BUSINESS MERGERS AND ACQUISITIONS ACT Article 45

If as a result of carrying on the merger/consolidation, division or the acquisition as provided in Articles 27 through 30 of this Act, the shares or contributed capital of the subsidiary company held by the company reaches ninety percent or more of the total number of issued shares or subscribed capital, the company may be elected as the tax payer since the fiscal year having survived twelve months of a given taxable year during the term of such holding to declare a combined final business income tax as provided in the Income Tax Act, and declare the undistributed earnings with an additional ten percent of business income tax; any other tax related matters shall be carried out separately by the company and its subsidiary company.Companies electing to file a combined final business income tax return according to the preceding paragraph shall bring into all qualified domestic subsidiary companies. It is not required to secure a prior admission before such combination choice is made; however, once the choice of combination is made, unless there is due cause and approved by the Ministry of Finance two months before the end of the fiscal year, no change is permitted.Within five years after the shift is permitted under the preceding paragraph, the company is not allowed to opt for combination filing. When the holding of shares or subscribed capital drops below the standard prescribed in Paragraph 1 of this Article, the subsidiary company shall file a separate business income tax return and since then, the subsidiary company has not been permitted to be brought into the combined business income tax return for five consecutive years.Companies file combined business income tax return according to Paragraph 1 of this Article, the calculation of the combined business income and the tax payable, of the undistributed earnings under the combination and the additional tax, the deduction of the business loss, the application of investment encouragement deduction, the deduction of foreign tax payment, the arrangement of shareholders' deductible tax account, the filing of temporary payment and other rules are prescribed by the Ministry of Finance.