Taiwan

YEAR IN REVIEW

(1 July 2024 to 30 June 2025)

The Ministry of Environment issued an amended List of Regulated GHG Emission Sources, expanding the scope to include additional industries, such as the IT service industry, retail businesses, hotels, and hospitals, to be subject to GHG accounting and reporting requirements.
Sustainability reporting requirements (that are fully-aligned with IFRS S1 and S2) will be phased in for listed companies from 2026 to 2028.
Carbon fee regulations took effect on 29 August 2024, marking Taiwan’s official entry into the carbon pricing era. A carbon fee scheme will apply to electricity and manufacturing businesses that emit over 25k tonnes of Scope 1 and Scope 2 GHG emissions per year. In-scope businesses must pay the carbon fee for the preceding year from May 2026, with preferential rates available for those who meet their proposed and approved GHG reduction targets.

Scroll down or click below for further information on each key theme.

PODCAST OVERVIEW

Please click on the podcast above for a snapshot of the three key themes of ESG reporting, transition planning and greenwashing risks in respect of Taiwan.

KEY CONTACTS

	Benjamin Li Partner, Lee and Li, Attorneys-at-Law
	Helen Huang Associate Partner, Lee and Li, Attorneys-at-Law

A. ESG Reporting

1. Are there legal or regulatory requirements for companies to make ESG disclosures in your jurisdiction?

Yes.

2. What are the key legislative and regulatory sources for ESG disclosure requirements and to whom do they apply?

Regulated GHG emitters

The Climate Change Response Act (CCRA) provides that businesses announced by the Ministry of Environment (MOE) (formerly the Environmental Protection Administration) are required to report their GHG emissions each year by submitting relevant data to the registry of the MOE, and the data submitted must be verified by a certified verification institute. The MOE has announced the businesses which are in-scope: Businesses Subject to Accounting and Registration of Greenhouse Gases Emission Sources (List of Regulated GHG Emission Sources) - see section A.7 below for more details.

Previously, the CCRA provided for the implementation of the accounting and reporting of GHG emissions in two phases, in which specific fields of businesses were regulated in turn. With the amendment of the List of Regulated GHG Emission Sources on 31 May 2023, all businesses stipulated in the List of Regulated GHG Emission Sources that meet the relevant threshold (i.e., 25k tonnes of GHG emissions) are subject to accounting, reporting, and verification requirements. In March 2025, the MOE issued an amended List of Regulated GHG Emission Sources, expanding the scope to include additional industries. Newly included sectors such as the IT service industry, retail businesses, hotels, and hospitals that meet their respective reporting thresholds are now subject to GHG accounting and reporting requirements. However, these newly added industries are not required to undergo verification of their GHG accounting results.

Under the Regulations for Management of Inventory, and Registration of Greenhouse Gases amended on 14 September 2023, the regulated businesses are required to submit a GHG emissions accounting report by 30 April of each year and the verification of the GHG accounting results by 31 October of each year. The reported data is publicly accessible on the MOE’s Platform on GHG Emission Amount.

Listed companies and financial institutions

The Taiwan Stock Exchange’s Corporation Rules Governing the Preparation and Filing of Sustainability Reports by Listed Companies and the Taipei Exchange’s Rules Governing the Preparation and Filing of Sustainability Reports by Listed Companies require all listed companies to submit ESG reports (including GHG emissions data) on an annual basis (by 31 August of each year starting from 2025) subject to a verification and certification process.

Listed companies and financial institutions are also required to disclose their climate-related information in their annual reports.

The Financial Supervisory Commission (FSC) promulgated the Guidelines of Climate-Related Financial Disclosure for Domestic Banking Institutions and the Guidelines of Climate-Related Financial Disclosure for Insurance Institutions which require domestic financial institutions to disclose their climate-related financial risks every year from June 2023.

3. Are the requirements mandatory or do they apply on a comply-or-explain basis?

The disclosure requirements mentioned in A.2 above are mandatory. Failure to submit the ESG reports would trigger an administrative fine ranging from NT$10,000 to NT$30,000.

4. Which aspects of ESG do the requirements focus upon?

Listed companies are required to specify in their ESG reports various sustainability-related factors based on the FSC's requirements by industry, and must also indicate the response measures and their progress in respect of the risks and opportunities as a result of climate change (such as the short, medium-term and long-term plan for the operation and strategy of the company, financial impact of the climate change on the company, and GHG emission data, etc.). The reporting generally covers all the commonly seen ESG elements.

Businesses subject to the List of Regulated GHG Emissions Sources are required to report their GHG emissions.

5. Are the disclosure requirements based on international standards? If so, which one(s)?

The mandatory ESG reporting requirements in Taiwan incorporate the standards of GRI, TCFD and SASB.

