Doing Business 2018 Taiwan, China Economy Pro le of Taiwan, China Doing Business 2018 Indicators (in order of appearance in the document) Starting a business Procedures, time, cost and paid-in minimum capital to start a limited liability company Dealing with construction Procedures, time and cost to complete all formalities to build a warehouse and the quality control and permits safety mechanisms in the construction permitting system Getting electricity Procedures, time and cost to get connected to the electrical grid, the reliability of the electricity supply and the transparency of tariffs Registering property Procedures, time and cost to transfer a property and the quality of the land administration system Getting credit Movable collateral laws and credit information systems Protecting minority investors Minority shareholders’ rights in related-party transactions and in corporate governance Paying taxes Payments, time and total tax rate for a firm to comply with all tax regulations as well as post-filing processes Trading across borders Time and cost to export the product of comparative advantage and import auto parts Enforcing contracts Time and cost to resolve a commercial dispute and the quality of judicial processes Resolving insolvency Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal framework for insolvency Labor market regulation Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. Page 2   for insolvency Doing Business Labor market 2018 regulation Taiwan, China Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. The ranking of 190 economies is determined by sorting the aggregate distance to frontier scores, rounded to two decimals. More about Doing Business (PDF, 5MB) Ease of Doing Business in Region East Asia & Pacific DB 2018 Rank 190 1 Taiwan, China Income Category High income 15 Population 23,539,816 DB 2018 Distance to Frontier (DTF) GNI Per Capita (US$) 23,284 0 100 80.07 City Covered Taipei DB 2018 Distance to Frontier (DTF) 0 100 83.92: Korea, Rep. (Rank: 4) 83.44: Hong Kong SAR, China (Rank: 5) 80.07: Taiwan, China (Rank: 15) 78.43: Malaysia (Rank: 24) 75.68: Japan (Rank: 34) Page 3   62.70: Regional Average (East Asia & Pacific) aggregate distance to frontier scores, rounded to two decimals. More Doingabout 2018 (PDF, Doing Business Business 5MB)China Taiwan, Ease of Doing Business in Region East Asia & Pacific DB 2018 Rank 190 1 Taiwan, China Income Category High income 15 Population 23,539,816 DB 2018 Distance to Frontier (DTF) GNI Per Capita (US$) 23,284 0 100 80.07 City Covered Taipei DB 2018 Distance to Frontier (DTF) 0 100 83.92: Korea, Rep. (Rank: 4) 83.44: Hong Kong SAR, China (Rank: 5) 80.07: Taiwan, China (Rank: 15) 78.43: Malaysia (Rank: 24) 75.68: Japan (Rank: 34) 62.70: Regional Average (East Asia & Pacific) Note: The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. Rankings on Doing Business topics - Taiwan, China 4 3 1 10 16 18 20 24 28 56 55 55 82 90 Rank 109 136 163 190 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Investors Borders Permits Distance to Frontier (DTF) on Doing Business topics - Taiwan, China 99.45 100 94.43 86.32 83.89 84.94 77.96 78.63 80 75.11 70.00 60 DTF 50.00 40 20 0 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:+0.01 Change:0.00 Change:0.00 Investors Change:+0.09 Borders Change:+1.85 Change:+0.17 Change:+0.01 Permits Change:0.00 Change:+1.95 Change:+0.02 Starting a Business Page 4   This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:+0.01 Change:0.00 Change:0.00 Investors Change:+0.09 Borders Change:+1.85 Change:+0.17 Change:+0.01 Permits Change:0.00 Change:+1.95 Doing Business 2018 Taiwan, China Change:+0.02 Starting a Business This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized limited liability company to start up and formally operate in economy’s largest business city. To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domestically owned, has start-up capital equivalent to 10 times income per capita, engages in general industrial or commercial activities and employs between 10 and 50 people one month after the commencement of operations, all of whom are domestic nationals. Starting a Business considers two types of local limited liability companies that are identical in all aspects, except that one company is owned by 5 married women and the other by 5 married men. The distance to frontier score for each indicator is the average of the scores obtained for each of the component indicators. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally start and operate a To make the data comparable across economies, several assumptions company (number) about the business and the procedures are used. It is assumed that any required information is readily available and that the entrepreneur will pay Pre-registration (for example, name verification no bribes. or reservation, notarization) Registration in economy’s largest business city The business: - Is a limited liability company (or its legal equivalent). If there is more than Post-registration (for example, social security one type of limited liability company in the economy, the most common registration, company seal) among domestic rms is chosen. Information on the most common form is Obtaining approval from spouse to start business obtained from incorporation lawyers or the statistical o ce. or leave home to register company - Operates in the economy’s largest business city and the entire o ce Obtaining any gender-specific permission that space is approximately 929 square meters (10,000 square feet). For 11 can impact company registration, company economies the data are also collected for the second largest business city. operations and process of getting national - Is 100% domestically owned and has ve owners, none of whom is a legal identity card entity; and has a start-up capital of 10 times income per capita and has a Time required to complete each procedure turnover of at least 100 times income per capita. (calendar days) - Performs general industrial or commercial activities, such as the production or sale of goods or services to the public. The business does Does not include time spent gathering not perform foreign trade activities and does not handle products subject information to a special tax regime, for example, liquor or tobacco. It does not use Each procedure starts on a separate day (2 heavily polluting production processes. procedures cannot start on the same day) - Leases the commercial plant or o ces and is not a proprietor of real Procedures fully completed online are recorded estate and the amount of the annual lease for the o ce space is equivalent as ½ day to 1 times income per capita. Procedure is considered completed once final - Does not qualify for investment incentives or any special bene ts. document is received - Has at least 10 and up to 50 employees one month after the commencement of operations, all of whom are domestic nationals. No prior contact with officials - Has a company deed 10 pages long. Cost required to complete each procedure (% of The owners: income per capita) - Have reached the legal age of majority. If there is no legal age of majority, Official costs only, no bribes they are assumed to be 30 years old. No professional fees unless services required by - Are sane, competent, in good health and have no criminal record. law or commonly used in practice - Are married and the marriage is monogamous and registered with the authorities. Paid-in minimum capital (% of income per capita) - Where the answer di ers according to the legal system applicable to the Funds deposited in a bank or with third party woman or man in question (as may be the case in economies where there before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Standardized Company Page 5   before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Doing Business 2018 Taiwan, China Standardized Company Legal form Private Company Limited By Shares Paid-in minimum capital requirement TWD 0 City Covered Taipei East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Procedure – Men (number) 3 7.0 4.9 1.00 (New Zealand) Time – Men (days) 10 22.7 8.5 0.50 (New Zealand) Cost – Men (% of income per capita) 2.0 18.4 3.1 0.00 (United Kingdom) Procedure – Women (number) 3 7.0 4.9 1.00 (New Zealand) Time – Women (days) 10 22.8 8.5 0.50 (New Zealand) Cost – Women (% of income per capita) 2.0 18.4 3.1 0.00 (United Kingdom) Paid-in min. capital (% of income per capita) 0.0 15.1 8.7 0.00 (113 Economies) Figure – Starting a Business in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 98.14: Hong Kong SAR, China (Rank: 3) 95.83: Korea, Rep. (Rank: 9) 94.43: Taiwan, China (Rank: 16) 84.37: Japan (Rank: 106) 83.78: Malaysia (Rank: 111) 82.32: Regional Average (East Asia & Pacific) Note: The ranking of economies on the ease of starting a business is determined by sorting their distance to frontier scores for starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Starting a Business in Taiwan, China – Procedure, Time and Cost Time Cost 10 1.8 1.6 8 ost (% of income per capita) 1.4 1.2 Time (days) 6 1 0.8 4 0.6 Page 6   0.4 starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Taiwan, China Figure – Starting a Business in Taiwan, China – Procedure, Time and Cost Time Cost 10 1.8 1.6 8 Cost (% of income per capita) 1.4 1.2 Time (days) 6 1 0.8 4 0.6 2 0.4 0.2 0 0 1 2 3 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Details – Starting a Business in Taiwan, China – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Use the online platform to search the name, apply for incorporation and 7 days TWD 150 (online tax registration, apply for Labor Insurance, National Health Insurance search) or TWD 300 and Pension Plan Report with the Bureau of Labor Insurance and (government fee) + register for work rules with the Council of Labor A airs 0.025% of capital (in Agency : Ministry of Economic A airs (MOEA) case the registration fee payable is less The company can search the availability of the company name and check the than TWD 1,000, the legality of planned business online. Applications for company registration can be done via the Company and Business One-stop Service Request registration fee shall website (http://onestop.nat.gov.tw/oss/identity/Identity/init.do). The original be TWD 1,000) company registration form stamped with the seals of the company must be delivered to the registration authority. With e ective from April 14, 2014, entrepreneurs can apply for company registration as well as upload the scanned and stamped company registration form using the Company and Business One-stop Service Request website using an electronic signature. The review period has been shortened to 2 days. Therefore the procedure now takes one day for search, reservation and application. Then the government o cials are required to review the application on the second day. At the end of the second day, (if approved) the approval is ready, and the applicant can pick it up from the Ministry of Economic A airs (MOEA). Otherwise, it is mailed to the applicant, in which case it takes up to four days to receive the con rmation. The articles of incorporation for a private limited company must include the company name, business purpose, shareholders’ contributions, pro t- allocation ratio, location of o ces, number and names of directors, manner Page 7   of issuing public announcements, and the date the articles of incorporation (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Doing Business 2018 Taiwan, China Details – Starting a Business in Taiwan, China – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Use the online platform to search the name, apply for incorporation and 7 days TWD 150 (online tax registration, apply for Labor Insurance, National Health Insurance search) or TWD 300 and Pension Plan Report with the Bureau of Labor Insurance and (government fee) + register for work rules with the Council of Labor A airs 0.025% of capital (in Agency : Ministry of Economic A airs (MOEA) case the registration fee payable is less The company can search the availability of the company name and check the than TWD 1,000, the legality of planned business online. Applications for company registration can be done via the Company and Business One-stop Service Request registration fee shall website (http://onestop.nat.gov.tw/oss/identity/Identity/init.do). The original be TWD 1,000) company registration form stamped with the seals of the company must be delivered to the registration authority. With e ective from April 14, 2014, entrepreneurs can apply for company registration as well as upload the scanned and stamped company registration form using the Company and Business One-stop Service Request website using an electronic signature. The review period has been shortened to 2 days. Therefore the procedure now takes one day for search, reservation and application. Then the government o cials are required to review the application on the second day. At the end of the second day, (if approved) the approval is ready, and the applicant can pick it up from the Ministry of Economic A airs (MOEA). Otherwise, it is mailed to the applicant, in which case it takes up to four days to receive the con rmation. The articles of incorporation for a private limited company must include the company name, business purpose, shareholders’ contributions, pro t- allocation ratio, location of o ces, number and names of directors, manner of issuing public announcements, and the date the articles of incorporation were adopted. The application for a taxpayer’s identi cation number is done at the same time. The Labor Insurance Bureau now adopts a three-in-one consolidation application (i.e., the labor insurance application, national health insurance application and the pension plan appropriation application), so the Labor Insurance Bureau and National Health Insurance Bureau can now review and process the application at the same time, if all in order, the Bureau can grant the application in 5 - 7 business days. All rms may apply for national health insurance (NHI) regardless of the number of employees, but only companies with ve or more employees may apply for labor insurance (LI) (Article 6 of Labor Insurance Act). National health insurance, labor insurance, and the pension plan report can be led with one consolidated form. Forms can be downloaded from the Bureau of Labor Insurance Web site. In order to promote the public to use the online website to start a company, on January 16 2013, MOEA announced that companies that le their applications and submit required documents via on-line registration shall have a reduction of NTD 300 on their registration fees. 2 Make a company seal 1 day TWD 450 (depending Agency : Seal maker on the number/ material used, each Company registration documents and deeds are sealed (chopped). A set of 450 range from TWDPage 8   company seals are commonly prepared for registration, including the name to TWD 1000) applications and submit required documents via on-line registration shall Doing have 2018of NTD a reduction Business 300 on Taiwan, their registration fees. China 2 Make a company seal 1 day TWD 450 (depending Agency : Seal maker on the number/ material used, each Company registration documents and deeds are sealed (chopped). A set of range from TWD 450 company seals are commonly prepared for registration, including the name to TWD 1000) of the company, and name of the chairperson of the board of directors. These seals are required to be used for future company updates. Since May 2012, the applicant may prepare such document in the form of electronic documents pre xed electronic signature to transmit the application package via One-Stop-Shop Online Application Website electronic mail. Therefore the applicants still need making seals for registration documents, but they can use electronic signature to transmit these documents via online website. 