Taiwan advanced its regulatory framework for artificial intelligence with the submission of the Draft Artificial Intelligence Basic Act to the Legislative Yuan on August 28, 2025. This legislation represents a culmination of efforts initiated in 2017 through the Ministry of Science and Technology’s AI Grand Strategy for a Small Country project, aimed at developing a robust AI ecosystem. The Draft Act designates the Ministry of Digital Affairs as the competent authority responsible for implementing its provisions and establishes essential principles for government action in advancing AI research and development.
The strategic importance of Taiwan in the global hardware supply chain has grown significantly, particularly since the emergence of generative AI technologies like OpenAI’s ChatGPT in late 2022. The semiconductor industry has been a critical driver, with production value expected to surpass NT$6.4 trillion in 2025, reflecting a 22.2% increase from the previous year. This growth underscores Taiwan’s pivotal role in supplying vital hardware infrastructure necessary for the AI sector.
The government’s approach builds upon earlier initiatives, including the Taiwan AI Action Plan 1.0 (2018-2021), which focused on enhancing research, infrastructure, and talent development. Following the milestones achieved in this first plan, the Executive Yuan approved Taiwan AI Action Plan 2.0 in 2023, with aspirations to elevate the AI industry value beyond NT$250 billion by 2026. This second phase emphasizes talent cultivation, industry expansion, and enhancing Taiwan’s global technological presence.
As generative AI technologies rapidly evolved in 2023, the National Science and Technology Council launched several initiatives, including the Trustworthy AI Dialogue Engine, which aims to bolster Taiwan’s position in chip manufacturing while integrating advanced silicon chips with cutting-edge technologies. Discussions in the Legislative Yuan regarding various AI bills have been ongoing since 2019, focusing on risks and ethical considerations. The consolidation process saw the approval of more than ten versions of the Draft AI Basic Act for further legislative review.
The Draft AI Basic Act delineates 15 policy objectives for government action, encompassing overall resource allocation, subsidies, and financial incentives for AI-related industries. It mandates sectoral regulators to create innovative experimental environments for AI products and services, fostering public-private partnerships to promote AI innovation. The legislation also emphasizes the importance of international cooperation in AI development.
Education on AI principles across all societal levels is a key focus, alongside measures to avert personal or property damage, conflicts of interest, and algorithmic biases. The Ministry of Digital Affairs will provide assessment tools to regulators and seeks to establish a risk classification framework in alignment with international standards. This framework will guide sectoral regulators in stipulating risk classifications pertinent to their industries.
The government further aims to prevent skill gaps and protect labor rights affected by AI advancements. The framework emphasizes personal data protection by default, alongside mechanisms for open data and data reuse to enhance AI capabilities and promote responsible data governance. Additionally, the Draft AI Basic Act calls for regular assessments of data quality and quantity to ensure compliance with multicultural values and respect for intellectual property rights.
While the Draft AI Basic Act outlines high-level governmental responsibilities, it does not impose specific regulatory requirements on the private sector. However, following its enactment, ministries will be obliged to align their regulations with the Act’s provisions. The legislation also stipulates that existing laws must be interpreted in accordance with the Draft AI Basic Act, marking a significant shift in regulatory oversight.
The Taiwan Intellectual Property Office has issued rulings on copyright issues related to using generative AI, stressing the necessity for copyright owners to authorize the use of their works in AI training. Notably, it has clarified that AI-generated content may not be copyrightable without human creative input, creating a complex legal landscape for content creators and AI developers alike.
As AI technologies proliferate, Taiwan’s comprehensive regulatory approach aims to balance innovation with risk management. The Draft AI Basic Act addresses concerns regarding algorithmic bias, data governance, and consumer protection while leveraging Taiwan’s semiconductor dominance to foster an adaptable AI ecosystem. This framework not only aligns with global trends in AI governance but also prepares Taiwan for the challenges posed by the rapid evolution of AI technologies.
See also
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Asia-Pacific Leverages AI for $1 Trillion Economic Boost and Enhanced Regional Cooperation
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