There are two main types of CSOs in Taiwan.

1) The civil association is regulated under the Civil Associations Act by the Ministry of Interior. The Act differentiates between three different kinds of associations:

a) occupational association, which refers to “an association organized by the institutions and associations in the same trade or the job-holders of the same occupation with a view to associate the relationship between colleagues, enhance common benefits, and promote social economic construction.”

b) social association, which refers to “an association composed of individuals and (or) associations for the purpose of promoting culture, academic research, medicine, health, religion, charity, sports, fellowship, social service, or other public welfare.” It can conduct events, solicit donations, recruit volunteers, receive revenue, and fundraise. The definition of social association is interpreted broadly so as to embrace a broad range of permissible purposes, including human rights, democracy and governance, and environmental issues.

c) political association, which refers to “an association organized by the citizens of the Republic of China with a view to help form political volition and to promote political participation for the citizens based on common ideas of democratic politics.”

2) The foundation is regulated under the 2018 Foundations Act. The Act defines a foundation as “a private legal person that is dedicated to public-benefit purpose with property endowed by endowers, approved by the competent authority and registered with the court.”

The Act distinguishes between a “government-endowed foundation” and a “public-endowed foundation”. A government-endowed foundation is one “established after August 15, 1945, with endowment property from the property left by the Japanese government or people and taken over by the Republic of China (“R.O.C.”) government.” All other foundations are regarded as public-endowed foundations.

Among public-endowed foundations, there are local and national foundations. Local foundations may only operate in a single city or county, whereas national foundations may operate nationally.

Unlike civil associations, the matter of the government authority that registers foundations is complex, and depends on the prospective foundation’s operational objectives. Each government agency has its own regulations and requirements with respect to the establishment and operation of Taiwan foundations. One common requirement is that prospective foundations must acquire a certain minimum amount of endowment funding. The minimum amount of endowment funding varies depending on the particular government agency to which the application to establish the foundation is made. Such minimum endowment funding amounts vary from a few million New Taiwan dollars to NT$50 million (approximately US$100,000 to US$1.7 million).

3) In addition to civil associations and foundations, the Ministry of Interior has also issued instructions for foreign CSOs to set up representative offices in Taiwan. These instructions were first issued in 1987 and then amended on December 31, 2020. (For more on representative offices, see Barriers to Entry below.)

In 2021, data from the Ministry of Interior indicate that there were:

• 127 political associations (including political parties);
• 11,324 occupational associations; and
• 61,863 social associations, including 21,974 national associations and 39,889 local associations.

The number of registered foundations is uncertain, possibly because they are regulated by different agencies depending on the sector in which they work.

The number of religious organizations, which are regulated under the Foundation Act, is also unclear.

As of 2021, according to   data   from the Ministry of Interior, the number of religious organizations was 15,183 of which 12,281 were temples and 2,902 were churches. Religious organizations are in principle regulated under the Foundation Act, but it is unclear how many are registered. According to Professor Ming Ho-sho, only a   very small number   of temples are officially registered.

Public Benefit Status

There are no specific laws or regulations that confer a special “charitable” or “public benefit” status for CSOs. However the Foundation Act defines foundations as having a public benefit purpose (Article 2), and the Civil Association Act defines social associations as providing a “public welfare” purpose. (Article 39)

Tax laws in Taiwan do provide incentives to encourage individuals and companies to make charitable donations. The Income Tax Act of 2015 establishes that individual taxpayers can claim a tax deduction of up to 20 percent of gross consolidated income for donations to educational, cultural, public welfare or charitable organizations or associations, while companies can only claim a maximum deduction of 10 percent of their income for charitable donations. (Income Tax Act, Article 36)

The Income Tax Act (Article 4) establishes a required tax exemption for the income of education, cultural, public welfare and charitable organizations or institutions. Certain restrictions apply; for example, the income shall not be distributed to any individual or executive official, and operating expenditures should be used only to pursue the purposes of the organization. The organization shall not carry out any unrelated business. Income generated by selling products and services are not tax-exempt. The income shall be deposited in banks, or as bonds, stocks, and others forms and systems permitted by the regulating authority. The organization shall not have any abnormal financial or operating relationship with founders or board members and should provide financial revenues and expenditures for examination.

Some CSOs that do not generate any operating revenue are also eligible for income tax exemption, such as religious groups which are registered as temples, religious social groups, or religious financial groups.

Barriers to Entry

There is no law prohibiting the formation and operation of “unregistered” groups, but neither does the Civil Association Act explicitly recognize the ability of unregistered groups to form and operate. In addition, the Law and relevant implementing regulations pose onerous and discriminatory procedural burdens on groups wanting to register and operate a social association.

Social Associations

To set up an association, the founders must submit an application form, a draft of the association’s constitution, and a list of the initiators to the regulatory authority to apply for approval. There is no minimum endowment or amount of assets required for social associations.

