Taiwan's Artificial Intelligence Basic Act: Key Takeaways for Legal Teams
Taiwan has passed the Artificial Intelligence Basic Act, setting out national principles for AI governance and naming the National Science and Technology Council (NSTC) as the competent authority. The law prioritizes social welfare, digital equity, innovation, and national competitiveness, while pushing the government to promote AI research and applications.
The act is principle-based and high level. It signals government direction and funding, but leaves enforcement mechanics to future rulemaking.
Regulatory Authority and Politics
The NSTC is designated as the governing authority for AI. This provision was backed by KMT and TPP lawmakers and opposed by DPP lawmakers, who argued basic laws typically don't specify an authority.
Expect the NSTC to lead on definitions, risk classifications, and compliance procedures once secondary regulations are drafted.
Seven Core Principles You'll Need to Operationalize
- Sustainability and well-being
- Human autonomy
- Privacy and data governance
- Cybersecurity and safety
- Transparency and explainability
- Fairness and non-discrimination
- Accountability
These principles will shape policy, procurement, and audits. Start mapping your controls to each now, even before detailed rules arrive.
Risk and Prohibited Outcomes
AI applications must not harm life, freedom, or property, nor undermine social order, national security, or the environment. The act also flags bias, discrimination, false advertising, misinformation, and fabrication as unacceptable uses or outcomes.
This sets a baseline for legal review thresholds and incident response triggers.
National Governance Structure
The Executive Yuan must establish a national AI strategy committee chaired by the premier. Members include academics, industry representatives, agency heads, and local leaders.
The committee must meet at least once a year. The NSTC handles administrative support.
Funding, Support, and Labor Protections
- Government funding within fiscal capacity for AI research, applications, and infrastructure
- Assistance and subsidies for AI development, training, testing, and validation
- Data openness paired with personal data protection measures
- Risk-based AI management aligned with international standards
- Labor safeguards, including retraining and employment assistance for workers displaced by AI
Legal and compliance teams should track grant programs, procurement requirements, and any conditions tied to subsidies.
What's Missing (For Now)
The act does not lay out enforcement mechanisms, penalties, or detailed compliance procedures. Those will likely come via NSTC-led regulations and cross-ministry guidance.
Plan for a staged rollout: principles now, implementing measures later. Keep your governance flexible.
Action List for In-House Counsel and Compliance
- Inventory AI systems and use cases (internal and vendor-supplied). Classify risks consistent with the act's prohibited outcomes.
- Map policies to the seven principles. Assign owners for privacy, security, fairness, transparency, and accountability.
- Stand up an AI governance forum that can interact with government consultations and the national committee's output.
- Strengthen data governance: lawful basis, minimization, retention, de-identification, and vendor data controls.
- Implement bias testing and document model evaluation, limits, and monitoring plans.
- Draft transparency artifacts: model cards, user notices, acceptable use, and marketing review to avoid false claims.
- Tighten vendor management: contract clauses for audit rights, incident reporting, model updates, and indemnities tied to the act's principles.
- Coordinate with HR on labor impacts, retraining pathways, and change management plans.
- Build an issues log and incident response playbook for misinformation, security events, or material model failures.
- Monitor NSTC rulemaking and Executive Yuan committee guidelines; prepare to adapt controls as standards land.
Aligning With International Standards
The act calls for risk-based management that follows international standards. If you need a starting point for controls and documentation, these frameworks are widely referenced:
What to Watch Next
- NSTC consultations on definitions, risk tiers, conformity assessments, and reporting duties
- Committee-issued development guidelines and sector-specific recommendations
- Procurement standards that bake the seven principles into contracts and audits
Prepare briefing notes for the board and product leaders. Early alignment is cheaper than late remediation.
Optional Upskilling
If your legal team needs structured training on AI governance and compliance, see curated options by job role at Complete AI Training.
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