3 Submit a CPA audit report showing that the amount of capital invested 2 days TWD 5,000 - 20,000 is su cient to cover company establishment cost fee varies across Agency : Ministry of Economic A airs (MOEA) firms In place of showing the invested capital will cover the costs of establishing a company to the Ministry of Economic A airs; entrepreneurs submit a CPA audit report showing the invested capital has been fully paid pursuant to Article 7 of Regulations Governing Certi cation of Capital upon Registration Applications of Companies (last amended on June 25, 2013). In addition, Section 1 of Article 7 of Company Act (last amended on January 4, 2012) allows a company to attach an auditing certi cate from an independent certi ed public accountant within 30 days after the registration of incorporation. Entrepreneurs can submit the audit report via the One-Stop- Shop online system using an electronic signature. Applies to women only. Takes place simultaneously with previous procedure. Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional certi cation requirements. The most recent round of data collection was completed in June 2017. See the methodology for more information What the indicators measure Case study assumptions Procedures to legally build a warehouse (number) To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility Submitting all relevant documents and obtaining connections are used. all necessary clearances, licenses, permits and certificates The construction company (BuildCo): Submitting all required notifications and - Is a limited liability company (or its legal equivalent) and operates in the receiving all necessary inspections economy’s largest business city. For 11 economies the data are also collected for the second largest business city. Obtaining utility connections for water and - Is 100% domestically and privately owned; has ve owners, none of whom sewerage is a legal entity. Has a licensed architect and a licensed engineer, both Registering and selling the warehouse after its registered with the local association of architects or engineers. BuildCo is completion not assumed to have any other employees who are technical or licensed Time required to complete each procedure experts, such as geological or topographical experts. (calendar days) - Owns the land on which the warehouse will be built and will sell the warehouse upon its completion. Does not include time spent gathering Page 9   information Applies to women only. Takes place simultaneously with previous procedure. Doing Business 2018 Taiwan, China Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional certi cation requirements. The most recent round of data collection was completed in June 2017. See the methodology for more information What the indicators measure Case study assumptions Procedures to legally build a warehouse (number) To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility Submitting all relevant documents and obtaining connections are used. all necessary clearances, licenses, permits and certificates The construction company (BuildCo): Submitting all required notifications and - Is a limited liability company (or its legal equivalent) and operates in the receiving all necessary inspections economy’s largest business city. For 11 economies the data are also collected for the second largest business city. Obtaining utility connections for water and - Is 100% domestically and privately owned; has ve owners, none of whom sewerage is a legal entity. Has a licensed architect and a licensed engineer, both Registering and selling the warehouse after its registered with the local association of architects or engineers. BuildCo is completion not assumed to have any other employees who are technical or licensed Time required to complete each procedure experts, such as geological or topographical experts. (calendar days) - Owns the land on which the warehouse will be built and will sell the warehouse upon its completion. Does not include time spent gathering information The warehouse: Each procedure starts on a separate day— - Will be used for general storage activities, such as storage of books or though procedures that can be fully completed stationery. online are an exception to this rule - Will have two stories, both above ground, with a total constructed area of Procedure is considered completed once final approximately 1,300.6 square meters (14,000 square feet). Each oor will document is received be 3 meters (9 feet, 10 inches) high and will be located on a land plot of No prior contact with officials approximately 929 square meters (10,000 square feet) that is 100% owned by BuildCo, and the warehouse is valued at 50 times income per capita. Cost required to complete each procedure (% of - Will have complete architectural and technical plans prepared by a warehouse value) licensed architect. If preparation of the plans requires such steps as Official costs only, no bribes obtaining further documentation or getting prior approvals from external agencies, these are counted as procedures. Building quality control index (0-15) - Will take 30 weeks to construct (excluding all delays due to administrative Sum of the scores of six component indices: and regulatory requirements). Quality of building regulations (0-2) The water and sewerage connections: Quality control before construction (0-1) - Will be 150 meters (492 feet) from the existing water source and sewer Quality control during construction (0-3) tap. If there is no water delivery infrastructure in the economy, a borehole Quality control after construction (0-3) will be dug. If there is no sewerage infrastructure, a septic tank in the smallest size available will be installed or built. Liability and insurance regimes (0-2) - Will have an average water use of 662 liters (175 gallons) a day and an Professional certifications (0-4) average wastewater ow of 568 liters (150 gallons) a day. Will have a peak water use of 1,325 liters (350 gallons) a day and a peak wastewater ow of 1,136 liters (300 gallons) a day. - Will have a constant level of water demand and wastewater ow throughout the year; will be 1 inch in diameter for the water connection and 4 inches in diameter for the sewerage connection. Standardized Warehouse Page 10   and 4 inches in diameter for the sewerage connection. Doing Business 2018 Taiwan, China Standardized Warehouse Estimated value of warehouse TWD 37,638,586.00 City Covered Taipei East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Procedures (number) 10 15.2 12.5 7.00 (Denmark) Time (days) 93 138.2 154.6 27.5 (Korea, Rep.) Cost (% of warehouse value) 0.4 2.2 1.6 0.10 (5 Economies) Building quality control index (0-15) 13.0 8.9 11.4 15.00 (3 Economies) Figure – Dealing with Construction Permits in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 86.32: Taiwan, China (Rank: 4) 84.86: Hong Kong SAR, China (Rank: 5) 82.19: Malaysia (Rank: 11) 77.74: Korea, Rep. (Rank: 28) 73.36: Japan (Rank: 50) 69.60: Regional Average (East Asia & Pacific) Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their distance to frontier scores for dealing with construction permits. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Dealing with Construction Permits in Taiwan, China – Procedure, Time and Cost Time Cost 0.25 90 80 0.2 Cost (% of warehouse value) 70 60 Time (days) 0.15 50 40 0.1 30 20 0.05 10 0 0 1 *2 3 4 5 6 7 8 9 10 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Page 11   component indicators. Doing Business 2018 Taiwan, China Figure – Dealing with Construction Permits in Taiwan, China – Procedure, Time and Cost Time Cost 0.25 90 80 0.2 Cost (% of warehouse value) 70 60 Time (days) 0.15 50 40 0.1 30 20 0.05 10 0 0 1 *2 3 4 5 6 7 8 9 10 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Dealing with Construction Permits in Taiwan, China and comparator economies – Measure of Quality 14 13.0 13.0 12.0 12 11.0 10 8.9 Index score 8.0 8 6 4 2 0 Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Details – Dealing with Construction Permits in Taiwan, China – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain information about infrastructure from the water company 14 days no charge Agency : Taiwan Water Corporation at One-Stop Counter BuildCo visits the One-Stop Counter to obtain information on the intended building site’s water and electricity infrastructure. 2 Obtain information about electricity infrastructure from electricity 14 days no charge provider Agency : Taiwan Power Company (Taipower) at One-Stop Counter 3 Request and obtain building permit from the City Government at the 21 days TWD 31,402 One-Stop Counter Page 12   Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Doing Business 2018 Taiwan, China Details – Dealing with Construction Permits in Taiwan, China – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain information about infrastructure from the water company 14 days no charge Agency : Taiwan Water Corporation at One-Stop Counter BuildCo visits the One-Stop Counter to obtain information on the intended building site’s water and electricity infrastructure. 2 Obtain information about electricity infrastructure from electricity 14 days no charge provider Agency : Taiwan Power Company (Taipower) at One-Stop Counter 3 Request and obtain building permit from the City Government at the 21 days TWD 31,402 One-Stop Counter Agency : City Government at the One-Stop Counter With the One-Stop Counter introduced in March 2011, becoming fully operational in early 2012, builders now can obtain several approvals in one place. BuildCo submits a construction permit application at the One-Stop Counter, along with the drawings and explanations as part of the “pre- construction application form." In particular cases, if there is a need for an application to be processed jointly with another unit, the applicant should ll out a Taipei City Government Building Permit (Design Alteration) Joint Review Form, ticking the joint processing unit and joint review item(s), and submit it once. If an application is not within the scope of the One-Stop Counter’s jurisdiction, or is one that cannot be processed due to special circumstances, the One-Stop Counter will not be able to accept it, but will assist the applicant in going through the ordinary channels. If an application is within the scope of the One-Stop Counter’s jurisdiction, the sta member that receives it will verify that the correct documents have been submitted, assign the application a case number, and submit a receipt stamp or fax a receipt stub with the fees that need to be paid. When the documents are complete, the One-Stop Counter will forward them to the relevant o ces (the Construction Management O ce, Bureau of High Speed Rail, Department of Rapid Transit Systems, Department of Public Works, Department of Cultural A airs, Department of Transportation, Department of Land, Department of Urban Development, etc.) to conduct a joint review. When a joint review of an application has been conducted by the One-Stop Counter and it has been found that the application does not conform to requirements, the One-Stop Counter will notify the applicant that he has one chance to make the necessary amendments. Once all amendments have been made, a construction permit is issued, and fees for the construction permit, speci cation of building setback line, wastewater discharge permit, and land ownership certi cate are paid. It is possible to apply for a building permit online since April 1, 2015 and the website is http://tccmoapply.dba.tcg.gov.tw:8080/tccmoapply/ 4 Report the start date and present construction plan to the City 1 day TWD 25,674 Page 13   Government at the One-Stop Counter and pay air pollution protection It is possible to apply for a building permit online since April 1, 2015 and the Doing website Business is http://tccmoapply.dba.tcg.gov.tw:8080/tccmoapply/ 2018 Taiwan, China 4 Report the start date and present construction plan to the City 1 day TWD 25,674 Government at the One-Stop Counter and pay air pollution protection fee before starting construction Agency : City Government at the One-Stop Counter After BuildCo obtains the construction permit, he prepares the application for commencement of construction, a construction plan, and other required documentation and submits them to the One-Stop Counter. BuildCo then pays the air pollution protection fee and obtains approval for the commencement of work. Under the provisions of Article 4 of the Regulations Governing Construction Project Air Pollution Prevention Facilities, the case study warehouse would be classi ed as a Grade 2 construction. 5 Request occupancy permit, post-contruction approvals and registrations 1 day TWD 75,277 at the One-Stop Counter Agency : City Government at the One-Stop Counter Where construction is completed without involving damage to adjacent property, BuildCo can take the original construction permit to the One-Stop Counter and make a one-time submission of the Self Checklist for Post- Completion Application Documents (OSC4) and apply for an occupancy permit. The mode of submission is the same as the construction permit application. BuildCo must place the relevant application letter, application form, drawings and explanations, and other documentation required by law or by the regulations of the unit concerned into one envelope for each separate application. BuildCo must also write the type of application and the unit concerned on the envelope (e.g., “Application to the Fire Department for post-completion inspection of re- ghting equipment.”) The One-Stop Counter will pass the application documents to the relevant units or review and processing. As part of the review process, the relevant departments will conduct a joint nal inspection. If the building is found to be in compliance with applicable regulations, the One-Stop Counter will approve the issuance of an occupancy permit and BuildCo must pay the applicable fees. BuildCo may choose to pick up the occupancy permit in person at the One-Stop Counter or have it mailed to him. The One-Stop Counter will also notify Taipei Water Department to carry out the water connection procedures. Moreover, once issuance of the occupancy permit is approved, the One-Stop Counter will transmit the documentation to apply for registration of title to the local land administration o ce. For the registration of a new building, Point 3 of the Supplementary Regulations on Computing and Collecting Land Registration Fees and Penalties stipulates that the registration fee is computed according to the total cost of construction as recorded in the occupancy permit. Article 84 of the Land Registration Regulations stipulates that the general land registration procedure applies to the registration of a new building; hence the applicable registration fee is 0.2% of the total cost of construction. 