The Civil Association Act requires no less than thirty (30) initiators who are over twenty (20) years old and of legal capacity. These initiators must be Taiwan nationals or foreign nationals with alien residence cards. Any adult can be a founder or initiator of a social association, provided that they are not serving a jail sentence or security punishment, currently going through bankruptcy proceedings, or placed in a custodianship. (Article 8)

These requirements have been criticized by civil society groups and experts as discriminating against 1) youth under 20; 2) people with disabilities who may be under the care of a custodian; and 3) non-resident foreigners. [1]

Social associations can be registered at the local or national level. For local associations, initiators must have household or work addresses in the city or county in which the association is to be established. For national associations, the initiators must have household or work addresses in at least seven different cities or counties in Taiwan.

A civil association must be located where the regulatory authority is located. However, with the approval of the regulatory authority, it may be located in another place, and branches may be established. (Article 6)

After the application for establishing an association is approved, an Establishment Meeting bringing together all initiators eligible to be members of the association shall be held to elect a board of nine directors and three supervisors and discuss the association’s workplan and budget. (Article 9) Within 30 days after the Establishment Conference is held, the association will hold its first board meeting to elect a board chairperson and submit the articles of association, a list of members and board members, curriculum vitae of the elected board members, workplan and budget to the regulatory authority (Ministry of Interior) for approval and accreditation, and the regulatory authority shall grant an accreditation certificate. After being approved and registered by the regulatory authority, a civil association may register itself as a legal person at the governing local court and shall submit a photocopy of the registration certificate to the regulatory authority for reference within thirty (30) days after the registration is finished. There is no fee for registration at the Ministry of Interior but there is a NT$1000 fee (about U.S $30) to register as a legal person at the local court.

[1] Asia Citizen Future Association (ACFA). 2023. “Exploring Taiwan’s Role Amid the Crisis of Closing Space in Southeast Asia. Asia Citizen Future Association (ACFA),”   Taipei, Taiwan,   ; Shieh, Shawn. 2023. “Taiwan’s Laws Regulating Civil Society: A Comparative and International Argument for Reform,” 8 December, Taipei:   Taiwan Foundation for Democracy   .

Foundations

Unlike social associations, there are no restrictions on who can serve as a founder of a foundation and no required minimum number of founders/initiators. Prospective foundations, however, must have a minimum amount of endowment funding. The minimum amount of endowment funding varies depending on the government agency to which the application to establish the foundation is made. The minimum amounts of endowment funding vary from a few million New Taiwan dollars to NT$50 million (approximately US$100,000 to US$1.7 million).

An application for establishment of a foundation will be made by submitting documents, including the charter of endowment, list of endowment property and supporting documents, list of directors and supervisors, if any, work plan, and other documents to the relevant government authority. (Articles 9-10)

Foundations shall be domiciled at the place where its principal office is located and may establish any branch office upon approval by the competent authority. (Article 6)

A foundation’s directors shall, within 15 days after receiving the approval document, apply for registration with the court having jurisdiction over the places where the principal office and branch office are located. (Article 12)

The Foundation Act requires foundations to establish a board of directors consisting of five (5) to twenty-five (25) directors, provided there is an odd number of directors. One of the directors should serve as the chairperson of the board, and another may serve as the vice chairperson. A foundation may also establish a supervisory board, provided that the number of supervisors may not exceed one-third (1/3) the number of directors.

The Foundation Act specifies that the government authority shall grant approval or dismiss the prospective foundation’s application within 60 days after its receipt of the application. When necessary, the time period may be extended for not more than 30 days. (Article 12)

Representatives of Offices of Foreign CSOs

Foreign CSOs may register as social associations or foundations but the preference for Taiwan citizens or resident foreigners, and the complicated application process which must be carried out in China, make the registration process difficult if not prohibitive. The Foundation Act, for example, allows foreign foundations to apply for recognition from the central competent authority by submitting the requisite documents in Chinese. (Articles 69-70) A recognized foreign foundation has the same legal capacity as a Taiwan foundation. (Article 71) A recognized foreign foundation shall apply to the court for registration of the establishment of its principal office within 15 days after its receipt of the recognition document. (Article 72)

Due to the challenges for foreign CSOs to register as a social association or foundation, The Ministry of Interior, however, has issued   directions for foreign CSOs   to register a representative office in Taiwan. These instructions were first issued on November 4, 1987, by the Ministry of the Interior (Order (76) Tai-Nei-She-Tzu No. 539766) and amended on December 30, 2020. A representative office may operate in Taiwan only as the agent of its overseas principal and is not considered a separate legal entity. The responsible person may be a Taiwan national or foreign national with an ARC.

Significantly, while these directions apply to CSOs from Hong Kong and Macao that wish to set up representative offices in Taiwan, they “do not apply to people, legal persons or organizations from mainland China or other mainland Chinese institutions and organizations established in Hong Kong or Macao that wish to set up offices in Taiwan.” Nor may a person from mainland China “serve as the responsible person or be a staff member of an office.”