To promote the circulation and utilization of the results of innovation or R&D, when sponsoring, commissioning certain entities to do so, or funding innovation or R&D projects, the central authorities in charge of relevant enterprises and the state-owned enterprises subordinate to such authorities shall require the entities conducting such innovation or R&D to devise the strategy for applying such innovation or R&D results for business operation, substantively analyze the intellectual property rights, ensure the quality of the intellectual property, give comprehensive protection to the results, and evaluate circulation and utilization methods.
The circulation and utilization of the intellectual property under the preceding paragraph shall be valuated by a legally qualified intangible asset valuation associate or by an institution or person registered in accordance with Article 13, and the evaluation material shall be recorded in the information service system designated by the central competent authority.
The scope of application, promotion, administration measures, and other matters regarding the innovation and R&D under Paragraph 1 of this Article shall be prescribed by the central competent authority.

To promote the circulation and application of the results of innovation or R&D, where a domestic individual, company or limited partnership receives revenue from assignment or licensing of his/her/its intellectual property rights in his/her/its own R&D results, up to 200 percent of his/her/its R&D expenditures in the then-current year may be deducted from the amount of his/her/its taxable income up to the amount of the above revenue in that year, and, in the case of a company or limited partnership, the company or limited partnership may choose between the tax credit against its R&D expenditures under this Paragraph and the investment tax credit under Article 10.
Where a domestic individual, company or limited partnership assigns or grants a license to use his/her/its intellectual property rights in his/her/its own R&D results to a company, the individual, company or limited partnership may opt to exclude the new shares acquired as the consideration from his/her/its taxable income in the year such shares are acquired. Once a choice of option is made, it cannot be reversed. However, after the individual, company or limited partnership has opted to exclude such new shares from his/her/its taxable income in the year such shares are acquired, if the shares are transferred or are delivered by book-entry transfer to an account with a securities depository enterprise, the entire transfer price, the market price of the shares at the time of gift or distribution as estate, or the market price of the shares on the date of book-entry transfer less the expenses or costs incurred for acquisition of the shares but not yet recognized, shall be included in the revenue for the year of transfer or book-entry transfer and be declared for assessment of income tax.
Where a domestic individual has opted to exclude the new shares acquired as the consideration from his/her taxable income in the year such shares are acquired in accordance with the preceding paragraph, and has held such shares and provided services regarding application of the intellectual property rights under the preceding paragraph to the company issuing those shares accumulatively for two years, if the shares are transferred or are delivered by book-entry transfer to an account with a securities depository enterprise, and the entire transfer price, the market price of the shares at the time of gift or distribution as estate, or the market price of the shares on the date of book-entry transfer is higher than the acquisition price of the shares, the acquisition price of the shares shall be included in the revenue for the year of transfer or book-entry transfer and be declared for assessment of income tax. Where a domestic individual has not declared the price of the shares for assessment of income tax or has declared the price for assessment of income tax but cannot provide documentary proof of the acquisition price of the shares, and the information is not available from the taxation authority, the above provisions shall not apply.
The transfer under the preceding two paragraphs refers to purchase, sale, gift, distribution as estate, cancellation of shares as a result of capital reduction, corporate liquidation, or change in ownership due to other causes.
Where an individual's income is calculated in accordance with Paragraph 1, 2 or 3 hereof but is not declared or proved by any documents, the sum of his/her costs and necessary expenses shall be calculated at 30 percent of his/her revenue, the transfer price, the market price of the shares at the time of the gift or distribution as estate, or the market price of the shares on the date of book-entry transfer, and be deducted from the individual's taxable income.
The incentives under Paragraph 2 are available only if the company issuing shares submits the required documents and information in the prescribed format to the central authority in charge of relevant enterprises for certification in the year it accepts contributions in exchange for its shares. A copy of the results of the certification shall also be delivered to the taxation authority at the place where the company is located.
Where a domestic individual intends to apply for the tax benefit under Paragraph 3, the company issuing those shares shall submit documents prepared in the prescribed format to explain the services regarding application of the intellectual property rights provided by the individual to the company to the central authority in charge of the relevant enterprises for recognition when it applies for the certification under the preceding paragraph. In the year when the individual has held the shares and provided services regarding application of the intellectual property rights to the company for two years, the company shall submit documents proving the individual’s shareholding and services mentioned above to the central authority in charge of the relevant enterprises for recordation. A copy of the proof shall be delivered to the taxation authority at the place where the company is located.
The regulations governing the scope of application of the R&D expenditures deductible from the taxable income under Paragraph 1, the application deadline, the application procedure, the approving authority, and other related matters shall be prescribed by the central competent authority in consultation with the Ministry of Finance.
The scope of the intellectual property rights in the R&D results under Paragraphs 1 and 2, and the formats, the application deadlines and procedure, and the formats of the required documents under Paragraphs 6 and 7 shall be prescribed by the central competent authority.
The regulations governing the procedure for deferred payment and assessment on shares acquired with the transferred or licensed intellectual property rights in R&D results under Paragraphs 2 and 3, the documents to be submitted, and other related matters shall be prescribed by the Ministry of Finance.