6 Receive nal inspection 1 day no charge Page 14   Doing Business 2018 Taiwan, China 5 Request occupancy permit, post-contruction approvals and registrations 1 day TWD 75,277 at the One-Stop Counter Agency : City Government at the One-Stop Counter Where construction is completed without involving damage to adjacent property, BuildCo can take the original construction permit to the One-Stop Counter and make a one-time submission of the Self Checklist for Post- Completion Application Documents (OSC4) and apply for an occupancy permit. The mode of submission is the same as the construction permit application. BuildCo must place the relevant application letter, application form, drawings and explanations, and other documentation required by law or by the regulations of the unit concerned into one envelope for each separate application. BuildCo must also write the type of application and the unit concerned on the envelope (e.g., “Application to the Fire Department for post-completion inspection of re- ghting equipment.”) The One-Stop Counter will pass the application documents to the relevant units or review and processing. As part of the review process, the relevant departments will conduct a joint nal inspection. If the building is found to be in compliance with applicable regulations, the One-Stop Counter will approve the issuance of an occupancy permit and BuildCo must pay the applicable fees. BuildCo may choose to pick up the occupancy permit in person at the One-Stop Counter or have it mailed to him. The One-Stop Counter will also notify Taipei Water Department to carry out the water connection procedures. Moreover, once issuance of the occupancy permit is approved, the One-Stop Counter will transmit the documentation to apply for registration of title to the local land administration o ce. For the registration of a new building, Point 3 of the Supplementary Regulations on Computing and Collecting Land Registration Fees and Penalties stipulates that the registration fee is computed according to the total cost of construction as recorded in the occupancy permit. Article 84 of the Land Registration Regulations stipulates that the general land registration procedure applies to the registration of a new building; hence the applicable registration fee is 0.2% of the total cost of construction. 6 Receive nal inspection 1 day no charge Agency : Relevant Agencies at One-Stop Counter 7 Obtain occupancy permit, post-contruction approvals and registrations 33 days no charge at the One-Stop Counter Agency : City Government at One-Stop Counter 8 Apply for water supply from a local water company 1 day no charge Agency : Taiwan Water Corporation 9 Receive inspection from water company 1 day no charge Agency : Taiwan Water Corporation 10 Obtain connection to water 19 days TWD 25,000 Agency : Taiwan Water Corporation Page 15   The whole process (from application to connection) may take 14 -- 28 days. 9 Receive inspection from water company 1 day no charge Agency : Taiwan Water Corporation Doing Business 2018 Taiwan, China 10 Obtain connection to water 19 days TWD 25,000 Agency : Taiwan Water Corporation The whole process (from application to connection) may take 14 -- 28 days. Takes place simultaneously with previous procedure. Details – Dealing with Construction Permits in Taiwan, China – Measure of Quality Answer Score Building quality control index (0-15) 13.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections by 1.0 construction? (0-2) in-house engineer. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 accordance with the approved plans and regulations? (0-2) inspection is done by government agency; Yes, in- house engineer submits report for nal inspection. Do legally mandated nal inspections occur in practice? (0-1) Final inspection 1.0 always occurs in practice. Liability and insurance regimes index (0-2) 1.0 Which parties (if any) are held liable by law for structural aws or problems in the Professional in 1.0 Page 16   Takes place simultaneously with previous procedure. Doing Business 2018 Taiwan, China Details – Dealing with Construction Permits in Taiwan, China – Measure of Quality Answer Score Building quality control index (0-15) 13.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections by 1.0 construction? (0-2) in-house engineer. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 accordance with the approved plans and regulations? (0-2) inspection is done by government agency; Yes, in- house engineer submits report for nal inspection. Do legally mandated nal inspections occur in practice? (0-1) Final inspection 1.0 always occurs in practice. Liability and insurance regimes index (0-2) 1.0 Which parties (if any) are held liable by law for structural aws or problems in the Professional in 1.0 building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) charge of the supervision; Construction company; Owner or investor. Which parties (if any) are required by law to obtain an insurance policy to cover No party is 0.0 Page 17   possible structural aws or problems in the building once it is in use (Latent Defect required by law company; Owner Doing Business 2018 Taiwan, China or investor. Which parties (if any) are required by law to obtain an insurance policy to cover No party is 0.0 possible structural aws or problems in the building once it is in use (Latent Defect required by law Liability Insurance or Decennial Insurance)? (0-1) to obtain insurance . Professional certi cations index (0-4) 4.0 What are the quali cation requirements for the professional responsible for verifying Minimum 2.0 that the architectural plans or drawings are in compliance with existing building number of years regulations? (0-2) of experience; University degree in architecture or engineering; Being a registered architect or engineer; Passing a certi cation exam. What are the quali cation requirements for the professional who supervises the Minimum 2.0 construction on the ground? (0-2) number of years of experience; University degree in engineering, construction or construction management; Being a registered architect or engineer; Passing a certi cation exam. Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is Page 18   purchasing material for these works in an area with no physical constraints. For example, the property is not certi cation exam. Doing Business 2018 Taiwan, China Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is purchasing material for these works in an area with no physical constraints. For example, the property is not Concluding any necessary supply contract and near a railway. obtaining final supply - Is a new construction and is being connected to electricity for the rst time. Time required to complete each procedure - Has two stories with a total surface area of approximately 1,300.6 square (calendar days) meters (14,000 square feet). The plot of land on which it is built is 929 Is at least 1 calendar day square meters (10,000 square feet). Each procedure starts on a separate day Does not include time spent gathering The electricity connection: information - Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140-kilo-volt-ampere (kVA) with a power factor of 1, Reflects the time spent in practice, with little when 1 kVA = 1 kilowatt (kW). follow-up and no prior contact with officials - Has a length of 150 meters. The connection is to either the low- or Cost required to complete each procedure (% of medium-voltage distribution network and is either overhead or income per capita) underground, whichever is more common in the area where the warehouse is located and requires works that involve the crossing of a 10- Official costs only, no bribes meter road (such as by excavation or overhead lines) but are all carried out Value added tax excluded on public land. There is no crossing of other owners’ private property The reliability of supply and transparency of because the warehouse has access to a road. tari s index (0-8) - Does not require work to install the internal wiring of the warehouse. This has already been completed up to and including the customer’s service Duration and frequency of power outages (0–3) panel or switchboard and the meter base. Tools to monitor power outages (0–1) Tools to restore power supply (0–1) The monthly consumption: Regulatory monitoring of utilities’ performance - It is assumed that the warehouse operates 30 days a month from 9:00 (0–1) a.m. to 5:00 p.m. (8 hours a day), with equipment utilized at 80% of capacity Financial deterrents limiting outages (0–1) on average and that there are no electricity cuts (assumed for simplicity reasons) and the monthly energy consumption is 26,880 kilowatt-hours Transparency and accessibility of tariffs (0–1) (kWh); hourly consumption is 112 kWh. Price of electricity (cents per kilowatt-hour)* - If multiple electricity suppliers exist, the warehouse is served by the Price based on monthly bill for commercial cheapest supplier. warehouse in case study - Tari s e ective in March of the current year are used for calculation of the price of electricity for the warehouse. Although March has 31 days, for * N o t e : Doing Business m e a s u r e s t h e p r i c e o f calculation purposes only 30 days are used. electricity, but it is not included in the distance to frontier score nor the ranking on the ease of getting electricity. Page 19   Standardized Connection frontier score nor the ranking on the ease of getting electricity. Doing Business 2018 Taiwan, China Standardized Connection Price of electricity (US cents per kWh) 10.9 Name of utility Taiwan Power Company City Covered Taipei East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Procedures (number) 3 4.5 4.7 2 (United Arab Emirates) Time (days) 22 71.6 79.1 10 (United Arab Emirates) Cost (% of income per capita) 38.9 712.0 63.0 0.00 (Japan) Reliability of supply and transparency of tariff 8 3.7 7.4 8.00 (28 Economies) index (0-8) Figure – Getting Electricity in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 99.89: Korea, Rep. (Rank: 2) 99.45: Taiwan, China (Rank: 3) 99.02: Hong Kong SAR, China (Rank: 4) 94.33: Malaysia (Rank: 8) 89.88: Japan (Rank: 17) 72.23: Regional Average (East Asia & Pacific) Note: The ranking of economies on the ease of getting electricity is determined by sorting their distance to frontier scores for getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Getting Electricity in Taiwan, China – Procedure, Time and Cost Time Cost 45 20 40 Cost (% of income per capita) 35 15 30 Time (days) 25 10 20 15 5 10 Page 20   5 getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Taiwan, China Figure – Getting Electricity in Taiwan, China – Procedure, Time and Cost Time Cost 45 20 40 Cost (% of income per capita) 35 15 30 Time (days) 25 10 20 15 5 10 5 0 0 1 2 3 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Getting Electricity in Taiwan, China and comparator economies – Measure of Quality 9 8 8 8 8 8 8 7 6 Index score 5 4 3.7 3 2 1 0 Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Details – Getting Electricity in Taiwan, China – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Submit application for connection and await completion of design 4 calendar days TWD 293,202 Agency : Taiwan Power Company (TPC) The customer lls out an application form and sends it to (or takes it to) TPC’s branch and pays the fee for connection. The following documents are required: Application form, an indoors wires diagram, and the usage license or certi cate approved by authorities of building. TPC will then design the external line. Before the external connection works can start the utility has to nish the design for the works. In this case, when the customer submits an application at a TPC branch, TPC will estimate the customer's Contribution in Aid of Page 21   Construction Costs. The customer can pay the fee when they apply. Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Doing Business 2018 Taiwan, China Details – Getting Electricity in Taiwan, China – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Submit application for connection and await completion of design 4 calendar days TWD 293,202 Agency : Taiwan Power Company (TPC) The customer lls out an application form and sends it to (or takes it to) TPC’s branch and pays the fee for connection. The following documents are required: Application form, an indoors wires diagram, and the usage license or certi cate approved by authorities of building. TPC will then design the external line. Before the external connection works can start the utility has to nish the design for the works. In this case, when the customer submits an application at a TPC branch, TPC will estimate the customer's Contribution in Aid of Construction Costs. The customer can pay the fee when they apply. The Customer’s Contribution in Aid of Construction Costs includes fees for the power line design, construction, meter installation and check of the internal wiring, and labor costs. 2 Await completion of external works by TPC’s subcontractor 17 calendar days TWD 0 Agency : Taiwan Power Company (TPC) The contractor hired by the utility will complete the external connection work. All material is available in more than 50% of the cases. The customer doesn’t have to buy any material for the external connection works. The excavation permit is obtained by the utility. It is obtained from the agency of the government that is in charge of the roads. 3 Await meter installation, internal wiring inspection and electricity ow 1 calendar day TWD 0 from TPC Agency : Taiwan Power Company (TPC) The electrician who did the internal wiring submits a signed noti cation to the utility upon completion in which they guarantee it has been carried out according to the regulations. Then TPC will inspect the internal wiring after the external connection works are over. According to Article 43 of "The Electricity Act", "the installation of user electricity devices by electricity enterprises shall comply with relevant regulations provided by the central competent authority and electricity supply may only be connected after said devices have passed inspection. For electricity equipment already installed by the user, inspection shall be carried out with the result thereof recorded at least once every three years. In the event that non-conformity is found, a time period shall be speci ed for the user to make recti cation." Taipower inspects the internal wiring and installs the meter after the external connection works are over. If the internal wiring check is passed, the meter will be installed and the electricity will start owing. Takes place simultaneously with previous procedure. Details – Getting Electricity in Taiwan, China – Measure of Quality Page 22   Takes place simultaneously with previous procedure. Doing Business 2018 Taiwan, China Details – Getting Electricity in Taiwan, China – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 8 Total duration and frequency of outages per customer a year (0-3) 3 System average interruption duration index (SAIDI) 0.3 System average interruption frequency index (SAIFI) 0.2 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 1.0 Mechanisms for monitoring outages (0-1) 1 Does the distribution utility use automated tools to monitor outages? Yes Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 1 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on Yes reliability of supply? Financial deterrents aimed at limiting outages (0-1) 1 Does the utility either pay compensation to customers or face nes by the regulator (or both) if outages Yes exceed a certain cap? Communication of tari s and tari changes (0-1) 1 Are e ective tari s available online? Yes Link to the website, if available online http://www.taipower .com.tw/e_content/i ndex.aspx Are customers noti ed of a change in tari ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tari index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Page 23   What the indicators measure Case study assumptions If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Doing Business 2018 Taiwan, China Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally transfer title on immovable To make the data comparable across economies, several assumptions property (number) about the parties to the transaction, the property and the procedures are used. Preregistration procedures (for example, checking for liens, notarizing sales agreement, The parties (buyer and seller): paying property transfer taxes) - Are limited liability companies (or the legal equivalent). Registration procedures in the economy's largest - Are located in the periurban area of the economy’s largest business city. business citya. For 11 economies the data are also collected for the second largest Postregistration procedures (for example, filling business city. title with municipality) - Are 100% domestically and privately owned. Time required to complete each procedure - Have 50 employees each, all of whom are nationals. (calendar