# Equity research in Japan, Korea and Taiwan: what changes from the US

> In Japan, Korea and Taiwan the fiscal calendar, the units, the takeover rules and the taxes a fund pays all differ from the US, often in ways that raise no error. What changes, and how Matterfact's agent keeps each market's rules current.

Japan, Korea and Taiwan list about 8,400 domestic companies worth about $14.7 trillion: more than twice as many companies as the NYSE and Nasdaq combined, at about a fifth of their value. In the year to January 2026, Korea's market more than doubled in dollar terms and Taiwan's grew by 44%. For a fund covering them with AI, the question is whether its agent knows these markets' rules or brings US ones.

Most of those rules raise no error when they are applied wrongly. Toyota's fiscal 2025 is Sony's fiscal 2024. Samsung's stock moves on results it publishes a week after the quarter ends, weeks before its full report. Taiwanese statements are in thousands of NT dollars. And the rules that cost money moved in 2026: Korea raised its trading tax by a third in January, and Japan cut its tender-offer trigger from one-third to 30% in May. A model trained before those changes quotes the old rules, and nothing in the spreadsheet flags them.

Matterfact's agent works from a written rulebook for each market: more than 40 rules and rates across Japan, Korea and Taiwan, each dated and checked against current sources, which every analysis loads before it builds a model.

## TL;DR

- **The same fiscal-year label can mean two different years, and the stock often moves before the quarterly report.** Toyota's fiscal 2025 is Sony's fiscal 2024; Samsung's early results come a week after quarter-end; Taiwan reports revenue every month.
- **Units differ by up to 10,000 times.** Taiwanese statements are in thousands of NT dollars, and press in Japan and Korea counts in 億 (100 million) and 兆 (1 trillion).
- **Takeover and trading rules decide what an event-driven thesis can assume.** Japan's tender-offer trigger fell to 30% and now covers on-market buying, Taiwan's is 20% within 50 days, and Korea has none; daily price limits run from ±10% in Taiwan to ±30% in Korea.
- **For a tax-exempt US investor, dividend withholding more than doubles across the three markets.** 10% in Japan, 16.5% in Korea and 21% in Taiwan; Korea's trading tax rose by a third in 2026, and Japan has none.
- **Control runs through cross-shareholdings, family groups and founders.** Each produces kinds of company that are valued differently from their nearest US peers.

## Reporting: the same label can mean two years, and the stock moves on a different release

Most large Japanese companies close their year on March 31, so their first quarter runs from April to June. Some name the year after the calendar year in which it ends, others after the year in which it starts, and the largest companies in the market use both (Exhibit 1).

Exhibit 1\
**Toyota and Sony give the same twelve months different names, and Samsung and TSMC split them across two fiscal years.**

| | Year ends | What it calls April 2024 to March 2025 | Its first quarter |
|---|---|---|---|
| Toyota | March | Fiscal 2025 | April to June |
| Sony | March | Fiscal 2024 | April to June |
| Samsung Electronics | December | Q2–Q4 of fiscal 2024 and Q1 of fiscal 2025 | January to March |
| TSMC | December | Q2–Q4 of fiscal 2024 and Q1 of fiscal 2025 | January to March |

*Note: Most large US companies also close their year in December.*\
*Source: Company results releases; Matterfact Japan, Korea and Taiwan references*

A "second quarter against second quarter" comparison between a Japanese company and a Korean or Taiwanese peer sets July to September against April to June. Comparing each company's latest full year can put periods nine months apart: Toyota's year to March 2025 against TSMC's year to December 2025. The agent never uses a bare label. Every column carries its period-end month, as in "Q1 FY3/27 = Apr–Jun 2026", and a peer set is put on one calendar before any comparison is made.

The market also reacts to a different release. In the US the stock moves on the quarterly report, scored against consensus. Each of the three markets moves that event somewhere else, and keeps its filings in its own system rather than on EDGAR (Exhibit 2).

