Taiwan is one of the places buyers go when they need an electronic product designed, built, or both. The commercial discussion usually centres on unit price and minimum order. The three questions that decide whether the product can still be built in three years’ time get less attention: who owns the design files, who decides when a component on the bill of materials is replaced, and whether the finished product needs a Taiwanese export permit before it can leave.
💬 Looking for a Taiwanese electronics manufacturer, or need the design-ownership and BOM terms set before you sign? We find, vet and manage the manufacturer that fits each project as part of sourcing from across Asia. Tell us what you are building. How we work there: our sourcing agent service for Taiwan.
Company checks, BSMI and the certificate of origin are covered in sourcing from Taiwan: a buyer’s step-by-step guide. This article starts where that one stops: the terms of the manufacturing relationship itself.
Decide first: your design, their design, or a shared one
The model you choose decides which files you hold at the end, so pick it deliberately — build-to-print (OEM/EMS), the factory’s own design under your brand (ODM), or a design developed together (often called JDM).
| Model | Who designs | Files the buyer usually holds | Ease of moving production later |
|---|---|---|---|
| Build-to-print (OEM / EMS) | The buyer | Everything: schematics, PCB layout, Gerbers, BOM, firmware source, test specs | High — the package can go to another manufacturer |
| ODM (factory platform, buyer’s brand) | The manufacturer | Often only the product specification and the finished-goods drawings | Low unless the contract releases the design |
| Joint development (JDM) | Both | Whatever the contract lists as deliverables | Depends entirely on the contract wording |
An ODM arrangement is not a weaker choice. It can bring a product to market without a full in-house engineering team. But the buyer is then buying the right to sell a product, not owning a design, unless the contract says otherwise. That is the trade, and it should be priced and negotiated as such.
Who owns the design if the contract says nothing
Under Taiwan’s Copyright Act and Patent Act, work done by a commissioned developer belongs to that developer unless the contract allocates it — the paying customer gets a right to use or exploit it, not ownership.
Two provisions matter here.
- Copyright Act, Article 12. For a work completed under commission, the commissioned party is the author unless the agreement names the commissioning party as author. The economic rights follow the agreement; if it is silent, they stay with the commissioned party, and the commissioning party may use the work. Firmware, software and design documents fall within this.
- Patent Act, Article 7(3). Where one party funds another to carry out research and development, the right to apply for a patent and the patent itself are allocated by contract; absent agreement, they belong to the inventor or designer, and the funding party may exploit the invention, utility model or design.
Checked against the Laws and Regulations Database of the Republic of China (Taiwan) on 17 October 2026. This is a summary of the statutory default, not legal advice — a Taiwanese lawyer should review the contract for a significant programme.
In practice, put a deliverables list in the contract and state the ownership of each item:
- Schematics, PCB layout files and Gerbers.
- The full BOM with manufacturer part numbers, not only internal codes.
- Firmware source code and the build environment, or a source-code escrow arrangement.
- Test specifications, test programs and test fixture drawings.
- Mechanical drawings and the 3D data for enclosures and tooling.
Then add what happens on termination: which files are released, in what format, and whether tooling paid for by the buyer is shipped or held. Without that clause, the buyer of an ODM product who wants a second source starts from zero.
The bill of materials: approved parts, alternates and end-of-life
Agree in writing that no component on the BOM is substituted without your approval, that the manufacturer notifies you of end-of-life and change notices from its suppliers, and that last-time-buy decisions are yours.
Electronic components go end-of-life, change die revision, or go on allocation. A manufacturer that needs to keep a line running will look for an alternate. That is reasonable, but an alternate that is “pin-compatible” may still differ in temperature range, tolerance, firmware behaviour or certification status, and a substitution can invalidate a safety or radio approval already granted in your market.
| Term | What to write into the agreement |
|---|---|
| Approved vendor list (AVL) | Each BOM line lists the approved manufacturer part numbers; anything else needs written approval |
| Alternate approval | The manufacturer submits the alternate with datasheet comparison and, where relevant, a sample build for your test |
| Change and EOL notices | The manufacturer forwards supplier product change notices and end-of-life notices promptly |
| Last-time buy | The buyer decides whether to buy remaining stock or redesign; who holds and pays for that stock is agreed in advance |
| Firmware version | The firmware version is part of the product revision and cannot change without a revision update |
💬 Need a BOM control clause or an alternate-approval process that a Taiwanese manufacturer will actually follow? Send us your BOM and the product spec.
Export control: when Taiwan’s SHTC rules apply
A product, part, software or technology needs a Taiwanese export permit if it meets a specification on the strategic high-tech commodities (SHTC) control list, or if the end use or end user could be military — for every destination, regardless of HS code.
