Disclaimer: This discussion is based on the “Artificial Intelligence Basic Act - Integrated Version of Proposals by 12 KMT Legislators.” The bill was reviewed article by article at the joint meeting of the Legislative Yuan’s Education and Culture Committee and Transportation Committee on August 4, 2025. The final version passed by the committee shall be subject to the official parliamentary records.
Update: According to the results of the joint review meeting of the Legislative Yuan’s Education and Culture Committee and Transportation Committee on August 4, 2025, the bill’s title and Articles 1 to 11 remain reserved based on previous review results. Articles 13, 16, 17, 18, 19, 20, and chapter titles, along with Articles 33 to 39 proposed by the Taiwan People’s Party caucus, are reserved. The bill draft (passed by committee) has been sent to the plenary session for processing.
Legislative Opportunity: Taiwan’s Historic Moment in AI Development
Taiwan stands at a critical crossroads in artificial intelligence development. As South Korea passed its AI Basic Act in January 2025 and Japan completed its legislation in June 2024, Taiwan cannot be absent from this legal race that will determine competitiveness for the next decade. The 21-article draft integrated by 12 KMT legislators represents not merely technical regulations, but Taiwan’s value declaration of choosing “innovation-led, open and inclusive” approaches against authoritarian and closed models.
The core philosophy of this bill is simple yet profound: making Taiwan a global democratic beacon for AI innovation, using open innovation to protect digital sovereignty, and ensuring all citizens share the benefits of AI development through legal frameworks.
Core Policy Philosophy: Taiwan’s Innovation-First Path
Strategic Choice: Open Innovation vs. Regulatory Constraints
Why choose innovation-first? Observing the U.S. AI Action Plan released in July 2025 with its significant deregulation policies, we see a clear trend: excessive regulation will stifle innovation vitality. As a technology island, Taiwan must maintain its leading edge in the global AI race and cannot let bureaucratic procedures become obstacles to innovation.
What are Taiwan’s unique advantages? We possess the world’s strongest semiconductor manufacturing capabilities, a complete ICT industrial chain, and more importantly, transparent governance and open innovation culture brought by democratic institutions. These advantages enable Taiwan to forge a “third path” that both promotes innovation and ensures security.
Deep Alignment with American Values
The U.S. 2025 AI Action Plan emphasizes “objective and ideologically unbiased” AI systems, which highly aligns with Taiwan’s promoted “trustworthy AI” philosophy. Our bill design references American experience, adopting risk classification rather than grading systems, avoiding rigid ex-ante regulation and allowing market mechanisms and corporate self-regulation to play leading roles.
Specific Manifestations:
- Establishing “AI regulatory sandbox” mechanisms to encourage innovative experimentation
- Promoting open-source AI ecosystem development
- Strengthening AI technology cooperation with democratic countries like the US, Japan, and Europe
Key Article Policy Interpretations
Articles 1-3: Basic Principles and Development Direction
Policy Philosophy: Establishing seven fundamental principles including “sustainable development, human autonomy, and privacy protection” to lay the value foundation for Taiwan’s AI development. In stark contrast to China’s emphasis on “security and controllability,” Taiwan chooses “human-centered values” as the foundation of AI governance.
Strategic Significance: This is not just technical regulation but a declaration of values. In global AI governance standard-setting, Taiwan aims to export democratic, free, and innovative values, becoming an important counterbalance to authoritarian AI models.
Articles 4-6: Competent Authorities and Governance Architecture
Why insist on NSTC leadership? The National Science and Technology Council (NSTC) controls national research budgets and talent resources, possessing a “development-centered” policy DNA. In comparison, the Ministry of Digital Affairs, as a third-level agency, has limited human resources and budget, leaning more toward regulatory orientation.
International Experience Comparison:
- Japanese Model: Establishing cabinet-level “AI Strategy Headquarters” directly led by the Prime Minister
- American Model: Setting up “AI and Cryptocurrency Special Advisors” for cross-departmental coordination
- Taiwan’s Choice: NSTC leadership, establishing “AI Strategy Special Committee” to ensure innovation orientation
Governance Philosophy: It’s not about avoiding regulation, but implementing “smart regulation.” Let professional agencies do professional work - NSTC responsible for innovation promotion, various competent authorities responsible for business regulation, forming a governance system that is both division-based and coordinated.
Article 15: Strategic Value of Data Openness with Pricing
This is the soul article of the entire bill. In the AI era, data is the new oil, and data sovereignty is an extension of national sovereignty.
Why is Data Openness So Important?
Cultural Sovereignty Protection: Currently, global large language models over-rely on Chinese simplified text data, leading to cultural invasion phenomena where “数字转型” replaces “數位轉型” and “人工智能” replaces “人工智慧.” Taiwan must establish an autonomous Traditional Chinese corpus to protect linguistic and cultural sovereignty.
Industrial Development Engine: Government-funded establishment of “Taiwan Sovereign AI Training Corpus,” similar to Australia’s media bargaining law mechanism, guiding international AI giants like Google and Meta to purchase data from Taiwan’s local media, creating new business models for Taiwan’s digital content industry.
International Competition Weapon: Open but priced data policy makes Taiwan play a key role in the global AI ecosystem. We are not just chip manufacturers but also providers of high-quality data.
