Taiwan Policies and Measures
1977
Government regulations stipulate that, except for Chinese medicinal herbs and certain agricultural and industrial materials imported through Hong Kong, all other goods from the mainland will be confiscated by customs officials.
1979
The government announces the Three Nos policy—no contact, no negotiation, and no compromise; direct trade with the mainland is forbidden.
1984
Restrictions are relaxed on mainland products imported through Hong Kong and Macau. Private sector trade with the mainland through third countries or areas is allowed.
1985
July: The three basic principles concerning trade with the mainland through Hong Kong and Macau are announced: direct trade with the mainland is prohibited; manufacturers cannot have direct contact with any mainland organization or personnel; the government will not intervene in trade with the mainland conducted through a third country.
Reprinted and adapted from “Taiwan Businesspeople and Cross-Straits Economic Development,” by Hsu Song-ken, a research fellow at the Institute of Economics, Academia Sinica. Hsu’s paper was presented at a seminar on economic cooperation held in September 1993 in Beijing.
1987
July: The Bureau of Entry and Exit begins accepting applications for direct tourist travel to Hong Kong and Macau.
August: Restrictions are lifted on the indirect importation of twenty-nine categories of agricultural and industrial materials from the mainland.
November: The ROC Red Cross Society begins accepting applications from local residents wanting to visit relatives in the mainland.
1988
July: The 13th National Congress of the KMT (Kuomintang) approves a mainland policy for the current phase of relations. The main goal of the new policy is to support democratization on the mainland and promote revitalization of Chinese culture. The policy emphasizes people-to-people contacts, indirect trade, gradual progress in relations, and maintaining the ROC’s security.
August: The Executive Yuan establishes the Mainland Affairs Task Force, convened by the vice premier.
The Ministry of Economic Affairs (MOEA) announces the Principles for Dealing With Indirect Importation of Mainland Products and the List of Items Allowed for Indirect Importation From the Mainland (a total of fifty items).
The Board of Foreign Trade, MOEA, promulgates the Important Points for Precautionary Measures Concerning Indirect Importation of Mainland Goods.
December: The customs office assumes full responsibility for dealing with illegal imports from the mainland. Minor violators are no longer punished, but the goods are refused entry.
1989
January: Forty more items are added to the list of mainland agricultural and industrial materials allowed to enter Taiwan through a third port.
March: The Board of Foreign Trade restates that ROC manufacturers are banned from participating directly or indirectly in trade fairs organized by the mainland authorities or private mainland enter prises.
May: The Ministry of Justice draws up the Statute Governing Relations Between People of the Taiwan Area and the Mainland Area as a legal frame work for dealing with general affairs in cross-straits, people-to-people relations. (The law is approved by the Executive Yuan in November 1990.)
June: The government announces the Regula tions Governing Mainland Goods: mainland goods can be imported if they do not endanger national se curity, have no negative effect on related industries, and help make export products more competitive.
1990
January: Another sixty-five items are added to the list of items that can be indirectly imported from the mainland.
August: The ban is lifted and guidelines are promulgated on participation in mainland trade fairs and fact-finding trips to the mainland by private manufacturers.
The Regulations Governing Indirect Export to the Mainland Area are announced. Based on a list of prohibited exports, the major provisions state that exports of high-tech products should follow related regulations; the Board of Foreign Trade can ask the MOEA to discontinue an export item if it is considered to have a negative impact on national security or economic development; and export commodities must show whether the final destination is the mainland.
The government announces the Regulations Governing Indirect Investment and Technical Cooperation in the Mainland. Basic requirements are: investors must consider Taiwan’s national security and economic development in their dealings with the mainland; the mainland businesses involved must have a limited connection with Taiwan’s domestic industries, be labor-intensive, and not compete with Taiwan; the mainland must have an abundant supply of materials needed by the Taiwan businesses involved; and Taiwan businesses must adhere to the list of allowed items.
Manufacturers of 3,353 items (in sixty-seven categories) are allowed to invest in the mainland or to establish technical cooperation.
October: The president announces the establishment of the National Unification Council, a non-partisan board formed to advise the president in drawing up fundamental guidelines for national unification.
1991
January: The Executive Yuan sets up the Mainland Affairs Council (MAC), a formal administrative agency responsible for overall planning, coordination, and evaluation of government policy toward the mainland.
