TAIPEI (Taiwan News) — The legislature passed a six-year, NT$240 billion (US$7.3 billion) law Thursday covering unmanned vehicle development and procurement, adopting a KMT-backed framework instead of the Cabinet’s NT$210 billion special procurement proposal, per Economic Daily News.
The Legislative Yuan voted 60–50 to adopt the KMT caucus version of legislation titled the Act to Strengthen National Defense Self-Reliance and Promote the Development of the Unmanned Vehicle Industry. The measure is an ordinary law rather than a special procurement act and will take effect six months after promulgation, with certain details to be set by the Cabinet.
The Cabinet proposed its legislation in June after drones and unmanned boats were excluded from the NT$780 billion special defense procurement law passed in May. Its NT$210 billion proposal focused on gradually acquiring three categories of military systems through December 2031, according to the Cabinet. Thursday’s law retains those three categories.
The statute designates the Ministry of Economic Affairs as the lead agency, while the Ministry of National Defense will oversee military procurement. Procurement, research and development subsidies, imports of critical technologies, cybersecurity reviews, and test-range zoning will be coordinated with the relevant ministries.
Under the law, the central government will allocate funds through its annual budgets for six consecutive years, totaling NT$240 billion. Annual spending is set at NT$40 billion in principle, though the total and annual amounts may be increased as needed. Funding may come from ministry budgets or designated government funds.
The Cabinet will establish a National Unmanned Vehicle Industry Development Strategy Special Committee to coordinate and supervise national policy. The committee will meet at least twice a year and may convene emergency sessions in response to major events.
The committee will have 15 to 19 members, be chaired by the vice premier, and include the heads of relevant government agencies as well as experts recommended by the legislative caucuses.
The lead agency will coordinate with other ministries every four years on an unmanned vehicle industry development program, with reviews conducted every two years. The program must be reviewed by the committee and approved by the Cabinet before being submitted to the legislature for reference.
For military procurement, the defense ministry must acquire unmanned attack and reconnaissance systems suited to the different phases of a potential amphibious operation. The systems include the Cabinet-approved coastal surveillance drones, coastal attack drones, and small one-way attack unmanned boats, per CNA.
Organizations that use products posing national security risks may be disqualified from receiving subsidies, required to repay them, and fined one to three times the amount received. False applications may result in fines of NT$1 million to NT$5 million, while companies refusing inspections face fines of NT$500,000 to NT$3 million.
Drone manufacturers may apply for tax breaks, investment credits, deferred taxation, and other assistance available under existing industrial innovation, small-business, defense industry, and tax laws. Companies found to have committed violations within the previous three years will be excluded from tax incentives and required to repay benefits received.