days) - Perform general commercial activities. Does not include time spent gathering information The property (fully owned by the seller): - Has a value of 50 times income per capita, which equals the sale price. Each procedure starts on a separate day - though - Is fully owned by the seller. procedures that can be fully completed online - Has no mortgages attached and has been under the same ownership for are an exception to this rule the past 10 years. Procedure is considered completed once final - Is registered in the land registry or cadastre, or both, and is free of title document is received disputes. No prior contact with officials - Is located in a periurban commercial zone, and no rezoning is required. Cost required to complete each procedure (% of - Consists of land and a building. The land area is 557.4 square meters property value) (6,000 square feet). A two-story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse is 10 years old, is in Official costs only (such as administrative fees, good condition, has no heating system and complies with all safety duties and taxes). standards, building codes and legal requirements. The property, Value Added Tax, Capital Gains Tax and illicit consisting of land and building, will be transferred in its entirety. payments are excluded - Will not be subject to renovations or additional construction following the purchase. Quality of land administration index (0-30) - Has no trees, natural water sources, natural reserves or historical Reliability of infrastructure index (0-8) monuments of any kind. Transparency of information index (0–6) - Will not be used for special purposes, and no special permits, such as for Geographic coverage index (0–8) residential use, industrial plants, waste storage or certain types of agricultural activities, are required. Land dispute resolution index (0–8) - Has no occupants, and no other party holds a legal interest in it. Equal access to property rights index (-2–0) Standard Property Transfer Property value TWD 37,638,586.00 City Covered Taipei Page 24   East Asia & OECD high Doing Business 2018 Taiwan, China Standard Property Transfer Property value TWD 37,638,586.00 City Covered Taipei East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Procedures (number) 3 5.5 4.6 1.00 (4 Economies) Time (days) 4 74.5 22.3 1.00 (3 Economies) Cost (% of property value) 6.2 4.3 4.2 0.00 (5 Economies) Quality of the land administration index (0-30) 28.5 15.8 22.7 29.00 (Singapore) Figure – Registering Property in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 83.89: Taiwan, China (Rank: 18) 76.34: Korea, Rep. (Rank: 39) 76.06: Malaysia (Rank: 42) 73.92: Japan (Rank: 52) 73.54: Hong Kong SAR, China (Rank: 55) 57.21: Regional Average (East Asia & Pacific) Note: The ranking of economies on the ease of registering property is determined by sorting their distance to frontier scores for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Registering Property in Taiwan, China – Procedure, Time and Cost Time Cost 4 7 3.5 6 Cost (% of property value) 3 5 2.5 Time (days) 4 2 3 1.5 2 1 0.5 1 0 0 1 2 3 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Page 25   Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Taiwan, China Figure – Registering Property in Taiwan, China – Procedure, Time and Cost Time Cost 4 7 3.5 6 Cost (% of property value) 3 5 2.5 Time (days) 4 2 3 1.5 2 1 0.5 1 0 0 1 2 3 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Registering Property in Taiwan, China and comparator economies – Measure of Quality 35 30 28.5 27.5 27.5 27.5 24.5 25 Index score 20 15.8 15 10 5 0 Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Details – Registering Property in Taiwan, China – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Buyer researches the property rights and encumbrances registered Less than one day TWD 10 for the against the property at the registry of titles (online procedure) search and TWD 20 Agency : Land Registry per sheet of e- transcript The buyer obtains copies of the land and building's registration from the electronic registration database. Each page costs TWD 20. 2 Buyer pays the Deed tax at the Municipality Less than one day 6% of standard Agency : Municipality (online procedure) property value (Deed Tax) + 0.1% Stamp The Deed tax is 6% of the standard property value, and buyer pays it at the Duty Municipality. Seller pays the Land value increase tax. As a result, Taiwan government (Real-estate Valuation Committee) issues so- Page 26   Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Doing Business 2018 Taiwan, China Details – Registering Property in Taiwan, China – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Buyer researches the property rights and encumbrances registered Less than one day TWD 10 for the against the property at the registry of titles (online procedure) search and TWD 20 Agency : Land Registry per sheet of e- transcript The buyer obtains copies of the land and building's registration from the electronic registration database. Each page costs TWD 20. 2 Buyer pays the Deed tax at the Municipality Less than one day 6% of standard Agency : Municipality (online procedure) property value (Deed Tax) + 0.1% Stamp The Deed tax is 6% of the standard property value, and buyer pays it at the Duty Municipality. Seller pays the Land value increase tax. As a result, Taiwan government (Real-estate Valuation Committee) issues so- called "standard" valuation information of property every year for tax authorities' and tax payers' reference. After years, such government announcement of valuation becomes the reported tax base by taxpayers and acceptable by tax authorities. The real "contract price" might be ignored when ling deed tax in practice now. The standard value is always lower than market price. As of January 30 2005, the Land value increase tax (capital gains tax) is levied according to the following rates: (1) Where the net increase of the value of any land is no more than 100 percent of the original value of such land, the rate shall be 20 percent of the net increase. (2) Where the net increase of the value of any land is no more than 200 percent of the original value of such land, the rate shall be 30 percent of that part of the net increase which exceeds the original value by more than 100 percent in addition to the rate prescribed in the preceding section. (3) Where the net increase of the value of any land is no more than 300 percent of the original value of such land, the rate shall be 40 perсent of that part of the net increase which exceeds the original value by more than 200 percent in addition to the rates prescribed in the preceding section. As of October 2009, the Ministry of Finance completed the development of the Local Tax Online Filing Portal, provided for use by the public nationwide. Taiwan government spent two years planning this system, which enables the public to carry out the ling for these local taxes online at home, and speeds up the procedure for property registration. (The Local Tax Online Filing Portal website can be visited at: https://www.etax.nat.gov.tw/wSite/indexLocal.htm) 3 Registration of transfer of title at the Land Registry 3 days 0.1% of property Agency : Land Registry value (registration fee) + TWD 80 for The transfer of title is registered at the Land Registry. The original ownership new ownership certi cate must be returned and a new one is issued. certificate Takes place simultaneously with previous procedure. Details – Registering Property in Taiwan, China – Measure of Quality Page 27   Answer Score Takes place simultaneously with previous procedure. Doing Business 2018 Taiwan, China Details – Registering Property in Taiwan, China – Measure of Quality Answer Score Quality of the land administration index (0-30) 28.5 Reliability of infrastructure index (0-8) 8.0 What is the institution in charge of immovable property registration? Land O ce In what format are the majority of title or deed records kept in the largest business city Computer/Fully 2.0 —in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for checking for encumbrances (liens, mortgages, Yes 1.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Land O ce In what format are the majority of maps of land plots kept in the largest business city— Computer/Fully 2.0 in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for recording boundaries, checking plans and providing Yes 1.0 cadastral information (geographic information system)? Is the information recorded by the immovable property registration agency and the Single database 1.0 cadastral or mapping agency kept in a single database, in di erent but linked databases or in separate databases? Do the immovable property registration agency and cadastral or mapping agency use Yes 1.0 the same identi cation number for properties? Transparency of information index (0–6) 4.5 Who is able to obtain information on land ownership at the agency in charge of Anyone who 1.0 immovable property registration in the largest business city? pays the o cial fee Is the list of documents that are required to complete any type of property transaction Yes, online 0.5 made publicly available–and if so, how? Link for online access: 1.http://www.lan d.moi.gov.tw/chh tml/tabledown.a sp? cid=52&qcode= 2. http://www.e- services.taipei.go v.tw/hypage.exe? HYPAGE=index_0 1.htm&clsid0=1& clsid1=24&clsid2 =39&cond=all&to tal_srv=103#sho wname_place 3. http://www.land. gov.taipei/ct.asp? xItem=59214040 &CtNode=84881 &mp=111001 Page 28   Is the list of documents that are required to complete any type of property transaction Yes, online 0.5 made Doing publicly available–and Business 2018 Taiwan,if so, how? China Link for online access: 1.http://www.lan d.moi.gov.tw/chh tml/tabledown.a sp? cid=52&qcode= 2. http://www.e- services.taipei.go v.tw/hypage.exe? HYPAGE=index_0 1.htm&clsid0=1& clsid1=24&clsid2 =39&cond=all&to tal_srv=103#sho wname_place 3. http://www.land. gov.taipei/ct.asp? xItem=59214040 &CtNode=84881 &mp=111001 Is the applicable fee schedule for any property transaction at the agency in charge of Yes, online 0.5 immovable property registration in the largest business city made publicly available– and if so, how? Link for online access: 1.http://www.lan d.gov.taipei/np.a sp? ctNode=85161& mp=111001 2.http://w2.land.t aipei.gov.tw/calc/ exp/r_1.asp Does the agency in charge of immovable property registration commit to delivering a Yes, online 0.5 legally binding document that proves property ownership within a speci c time frame– and if so, how does it communicate the service standard? Link for online access: 1.http://www.lan d.gov.taipei/ct.as p? xItem=59212504 &CtNode=84881 &mp=111001 2.http://www.lan d.gov.taipei/ct.as p? xItem=70657500 &ctNode=70422 &mp=111002 3.http://www.e- services.taipei.go v.tw/hypage.exe? HYPAGE=form.ht m&s_uid=024002 Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the agency in charge of immovable property registration? Page 29   Contact information: 1. The HYPAGE=form.ht Doing Business 2018 Taiwan, China m&s_uid=024002 Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the agency in charge of immovable property registration? Contact information: 1. The Committee on Property Dispute Conciliation is set up by the Municipal or County Land O ce, and the Committee shall employ members with land administration, construction, and legal backgrounds together with local distinguished persons. The following are websites of the property dispute conciliation application in Taipei City Government: (1) http://www.land. gov.taipei/ct.asp? xItem=11837&Ct Node=85168&m p=111001 (2)http://www.e- services.taipei.go v.tw/hypage.exe? HYPAGE=index_0 1.htm&clsid0=1& clsid1=24&clsid2 =313&cond=all&t otal_srv=101# 2. Every land o ce has its own mechanism that can be found online. Take Taipei City Zhongshan Land O ce for example: (http://www.csla. gov.taipei/ct.asp? xItem=4324&CtN ode=37845&mp= 111031). (1)Mail Box: Page 30   gov.taipei/ct.asp? xItem=4324&CtN Doing Business 2018 Taiwan, China ode=37845&mp= 111031). (1)Mail Box: http://www.csla.g ov.taipei/sp.asp? pbid=226&xdurl= bossmail/prosec uteMail.asp (2)Email: fz_people@mail.t aipei.gov.tw (3)Tel: 02- 25052775 3. Mail Box (Department of land, Taipei City Government), http://www.land. gov.taipei/ct.asp? xItem=59183952 &CtNode=84881 &mp=111001 and http://w2.land.tai pei.gov.tw/LandB ox/ce_1.asp TEL: 02-27208889 or 1999 4. Tel. of every section of Department of Land, Taipei City Government, http://www.land. gov.taipei/ct.asp? xItem=114562&C tNode=84095&m p=111001 Are there publicly available o cial statistics tracking the number of transactions at the Yes 0.5 immovable property registration agency? Number of property transfers in the largest business city in 2015: 19796.0 Who is able to consult maps of land plots in the largest business city? Anyone who 0.5 pays the o cial fee Is the applicable fee schedule for accessing maps of land plots made publicly available Yes, online 0.5 —and if so, how? Link for online access: 1. http://w2.land.tai pei.gov.tw/calc/e xp/s_13.asp 2. http://www.land. moi.gov.tw/law/c hhtml/mainfram e.asp? LCID=305&lawna me=%A4g%A6a% Page 31   Is the applicable fee schedule for accessing maps of land plots made publicly available Yes, online 0.5 —and Doing if so, how? Business 2018 Taiwan, China Link for online access: 1. http://w2.land.tai pei.gov.tw/calc/e xp/s_13.asp 2. http://www.land. moi.gov.tw/law/c hhtml/mainfram e.asp? LCID=305&lawna me=%A4g%A6a% BD%C6%A4V%B6 O%A4%CE%AB% D8%BFv%A7%EF %A8}%AA%AB%B 4%FA%B6q%B6O %A6%AC%B6O% BC%D0%B7%C7& lcmod=%A4%A4 %B5%D8%A5%C1 %B0%EA103%A6 ~5%A4%EB8%A4 %E9%A4%BA%AC F%B3%A1%A5x% A4%BA%A6a%A6 r%B2%C4103015 2777%B8%B9%A 5O%AD%D7%A5 %BF%B5o%A5%A C Does the cadastral or mapping agency commit to delivering an updated map within a Yes, online 0.5 speci c time frame—and if so, how does it communicate the service standard? Link for online access: 1. http://law.moj.go v.tw/Law/LawSea rchResult.aspx? p=A&k1=%E5%9C %B0%E7%B1%8D %E6%B8%AC%E9 %87%8F%E5%AF %A6%E6%96%BD %E8%A6%8F%E5 %89%87&t=E1F1 A1&TPage=1 2. http://www.e- services.taipei.go v.tw/hypage.exe? HYPAGE=form.ht m&s_uid=024031 Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the cadastral or mapping agency? Contact information: The Committee on Property Dispute Conciliation is Page 32   set up by the Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred Doing at the cadastral Business or mapping 2018 Taiwan, agency? China Contact information: The Committee on Property Dispute Conciliation is set up by the Municipal or County Land O ce, and the Committee shall employ members with land administration, construction, and legal backgrounds together with local distinguished persons. The following is website of the property dispute conciliation application in Taipei City Government: http://www.land. gov.taipei/ct.asp? xItem=11837&Ct Node=85168&m p=111001 Geographic coverage index (0–8) 8.0 Are all privately held land plots in the economy formally registered at the immovable Yes 2.0 property registry? Are all privately held land plots in the largest business city formally registered at the Yes 2.0 immovable property registry? Are all privately held land plots in the economy mapped? Yes 2.0 Are all privately held land plots in the largest business city mapped? Yes 2.0 Land dispute resolution index (0–8) 8.0 Does the law require that all property sale transactions be registered at the immovable Yes 1.5 property registry to make them opposable to third parties? Is the system of immovable property registration subject to a state or private Yes 0.5 guarantee? Is there a speci c compensation mechanism to cover for losses incurred by parties who Yes 0.5 engaged in good faith in a property transaction based on erroneous information certi ed by the immovable property registry? Does the legal system require a control of legality of the documents necessary for a Yes 0.5 property