Exhibit 2\
**Taiwan reports revenue 12 times a year, and some of Korea's largest companies report a week after the quarter ends.**

| | United States | Japan | Korea | Taiwan |
|---|---|---|---|---|
| Where results are filed | EDGAR | EDINET (statutory) and TDnet (exchange disclosure) | DART | MOPS |
| The quarterly report | The 10-Q and an earnings release | The kessan tanshin, unaudited, within 45 days; statutory first- and third-quarter reports ended in April 2024 | A quarterly report within 45 days | A quarterly report within 45 days |
| An earlier release | None required | None | Revenue and operating profit about a week after quarter-end, at some of the largest companies | Revenue for every month, by the 10th of the next |
| What the quarter is judged against | Consensus, shaped by guidance on the call | The company's own full-year forecast in the tanshin, revised once expected results move past set thresholds | Consensus, at the early release where there is one | Revenue the monthly reports have already shown; the largest exporters also guide in US dollars at a stated exchange rate |

*Source: Exchange and regulator rules; Matterfact Japan, Korea and Taiwan references, September 2026*

- **In Japan, the company's own forecast is the bar, and it usually starts low.** First forecasts are habitually conservative and raised during the year, so a cautious first forecast is not, on its own, a sign of slowing.
- **In Korea, two releases make one quarter.** Samsung Electronics and LG Electronics publish revenue and operating profit about a week after the quarter ends, and full results weeks later; SK Hynix publishes only full results, about four weeks after quarter-end. The first release is the event, and counting the second as another data point double-counts the quarter.
- **In Taiwan, revenue is known every month.** By the time quarterly results arrive, most of the revenue surprise is already known, but the monthly figure says nothing about margins. Lunar New Year moves between late January and mid-February, so January and February have to be read together.

## Units differ by up to 10,000 times, and a wrong one can still look plausible

Japanese statements are in millions of yen, Korean in millions of won and Taiwanese in thousands of New Taiwan dollars, while press and broker notes in Japan and Korea count in 億 (100 million) and 兆 (1 trillion). The won trades at well over a thousand to the dollar, so a figure off by a factor of a thousand can still look reasonable (Exhibit 3).

Exhibit 3\
**Five places where a US default goes wrong in Japan, Korea and Taiwan.**

| A US default assumes | What the agent applies in Japan, Korea and Taiwan | Where it is filed |
| --- | --- | --- |
| Every source for a company uses the same unit, usually millions | **Taiwan.** Statements on MOPS are in thousands of NT dollars. When a data feed or an extracted table drops the unit, every line is off by a factor of a thousand. | Financial statements on MOPS and the data feeds built from them |
| Headlines and filings count in the same units | **Japan and Korea.** Filings count in millions; headlines and broker notes in 億 (100 million) and 兆 (1 trillion). Mixing the two is an error of 100 or 10,000 times. | Statutory filings against press and broker notes |
| A beat against guidance is an operating beat | **Japan.** Every forecast embeds a dollar-yen assumption. A beat printed at a weaker yen than assumed is currency, and is scored as such. | The exchange rate stated with the tanshin forecast |
| Guidance and results are in the same currency | **Taiwan.** The largest exporters guide in US dollars at a stated exchange rate and report in NT dollars. Guidance is scored at the guided rate, or a currency move manufactures a miss. | The company's guidance release |
| Market value is the share price times the shares of the listed line | **Korea.** Non-voting preference shares trade as a separate listing, as at Samsung Electronics (005935 against the common 005930). Market value adds both lines. | Both listings on the Korea Exchange |

*Source: Matterfact Japan, Korea and Taiwan references and cross-border normalizer, September 2026*

## Takeover and trading rules decide what an event-driven thesis can assume

The three markets set takeover, ownership and trading rules differently, and two of them changed in the past two years (Exhibit 4).

