To expand the operational scale of agritech businesses and agri-startups, and help them speedily tap into the capital markets to fund their operations, the Council of Agriculture (COA) has promulgated the Directions on the Council of Agriculture Accepting Commission to Provide Opinions on the Marketability of Agritech Enterprises or Agri-startups. Such businesses will now be able to list on the Taiwan Stock Exchange or over-the-counter market similarly to science and technology companies, without being subject to any restriction in respect of years of establishment and profitability.

As explained by the COA, “agritech enterprise” refers to a company that engages in agricultural production or agricultural experimentation and research, has actual production related to agriculture, simultaneously employs at least five specialist R&D personnel, and in the preceding financial year had R&D expenditure of at least 3% of its total net operating income or at least 10% of its paid-in capital.

“Agri-startup” refers to a company that has a new and marketable business model, or has developed business content that is forward looking and has business value, and has already obtained appropriate intellectual property rights or other market tradable results. It must also employ at least five specialist R&D personnel, and in the preceding financial year must have had R&D expenditure of at least 3% of its total net operating income or at least 5% of its paid-in capital.

The COA further explains that such a business should first prepare and submit the relevant listing documents to the Taiwan Stock Exchange or GreTai Securities Market. Then, upon receipt of commission, the COA will conduct a review and assessment to determine if the applicant enterprise meets the applicable conditions. If so approved, and provided it meets the applicable capital requirements, the agritech enterprise or agri-startup will not be subject to any listing restrictions in respect of its profitability or length of establishment. It is estimated that this change in regulation will shorten the listing application process for such companies by between one and two years