transaction (e.g., checking the compliance of contracts with requirements of Page 33   engaged in good faith in a property transaction based on erroneous information ed by the immovable certi Business Doing property 2018 Taiwan, registry? China Does the legal system require a control of legality of the documents necessary for a Yes 0.5 property transaction (e.g., checking the compliance of contracts with requirements of the law)? If yes, who is responsible for checking the legality of the documents? Registrar. Does the legal system require veri cation of the identity of the parties to a property Yes 0.5 transaction? If yes, who is responsible for verifying the identity of the parties? Registrar. Is there a national database to verify the accuracy of identity documents? Yes 1.0 For a standard land dispute between two local businesses over tenure rights of a Taiwan Taipei property worth 50 times gross national income (GNI) per capita and located in the District Court largest business city, what court would be in charge of the case in the rst instance? How long does it take on average to obtain a decision from the rst-instance court for Less than a year 3.0 such a case (without appeal)? Are there any statistics on the number of land disputes in the rst instance? Yes 0.5 Number of land disputes in the largest business city in 2015: 122,163 cases (for all kinds of property disputes) 84.26% (122163 / 144990 * 100% = 84.26%) Equal access to property rights index (-2–0) 0.0 Do unmarried men and unmarried women have equal ownership rights to property? Yes 0.0 Do married men and married women have equal ownership rights to property? Yes 0.0 Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) security interest is created, publicized and enforced according to the law. Credit bureau coverage (% of adults) Special emphasis is given to how the collateral registry operates (if Number of individuals and firms listed in largest registration of security interests is possible). The case scenarios involve a credit bureau as a percentage of adult population secured borrower, company ABC, and a secured lender, BizBank. Page 34   Do married men and married women have equal ownership rights to property? Yes 0.0 Doing Business 2018 Taiwan, China Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) security interest is created, publicized and enforced according to the law. Credit bureau coverage (% of adults) Special emphasis is given to how the collateral registry operates (if Number of individuals and firms listed in largest registration of security interests is possible). The case scenarios involve a credit bureau as a percentage of adult population secured borrower, company ABC, and a secured lender, BizBank. Credit registry coverage (% of adults) In some economies the legal framework for secured transactions will allow Number of individuals and firms listed in credit only case A or case B (not both) to apply. Both cases examine the same set registry as a percentage of adult population of legal provisions relating to the use of movable collateral. Several assumptions about the secured borrower (ABC) and lender (BizBank) are used: - ABC is a domestic limited liability company (or its legal equivalent). - ABC has up to 50 employees. - ABC has its headquarters and only base of operations in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Both ABC and BizBank are 100% domestically owned. The case scenarios also involve assumptions. In case A, as collateral for the loan, ABC grants BizBank a nonpossessory security interest in one category of movable assets, for example, its machinery or its inventory. ABC wants to keep both possession and ownership of the collateral. In economies where the law does not allow nonpossessory security interests in movable property, ABC and BizBank use a fiduciary transfer-of-title arrangement (or a similar substitute for nonpossessory security interests). In case B, ABC grants BizBank a business charge, enterprise charge, floating charge or any charge that gives BizBank a security interest over ABC’s combined movable assets (or as much of ABC’s movable assets as possible). ABC keeps ownership and possession of the assets. East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Strength of legal rights index (0-12) 2 7.2 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 8 4.2 6.6 8.00 (34 Economies) Page 35   Credit registry coverage (% of adults) 0.0 16.0 18.3 100.00 (3 Economies) possible). ABC keeps ownership and possession of the assets. Doing Business 2018 Taiwan, China East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Strength of legal rights index (0-12) 2 7.2 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 8 4.2 6.6 8.00 (34 Economies) Credit registry coverage (% of adults) 0.0 16.0 18.3 100.00 (3 Economies) Credit bureau coverage (% of adults) 98.4 22.3 63.7 100.00 (23 Economies) Figure – Getting Credit in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 80.00: Malaysia (Rank: 20) 75.00: Hong Kong SAR, China (Rank: 29) 65.00: Korea, Rep. (Rank: 55) 57.00: Regional Average (East Asia & Pacific) 55.00: Japan (Rank: 77) 50.00: Taiwan, China (Rank: 90) Note: The ranking of economies on the ease of getting credit is determined by sorting their distance to frontier scores for getting credit. These scores are the distance to frontier score for the sum of the strength of legal rights index and the depth of credit information index. Figure – Legal Rights in Taiwan, China and comparator economies 9 8 8 8 7.2 7 6 Index score 5 5 5 4 3 2 2 1 0 Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Details – Legal Rights in Taiwan, China Strength of legal rights index (0-12) 2 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without No requiring a speci c description of collateral? Page 36   Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Doing Business 2018 Taiwan, China Details – Legal Rights in Taiwan, China Strength of legal rights index (0-12) 2 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without No requiring a speci c description of collateral? Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring No a speci c description of collateral? May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds No or replacements of the original assets? Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and Yes obligations be secured between parties; and can the collateral agreement include a maximum amount for which the assets are encumbered? Is a collateral registry in operation for both incorporated and non-incorporated entities, that is uni ed geographically No and by asset type, with an electronic database indexed by debtor's name? Does a notice-based collateral registry exist in which all functional equivalents can be registered? No Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be No performed online by any interested third party? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency No procedure? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a business is liquidated? No Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised No reorganization procedure? Does the law protect secured creditors’ rights by providing clear grounds for relief from the stay and/or sets a time limit for it? Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law Yes allow the secured creditor to sell the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt? Figure – Credit Information in Taiwan, China and comparator economies 10 8 8 8 8 7 Index score 6 6 4.2 4 2 0 Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Details – Credit Information in Taiwan, China Page 37   0 China Taiwan,2018 Doing Business Hong Kong Taiwan, SAR, China China Japan Korea, Rep. Malaysia East Asia & Pacific Details – Credit Information in Taiwan, China Credit Credit Depth of credit information index (0-8) bureau registry Score Are data on both firms and individuals distributed? Yes No 1 Are both positive and negative credit data distributed? Yes No 1 Are data from retailers or utility companies - in addition to data from banks and financial institutions - Yes No 1 distributed? Are at least 2 years of historical data distributed? (Credit bureaus and registries that distribute more Yes No 1 than 10 years of negative data or erase data on defaults as soon as they are repaid obtain a score of 0 for this component.) Are data on loan amounts below 1% of income per capita distributed? Yes No 1 By law, do borrowers have the right to access their data in the credit bureau or credit registry? Yes No 1 Can banks and financial institutions access borrowers’ credit information online (for example, Yes No 1 through an online platform, a system-to-system connection or both)? Are bureau or registry credit scores offered as a value-added service to help banks and financial Yes No 1 institutions assess the creditworthiness of borrowers? Score ("yes" to either public bureau or private registry) 8 Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult population, the total score on the depth of credit information index is 0. Coverage Credit bureau Credit registry Number of individuals 16,467,000 0 Number of firms 550,000 0 Total 17,017,000 0 Percentage of adult population 98.4 0.0 Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it is assumed that Buyer is a large private company with multiple Page 38   transactions; Available legal remedies (damages, Percentage of adult population 98.4 0.0 Doing Business 2018 Taiwan, China Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it transactions; Available legal remedies (damages, is assumed that Buyer is a large private company with multiple disgorgement of profits, fines, imprisonment, shareholders. rescission of the transaction) - Has a board of directors and a chief executive o cer (CEO) who may legally act on behalf of Buyer where permitted, even if this is not speci cally Ease of shareholder suits index (0–10): Access to required by law. internal corporate documents; Evidence - Has a supervisory board (applicable to economies with a two-tier board obtainable during trial and allocation of legal system) on which 60% of the shareholder-elected members have been expenses appointed by Mr. James, who is Buyer’s controlling shareholder and a Extent of conflict of interest regulation index member of Buyer’s board of directors. (0–10): Simple average of the extent of disclosure, - Has not adopted any bylaws or articles of association that di er from extent of director liability and ease of default minimum standards and does not follow any nonmandatory codes, shareholder indices principles, recommendations or guidelines relating to corporate Extent of shareholder rights index (0-10): governance. Shareholders’ rights and role in major corporate - Is a manufacturing company with its own distribution network. decisions Extent of ownership and control index (0-10): The transaction involves the following details: Governance safeguards protecting shareholders - Mr. James owns 60% of Buyer and elected two directors to Buyer’s ve- from undue board control and entrenchment member board. Extent of corporate transparency index (0-10): - Mr. James also owns 90% of Seller, a company that operates a chain of Corporate transparency on ownership stakes, retail hardware stores. Seller recently closed a large number of its stores. compensation, audits and financial prospects - Mr. James proposes that Buyer purchase Seller’s unused eet of trucks to expand Buyer’s distribution of its food products, a proposal to which Buyer Extent of shareholder governance index (0–10): agrees. The price is equal to 10% of Buyer’s assets and is higher than the Simple average of the extent of shareholders market value. rights, extent of ownership and control and - The proposed transaction is part of the company’s ordinary course of extent of corporate transparency indices business and is not outside the authority of the company. Strength of minority investor protection index - Buyer enters into the transaction. All required approvals are obtained, (0–10): Simple average of the extent of conflict of and all required disclosures made (that is, the transaction is not interest regulation and extent of shareholder fraudulent). governance indices - The transaction causes damages to Buyer. Shareholders sue Mr. James and the other parties that approved the transaction. East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Extent of conflict of interest regulation index (0- 6.7 5.7 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 7.3 4.8 6.4 Page 39   9.00 (Kazakhstan) and the other parties that approved the transaction. Doing Business 2018 Taiwan, China East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Extent of conflict of interest regulation index (0- 6.7 5.7 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 7.3 4.8 6.4 9.00 (Kazakhstan) Figure – Protecting Minority Investors in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 80.00: Malaysia (Rank: 4) 76.67: Hong Kong SAR, China (Rank: 9) 71.67: Korea, Rep. (Rank: 20) 70.00: Taiwan, China (Rank: 24) 58.33: Japan (Rank: 62) 52.33: Regional Average (East Asia & Pacific) Note: The ranking of economies on the strength of minority investor protections is determined by sorting their distance to frontier scores for protecting minority investors. These scores are the simple average of the distance to frontier scores for the extent of con ict of interest regulation index and the extent of shareholder governance index. Figure – Protecting Minority Investors in Taiwan, China and comparator economies – Measure of Quality Taiwan (China) 10 5 9 5 7 6 Hong Kong SAR, China 8 8 10 4 7 9 Japan 5 6 7 3 6 8 Korea, Rep. 9 6 7 6 7 8 Malaysia 8 9 10 6 8 7 OECD high income 7.3 5.6 6.5 5.2 6.3 7.4 East Asia & Pacific 5.6 4.6 6.2 3.9 5.3 6.1 0 10 20 30 40 50 60 Sub-Indicator Score Extent of corporate transparency index (0­10) Extent of director liability index (0­10) Extent of disclosure index (0­10) Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Details – Protecting Minority Investors in Taiwan, China – Measure of Quality Answer Score Page 40   Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Doing Business 2018 Taiwan, China Details – Protecting Minority Investors in Taiwan, China – Measure of Quality Answer Score Extent of con ict of interest regulation index (0-10) 6.7 Extent of disclosure index (0-10) 9 Which corporate body is legally su cient to approve the Buyer-Seller transaction? (0-3) Board of 2.0 directors excluding interested members Must an external body review the terms of the transaction before it takes place? (0-1) Yes 1.0 Must Mr. James disclose his con ict of interest to the board of directors? (0-2) Full disclosure of 2.0 all material facts Must Buyer disclose the transaction in published periodic lings (annual reports)? (0-2) Disclosure on 2.0 the transaction and on the con ict of interest Must Buyer immediately disclose the transaction to the public and/or shareholders? (0- Disclosure on 2.0 2) the transaction and on the con ict of interest Extent of director liability index (0-10) 5 Can shareholders representing 10% of Buyer's share capital sue directly or derivatively Yes 1.0 for the damage the transaction caused to Buyer? (0-1) Can shareholders hold the interested director liable for the damage the transaction Liable if negligent 1.0 caused to Buyer? (0-2) Can shareholders hold the other directors liable for the damage the transaction caused Liable if negligent 1.0 to Buyer (0-2) Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by Yes 1.0 shareholders? (0-1) Must Mr. James repay pro ts made from the transaction upon a successful claim by No 0.0 shareholders? (0-1) Is Mr. James disquali ed or ned and imprisoned upon a successful claim by Yes 1.0 shareholders? (0-1) Can a court void the transaction upon a successful claim by shareholders? (0-2) Only in case of 0.0 fraud or bad faith Ease of shareholder suits