Fundamental Differences from Chinese Model
China’s AI development relies on state data monopoly and algorithm censorship. Taiwan chooses an “open and priced” model, realizing data value through market mechanisms - this is the fundamental divergence between democratic vs. authoritarian systems in the AI field.
Articles 10-14: Industrial Development and Innovation Support
Local Industry Support Strategy:
- Promoting AI startup ecosystem development, targeting cultivation of 100 AI unicorns
- Establishing “computing power pool” sharing mechanisms so SMEs can enjoy AI development benefits
- Developing vertical domain AI applications, establishing Taiwan’s advantages in healthcare, finance, manufacturing, and other fields
Sovereign AI Implementation Path: TAIDE (Trustworthy AI Dialogue Engine) represents Taiwan’s autonomous capabilities in AI foundation models. Through bill protection, we aim to establish a complete sovereign AI ecosystem from chips to applications.
Articles 16-21: Risk Management and Social Protection
Urgency of AI Fraud Prevention: Taiwan experiences about 500 fraud cases daily, with AI technology making fraud methods more sophisticated. The bill establishes specialized AI fraud prevention mechanisms to protect people from deepfakes, intelligent phishing, and other new threats.
Digital Equity Realization: Ensuring rural areas, disabled individuals, economically disadvantaged groups, and indigenous peoples are not left behind by AI development. This is not social welfare policy but strategic consideration to ensure AI development benefits are shared by all.
International Comparison: Taiwan’s Differentiation Advantages
Alignment with U.S. AI Action Plan
The U.S. 2025 AI policy’s three pillars: accelerating AI innovation, building AI infrastructure, leading international AI diplomacy. Taiwan’s AI Basic Act corresponds in all three dimensions:
- Innovation Acceleration: NSTC leadership, reducing regulatory constraints
- Infrastructure Building: Investment in computing power pools, databases, and other infrastructure
- International Cooperation: Establishing AI technology alliances with democratic countries
Balance with Japan’s Soft Law Governance
Japan adopts “soft law governance” to avoid rigid regulation. Taiwan learns from this experience, establishing principled frameworks through basic law while specific implementation details are regulated by ministerial supporting regulations, maintaining policy flexibility.
Strategic Counter to Chinese Model
China’s July 2024 “Artificial Intelligence Global Governance Action Plan” emphasizes “multilateral cooperation and inclusive development,” appearing moderate on the surface but concealing control intentions. Taiwan chooses a truly open innovation model, demonstrating democratic institutions’ systemic advantages in AI governance through transparent governance, market competition, and international cooperation.
Necessity of Open Innovation Against Authoritarianism
New Battlefield of Institutional Competition
AI is not just technological competition but institutional competition. Authoritarian countries use AI technology for social control and value output; democratic countries must counter with superior AI governance models.
Taiwan’s Responsibility and Opportunity: As a key node in the democratic supply chain, Taiwan has both the obligation and capability to provide a “democratic paradigm” for global AI governance. Our successful experience will inspire more countries to choose open innovation paths.
Strategic Significance of Value Export
Through sovereign AI systems like TAIDE, Taiwan can export democratic, free, innovative, and inclusive values to the world. This is more effective than any diplomatic activity in enhancing Taiwan’s international influence.
Social Communication Focus: Why Support This Bill?
For Business Community: Innovation-Friendly Legal Environment
Reducing Compliance Costs: Adopting risk classification systems, avoiding “one-size-fits-all” regulation Providing Development Space: AI regulatory sandbox allows enterprises to innovate with confidence International Integration: Regulatory standards align with US, Japan, and Europe, facilitating enterprise expansion into international markets
For General Public: Sharing AI Benefits for All
Fraud Protection: Establishing comprehensive AI fraud prevention mechanisms Digital Equity: Ensuring AI development doesn’t widen digital gaps Cultural Protection: Maintaining the subjectivity of Traditional Chinese and Taiwan culture
For International Community: Responsible AI Power
Value Leadership: Demonstrating Taiwan’s democratic paradigm in AI governance Technical Contribution: Sharing Taiwan’s AI development experience and technological achievements Cooperation Partner: Becoming a reliable partner in international AI cooperation
Conclusion: A Critical Moment of Historical Choice
The formulation of Taiwan’s Artificial Intelligence Basic Act is not just the birth of technical regulations but Taiwan’s strategic positioning in the AI era. We choose innovation as the engine, openness as the driving force, and democratic values as guidance to forge a path belonging to Taiwan in the global AI race.
This is the opportunity window history has given Taiwan. When the world is observing whether democratic institutions can demonstrate superiority in AI governance, Taiwan’s success will prove that open innovation can not only defeat closed authoritarianism but also guide the correct direction for human AI development.
Let us jointly support this bill and make historic contributions to Taiwan’s AI future and the AI development of the democratic world.
References
- Future of Privacy Forum. (2024). Understanding Japan’s AI Promotion Act: An “Innovation-First” Blueprint for AI Regulation.
- The White House. (2025). White House Unveils America’s AI Action Plan.
- DIGITIMES. (2025). Taiwan announces ambition to ‘make waves’ with AI.
- National Science and Technology Council. (2024). AI Basic Act Draft Announcement: Promoting Innovation While Balancing Human Rights and Risks.
- Central News Agency. (2025). Wu Cheng-wen: AI Basic Act to be taken over by Ministry of Digital Affairs, NSTC to focus on research development.
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