Benefits of Making Business in Taiwan | Buy & Sell Business

1. BENEFITS OF MAKING BUSINESS IN TAIWAN WWW.MERGERSCORP.COM

2. At MergersCorp M&A International we help our clients confidentially buy and sell privately held businesses, aligning the interests of all parties for mutual success and satisfaction. It is our goal to make the process of either buying a new business or selling your current business as smooth and efficient as possible. We know how important confidentiality is to our sellers and we treat it with the utmost importance. WWW.MERGERSCORP.COM

3. BENEFITS OF MAKING BUSINESS IN TAIWAN WWW.MERGERSCORP.COM

4. Country Overview Taiwan, officially the Republic of China (ROC), a largely mountainous island nation in East Asia, formerly known as Formosa. Taiwan is located north of the Philippines and the South China Sea, about 180 km off the southeastern coast of China, separated from the mainland by the Taiwan Strait. The island shares maritime borders with China, Japan, and the Philippines. With an area of 36,188 km² Taiwan is slightly larger than Belgium or slightly smaller than the U.S. states of Maryland and Delaware combined. The ROC has a population of 23.5 million (in 2015), making it one of the most populated countries in the world; capital city is Taipei, largest city is New Taipei City or Xinbei, an urban agglomeration with 4 million people that surrounds the capital. In the long-term, the Taiwan Population is projected to trend around 23.62 Million in 2020, according to our econometric models. The population of Taiwan represents 0.34 percent of the world´s total population which arguably means that one person in every 301 people on the planet is a resident of Taiwan.

5. Executive Summary Taiwan is an island that has for all practical purposes been independent since 1950, but which China regards as a rebel region that must be reunited with the mainland - by force if necessary. China has claimed sovereignty over Taiwan since the end of the Chinese civil war in 1949, when the defeated Nationalist government fled to the island as the Communists, under Mao Zedong, swept to power. China insists that nations cannot have official relations with both China and Taiwan, with the result that Taiwan has formal diplomatic ties with only a few countries. The US is Taiwan's most important friend and protector. Despite its diplomatic isolation, Taiwan has become one of Asia's major economic players, and one of the world's top producers of computer technology. The principal religions of Taiwan according to the number of adherents are: Buddhism, Daoism, Christianity, and Yiguan Dao. Buddhists and Daoists are by far the largest groups.

6. Introduction – Doing business in Taiwan Automotive and Car Parts Business Without an iota of doubt, Taiwan has a robust economy that is very much capable of high technology industrial production. One business therefore you may want to invest in this country is that Auto parts business. However, this all depends on the scale you would like to start from. Medical Supplies and Equipment The need to solve the problems in the health sector all over the world is such that requires good supply of equipments. Therefore this is the reason why Taiwan producers have taken it upon themselves to produce the very best of medical supplies. You too can plug into this business opportunity. Some of the things that may be considered dealing in are ; dental equipment and appliances, diagnostic instruments, hospital equipments, medical disposable items, prosthetic and orthopedic products , amongst others.

7. Conducting business in Taiwan consider dealing in Hardware. This might be a capital intensive business to start with; however, you can be sure that the returns on your investment wouldn’t be regret. If you are such a one that has a penchant for bicycles generally. Then you may make this a business line as there are lots of bicycle products opportunities in Taiwan It is no longer news that heavy duty machineries can be found in Taiwan. Hence, it might also no longer be news to you that you could make great profit from dealing in machinery in Taiwan. This is because the market all over the world is a very vast one. You may decide to set up your business in Taiwan for the sole aim of exporting to countries from there. Taiwan is one country where the production of hardware is in abundance, if you are an IT savvy person, then you may want to

8. Taxation in Taiwan flat rate of 18% on Taiwan taxable salary income, regardless of where the remuneration is paid. Taiwan Corporate - Taxes on corporate income. With effect from 1 January 2018, the CIT rate in Taiwan is 20%. However, for profit-seeking entities with less than TWD 500,000 in taxable income, the CIT rate is 18% in 2018, 19% in 2019, and 20% in 2020 if taxable income exceeds TWD 120,000. Capital gains on disposal of Taiwanese qualified securities and futures by resident companies and non- resident companies with a fixed place of business or business agent in Taiwan are exempt from corporate income tax, but are liable for basic income tax of 12%, with an exemption amount of TWD 500,000. In Taiwan, the sales tax rate is a tax charged to consumers based on the purchase price of certain goods and services. A non-resident alien residing in Taiwan for more than 90 days but less than 183 days in a calendar year is subject to tax at a