index (0-10) 6 Before suing can shareholders representing 10% of Buyer's share capital inspect the No 0.0 transaction documents? (0-1) Page 41   shareholder Ease ofBusiness Doing suits index 2018 (0-10) Taiwan, China 6 Before suing can shareholders representing 10% of Buyer's share capital inspect the No 0.0 transaction documents? (0-1) Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 document Can the plainti request categories of documents from the defendant without No 0.0 identifying speci c ones? (0-1) Can the plainti directly question the defendant and witnesses at trial? (0-2) Preapproved 1.0 questions only Is the level of proof required for civil suits lower than that of criminal cases? (0-1) Yes 1.0 Can shareholder plainti s recover their legal expenses from the company? (0-2) Yes if successful 1.0 Extent of shareholder governance index (0-10) 7.3 Extent of shareholder rights index (0-10) 7 Does the sale of 51% of Buyer's assets require shareholder approval? Yes 1.0 Can shareholders representing 10% of Buyer's share capital call for a meeting of Yes 1.0 shareholders? Must Buyer obtain its shareholders’ approval every time it issues new shares? No 0.0 Do shareholders automatically receive preemption rights every time Buyer issues new Yes 1.0 shares? Must shareholders approve the election and dismissal of the external auditor? No 0.0 Are changes to the rights of a class of shares only possible if the holders of the a ected Yes 1.0 shares approve? Assuming that Buyer is a limited company, does the sale of 51% of its assets require Yes 1.0 member approval? Assuming that Buyer is a limited company, can members representing 10% call for a Yes 1.0 meeting of members? Assuming that Buyer is a limited company, must all members consent to add a new No 0.0 member? Assuming that Buyer is a limited company, must a member rst o er to sell their Yes 1.0 interest to the existing members before they can sell to non-members? Extent of ownership and control index (0-10) 5 Is it forbidden to appoint the same individual as CEO and chair of the board of No 0.0 directors? Must the board of directors include independent and nonexecutive board members? Yes 1.0 Can shareholders remove members of the board of directors without cause before the Yes 1.0 end of their term? Must the board of directors include a separate audit committee exclusively comprising No 0.0 board members? Page 42   Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% Yes 1.0 Can shareholders remove members of the board of directors without cause before the Yes 1.0 end of Doing their term? Business 2018 Taiwan, China Must the board of directors include a separate audit committee exclusively comprising No 0.0 board members? Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% Yes 1.0 of Buyer? Must Buyer pay declared dividends within a maximum period set by law? Yes 1.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? No 0.0 Assuming that Buyer is a limited company, must Buyer have a mechanism to resolve Yes 1.0 disagreements among members? Assuming that Buyer is a limited company, must a potential acquirer make a tender No 0.0 o er to all shareholders upon acquiring 50% of Buyer? Assuming that Buyer is a limited company, must Buyer distribute pro ts within a No 0.0 maximum period set by law? Extent of corporate transparency index (0-10) 10 Must Buyer disclose direct and indirect bene cial ownership stakes representing 5%? Yes 1.0 Must Buyer disclose information about board members’ primary employment and Yes 1.0 directorships in other companies? Must Buyer disclose the compensation of individual managers? Yes 1.0 Must a detailed notice of general meeting be sent 21 days before the meeting? Yes 1.0 Can shareholders representing 5% of Buyer’s share capital put items on the general Yes 1.0 meeting agenda? Must Buyer's annual nancial statements be audited by an external auditor? Yes 1.0 Must Buyer disclose its audit reports to the public? Yes 1.0 Assuming that Buyer is a limited company, must members meet at least once a year? Yes 1.0 Assuming that Buyer is a limited company, can members representing 5% put items on Yes 1.0 the meeting agenda? Assuming that Buyer is a limited company, must Buyer's annual nancial statements be Yes 1.0 audited by an external auditor? Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. Page 43   Assuming that Buyer is a limited company, must Buyer's annual nancial statements be Yes 1.0 audited by an external auditor? Doing Business 2018 Taiwan, China Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory 2016 (number per year adjusted for electronic and contributions a medium size company must pay in a year, and measures joint ling and payment) the administrative burden of paying taxes, contributions and dealing with post ling processes. Information is also compiled on frequency of ling Total number of taxes and contributions paid, and payments, time taken to comply with tax laws, time taken to comply including consumption taxes (value added tax, with the requirements of post ling processes and time waiting. sales tax or goods and service tax) Method and frequency of filing and payment To make data comparable across economies, several assumptions are used: Time required to comply with 3 major taxes - TaxpayerCo is a medium-size business that started operations on January (hours per year) 1, 2015. It produces ceramic flowerpots and sells them at retail. All taxes Collecting information, computing tax payable and contributions recorded are paid in the second year of operation Completing tax return, filing with agencies (calendar year 2016). Taxes and mandatory contributions are measured at all levels of government. Arranging payment or withholding Preparing separate tax accounting books, if The VAT refund process: required - In June 2016, TaxpayerCo. makes a large capital purchase: the value of the Total tax and contribution rate (% of pro t before machine is 65 times income per capita of the economy. Sales are equally all taxes) spread per month (1,050 times income per capita divided by 12) and cost of goods sold are equally expensed per month (875 times income per Profit or corporate income tax capita divided by 12). The machinery seller is registered for VAT and excess Social contributions, labor taxes paid by input VAT incurred in June will be fully recovered after four consecutive employer months if the VAT rate is the same for inputs, sales and the machine and Property and property transfer taxes the tax reporting period is every month. Input VAT will exceed Output VAT Dividend, capital gains, financial transactions in June 2016. taxes The corporate income tax audit process: Waste collection, vehicle, road and other taxes - An error in calculation of income tax liability (for example, use of incorrect Post ling Index tax depreciation rates, or incorrectly treating an expense as tax deductible) leads to an incorrect income tax return and a corporate income Time to comply with a VAT refund tax underpayment. TaxpayerCo. discovered the error and voluntarily Time to receive a VAT refund noti ed the tax authority. The value of the underpaid income tax liability is Time to comply with a corporate income tax audit 5% of the corporate income tax liability due. TaxpayerCo. submits corrected information after the deadline for submitting the annual tax Time to complete a corporate income tax audit return, but within the tax assessment period. East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Payments (number per year) 11 21.8 10.9 3 (Hong Kong SAR, China) Page 44   return, but within the tax assessment period. Doing Business 2018 Taiwan, China East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Payments (number per year) 11 21.8 10.9 3 (Hong Kong SAR, China) Time (hours per year) 221 189.2 160.7 55 (Luxembourg) Total tax and contribution rate (% of profit) 34.3 33.6 40.1 18.47% (32 Economies) Postfiling index (0-100) 63.17 56.55 83.45 99.38 (Estonia) Figure – Paying Taxes in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 98.82: Hong Kong SAR, China (Rank: 3) 86.69: Korea, Rep. (Rank: 24) 77.96: Taiwan, China (Rank: 56) 76.71: Japan (Rank: 68) 76.07: Malaysia (Rank: 73) 72.42: Regional Average (East Asia & Pacific) Note: The ranking of economies on the ease of paying taxes is determined by sorting their distance to frontier scores on the ease of paying taxes. These scores are the simple average of the distance to frontier scores for each of the four component indicators – number of tax payments. time, total tax rate and post ling index – with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax rate. The nonlinear distance to frontier for the total tax rate is equal to the distance to frontier for the total tax rate to the power of 0.8. The threshold is de ned as the total tax rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax rate below this threshold receive the same score as the economy at the threshold. Figure – Paying Taxes in Taiwan, China and comparator economies – Measure of Quality 120 98.85 100 93.04 80 71.69 Index score 63.17 52.65 56.55 60 40 20 0 Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Details – Paying Taxes in Taiwan, China Total tax and Payments Notes on Time Statutory contribution rate (% Notes Tax or mandatory contribution (number) Payments (hours) tax rate Tax base of profit) on TTR Page 45   Corporate income tax 1 online 161 17% taxable 12.53 Doing Business 2018 Taiwan, China Figure – Paying Taxes in Taiwan, China and comparator economies – Measure of Quality 120 98.85 100 93.04 80 71.69 Index score 63.17 52.65 56.55 60 40 20 0 Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Details – Paying Taxes in Taiwan, China Total tax and Payments Notes on Time Statutory contribution rate (% Notes Tax or mandatory contribution (number) Payments (hours) tax rate Tax base of profit) on TTR Corporate income tax 1 online 161 17% taxable 12.53 filing profit Employer paid - Pension 1 online 6% gross 6.93 contributions salaries Employer paid - Labor 1 online 27 various gross 6.15 insurance contributions rates salaries Employer paid - Mandatory 1 online various gross 5.23 health insurance contributions rates salaries Taipei City house tax 1 3% assessed 2.87 building value Taipei City land value tax 1 1% - 5.5% assessed 0.51 land value Tax on interest 0 10% interest 0.26 not income included Vehicle license tax 1 online TWD fixed fee 0.03 11,700 Value added tax (VAT) 1 online 33 5% value 0.00 not filing added included Employee paid - Labor 0 online various gross 0.00 withheld insurance contributions and rates salaries jointly Employee paid - Mandatory 0 online various gross 0.00 withheld health insurance contributions and rates salaries jointly Fuel tax 1 online various engine size 0.00 small rates Page 46   amount health insurance contributions and rates salaries Doing Business 2018 Taiwan, China jointly Fuel tax 1 online various engine size 0.00 small rates amount Land value increment tax 1 various gain 0.00 small rates amount Stamp duty on contracts 1 0.1% transaction 0.00 small value amount Totals 11 221 34.3 Details – Paying Taxes in Taiwan, China – Tax by Type Taxes by type Answer Profit tax (% of profit) 12.5 Labor tax and contributions (% of profit) 18.3 Other taxes (% of profit) 3.4 Details – Paying Taxes in Taiwan, China – Measure of Quality Answer Score Post ling index (0-100) 63.17 VAT refunds Does VAT exist? Yes Does a VAT refund process exist per the case study? Yes Restrictions on VAT refund process Restricted to international traders and capital investments Percentage of cases exposed to a VAT audit (%) 0% - 24% Is there a mandatory carry forward period? No Time to comply with VAT refund (hours) 4.5 91 Time to obtain a VAT refund (weeks) 12.3 82.37 Corporate income tax audits Does corporate income tax exist? Yes Percentage of cases exposed to a corporate income tax audit (%) 25% - 49% Time to comply with a corporate income tax audit (hours) 31.5 44.95 Time to complete a corporate income tax audit (weeks) 21.0 34.38 Page 47   Notes: Names of taxes have been standardized. For instance income tax, pro t tax, tax on company's income are all named to comply with TimeBusiness Doing 2018 a corporate Taiwan, income Chinatax audit (hours) 31.5 44.95 Time to complete a corporate income tax audit (weeks) 21.0 34.38 Notes: Names of taxes have been standardized. For instance income tax, pro t tax, tax on company's income are all named corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. The hours for Social Security include all the hours for labor taxes and mandatory contributions in general. The post ling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research questions on the availability and status of implementation of Electronic Data Interchange (EDI) and Single Window (SW) systems. With this information, Doing Business built a comprehensive dataset on the adoption and level of sophistication of electronic platforms in 190 economies. These data are not used to compute the distance to frontier score or ranking of the ease of doing business. The new dataset on EDI and SW systems is available here. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: Obtaining, preparing and submitting documents during transport, clearance, inspections and port Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 or border handling in origin economy days are recorded as 22×24=528 hours). If customs clearance takes 7.5 Obtaining, preparing and submitting documents hours, the data are recorded as is. Alternatively, suppose documents are required by destination economy and any transit submitted to a customs agency at 8:00a.m., are processed overnight and economies can be picked up at 8:00a.m. the next day. The time for customs clearance Covers all documents required by law and in would be recorded as 24 hours because the actual procedure took 24 practice, including electronic submissions of hours. information Border compliance Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Customs clearance and inspections Contributors are asked to convert local currency into U.S. dollars based on Inspections by other agencies (if applied to more the exchange rate prevailing on the day they answer the questionnaire. than 20% of shipments) Contributors are private sector experts in international trade logistics and Handling and inspections that take place at the are informed about exchange rates. economy’s port or border Assumptions of the case study: - For all 190 economies covered by Doing Domestic transport Business, it is assumed a shipment is in a warehouse in the largest Loading or unloading of the shipment at the business city of the exporting economy and travels to a warehouse in the warehouse or port/border largest business city of the importing economy. - It is assumed each Transport between warehouse and port/border economy imports 15 metric tons of containerized auto parts (HS 8708) from its natural import partner—the economy from which it imports the Traffic delays and road police checks while shipment is en route largest value (price times quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (de ned by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product. Shipment value is assumed to be $50,000. - The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport, or land border crossing. - All electronic information submissions Page 48   requested by any government agency in connection with the shipment are a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Doing Business 2018 Taiwan, China Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research questions on the availability and status of implementation of Electronic Data Interchange (EDI) and Single Window (SW) systems. With this information, Doing Business built a comprehensive dataset on the adoption and level of sophistication of electronic platforms in 190 economies. These data are not used to compute the distance to frontier score or ranking of the ease of doing business. The new dataset on EDI and SW systems is available here. