June 2023
Aaron Chen, Sean Tang, Sally Yang
When the National Security Act (hereinafter, the “Act”) and the Act Governing Relations between the People of the Taiwan Area and the Mainland Area were amended on June 8, 2022, provisions were added for the protection of “national core key technologies.” After soliciting public opinions, the National Science and Technology Commission (hereinafter, the “NSTC”), authorized under Article 3, Paragraph 4 of the Act, officially announced two sub-laws, namely, the Regulationon the Determination of National Core Key Technologies and the Regulations on Identification of Government Subsidized, Commissioned or Funded National Core Technologies Projects, on April 26, 2023. On the same day, the Executive Yuan also announced that Article 3, Paragraphs 3 to 5 of the Act would go into effect on April 28, 2023.[1] The new legal regime for the protection of national core key technologies (hereinafter, the “Key Technologies”) has officially been launched. For its impact, please refer to our article titled The Definition and Impact of National Core Key Technologies (Taiwan). This article merely explains the following process relating to the recognition of national core key technologies with respect to the above-mentioned two sub-laws that have just been released.
I. The process of recognizing national core key technologies
1. Submission of core key technology items by various agencies or institutions following the review of the expert examination committee
Each government agency (institution) and public research agency (institution) (hereinafter, the “Agencies (Institutions)”) should form an expert review committee consisting of five to eleven members who are representatives of related agencies, experts and scholars, and members of the industries appointed by such an agency in order to propose the recognition or modification of key technology items. The expert review committee should hold a meeting at least once a year and may convene special meetings as necessary to assist in the review of potential key technology items.
Government agencies (institutions) submitting applications for the recognition or modification of key technology items and their respective technical competent authorities are required to provide the following information: (1) the proposed key technology items, which should include a description of the technology, as well as its characteristics and functions; (2) an explanation of how the proposed key technology items meet the definition of national core key technologies under the Act; (3) opinions from experts, scholars, and industry representatives; and (4) other reference materials. The Agencies (Institutions) should make submissions to the National Core Key Technologies Review Committee through the National Core Key Technologies Office.
In addition, the Agencies (Institutions) that provide subsidies or funding, or allocate budgets for scientific and technological research and development should establish a dedicated unit or appoint dedicated personnel to regularly check potential key technology items and their respective technical competent authorities. After the above-mentioned expert review, the materials should be submitted to National Core Key Technologies Review Committee through the National Core Key Technologies Office.
(Articles 7, 8, and 9 of the Regulationon on the Determination of National Core Key Technologies)
2. Preparation of key technology items by the National Core Key Technologies Office
The National Core Key Technologies Office under the NSTC is responsible for tracking and analyzing domestic and international technological developments, preparing key technology items, consulting stakeholders such as industries, governments, academia, and research institutions, and submitting potential key technology items for recognition by the National Core Key Technologies Review Committee. If the key technology is proposed by the National Core Key Technologies Office itself, the required materials are the same as those that shall be submitted by the above-mentioned agencies.
(Articles 4 and 7 of the Regulationon on the Determination of National Core Key Technologies)
3. Recognition of key technology items through the review of the National Core Key Technologies Review Committee
The National Core Key Technologies Review Committee under the NSTC is responsible for the recognition, modification, and other review matters related to key technology items. The committee consists of 21 to 27 members, with NSTC’s chairperson serving concurrently as the organizer. The members of the committee, who serve on a part-time basis, include representatives from government agencies that provide subsidies or funding, scientific and technological research institutions, defense, intelligence, and Mainland affairs agencies, scientific research and technology experts and scholars, and experts of leading technologies or experts of industries that have an important impact on economic development. The term of office for the committee members is two years, and they may be reappointed once at the end of their term.
The review committee should hold meetings at least once a year to identify key technology items and may convene special meetings when necessary. The committee may invite representatives of stakeholders and other relevant experts to attend the meetings and provide inputs. During the drafting stage, some in the industries believed that the committee “should” invite representatives of stakeholders and experts to attend the meetings and provide opinions, but this suggestion was not adopted.
(Articles 2, 3, and 5 of the Regulationon on the Determination of National Core Key Technologies)
4. Public announcement of key technologies items and their competent authorities by the Executive Yuan
According to the provisions of the National Security Act, which is the mother law, key technology items and their competent authorities are publicly announced by the Executive Yuan before they are submitted to the Legislative Yuan for recordation, and this shall also apply to any subsequent changes.
In addition, to ensure the continuous and dynamic adjustment of key technology items, the aforementioned “competent authorities” are required to review the key technology items under their supervision annually and assist relevant industries in clarifying their scope of application. When requested by key technology holders or in response to changes in the industries or technological developments, the competent authorities for the technologies may propose the recognition or modification of key technology items through the above-mentioned process.
(The text of Article 3 of the National Security Act, and Articles 6 and 10 of the Regulationon on the Determination of National Core Key Technologies)
II. Personnel control process for government-funded key technology items
1. Inventory-taking and formation of a review team by the project implementation unit
Within three months of the Executive Yuan’s announcement of new or modified national core key technologies, the Agencies (Institutions) commissioning, subsidizing, or funding the development shall take inventory of the projects they have commissioned or subsidized, or ceased to fund less than three years ago, are planning to implement, are implementing, or have placed under their control.
After the inventory is taken, in order to confirm that the project falls within the scope of “national core key technologies” as announced by the Executive Yuan and that “over half of the project funding comes from government agencies (institutions),” the agency should set up a review team consisting of at least five members who are experts or scholars, industry experts, and representatives from the competent authorities for national core key technologies to conduct a review. In addition, the directors of the commissioned, subsidized, or funded projects shall be notified to attend and provide explanations.
(Articles 2 and 3 of the Regulations on Identification of Government Subsidized, Commissioned or Funded National Core Technologies Projects)
2. List of names provided by the project implementation unit
For individuals identified through the review process as being involved in national core key technologies (or those who should be removed from the control list), the “project implementation unit” should provide a list of the “project directors” and “personnel who are knowledgeable about technical secrets related to national core key technologies due to their involvement in the national core key technology business” to the commissioning, subsidizing, or funding agency.
(Article 4 of the Regulations on Identification of Government Subsidized, Commissioned or Funded National Core Technologies Projects)
3. Preparation by the agency of a name list for notification to the National Immigration Agency of the Ministry of the Interior
The commissioning, subsidizing, or funding agency should then notify the National Immigration Agency of the Ministry of the Interior and the parties involved when creating a name list or making changes to the list with a copy to the NSTC. This shall also apply to changes in key technology items, the recognition results, or the personnel involved.
(Article 4 of the Regulations on Identification of Government Subsidized, Commissioned or Funded National Core Technologies Projects)
For other important details regarding the current Amendments, please refer to the detailed explanation in our law newws titled Draft Regulations Related to the Determination of National Core Key Technologies Pre-announced by the NSTC of Taiwan.
After the official release of the above-mentioned two sub-laws, the legal regime for “national core key technologies” is formally launched. Businesses are advised to pay close attention to the subsequent government definition of the technologies that fall within the scope of “national core key technologies” and any potential implementation issues after the new system is implemented.
[1] Executive Yuan Gazette, https://gazette.nat.gov.tw/egFront/detail.do?metaid=140111&log=detailLog
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