Exhibit 4\
**Japan's tender-offer trigger is 30%, Taiwan's is the pace of buying and Korea has none.**

| | Japan | Korea | Taiwan |
|---|---|---|---|
| Mandatory tender offer | Above 30% of the votes, bought on or off the market, since May 1, 2026; before, above one-third and off-market only | None; a bill to reinstate one is before the National Assembly | Buying 20% or more within 50 days |
| Limits on foreign owners | Prior notice from 1% in designated sectors such as defence and semiconductors | Caps such as 49% in telecoms, 40% at KEPCO and 30% at KOGAS | Caps such as 49% direct and 60% in all in telecoms, and below 50% in airlines |
| Short selling | Permitted | Banned from November 2023 to March 2025; disclosure from 0.01% of shares (and ₩100m) or ₩1bn | Permitted for registered foreign investors |
| Daily price limit | Fixed yen bands by price tier, widened after two days at the limit | ±30% | ±10% |

*Source: National securities laws and exchange rules; Matterfact Japan, Korea and Taiwan references, re-checked October 2026*[^rates]

**Japan's trigger fell to 30% and now covers the market.** Since May 1, 2026, a buyer whose stake would pass 30% of the votes must make a tender offer, whether it buys on or off the exchange. A thesis built on a creeping stake-builder has to be re-run under the new rule. Any stake of 5% must also be reported within five business days, with each later 1% change, and foreign buyers in designated sectors must notify the government before crossing 1%, down from 10% before 2020.

**Korea has no mandatory bid, for now.** A controlling stake can change hands at a premium with no offer to minority shareholders, so a Korean buyout thesis cannot borrow the logic of Japan, Taiwan or the UK. That may change: Korea abolished its mandatory bid in 1998, and a bill to bring it back cleared committee in the National Assembly in September 2026 but has not become law. What has changed is the duty owed: since July 2025, Korean directors owe loyalty to shareholders as well as to the company.

**Taiwan's trigger is the pace of buying.** Acquiring 20% or more of a company within 50 days requires a tender offer, so the timing of a stake-build matters as much as its size.

**Check the dates on any Korean short.** Short selling was banned from November 2023 until the end of March 2025, as it had been in 2008, 2011 and 2020–21. A backtest that runs across those windows mixes two regimes, and a short thesis has to check the calendar before it assumes a borrow.

**A close at the limit hides unfilled orders.** A stock that closes at Korea's ±30% or Taiwan's ±10% limit traded there, but buyers or sellers were left unfilled, so the close understates where the stock would have cleared. A return series or a stop built on that close has to look at the next day's open.

## For a tax-exempt US investor, dividend withholding more than doubles across the three markets

Withholding tax comes off every dividend before it reaches the fund. A taxable US investor can usually credit most of it against US tax; a pension, an endowment or another tax-exempt investor cannot, and keeps only what is left. Across the three markets, withholding takes between 10% and 21% of a dividend paid to a US investor, and the trading tax runs from nothing in Japan to 0.3% of every sale in Taiwan (Exhibit 5).

Exhibit 5\
**A US investor gives up 10% of a Japanese dividend, 16.5% of a Korean one and 21% of a Taiwanese one.**

**Dividend withholding tax on a US investor, %**
With the US tax treaty, and without one, as of October 31, 2026

| Category | With the US treaty | Without a treaty |
| --- | --- | --- |
| Japan | 10.0% | 15.3% |
| Korea | 16.5% | 22.0% |
| Taiwan | 21.0% | 21.0% |

*Note: Japan's rate without a treaty is 15.315%, shown rounded. Taiwan has no tax treaty with the US, so both bars are 21%.*\
*Source: National tax rules and the US treaties with Japan and Korea, checked October 31, 2026*[^rates]

**Korea's treaty rate is 16.5%, not the 15% the treaty states.** Korea adds its local income tax, 10% of the tax withheld, on top of the 15% treaty rate. A model quoting the treaty's headline understates the tax by a tenth.

**Taiwan has no tax treaty with the US.** A US pension fund or retirement account pays the full 21%, where in a treaty market it would often pay less. Relief legislation passed the House in January 2025 and has not become law.

**Korea's trading tax rose by a third in 2026, after years of cuts.** The rate had been reduced year by year, and a model that learned the trend will extend it. From January 2026 it rose from 0.15% to 0.20% on both KOSPI and KOSDAQ. Korea and Taiwan both tax the seller, so a short sale pays on the opening trade rather than on the cover.