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: Obtaining, preparing and submitting documents during transport, clearance, inspections and port Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 or border handling in origin economy days are recorded as 22×24=528 hours). If customs clearance takes 7.5 Obtaining, preparing and submitting documents hours, the data are recorded as is. Alternatively, suppose documents are required by destination economy and any transit submitted to a customs agency at 8:00a.m., are processed overnight and economies can be picked up at 8:00a.m. the next day. The time for customs clearance Covers all documents required by law and in would be recorded as 24 hours because the actual procedure took 24 practice, including electronic submissions of hours. information Border compliance Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Customs clearance and inspections Contributors are asked to convert local currency into U.S. dollars based on Inspections by other agencies (if applied to more the exchange rate prevailing on the day they answer the questionnaire. than 20% of shipments) Contributors are private sector experts in international trade logistics and Handling and inspections that take place at the are informed about exchange rates. economy’s port or border Assumptions of the case study: - For all 190 economies covered by Doing Domestic transport Business, it is assumed a shipment is in a warehouse in the largest Loading or unloading of the shipment at the business city of the exporting economy and travels to a warehouse in the warehouse or port/border largest business city of the importing economy. - It is assumed each Transport between warehouse and port/border economy imports 15 metric tons of containerized auto parts (HS 8708) from its natural import partner—the economy from which it imports the Traffic delays and road police checks while shipment is en route largest value (price times quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (de ned by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product. Shipment value is assumed to be $50,000. - The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport, or land border crossing. - All electronic information submissions requested by any government agency in connection with the shipment are considered to be documents obtained, prepared and submitted during the export or import process. - A port or border is a place (seaport, airport or land border crossing) where merchandise can enter or leave an economy. - Relevant government agencies include customs, port authorities, road police, border guards, standardization agencies, ministries or departments of agriculture or industry, national security agencies and any other government authorities. Page 49   of agriculture or industry, national security agencies and any other Doing Business 2018 Taiwan, China government authorities. East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Time to export: Border compliance (hours) 17 55.9 12.7 0 (17 Economies) Cost to export: Border compliance (USD) 335 387.5 149.9 0.00 (19 Economies) Time to export: Documentary compliance 5 68.2 2.4 1.0 (25 Economies) (hours) Cost to export: Documentary compliance (USD) 84 112.1 35.4 0.00 (19 Economies) Time to import: Border compliance (hours) 47 70.5 8.7 0.00 (21 Economies) Cost to import: Border compliance (USD) 340 431.0 111.6 0.00 (27 Economies) Time to import: Documentary compliance 4 65.6 3.5 1.0 (30 Economies) (hours) Cost to import: Documentary compliance (USD) 65 111.4 25.6 0.00 (30 Economies) Figure – Trading across Borders in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 93.56: Hong Kong SAR, China (Rank: 31) 92.52: Korea, Rep. (Rank: 33) 86.51: Japan (Rank: 51) 84.94: Taiwan, China (Rank: 55) 82.75: Malaysia (Rank: 61) 69.97: Regional Average (East Asia & Pacific) Note: The ranking of economies on the ease of trading across borders is determined by sorting their distance to frontier scores for trading across borders. These scores are the simple average of the distance to frontier scores for the time and cost for documentary compliance and border compliance to export and import (domestic transport is not used for calculating the ranking). Figure – Trading across Borders in Taiwan, China – Time and Cost Time Cost 50 47 400 335 340 350 40 300 Time (hours) Cost (USD) 30 250 200 20 17 150 84 100 10 65 5 4 50 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary CompliancePage 50   Doing Business 2018 Taiwan, China Figure – Trading across Borders in Taiwan, China – Time and Cost Time Cost 50 47 400 335 340 350 40 300 Time (hours) Cost (USD) 30 250 200 20 17 150 84 100 10 65 5 4 50 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary Compliance Details – Trading across Borders in Taiwan, China Characteristics Export Import Product HS 85 : Electrical machinery and equipment and parts thereof; sound recorders and HS 8708: Parts and reproducers, television image and sound recorders and reproducers, and parts and accessories of motor accessories of such articles vehicles Trade partner China Germany Border Kaohsiung port Kaohsiung port Distance (km) 376 376 Domestic 6 6 transport time (hours) Domestic 300 300 transport cost (USD) Details – Trading across Borders in Taiwan, China – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 4.2 147.7 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 12.6 187.7 Import: Clearance and inspections required by customs authorities 34.5 155.4 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 12.9 185.0 Page 51   Details – Trading across Borders in Taiwan, China – Trade Documents (USD) Doing Business 2018 Taiwan, China Details – Trading across Borders in Taiwan, China – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 4.2 147.7 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 12.6 187.7 Import: Clearance and inspections required by customs authorities 34.5 155.4 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 12.9 185.0 Details – Trading across Borders in Taiwan, China – Trade Documents Export Import Commercial invoice Bill of lading Packing list Commercial invoice Bill of lading Packing list Certificate of origin Customs Import Declaration Customs Export Declaration SOLAS certificate SOLAS certificate Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 Attorney fees economies the data are also collected for the second largest business city. - The buyer orders custom-made goods, then fails to pay. Court fees - The value of the dispute is 200% of the income per capita or the Enforcement fees equivalent in local currency of USD 5,000, whichever is greater. Quality of judicial processes index (0-18) Page 52   - The seller sues the buyer before the court with jurisdiction over SOLAS certificate Doing Business 2018 Taiwan, China Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 Attorney fees economies the data are also collected for the second largest business city. - The buyer orders custom-made goods, then fails to pay. Court fees - The value of the dispute is 200% of the income per capita or the Enforcement fees equivalent in local currency of USD 5,000, whichever is greater. Quality of judicial processes index (0-18) - The seller sues the buyer before the court with jurisdiction over commercial cases worth 200% of income per capita or $5,000. Court structure and proceedings (-1-5) - The seller requests a pretrial attachment to secure the claim. Case management (0-6) - The dispute on the quality of the goods requires an expert opinion. Court automation (0-4) - The judge decides in favor of the seller; there is no appeal. Alternative dispute resolution (0-3) - The seller enforces the judgment through a public sale of the buyer’s movable assets. Standardized Case Claim value TWD 1,421,080.00 Court name Taipei District Court City Covered Taipei East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Time (days) 510 565.7 577.8 164.00 (Singapore) Cost (% of claim value) 18.3 47.3 21.5 9.00 (Iceland) Quality of judicial processes index (0-18) 14.0 7.9 11.0 15.50 (Australia) Figure – Enforcing Contracts in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 84.15: Korea, Rep. (Rank: 1) 75.11: Taiwan, China (Rank: 10) 69.13: Hong Kong SAR, China (Rank: 28) Page 53   of judicial processes Quality Business Doing index (0-18) 2018 Taiwan, China 14.0 7.9 11.0 15.50 (Australia) Figure – Enforcing Contracts in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 84.15: Korea, Rep. (Rank: 1) 75.11: Taiwan, China (Rank: 10) 69.13: Hong Kong SAR, China (Rank: 28) 66.61: Malaysia (Rank: 44) 65.26: Japan (Rank: 51) 53.09: Regional Average (East Asia & Pacific) Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their distance to frontier scores for enforcing contracts. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Enforcing Contracts in Taiwan, China – Time and Cost Time Cost 700 47.3 50 565.7 577.8 600 Cost (% of claim value) 37.3 510 40 500 425 Time (days) 385 30 400 360 23.6 23.4 290 21.5 300 18.3 20 12.7 200 10 100 0 0 East Asia & Hong Kong SAR, China Japan Korea, Rep. Malaysia OECD high income Taiwan, China Pacific Figure – Enforcing Contracts in Taiwan, China and comparator economies – Measure of Quality Taiwan (China) 3 4.5 3 3.5 Hong Kong SAR, China 2.5 2 1 4.5 Japan 2.5 1 1 3 Korea, Rep. 3 4 4 3.5 Malaysia 2.5 3 2.5 4 OECD high income 2.5 2.9 2 3.6 East Asia & Pacific 2.2 2 1.3 3 0 2 4 6 8 10 12 14 Page 54   16 East Asia & Hong Kong SAR, China Japan Korea, Rep. Malaysia OECD high income Taiwan, China Pacific Doing Business 2018 Taiwan, China Figure – Enforcing Contracts in Taiwan, China and comparator economies – Measure of Quality Taiwan (China) 3 4.5 3 3.5 Hong Kong SAR, China 2.5 2 1 4.5 Japan 2.5 1 1 3 Korea, Rep. 3 4 4 3.5 Malaysia 2.5 3 2.5 4 OECD high income 2.5 2.9 2 3.6 East Asia & Pacific 2.2 2 1.3 3 0 2 4 6 8 10 12 14 16 Sub-Indicator Score Alternative dispute resolution (0­3) Case management (0­6) Court automation (0­4) Court structure and proceedings (­1­5) Details – Enforcing Contracts in Taiwan, China Indicator Time (days) 510 Filing and service 30 Trial and judgment 360 Enforcement of judgment 120 Cost (% of claim value) 18.3 Attorney fees 15.5 Court fees 2.6 Enforcement fees 0.2 Quality of judicial processes index (0-18) 14.0 Court structure and proceedings (-1-5) 3.5 Case management (0-6) 4.5 Court automation (0-4) 3.0 Alternative dispute resolution (0-3) 3.0 Details – Enforcing Contracts in Taiwan, China – Measure of Quality Page 55   Alternative dispute resolution (0-3) 3.0 Doing Business 2018 Taiwan, China Details – Enforcing Contracts in Taiwan, China – Measure of Quality Answer Score Quality of judicial processes index (0-18) 14.0 Court structure and proceedings (-1-5) 3.5 1. Is there a court or division of a court dedicated solely to hearing commercial cases? No 0.0 2. Small claims court 1.5 2.a. Is there a small claims court or a fast-track procedure for small claims? Yes 2.b. If yes, is self-representation allowed? Yes 3. Is pretrial attachment available? Yes 1.0 4. Are new cases assigned randomly to judges? Yes, automatic 1.0 5. Does a woman's testimony carry the same evidentiary weight in court as a man's? Yes 0.0 Case management (0-6) 4.5 1. Time standards 0.0 1.a. Are there laws setting overall time standards for key court events in a civil case? Yes 1.b. If yes, are the time standards set for at least three court events? No 1.c. Are these time standards respected in more than 50% of cases? Yes 2. Adjournments 0.5 2.a. Does the law regulate the maximum number of adjournments that can be No granted? 2.b. Are adjournments limited to unforeseen and exceptional circumstances? Yes 2.c. If rules on adjournments exist, are they respected in more than 50% of cases? Yes 3. Can two of the following four reports be generated about the competent court: (i) Yes 1.0 time to disposition report; (ii) clearance rate report; (iii) age of pending cases report; and (iv) single case progress report? 4. Is a pretrial conference among the case management techniques used before the Yes 1.0 competent court? 5. Are there any electronic case management tools in place within the competent court Yes 1.0 for use by judges? 6. Are there any electronic case management tools in place within the competent court Yes 1.0 for use by lawyers? Court automation (0-4) 3.0 1. Can the initial complaint be led electronically through a dedicated platform within Yes 1.0 the competent court? 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? Page 56   1. Can the initial complaint be led electronically through a dedicated platform within Yes 1.0 Businesscourt? the competent Doing 2018 Taiwan, China 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? 3. Can court fees be paid electronically within the competent court? Yes 1.0 4. Publication of judgments 1.0 4.a Are judgments rendered in commercial cases at all levels made available to the Yes general public through publication in o cial gazettes, in newspapers or on the internet or court website? 4.b. Are judgments rendered in commercial cases at the appellate and supreme Yes court level made available to the general public through publication in o cial gazettes, in newspapers or on the internet or court website? Alternative dispute resolution (0-3) 3.0 1. Arbitration 1.5 1.a. Is domestic commercial arbitration governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all its aspects? 1.b. Are there any commercial disputes—aside from those that deal with public No order or public policy—that cannot be submitted to arbitration? 1.c. Are valid arbitration clauses or agreements usually enforced by the courts? Yes 2. Mediation/Conciliation 1.5 2.a. Is voluntary mediation or conciliation available? Yes 2.b. Are mediation, conciliation or both governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all their aspects? 