Based on the Roadmap for Taiwan Listed Companies to Align with IFRS Sustainability Disclosure Standards released by FSC on 17 August 2023, starting in 2026, listed companies that reach a certain threshold of paid-in capital will be required to apply the ISSB Standards for the preparation of their annual reports. Such required disclosure will be based on both IFRS S1 and IFRS S2. See section A.11 below for more details.

6. How do the disclosure requirements approach materiality (e.g. single or double materiality)?

Currently, the reporting requirements of sustainability reports and the FSC guidelines applicable to banks and insurance institutions adopt a single materiality approach.

7. Are there requirements for the disclosure of GHG emissions? If so, please specify the scope (e.g. Scope 1, Scope 2 and/or Scope 3), to whom they apply and whether there are requirements on the measurement methodology.

Further to section A.2 above, in the case of entities subject to the List of Regulated GHG Emission Sources, mandatory disclosure of GHG emissions applies to Scope 1 and Scope 2 emissions, whereas disclosure of Scope 3 emissions is encouraged but not mandatory. Entities subject to the List of Regulated GHG Emission Sources include the following, among others: (i) all businesses in Taiwan whose Scope 1 GHG emissions reach 25k tonnes per year, and (ii) all manufacturing businesses in Taiwan whose Scope 1 and Scope 2 GHG emissions altogether reach 25k tonnes per year.

The accepted measurement methodologies under the Regulations for Management of Inventory, and Registration of Greenhouse Gases include emission factors method, mass balance method, direct measurement, and any other measurement methods approved by the MOE.

8. Are there requirements to obtain independent assurance of any ESG disclosures? If so, what is the scope of such requirements? If not, are there plans to introduce such requirements?

The sustainability indicators reporting and the Scope 1 and Scope 2 emissions reporting in ESG reports submitted by listed companies must be assured by certified institutions.

9. For companies not subject to mandatory or comply-or-explain ESG reporting, are voluntary ESG disclosures customary?

No. However, as ESG is becoming commonplace in the corporate world, the incorporation of ESG and other non-financial considerations into investment strategies have been gradually gaining momentum in Taiwan as more investors realise that ESG investing is able to boost their portfolios and profitability.

10. Has your jurisdiction issued or adopted a taxonomy on sustainable activities? Is it mandatory and what is its scope of application?

Yes. In December 2022, various regulators jointly promulgated the Taiwan Taxonomy Guidelines for Sustainable Activities that include 29 types of regular economic activities (e.g., transportation and logistics) and 14 types of enabling economic activities (e.g., CCUS technologies). The taxonomy was further amended in December 2024.

It is not a mandatory requirement, but financial institutions are encouraged to refer to said Taxonomy Guidelines when making investments and issuing financial instruments labelled as “sustainable”.

11. Are there plans to adopt or incorporate any (other) international ESG reporting framework (e.g. the ISSB Standards and/or the TNFD)? If so, please give details.

In July 2023, the FSC announced that the government plans to adopt and fully incorporate the ISSB Standards in the annual reporting requirements applicable to listed companies on a phase-in basis.

Starting from 2026, listed companies that reach a certain threshold in paid-in capital will be required to prepare sustainability reports that fully align with both IFRS S1 and IFRS S2. The FSC proposes to apply the requirements in three phases starting in 2026 (for listed companies with a paid-in capital of NT$10 billion or more), 2027 (for listed companies with a paid-in capital of at least NT$5 billion but no more than NT$10 billion), and 2028 (all listed companies). The specific dates for the requirement to take effect have not been confirmed by the FSC.

The transition mechanism under IFRS S1 will generally apply to listed companies that are required to submit their sustainability reports based on IFRS S1 and S2.

There are currently no proposals for the TNFD to become a mandatory reporting framework in Taiwan.

12. Other upcoming developments / direction of travel

With the legal framework of ESG reporting now in place, it is expected that the regulators will focus on implementation and strengthen the enforcement of listed companies' mandatory ESG reporting.

The Ministry of Economic Affairs plans to update Taiwan's "National Action Plan on Business and Human Rights" and is developing voluntary "Guidelines on Business to Respect Human Rights" (HR Guidelines). The HR Guidelines is expected to cover human rights due diligence and remedy by businesses (within their operations and supply chains) and reporting the outcomes of these efforts. These are in early stages of development and no concrete timeline has been announced.

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B. Transition Planning

1. Has your jurisdiction set decarbonisation targets and strategies?

Yes, Taiwan’s “2050 Net Zero Pathway” was announced in March 2022 in which the government vowed to reach net-zero emissions by 2050 by focusing on four main strategies in energy, industry, lifestyle, and social transition. Similarly, the CCRA codifies this commitment of decarbonisation and sets out the net-zero emissions as Taiwan's long-term goal to be attained by 2050.

2. Are businesses subject to any mandatory carbon pricing or other “polluter pays” instruments (such as ETS, carbon taxes or EPR schemes)? If so, please give details. If not, are there plans to do so?