9. Trade $54.2 billion. The U.S. goods and services trade deficit with Taiwan was $13.9 billion in 2018. Taiwan is currently U.S.’s 11th largest goods trading partner with $76.0 billion in total (two way) goods trade during 2018. Goods exports totaled $30.2 billion; goods imports totaled $45.8 billion. The U.S. goods trade deficit with Taiwan was $15.5 billion in 2018. Trade in services with Taiwan (exports and imports) totaled an estimated $18.5 billion in 2018. Services exports were $10.0 billion; services imports were $8.4 billion. The U.S. services trade surplus with Taiwan was $1.6 billion in 2018. Taiwan was the United States' 15th largest goods export market in 2018. U.S. goods exports to Taiwan in 2018 were $30.2 billion, up 17.5% ($4.5 billion) from 2017, and up 21.3% from 2008. U.S. exports to Taiwan account for 1.8% of overall U.S. exports in 2018. U.S. goods and services trade with Taiwan totaled an estimated $94.5 billion in 2018. Exports were $40.3 billion; imports were

10. Banking in Taiwan there are 23 credit cooperatives, 283 agricultural credit unions, and 28 fishermen’s credit unions. These banks, cooperatives, and credit unions have traditionally played a dominant role in finance in Taiwan. The Central Bank performs all of the functions normally associated with central banks in other markets. It issues currency, manages foreign exchange reserves, handles treasury receipts and disbursements, sets interest rate policy, oversees the operations of local financial institutions, and serves as a lender of last resort. Taiwan’s domestic banks offer a wide range of services, including accepting deposits, making loans, handling trade finance and providing guarantees, and discounting bills and notes. Most are also involved in the securities business, underwriting and trading securities and managing bond and debenture issues, as well as providing savings account facilities. The Mega International Commercial Bank assists with long-term industrial and project financing, while the Export-Import Bank of the Republic of China and the Farmers Bank focus on trade finance and agricultural development, respectively Taiwan has a Central Bank, 37 domestic banks, and 29 local branches of foreign and Mainland China banks. In addition,

11. Our M&A Process NEGOTIATION & CLOSE POST MERGER INTEGRATION (PMI) INTEGRATION (PMI) POST MERGER TARGET APPRAISAL APPROACH DUE DILIGENCE Key Areas  Target & market analysis;  Initial assessment of synergies & value drivers;  Indicative valuation;  Go or No-Go decision;  Preparation of transaction documents (NDA – Non- disclosure Agreement/LOI- Letter of Intent);  Select Transaction team;  Appoint advisors;  Consider funding ability.  Initial approach letter;  Signing of NDA;  Prepare & share initial information requests;  Formulation of LOI (Letter of Intent) & possible negotiations;  Initial meeting and Q&A;  Circulate information on the Target to the Transaction team.  Set scope of due diligence;  Set up VDR (virtual data room);  Coordinating of due diligence, further meetings and Q&A sessions;  Consider points relevant to the Post-Merger (PMI) phase;  Revisit indicative valuation & prepare detailed valuation based on due diligence findings;  SPA negotiations with the seller;  Development of final structure (share/asset deal) and final valuation;  Approvals;  Signing of SPA & Close.  Consider the extent of integration;  Development of 100 Day PMI Plan;  Consider short & long term objectives;  Estimate requirements to capture synergies;  Determine resource needs & optimal allocation. Parties Involved  CFO;  Head of M&A;  Accountants;  Corporate finance advisors;  Consultants.  Senior management;  CEO, CFO, CTO;  Strategy director;  Head of M&A;  Head of Business Development;  Consultants.  Company general counsel;  Lawyers;  Senior management.  Company general counsel;  Lawyers;  Senior management/HR. 11 © Midaxo 2018 www.midaxo.com

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13. MergersCorp.com The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. Member firms of the MergersCorp network of independent firms are affiliated with MergersCorp International. MergersCorp International provides no client services. No member firm has any authority to obligate or bind MergersCorp International or any other member firm vis-à-vis third parties, nor does MergersCorp International have any such authority to obligate or bind any member firm. Copyright © 2020 MergersCorp International. All rights reserved. 13 © Midaxo 2018 www.midaxo.com