Taiwan regulates these exports under the Regulations Governing the Export and Import of Strategic High-tech Commodities, issued under Article 13 of the Foreign Trade Act and last amended on 31 October 2023. The International Trade Administration of the Ministry of Economic Affairs explains on its own guidance page that an item is SHTC when, for any destination, it meets the specifications in the dual-use and military goods lists — the HS code does not decide it — or when its end use or end user may involve military use. Separate rules apply to Russia and Belarus (a high-tech goods list), to Iran (a sensitive goods list), and Taiwan has banned all trade with North Korea.
What the regulations require of the exporter:
| Provision | What it says |
|---|---|
| Article 15(1) | The exporter applies for an export permit before shipment; a permit is valid for six months, or two years in the cases the article lists |
| Article 15(2) | For shipments to the United States or Japan, the authority may waive the permit where the FOB value of the same controlled item is below NT$300,000, or the exporter has an approved internal compliance programme — and only if the exporter has checked that the foreign party is not on Taiwan’s SHTC entity list |
| Article 15-1 | An exporter with an approved internal compliance programme can hold a three-year permit covering multiple countries and buyers |
| Article 16 | The application needs an International Import Certificate, a certificate of end use or a written assurance of end use, plus the transaction documents; end use and end user must be truthfully stated |
Checked against the published text of the Regulations and the International Trade Administration’s SHTC guidance on 17 October 2026. The control list itself is updated from time to time, so confirm the current version before relying on any classification.
For the buyer, this means three things. The manufacturer may ask you for an end-use statement or, for some destinations, an import certificate issued by your own government. Your company and your customer will be checked against the entity list. And the classification belongs in the specification stage, not the shipping stage: a product with a controlled module adds a permit step to every shipment. The test is the specification, not the product category, so ask the manufacturer to confirm classification in writing.
Quality terms that belong in the contract
Name the workmanship standard and class, the tests performed on every unit, and a signed golden sample, so that “good” means the same thing on both sides.
- Workmanship standard: IPC-A-610 for assemblies, with the class (1, 2 or 3) stated. Class decides acceptance criteria for solder joints and placement.
- Testing: which units get in-circuit test, functional test or burn-in, and who owns the test program and fixture.
- Golden sample: a signed reference unit held by both sides at each revision. For how to record approvals, see sample approval stages — the method applies here too.
- Traceability: serial numbers or lot codes linked to the BOM revision and firmware version.
Certification in your own market — for example Japan’s PSE mark, covered in Japan PSE mark for imported electrical products — is the importer’s responsibility in that market. Keep the test reports and the BOM revision they were issued against, because an unapproved substitution can break that link.
A working sequence
Choose the model, write the deliverables and BOM terms, confirm the export classification, then build pilot units — before the volume order.
- Choose OEM, ODM or joint development and price the design ownership you need.
- Shortlist and check manufacturers — see finding factories in ASEAN and Taiwan.
- Write the deliverables list, ownership and termination terms.
- Agree AVL, alternate approval, change notices and last-time buy.
- Get the SHTC classification in writing and prepare the end-use documents if needed.
- Run a pilot build against a golden sample — see prototyping and low-volume manufacturing in Taiwan.
- Build the landed cost with the ordinary duty rate — Taiwan has no preferential agreement with Vietnam; see comparing Asian suppliers on landed cost.
For machined enclosures and mechanical parts, the drawing and inspection points are in outsourcing precision machining to Taiwan.
💬 Want the design-ownership terms, BOM control and export classification sorted before the first pilot build in Taiwan? Talk to us about your project.
Frequently asked questions
1. If I pay a Taiwanese ODM to develop my product, do I own the design?
Not automatically. Under Taiwan’s Copyright Act and Patent Act, commissioned work belongs to the developer unless the contract allocates it; the paying party gets a right to use or exploit it. Write ownership into the contract item by item.
2. What files should I insist on receiving from an electronics manufacturer?
Schematics, PCB layout and Gerbers, the full BOM with manufacturer part numbers, firmware source or an escrow arrangement, test specifications and programs, and mechanical data. List them as contract deliverables.
3. Can the manufacturer swap a component on my BOM without telling me?
Only if your contract allows it. Agree an approved vendor list and require written approval for any alternate, because a substitution can affect performance and existing certifications.
4. Does my electronic product need a Taiwanese export permit?
Only if it meets a specification on Taiwan’s SHTC control list, or the end use or end user could be military. Ask the manufacturer to confirm the classification in writing at the specification stage.
5. Is there a simpler route for shipments to Japan or the United States?
Article 15(2) lets the authority waive the permit for those two destinations where the FOB value of the same controlled item is below NT$300,000, or the exporter has an approved internal compliance programme, provided the foreign party is not on Taiwan’s SHTC entity list.
Sources: Laws and Regulations Database of the Republic of China (Taiwan), Copyright Act (Article 12), Patent Act (Article 7), Regulations Governing the Export and Import of Strategic High-tech Commodities (Articles 15, 15-1 and 16; last amended 31 October 2023); International Trade Administration, Ministry of Economic Affairs, “What is a strategic high-tech commodity (SHTC)” guidance on trade.gov.tw. Checked on 17 October 2026.