hardest in Taiwanese due diligence compared with Vietnam?
Intellectual property (verifying real ownership and transfer restrictions), technology export controls, and change-of-control clauses in contracts with major counterparties. In Vietnam, DD typically snags on land and sub-licences.
What tax applies on transferring shares in a Taiwanese company?
Non-resident sellers may be taxed in Taiwan depending on structure; applicable tax treaties or arrangements should be checked before price finalisation. In Vietnam, organisations pay CIT and individuals pay PIT.
How long does a Taiwanese M&A deal usually take?
About 3–6 months; deals involving sensitive technology subject to the technology-screening layer take materially longer.
