This Act is enacted for the purpose of developing the mode of operation for a global logistic and management system, effecting aggressive promotion of trade liberalization and internationalization, facilitating the smooth flow of personnel, goods, finance, and technology, upgrading the national competitive power, and furthering the national economic development.

Establishment and management of a free trade zone shall be governed by the provisions set forth in this Act; matters not provided for in this Act shall be governed by other relevant acts and regulations provided, however, that if the relevant provisions of other acts are more favorable than those set forth in this Act, the most favorable act shall prevail.
However, the provision set forth in preceding paragraph is not applicable for Chapter 7 “Penal Provisions”

The terms as used in this Act shall be defined as follows:
1. Free trade zones: referred to an area which is situated within a controlled district of an international airport or an international seaport under the approval of the Executive Yuan, or of an adjacent area demarcated as a controlled area, and other areas approved by the Executive Yuan for the establishment of a controlled district for the purpose of conducting domestic and foreign business activities where the comprehensive goods tracking system can be connected with the controlled district of an international airport or seaport by means of technological facilities.
2. Free-trade-zone enterprise(s): referred to the enterprise(s) which has (have) been approved to engage in trading, warehousing, logistics, collecting, distributing (cargo of) containers, transiting, transshipment, forwarding, customs clearance, assembling, sorting, packaging, repairing, fabricating, processing, manufacturing, examining, testing, displaying, or technological service within a free trade zone.
3. Non-free-port-enterprise(s): referred to any financial, stevedoring, catering, hotel, business conference, transshipment, and other enterprises which are not a free-trade-zone enterprise as defined in the preceding Subparagraph 2, but has been approved to operate within a free trade zone.
4. Business personnel: referred to the persons who need to enter a free trade zone for the purpose of making business coordination or transacting business-related affairs.
5. Adjacent: referred to any of the following circumstances:
(1) A piece of land whose joining width with the land of a controlled district in an international airport or an international seaport is 30 meters or more;
(2) A piece of land being separated from a controlled district in an international airport or an international seaport by a road or a water-way in between, but still suitable for the formation of a controlled area; or
(3) A piece of land which may be connected with a controlled district in an international airport or an international seaport by a dedicated road having a length of less than one kilo-meter.
6. International seaports: referred to an international commercial port or an industrial specialized port approved for transportation of ROC and foreign ships.

The competent authority of the Act is Ministry of Transportation and Communications.

In order to centralize the operation and management of a free trade zone and to provide various services as required within the free trade zones, the competent authority shall select and recommend an appropriate government agency to the Executive Yuan for its approval of appointing the said candidate agency to act as the management authority of such a free trade zone.
In case the government agency selected by the competent authority concerned under the preceding paragraph is not a subordinate agency of that central government authority, consent shall be obtained from that government agency so selected and its superior agency.