The differences compound. On a 3% dividend yield, a tax-exempt US investor keeps 2.70% in Japan, 2.51% in Korea and 2.37% in Taiwan. At 400% annual turnover, trading tax costs nothing in Japan, 0.80% of the portfolio's value a year in Korea and 1.20% in Taiwan (Exhibit 6).

Exhibit 6\
**On the same gross numbers, a tax-exempt US investor keeps the most in Japan and pays the most to trade in Taiwan.**

| | Japan | Korea | Taiwan |
|---|---|---|---|
| What a tax-exempt US investor keeps of a 3% dividend yield | 2.70% | 2.51% | 2.37% |
| Tax on selling listed shares | None since 1999 | 0.20% on KOSPI and KOSDAQ from January 2026, up from 0.15%; paid by the seller | 0.3%, paid by the seller |
| Trading tax at 400% annual turnover | None | 0.80% of the portfolio's value a year | 1.20% of the portfolio's value a year |

*Note: Rates as of October 31, 2026. On KOSPI, the 0.20% is a 0.05% transaction tax plus a 0.15% rural development tax. The 3% yield and 400% turnover are illustrations, not averages. A taxable US investor can usually credit the withholding against US tax. Tax rates change with each year's legislation; confirm with a tax adviser before relying on them.*\
*Source: National tax rules; Matterfact analysis*

## Control runs through structures the US does not have

- **In Japan, voting float is smaller than economic float.** Cross-shareholdings among business partners, parent companies with listed subsidiaries and long-term stable holders mean much of the vote sits with friendly owners who rarely sell. The annual securities report lists each company's 60 largest strategic holdings, so the unwinding of cross-shareholdings can be tracked year by year. Since March 2023 the Tokyo Stock Exchange has asked listed companies, especially those trading below book value, to show how they will earn their cost of capital, and since January 2024 it has published which have responded.
- **In Japan, large net cash is normal.** Decades of retained earnings leave many companies with an enterprise value far below their market value, so a very low EV multiple needs a look at the cash line before anyone flags it as a data error.
- **In Korea, families control groups through holding companies.** Founding families hold small direct stakes and control through a listed holding company and cross-holdings among affiliates. A bear case that assumes the family will sell control rarely holds, and holding companies trade at deep, persistent discounts to the value of what they own. Korea's Corporate Value-up Program, launched in 2024, asks listed companies to publish plans to raise shareholder returns, and is aimed squarely at that discount.
- **In Taiwan, control rarely changes.** Founder-led boards, state stakes in strategic companies and little activism keep control where it is, and a stock at its foreign-ownership cap can trade apart from foreign demand.

These structures produce kinds of company that are valued differently from their nearest US peers (Exhibit 7).

Exhibit 7\
**Six common kinds of company in these markets, and how each is valued.**

| Kind of company | Examples | How the analysis differs |
|---|---|---|
| Japanese general trading house (sogo shosha) | Mitsubishi Corporation, Itochu, Mitsui & Co. | Valued on segment net profit, much of it from equity-method stakes, split into resource and non-resource businesses; P/E rather than EV/EBITDA |
| Japanese private railway group | Tokyu, Hankyu Hanshin | A sum of the parts: a railway on regulated fares plus the property, retail and hotels along its lines |
| Japanese REIT | Nippon Building Fund, Japan Real Estate | Distributions per unit, net asset value and leverage rather than US-style FFO; the US treaty rate applies only under holder-size conditions |
| Korean chaebol holding company | LG Corp., SK Inc. | Net asset value of its listed stakes, less a discount read from the company's own history |
| Korean preference share line | Samsung Electronics preferred | A separate non-voting listing; the spread to the common shares is a governance and liquidity signal |
| Taiwanese financial holding company | Fubon, Cathay | A sum of the parts by subsidiary, with dividends limited by the insurer's capital |

*Source: Matterfact Japan, Korea and Taiwan references, September 2026*

## Each market's rules live in one place, with the date they were checked

A general model is unlikely to apply these rules unprompted, and several of them change every year: Korea's trading tax and Japan's takeover trigger both changed in 2026. A model trained before a change quotes the old rule with confidence. When Claude drafted these rules for us, it gave Korea's treaty withholding as 15% rather than 16.5%, had Korea's trading tax falling rather than rising, and described Japan's 30% rule as pending when it was already in force. A second review caught others, such as a Japanese rule requiring daily disclosure of share buybacks (Japan requires monthly reports) and the wrong fiscal year-end for Lasertec, which closes its year in June. Each was corrected against current sources before it shipped.