There is currently no mandatory carbon trading market in Taiwan. To facilitate a voluntary carbon exchange scheme, the MOE announced on 1 July 2024, the Regulations on Carbon Credit Trading, Auction, and Transfer, which took effect on 15 August 2024.

Pursuant to the CCRA, it is also expected that a trading market for voluntary reduction quotas will be established soon. According to the CCRA, businesses may propose voluntary reduction projects to implement GHG reduction measures, and apply to the MOE for approval to obtain emission credits (GHG Credits), which should be used in accordance with the requirements and time period set by the MOE. The MOE promulgated on 12 October 2023 the Greenhouse Gas Voluntary Emission Reduction Projects Regulations (for the implementation of the scheme on GHG Credits) and the Regulations for the Management of Offsetting the Increased Greenhouse Gas Emissions (for the implementation of the GHG offset scheme described above).

On 29 August 2024, (a) Regulations Governing the Collection of Carbon Fees; (b) Designated Greenhouse Gas Reduction Goal for Entities Subject to Carbon Fees; and (c) Regulations for Administration of Self-Determined Reduction Plan promulgated by the MOE took effect. A carbon fee scheme will apply to electricity businesses and manufacturing businesses that emit over 25k tonnes of Scope 1 and Scope 2 GHG emissions per year. Business which are subject to a carbon fee will need to pay the carbon fee from May 2025.

An extended producer responsibility scheme is in place for manufacturers and importers of certain categories of products and packaging, which are required to pay a recycling and disposal fee primarily based on business / import volume.

3. Are there mandatory requirements for companies to have in place and/or disclose climate-related transition plans? If so, please give details. If not, are there plans for such requirements?

There are no mandatory requirements for corporate transition plans and/or their disclosure.

The Designated Greenhouse Gas Reduction Goal for Entities Subject to Carbon Fees and Regulations for Administration of Self-Determined Reduction Plan do not require the regulated businesses to set climate targets or have a transition plan in place. However, these regulations encourage the regulated businesses to voluntarily develop GHG emission reduction plans and set GHG reduction targets for 2030 based on the Voluntary Reduction Plan Guidelines promulgated by the MOE so as to qualify for a reduced carbon fee rate for meeting GHG reduction targets.

As noted in section A.11 above, listed companies will be required to adopt the IFRS S2, which covers climate-related disclosures, including any transition plans.

4. Are there mandatory requirements to set, meet and/or disclose climate-related targets? If so, please give details. If not, are there plans for such requirements?

Companies are not required to disclose, set or meet climate-related targets.

However, to reduce the impact of climate change caused by new or changed “GHG Sources” (i.e., businesses on the List of Regulated GHG Emission Sources), under the CCRA, businesses with new or changed GHG Sources that reach a certain scale are required to carry out incremental GHG offsets by a certain percentage through voluntary reduction quota (including purchase thereof), obtaining certain reduction benefits (such as replacement of automobiles with EVs), and implementation of GHG reduction measures set forth under Article 29 of the CCRA. For the implementation of the GHG offset scheme, the MOE promulgated the Regulations for the Management of Offsetting the Increased Greenhouse Gas Emissions on 12 October 2023. See section B.2 above for details.

5. Other upcoming developments / direction of travel

Based on the 2050 Net Zero Pathway and 12 Key Strategies, to achieve the 2050 net zero emission goal, it is expected that high emitting sectors (e.g., cement, steel and petrochemicals) would start to transition to low carbon production process and undergo facilities upgrades in order to be more sustainable.

A consultation was issued in May 2025 on proposed amendments to the Resource Recycling Act (to be renamed Resource Circulation Promotion Act) in order to promote resource circulation and to strengthen the relevant legal framework. The policy objective is to shift from the current focus on end-of-life recycling and treatment towards full life-cycle resource circulation. The proposed amendments include: (a) establishing a Resource Circulation Promotion Council; (b) green design guidelines for certain products and projects; (c) prioritising green procurement by public agencies; (d) mandatory services such as repair, rental and extended warranties for designated products; and (e) providing incentives and financial support to promote circular activities.

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C. Greenwashing Risks

1. Are there any recent examples of legal proceedings, regulatory actions or investigations against or into greenwashing in your jurisdiction?

No.

2. Are there any laws or regulations specifically dealing with greenwashing?

No, but greenwashing conducts are likely to be subject to the regulatory and penalty regimes under the Securities and Exchange Act, the Fair Trade Act, and/or the Civil Code.

3. What are the likely grounds on which such proceedings, actions or investigations can be instigated?

The possible grounds may include securities fraud, false statement, false advertising, and/or tort liabilities.

4. Other upcoming developments / direction of travel

Greenwashing is not fully regulated in Taiwan. It remains to be seen how the regulators as well as courts would define the meaning of greenwashing and deal with greenwashing claims. Given that a more comprehensive ESG disclosure regime has been established, it is generally expected that regulation of the accuracy of ESG disclosures will be introduced following the enhancement of the disclosure requirement.

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