Nine more items are added to the list of mainland agricultural and industrial materials allowed to enter Taiwan through a third country. The number of items allowed for investment in the mainland or for technical cooperation is increased to 3,679.
February: The Straits Exchange Foundation (SEF) is established. The SEF is a private, non-profit organization empowered by the government to handle those technical and business relations with the mainland that might involve ROC government authority but would be inappropriate for the government to handle directly under its policy of no official contact with mainland authorities.
Taiwan banks are allowed to set up liaison offices in Hong Kong.
May: The president declares the end of the Period of National Mobilization for Suppression of the Communist Rebellion. As a result, long-serving members of the National Assembly and Legislative Yuan must retire. (New members of the second National Assembly are elected in December 1991 to a four-year term.)
August: Foreign-based Taiwan fishing boats are allowed to hire mainland crew members, but mainland and other foreign crew are not allowed to make up more than one-third of the total. Mainland crew members are not allowed to disembark in Taiwan.
1992
January: The first import case of semi-finished products (shoe parts) is allowed.
March: The Regulations Governing Mainland Goods are revised and promulgated. The Important Points for Precautionary Measures Concerning the Indirect Importation of Mainland Goods are repealed.
September: The Statute Governing Relations between People of the Taiwan Area and the Mainland Area goes into effect.
October: The Mainland Affairs Council gives the go-ahead to the first group of service industries (158 categories) planning to invest in the mainland.
1993
February: The Regulations Governing the Entry of Mainland People Into Taiwan are announced.
The Executive Yuan approves the Regulations Governing Investment and Technical Cooperation in the Mainland. (These go into effect in March.)
March: The Regulations Governing Indirect Investment and Technical Cooperation in the Mainland are repealed.
April: The SEF meets with mainland counterpart, the Association for Relations Across the Taiwan Straits (ARATS), in Singapore for the historic “Koo-Wang” talks on cross-straits economic exchange.
The Executive Yuan announces the Regulations Governing the Introduction of Technology From the Mainland.
The Regulations Governing Trade between Tai wan and the Mainland Area are promulgated, replacing the Regulations Governing Indirect Export to the Mainland Area and the Regulations Governing Mainland Goods.
The Regulations Governing Taiwan Residents Entering the Mainland Area are announced. These regulations replace and consolidate a number of regulations and guidelines, including: the Regulations Governing Public School Teachers’ and Employees’ Applications for Permission to Visit Mainland Relatives; the Guidelines for Applications by Government Employees, Office Workers, and Workers in Public Enterprises for Visits to the Mainland; the Guidelines Governing Applications by Elected Representatives at All Levels for Visits to the Mainland; and the Guidelines for Government Employees to Apply for Permission to Visit Sick Relatives and to Attend Funerals on the Mainland.
July: The Hong Kong governor and the Executive Council announce that Hwa Nan Commercial Bank’s Hong Kong liaison office will be upgraded to a branch office.
The Rules Governing Indirect Remittances to the Mainland are promulgated: business remittances to the mainland no longer have to be disguised as personal remittances.
Mainland Policies and Measures
1979
January: Beijing proposes direct trade, direct mail, and direct transportation links in its “Message to Compatriots in Taiwan.”
May: Beijing proclaims the Temporary Regulations Governing Developing Trade Relations with Taiwan.
1980
June: The Ministry of Commerce promulgates the Supplementary Regulations Governing Taiwan Products (an internal document), ruling that no tariff is required if the certificate of origin indicates that goods are imported from Taiwan. In addition, the purchase of daily-use articles from Taiwan is encouraged; purchase orders of goods from Taiwan are given priority.
1981
May: The non-tariff rule on Taiwan goods is canceled and replaced by an adjusted tariff. The favorable discount for Taiwan orders is also cancelled, but exports to Taiwan and trade with fisher men at sea are encouraged.
September: Announcement of the Policy Concerning Taiwan’s Return to China and Peaceful Unification also known as Ye Jianying’s Nine-point Proposals. Ye, chairman of the National People’s Congress Standing Committee, suggests working with Taiwan to reach, consensus on direct mail, transportation, and trade links cross-straits visits with relatives; and cross-straits travel and academic, cultural, and sports exchanges.
