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Incentives for doing business in Taiwan: SBIR
By George Liu
Taiwan News, Staff Reporter
2014-08-28 09:54 AM

This article is part of an ongoing series detailing incentives offered by cities, counties, and the central government to companies operating in Taiwan. The goal of these pieces is to raise awareness among foreign enterprise as to the advantages of doing business in Taiwan and attract foreign participation in Taiwan’s economy. Hopefully, the information presented herein will incite interest in various locales on this beautiful island and prompt interested parties to seek further information.

The Ministry of Economic Affairs offers a Small Business Innovation Research (SBIR) program to reduce the cost and risk of innovation and R&D for small and medium enterprises (SMEs) and thereby stimulate these activities in the SME sector. SMEs can apply for subsidies covering up to 50% of the total cost of R&D. To be eligible, applicants must meet the following criteria: Applicant must be an SME, as defined in the Standard Definition of SMEs. Applicant must owe no back taxes to the government, and must have no record of contract cancellation when participating in government-related technology development plans over the past five years. A foreign company may submit an application for funding support, as long as the company in question conforms to the above two requirements by the time its application is approved. “Innovative service” project applicants may be business offices or medical juridical persons that are engaged in R&D activity and registered for tax purposes. In the case of R&D alliance applications, the applicant must be an SME. However, the application may be submitted jointly with a university or college, foundation, or other domestic or foreign organization. At least half of the members of the alliance must be SMEs. In principle, each SME must participate in at least one of the project sub-items.

The SBIR program encourages development of a brand new idea, concept, or technology, application of existing technology to a new application, application of a new technology or business model to an existing application, and improvement of an existing technology or product.

SBIR grants are distributed in three phases:

SBIR Phase I grants a NT$1,000,000 governmental subsidy within a span of 6 months for a small-scale experiment or statistical analysis of a creative concept that can potentially benefit industries so as to validate that concept as being viable. Applicants must describe the key problems addressed, the creative concept they intend to use, anticipated benefits to industries, as well as relative R&D track records and implementation plans.

SBIR Phase II grants a NT $10,000,000 governmental subsidy within a span of 2 years for R&D of a product, production method, or service mechanism based on a tangible and feasible creative concept expected to benefit industries. The R&D of a production method can extend to trial production or ramp-up stage. Applicants must describe the key problems addressed, the creative concept they intend to use, anticipated benefits to industries, as well as relative R&D track records and implementation plans.

SBIR Phase II+ grants a NT $5,000,000 governmental subsidy within a span of 1 year involving the implementation and wide application of R&D results in Phase 2 so as to meet market and customer demand. The focus of R&D extends from the emphasis on the design of technical innovations to the production of the technical application. They may include engineering techniques, molding development techniques, product design, trial production and ramp-up techniques, or primary market surveys. Applicants must describe the application of the developed technique, feasible implementation, commercialization target and expected benefits.

City and county governments also offer a local version of the SBIR program. This version is limited to SBIR Phase I and stipulates applicants should be involved with local specialty products or businesses.

For more information, please contact the Department of Investment Services, Ministry of Economic Affairs at (02) 2391-4950.

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