2.c. Are there nancial incentives for parties to attempt mediation or conciliation (i.e., Yes if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Page 57   Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Doing Business 2018 Taiwan, China Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent Court fees in local currency of USD 200,000, whichever is greater. - The hotel has a loan from a domestic bank, secured by a mortgage over Fees of insolvency administrators the hotel’s real estate. The hotel cannot pay back the loan, but makes Lawyers’ fees enough money to operate otherwise. Assessors’ and auctioneers’ fees In addition, Doing Business evaluates the adequacy and integrity of the Other related fees existing legal framework applicable to liquidation and reorganization Outcome proceedings through the strength of insolvency framework index. The index tests whether economies adopted internationally accepted good Whether business continues operating as a going practices in four areas: commencement of proceedings, management of concern or business assets are sold piecemeal debtor’s assets, reorganization proceedings and creditor participation. Recovery rate for creditors Measures the cents on the dollar recovered by secured creditors Outcome for the business (survival or not) determines the maximum value that can be recovered Official costs of the insolvency proceedings are deducted Depreciation of furniture is taken into account Present value of debt recovered Strength of insolvency framework index (0- 16) Sum of the scores of four component indices: Commencement of proceedings index (0-3) Management of debtor’s assets index (0-6) Reorganization proceedings index (0-3) Creditor participation index (0-4) East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Recovery rate (cents on the dollar) 82.2 35.4 71.2 93.1 (Norway) Time (years) 1.9 2.6 1.7 0.4 (Ireland) Page 58   Cost (% of estate) 4.0 20.6 9.1 1.00 (Norway) Creditor participation index (0-4) Doing Business 2018 Taiwan, China East Asia & OECD high Indicator Taiwan, China Pacific income Overall Best Performer Recovery rate (cents on the dollar) 82.2 35.4 71.2 93.1 (Norway) Time (years) 1.9 2.6 1.7 0.4 (Ireland) Cost (% of estate) 4.0 20.6 9.1 1.00 (Norway) Outcome (0 as piecemeal sale and 1 as going 1 .. .. .. concern) Strength of insolvency framework index (0-16) 11.0 7.0 12.1 15.00 (6 Economies) Figure – Resolving Insolvency in Taiwan, China and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 93.44: Japan (Rank: 1) 89.33: Korea, Rep. (Rank: 5) 78.63: Taiwan, China (Rank: 20) 65.69: Hong Kong SAR, China (Rank: 43) 62.51: Malaysia (Rank: 46) 40.78: Regional Average (East Asia & Pacific) Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their distance to frontier scores for resolving insolvency. These scores are the simple average of the distance to frontier scores for the recovery rate and the strength of insolvency framework index. Figure – Resolving Insolvency in Taiwan, China – Time and Cost Time Cost 3 25 2.6 20.6 2.5 20 1.9 Cost (% of estate) Time (years) 2 1.7 15 1.5 1.5 10.0 1.0 9.1 10 1 0.8 5.0 0.6 4.2 3.5 4.0 5 0.5 0 0 East Asia & Hong Kong SAR, China Japan Korea, Rep. Malaysia OECD high income Taiwan, China Pacific Figure – Resolving Insolvency in Taiwan, China and comparator economies – Measure of Quality Taiwan (China) 5.5 3 2 0.5 Page 59   Hong Kong SAR, China 3 2 1 0 East Asia & Hong Kong SAR, China Japan Korea, Rep. Malaysia OECD high income Taiwan, China Pacific Doing Business 2018 Taiwan, China Figure – Resolving Insolvency in Taiwan, China and comparator economies – Measure of Quality Taiwan (China) 5.5 3 2 0.5 Hong Kong SAR, China 3 2 1 0 Japan 6 3 2 3 Korea, Rep. 5.5 2.5 3 3 Malaysia 2 2 2 0 OECD high income 5.4 2.8 2.3 1.9 East Asia & Pacific 3.7 2.3 1.2 1 0 2 4 6 8 10 12 14 16 Sub-Indicator Score Management of debtor's assets index (0­6) Commencement of proceedings index (0­3) Creditor participation index (0­4) Reorganization proceedings index (0­3) Figure – Resolving Insolvency in Taiwan, China and comparator economies – Recovery Rate 100 92.4 87.2 84.7 90 82.2 81.3 80 70 60 Recovery Rate (cent 50 40 35.4 30 20 10 0 Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Details – Resolving Insolvency in Taiwan, China Indicator Answer Explanation Proceeding reorganization Mirage management will initiate reorganization as this is consistent with management's intent to keep the business operating and would also maximize the value of the asset from the perspective of BizBank. Outcome going concern The hotel will continue operating as a going concern after the reorganization plan is approved by creditors. Time (in years) 1.9 The reorganization proceeding until the reorganization plan is approved by creditors takes approximate 1.9 years. After Mirage filing the reorganization petition at Taipei District Court, the Court reviews the material, accepts Mirage case for consideration and appoints administrator usually in half a year. The insolvency administrator is responsible for finalizing creditors' claims and holding the creditor's meeting, which takes about an additional 2 Page 60   months. In the meantime, Mirage's management would prepare the reorganization plan and Taiwan, China Hong Kong SAR, China Japan Korea, Rep. Malaysia East Asia & Pacific Doing Business 2018 Taiwan, China Details – Resolving Insolvency in Taiwan, China Indicator Answer Explanation Proceeding reorganization Mirage management will initiate reorganization as this is consistent with management's intent to keep the business operating and would also maximize the value of the asset from the perspective of BizBank. Outcome going concern The hotel will continue operating as a going concern after the reorganization plan is approved by creditors. Time (in years) 1.9 The reorganization proceeding until the reorganization plan is approved by creditors takes approximate 1.9 years. After Mirage filing the reorganization petition at Taipei District Court, the Court reviews the material, accepts Mirage case for consideration and appoints administrator usually in half a year. The insolvency administrator is responsible for finalizing creditors' claims and holding the creditor's meeting, which takes about an additional 2 months. In the meantime, Mirage's management would prepare the reorganization plan and in practice it takes about 1 year to get the reorganization plan approved. Cost (% of 4.0 The costs associated with the case would amount to approximately 4% of the value of the estate) debtor's estate. Cost incurred during the entire insolvency process mainly include attorney fees (1.5%), insolvency representative or receiver fees (1-2%), fees of accountants, assessors, inspectors and other professionals (1%), and other fees (up to 0,5%). Recovery rate (cents on the 82.2 dollar) Details – Resolving Insolvency in Taiwan, China – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 11.0 Commencement of proceedings index (0-3) 3.0 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (a) Yes, a creditor 1.0 may le for both liquidation and reorganization What basis for commencement of the insolvency proceedings is allowed under the (a) Debtor is 1.0 insolvency framework? generally unable to pay its debts as they mature Management of debtor's assets index (0-6) 5.5 Does the insolvency framework allow the continuation of contracts supplying essential Yes 1.0 goods and services to the debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome Yes 1.0 contracts? Page 61   dollar) Doing Business 2018 Taiwan, China Details – Resolving Insolvency in Taiwan, China – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 11.0 Commencement of proceedings index (0-3) 3.0 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (a) Yes, a creditor 1.0 may le for both liquidation and reorganization What basis for commencement of the insolvency proceedings is allowed under the (a) Debtor is 1.0 insolvency framework? generally unable to pay its debts as they mature Management of debtor's assets index (0-6) 5.5 Does the insolvency framework allow the continuation of contracts supplying essential Yes 1.0 goods and services to the debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome Yes 1.0 contracts? Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0 Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0 Does the insolvency framework provide for the possibility of the debtor obtaining credit Yes 1.0 after commencement of insolvency proceedings? Does the insolvency framework assign priority to post-commencement credit? (a) Yes over all 0.5 pre- commencement creditors, secured or unsecured Reorganization proceedings index (0-3) 0.5 Which creditors vote on the proposed reorganization plan? (a) All creditors 0.5 Does the insolvency framework require that dissenting creditors in reorganization No 0.0 receive at least as much as what they would obtain in a liquidation? Are the creditors devided into classes for the purposes of voting on the reorganization No 0.0 plan, does each class vote separately and are creditors in the same class treated equally? Creditor participation index (0-4) 2.0 Does the insolvency framework require approval by the creditors for selection or No 0.0 appointment of the insolvency representative? Page 62   Creditor Doing participation Business 2018 index (0-4) Taiwan, China 2.0 Does the insolvency framework require approval by the creditors for selection or No 0.0 appointment of the insolvency representative? Does the insolvency framework require approval by the creditors for sale of substantial No 0.0 assets of the debtor? Does the insolvency framework provide that a creditor has the right to request Yes 1.0 information from the insolvency representative? Does the insolvency framework provide that a creditor has the right to object to Yes 1.0 decisions accepting or rejecting creditors' claims? Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments due when terminating a redundant worker. Job quality (i) whether law mandates equal remuneration for Page 63   work of equal value and nondiscrimination based on the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Doing Business 2018 Taiwan, China Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments due when terminating a redundant worker. Job quality (i) whether law mandates equal remuneration for work of equal value and nondiscrimination based on gender in hiring; (ii) whether law mandates paid or unpaid maternity leave; (iii) length of paid maternity leave; (iv) whether employees on maternity leave receive 100% of wages; (v) availability of ve fully paid days of sick leave a year; (vi) eligibility requirements for unemployment protection. Details – Labor Market Regulation in Taiwan, China Answer Hiring Page 64   Fixed-term contracts prohibited for permanent tasks? Yes days of sick leave a year; (vi) eligibility requirements for unemployment protection. Doing Business 2018 Taiwan, China Details – Labor Market Regulation in Taiwan, China Answer Hiring Fixed-term contracts prohibited for permanent tasks? Yes Maximum length of a single xed-term contract (months) No limit Maximum length of xed-term contracts, including renewals (months) No limit Minimum wage applicable to the worker assumed in the case study (US$/month) 649.8 Ratio of minimum wage to value added per worker 0.2 Maximum length of probationary period (months) n.a. Working hours Standard workday 8.0 Maximum number of working days per week 6.0 Premium for night work (% of hourly pay) 0.0 Premium for work on weekly rest day (% of hourly pay) 100.0 Premium for overtime work (% of hourly pay) 33.0 Restrictions on night work? No Whether nonpregnant and nonnursing women can work the same night hours as men Yes Restrictions on weekly holiday? No Restrictions on overtime work? No Paid annual leave for a worker with 1 year of tenure (working days) 7.0 Paid annual leave for a worker with 5 years of tenure (working days) 15.0 Paid annual leave for a worker with 10 years of tenure (working days) 16.0 Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 12.7 Redundancy rules Dismissal due to redundancy allowed by law? Yes Third-party noti cation if one worker is dismissed? Yes Third-party approval if one worker is dismissed? No Third-party noti cation if nine workers are dismissed? Yes Third-party approval if nine workers are dismissed? No Retraining or reassignment obligation before redundancy? Yes Page 65   Third-party Doing approval Business 2018 if nine workers Taiwan, are dismissed? China No Retraining or reassignment obligation before redundancy? Yes Priority rules for redundancies? No Priority rules for reemployment? Yes Redundancy cost Notice period for redundancy dismissal for a worker with 1 year of tenure 2.9 Notice period for redundancy dismissal for a worker with 5 years of tenure 4.3 Notice period for redundancy dismissal for a worker with 10 years of tenure 4.3 Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 3.8 Severance pay for redundancy dismissal for a worker with 1 year of tenure 2.2 Severance pay for redundancy dismissal for a worker with 5 years of tenure 10.8 Severance pay for redundancy dismissal for a worker with 10 years of tenure 21.7 Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 11.6 Job quality Equal remuneration for work of equal value? Yes Gender nondiscrimination in hiring? Yes Paid or unpaid maternity leave mandated by law? Yes Minimum length of maternity leave (calendar days)? 56.0 Receive 100% of wages on maternity leave? Yes Five fully paid days of sick leave a year? No Unemployment protection after one year of employment? Yes Minimum contribution period for unemployment protection (months)? 12.0 Business Reforms in Taiwan, China In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for Taiwan, China implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2018 Trading across Borders: Taiwan, China made exporting easier by allowing di erent organizations to electronically issue certi cates of origin. Enforcing Contracts: Taiwan, China, made enforcing contracts easier by introducing an electronic ling system. Labor Market Regulation: Taiwan, China, adopted legislation that increased the number of mandatory paid annual leave days and the number of weekly rest days. Page 66   DB2016 Minimum contribution period for unemployment protection (months)? 12.0 Doing Business 2018 Taiwan, China Business Reforms in Taiwan, China In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for Taiwan, China implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2018 Trading across Borders: Taiwan, China made exporting easier by allowing di erent organizations to electronically issue certi cates of origin. Enforcing Contracts: Taiwan, China, made enforcing contracts easier by introducing an electronic ling system. Labor Market Regulation: Taiwan, China, adopted legislation that increased the number of mandatory paid annual leave days and the number of weekly rest days. DB2016 Getting Electricity: The utility in Taiwan, China, reduced the time required for getting an electricity connection through a simpli ed procedure for obtaining excavation permits from the municipality. DB2015 Getting Electricity: Taiwan, China, made getting electricity easier by eliminating site inspections. Getting Credit: Taiwan, China, improved access to credit information by beginning to include data from utility companies in credit reports. Paying Taxes: Taiwan, China, made paying taxes easier for companies by introducing an electronic system for paying the vehicle license tax. DB2013 Dealing with Construction Permits: Taiwan, China, made dealing with construction permits easier by introducing a risk-based and self-regulatory inspection system and improving operational features of the one-stop shop for building permits. Protecting Minority Investors: Taiwan, China, strengthened investor protections by increasing disclosure requirements for related-party transactions and improving the liability regime for company directors in cases where such transactions are abusive. DB2012 Starting a Business: Taiwan (China) made starting a business easier by implementing an online one-stop shop for business registration. Dealing with Construction Permits: Taiwan (China) made dealing with construction permits easier by creating a one-stop center. DB2011 Starting a Business: Taiwan (China) eased business start-up by reducing the time required to check company names, register retirement plans and apply for health, pension and labor insurance. Paying Taxes: Taiwan (China) reduced the corporate income tax rate and simpli ed tax return forms, rules for assessing corporate income tax and the calculation of interim tax payments. DB2010 Starting a Business: Taiwan, China, made starting a business easier by abolishing the minimum capital requirement and speeding up various procedures. Paying Taxes: Taiwan, China, made paying taxes easier for companies by extending electronic ling and payment to value added tax. Page 67   Starting a Business: Taiwan, China, made starting a business easier by abolishing the minimum capital requirement and speeding procedures. up various2018 Doing Business Taiwan, China Paying Taxes: Taiwan, China, made paying taxes easier for companies by extending electronic ling and payment to value added tax. DB2009 Getting Credit: Taiwan, China, strengthened its secured transactions system through an amendment to its civil code allowing the use of personal real estate or property to secure a line of credit, for not more than a speci ed maximum amount. Page 68   Getting Credit: Taiwan, China, strengthened its secured transactions system through an amendment to its civil code allowing the use of personal Doing Business estate orTaiwan, real 2018 to secure a line of credit, for not more than a speci ed maximum amount. property China Page 69