1982
January: Deng Xiaoping proposes the idea of “One Country, Two Systems” for dealing with Hong Kong, Macau, and Taiwan.
August: Regulations are promulgated stating that all goods imported from Taiwan need the approval of all levels of the Taiwan Affairs Office.
1983
April: The State Council proclaims the Special Favorable Regulations Governing Taiwan Investment in the Special Economic Zones. These are later extended to include Hainan.
1985
June: The purchase of consumer goods from Taiwan is restricted. Henceforth, Taiwan goods must be centralized in and imported through Fujian or Hainan; no other province is allowed to import Taiwan goods. (In October, this restriction is relaxed, mainly on electrical appliances and textile articles.)
December: All economic and trade agencies on the provincial and municipal levels are instructed to obtain the approval of the United Front work department before importing Taiwan products.
1987
July: The State Council announces a permit system for managing imports from and exports to the Taiwan area. Permits must be authorized by the Ministry of Foreign Economic Relations and Trade (MOFERT). The announcement also states that the ministry is responsible for managing overall trade development with Taiwan, and that other government agencies and the private sector are restricted from setting up trade agencies handling business with Taiwan.
1988
July: The State Council announces the Rules for Encouraging Taiwan Investment. These state the favorable conditions given to Taiwan: investors are allowed a wider range of categories and more flexibility in their investments (Taiwan investors can, with some restrictions, buy stocks, bonds, and real estate); Taiwan businesspeople are allowed to serve as board chairmen: Taiwan investments will undergo simpler examination procedures; and there will be no limitations on the operation period of Taiwan-invested companies.
December: MOFERT adds the Department of Economic Relations and Trade with Taiwan to its organic structure. The new department is in charge of policymaking concerning trade and economic relations with Taiwan, including import and export businesses and Taiwan investment affairs. This change tightens control on policies concerning trade with Taiwan.
1989
March: The State Council announces new measures concerning Taiwan investment in the mainland, offering favorable conditions to Taiwan investors. These include giving Taiwan investors land development and operation rights in coastal areas and rights to purchase stocks, bonds, and real estate.
May: The State Council approves the Fujian Province report on setting up Taiwan Investors’ Districts. These include one in Xiamen, which expands the original Xiamen Special Economic Zone; one in Fuzhou, which expands the Mawei Development District; and one each in Haicang and Xinglin. The mainland later decides to set up the Meizhou Bay area for heavy-industry investors from Taiwan and to develop Taiwan investment and industrial districts in Haikou and Wenchang, both on Hainan Island.
June: The demonstrations in and around Tiananmen Square end in bloodshed on June 4; many Taiwan investors put their plans on hold.
July: MOFERT restricts the number of traders specializing in importing Taiwan goods to sixty-eight. There is no limitation on export traders.
1990
February: The Foreign Trade Administration under MOFERT announces a new measure that offers Taiwan investors favorable treatment in taxation and investment categories; it also encourages land investment and development.
December: At the Working Conference on Taiwan Affairs, President Yang Shangkun suggests that cross-straits relations should focus on economic and trade exchange and that the mainland should use economic development to promote political development, use people-to-people contact to promote official contact, and gear the development of cross-straits relations toward national unification and the Program for Comprehensive Modernization.
1991
July: MOFERT proposes five principles to enhance cross-straits exchange: exchange should be direct and two-way; be mutually beneficial; take various forms; be long-term and stable; and respect contracts and the spirit of justice.
December: The Association for Relations Across the Taiwan Straits (ARATS) is established (the counter part of Taiwan’s Straits Exchange Foundation).
1992
January: The Regulations Governing Chinese Citizens Traveling Between Taiwan and the Mainland are announced. These state that applicants will not be approved if they are involved in criminal or other activities that might endanger national security or interest; apply under false pretense or use false certificates; or suffer from mental illness or a serious in fectious disease.
April: Pingtan island of Fujian province is established as the mainland’s first special district for trade cooperation with Taiwan.
May: Beijing allows foreign businesses to invest in service industries and the domestic market, opening up a broader range of categories for Taiwan investment.
1993
April: ARATS and the SEF meet in Singapore for the historic “Koo-Wang” talks on cross-straits economic exchange.
October: Beijing proclaims the Regulations Governing Small-scale Trade Between Taiwan and the Mainland, which covers trade conducted by fishing boats.