If the approval of a juristic is revoked by the competent authority for violation of any approval condition, the ownership of the remaining assets should be governed by Article 44 of the Civil Code and does not vest with the donors or the national coffer(Taiwan)

Frank Sun
The Ministry of Justice issued the Law-10503510170 Circular of June 28, 2016 (hereinafter, the “Circular”) to communicate that if the approval of a juristic is revoked by the competent authority for violation of any approval condition, the ownership of the remaining assets should be governed by Article 44 of the Civil Code and does not vest with the donors or the national coffer.
According to the Circular, if the approval of a juristic person is revoked (or canceled for purposes of interpretation) by the competent authority for violation of any establishment condition, the ownership of the remaining assets does not vest with the donors or the national coffer but rather should be governed by Article 44 of the Civil Code. Except as otherwise stipulated by law, after debts are repaid, the donation bylaw should be followed. However, if a juristic person is dissolved for the sake of public interest, the remaining assets shall not vest with natural persons or profit-seeking entities. If the law or bylaw is silent, the remaining assets should vest with local autonomous organizations in the place where the juristic person is domiciled.
The Circular also pointed out that Article 65 of the Civil Code provides: “If the purpose of a foundation cannot be completed because of change of circumstances, the competent authority may, after considering the intent of the donors, change the purpose and the necessary organization of the foundation, or dissolve it.” Therefore, a foundation is a regulated juristic person without the concept of members or shareholders. Therefore, a foundation, which does not have a general members’ meeting or shareholders’ meeting as the supreme organ that conveys the intent of the foundation, cannot decide for itself to donate or return its assets on its own or to dissolve the foundation. Instead, this matter shall be handled by the competent authority pursuant to the procedure under Article 65 of the Civil Code.