Private participation in infrastructure projects is a world trend. With the capital, creativity and management skills from the private sector and the public power from the government, private institutions can use BOT (Build-Operate-Transfer), BTO (Build-Transfer-Operate), ROT (Rehabilitate-Operate-Transfer), BOO (Build-Own-Operate), or OT (Operate-Transfer) to participate in PPI (Private Participation in Infrastructure) projects. The quality of public services will be improved while the private investment opportunities have been discovered at the same time. The government cordially invites private investors to participate in quality PPP (Public Private Partnership) projects, to create a triple-win situation: higher revenues for investors, lower expenditures for the government, and better services for the general public.
Through steady revenue brought by PPP projects and the tax and land acquiring incentives provided by the PPIP Act (Act for Promotion of Private Participation in Infrastructure Projects), private investors can enjoy better profit margins, business expansion opportunities, and enhanced corporate image.
Investors can find detailed information about invitations to tender of the “announced projects” at http://ppp.mof.gov.tw/PPP.EngWeb/Project/Announcements; regarding “other listed projects”, of which tender announcements are not yet released, investors can find detailed information about them at http://ppp.mof.gov.tw/PPP.EngWeb/Project/OutLine.
There are no specific restrictions on foreign capital investment under the PPIP Act. Generally speaking, foreign investors can apply to establish a company in Taiwan after winning a bid. For establishing a company in Taiwan, foreign investors must apply for approval with the Investment Commission of the Ministry of Economic Affairs (MOEAIC). In addition, foreign companies that intent to invest in PPI projects in Taiwan have to establish a company or a branch office in Taiwan. The complete working procedures for establishing a company should be referred to and regulated by the Statute for Investment by Foreign Nationals. Whether the foreign capital investment is allowed will depend on the decision of the competent authority according to the Statute for Investment by Foreign Nationals. Applications for investment may be filed by a representative office, a designated representative or a joint venture. Besides, the actual timing of company establishment is subject to the nature of each PPI project.
After the government has made its tender announcements, private institutions can submit their applications based on the contents of the tender documents. After evaluation, the best applicant selected can begin construction and operation on the project once contract negotiation and signing are completed. The application procedures can be found on the website. The government’s evaluation will follow the principles of fairness, honesty, openness and transparency. For any dispute concerning the application and evaluation procedures between an applicant and the authority in charge, the applicant can file protests and complaints pursuant to the PPIP Act to ensure that their rights are well protected.
If the project is important and with certain scale, and is therefore deemed as a “major infrastructure project” (Article 3 of the PPIP Act), the project can enjoy several tax benefits (see Articles 36 to 40 of PPIP Act for detailed information).
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