Where a domestic academic or research institution assigns the intellectual property rights resulting from its R&D achievements and conferred on it to a company or licenses the company to use such rights in accordance with Paragraph 1, Article 6 of the Fundamental Science and Technology Act, and acquires shares in the company in return, and distributes such shares to the domestic creator of such intellectual property rights in accordance with Paragraph 3, Article 6 of the Fundamental Science and Technology Act, such domestic creator may opt to exclude the new shares so acquired from his/her income taxable in the year such shares are acquired. Once such option is chosen, it cannot be reversed. However, after the creator has opted to exclude such new shares from his/her income taxable in the year such shares are acquired, if the shares are transferred or are delivered by book-entry transfer to an account with a securities depository enterprise, the entire transfer price, the market price of the shares at the time of gift or distribution as estate, or the market price of the shares on the date of book-entry transfer shall be included in the creator’s salary for the year of transfer or book-entry transfer and be declared for assessment of income tax in accordance with the Income Tax Act.
Where a domestic creator has opted to exclude the acquired new shares from his/her taxable income in the year such shares are acquired in accordance with the preceding paragraph, and has held such shares and worked and carried out research and development at an industry or an academic or research institution within the territory of the R.O.C. accumulatively for two years, if the shares are transferred or are delivered by book-entry transfer to an account with a securities depository enterprise, and the entire transfer price, the market price of the shares at the time of gift or distribution as estate, or the market price of the shares on the date of book-entry transfer is higher than the market price of the shares at the time they are acquired by the creator, the market price of the shares at the time they are acquired by the creator shall be included in the creator’s revenue for the year of transfer or book-entry transfer, and be declared for assessment of income tax. Where an R.O.C. creator has not declared the price of the shares for assessment of income tax or has declared the price for assessment of income tax but cannot provide documentation proof of the market price of the shares at the time they are acquired by the creator, and the information is not available from the taxation authority, the above provisions shall not apply.
The assignment under the preceding two paragraphs refers to purchase, sale, gift, distribution as estate, cancellation of shares as a result of capital reduction, corporate liquidation, or change in ownership due to other causes.
Where a domestic academic or research institution distributes shares to a domestic creator in accordance with Paragraph 1 of this Article and desires to be qualified for the incentive under that paragraph, it shall submit duly formatted documents to the competent authority specified in Paragraph 3, Article 6 of the Fundamental Science and Technology Act for approval. A copy of the decision of the competent authority shall be served on the company issuing the shares and the taxation authority at the place where the company is located.
The scope of the intellectual property rights derived from an academic or research institution’s own R&D achievements in accordance with Paragraph 1 and conferred on the institution in accordance with Paragraph 1, Article 6 of the Fundamental Science and Technology Act, the rules for recognition of the shares distributed to domestic creators in accordance with Paragraph 3, Article 6 of the Fundamental Science and Technology Act, the rules for recognition of working and carrying out research and development at an industry or an academic or research institution within the territory of the R.O.C. under Paragraph 2, the formats of the documents, the application procedure and the required documents under the preceding paragraph, and other related matters shall be prescribed by the Ministry of Science and Technology.
The procedure for declaring deferral of the income tax payable for the shares acquired by the domestic creators under Paragraphs 1 and 2, the documents to be submitted, and other related matters shall be prescribed by the Ministry of Finance.

To assist enterprises in presenting the value of intangible assets derived from industrial innovations, the central competent authorities shall invite the relevant agencies to attend to the following matters:
1. Formulation and implementation of the standards for valuation services.
2. Establishment and management of valuation databases.
3. Cultivation and training of valuation associates, and setting up the mechanisms for registering and managing valuation personnel and institutions.
4. Promotion of investment in or financing with intangible assets, securitization transactions, insurance, completion guarantee, and other matters.
The central authority in charge of relevant industries may provide grants to certified or registered intangible asset valuation associates and institutions for their valuation activities in accordance with the law. The valuation associates and institutions receiving the grants shall register the valuation data from their valuation projects subject to the grants on the information service systems designated by the central competent authority.
The criteria for doing the valuation under Subparagraph 1, Paragraph 1, the application of such criteria, the measures for promoting the creation and management of the databases under Subparagraph 2, Paragraph 1, and other related matters shall be prescribed by the central competent authority in consultation with the financial competent authorities and other relevant agencies.
The scope and terms of registration of valuation associates and institutions under Subparagraph 3, Paragraph 1, the method of applying for such registration, the matters to be reviewed, such associates’ and institutions’ obligation to cooperate, the management measures, and rules for revoking or invalidating registration, and other relevant matters shall be prescribed by the central competent authority in consultation with the relevant agencies.
The matters to be promoted under Subparagraph 4, Paragraph 1 shall be prescribed by the central competent authority in consultation with the financial competent authorities and other relevant agencies.

To encourage enterprises to make use of intellectual property to create operational benefits, the central authorities in charge of relevant enterprises may assist enterprises in the establishment of systems for the protection and management of intellectual property.

To improve the efficiency of the circulation and utilization of intellectual property, the central authorities in charge of relevant enterprises may establish service mechanisms to provide the following services:
1. Establishment of information service systems to provide information relating to the circulation of intellectual property.
2. Provision of information relating to value addition and combination of intellectual property.
3. Implementation of activities relating to the promotion and marketing of intellectual property.
4. Assistance in the development of the intellectual property services industry.
5. Providing guidance to industries on financing through the use of intellectual property.
6. Other applications of intellectual property.

To encourage industry to develop brands, the central authorities in charge of relevant enterprises may provide incentives, grants, or guidance for enterprises that take part in international exhibitions and trade fairs, explore sales opportunities, or undertake brand development with the aim of developing international brands and raising their international image.
The regulations governing the recipients of the incentives, grants, or guidance as referred to in the preceding Paragraph, the eligibility criteria, the review standards, the application procedures, the approving authority, and other relevant matters shall be prescribed by the central authorities in charge of relevant enterprises.