The agent is built so that errors like these do not reach a model:

- **One rulebook per market holds every rule and rate.** Japan has its own. Korea and Taiwan share one, because both close in December, report quarterly and use near-IFRS accounting, so they compare cleanly with each other and badly with March-year Japan. Between them the rulebooks hold more than 40 rules and rates, each dated, and every analysis cites them rather than restating them.
- **Every industry analysis checks the calendar and the currency.** Each of the agent's 104 industry analyses, from banks to semiconductors, checks the fiscal calendar and the currency for these markets, or records why the check does not apply, as for US hospitals.
- **The agent reads the market from the ticker.** The suffix .T is Tokyo; .KS and .KQ are Korea's two boards; .TW and .TWO are Taiwan's. It loads the right rulebook, and recognises a trading house, a chaebol holding company or a Taiwanese foundry and values it accordingly.
- **Automated checks block stale rates.** Before any change ships, checks fail any analysis that copies a rate the rulebook owns, or that skips its market checks.

The rules will keep moving: Korea's tax law changes with each year's budget, its mandatory bid may return, and Japan's takeover rule changed in May. Because each rate lives in one dated place, a change is one edit, and every model the agent builds picks it up on its next run.

## What to ask of any agent that covers Japan, Korea and Taiwan

Research heads and technology leads can test any agent with five questions:

1. **Which year is "fiscal 2025", and which release is the event?** Does every column carry its period-end month?
2. **What unit is the source in?** Thousands of NT dollars, millions of yen or won, or 億?
3. **Which takeover and trading rules did it apply?** Japan's 30% trigger, Taiwan's 20% in 50 days, Korea's lack of any mandatory bid, and the short-selling calendar.
4. **Which tax rates did it assume, for which investor, and as of what date?** Korea's 16.5%, not 15%; Taiwan's 21% with no treaty relief; Korea's 2026 trading tax.
5. **What kind of company is it?** A trading house, a chaebol holding company or a preference line each needs its own approach.

An agent that cannot answer these is applying US rules to Asian companies and hoping they hold. Matterfact's agent applies each market's own rules alongside the [industry-specific models](/blog/industry-specific-financial-models) it builds for every company.

## FAQ

**What dividend withholding tax does a US investor pay in Japan, Korea and Taiwan?**

As of October 2026: 10% in Japan under the US treaty, against 15.315% without one; 16.5% in Korea, the 15% treaty rate plus Korea's local income tax, against 22% without a treaty; and 21% in Taiwan, which has no tax treaty with the US. A taxable US investor can usually credit the withholding against US tax; a tax-exempt investor cannot. Confirm with a tax adviser before relying on these rates.

**What is the mandatory tender offer threshold in Japan, Korea and Taiwan?**

In Japan, a buyer whose stake would pass 30% of the votes must make a tender offer, whether it buys on or off the market, since May 1, 2026; the trigger was previously one-third and covered only off-market purchases. In Taiwan, acquiring 20% or more of a company within 50 days requires a tender offer. Korea has no mandatory bid rule; a bill to reinstate one cleared committee in the National Assembly in September 2026 but has not become law.

**Do Korea and Taiwan tax share trades?**

Yes, on the sale. Korea's rate on KOSPI and KOSDAQ rose from 0.15% to 0.20% in January 2026; Taiwan's is 0.3%. Japan has had no tax on listed share trades since 1999. Because the seller pays, a short sale pays the tax when it is opened.

**Why do Japanese companies label the same fiscal year differently?**

Most large Japanese companies close their year on March 31, and two naming conventions coexist: some name the year after the calendar year in which it ends, others after the year in which it starts. Toyota calls the year ended March 2025 fiscal 2025, and Sony calls the same year fiscal 2024. Always anchor to the period-end month, written as FY3/25 or "FYE Mar-2025".

**When do Taiwanese companies report revenue?**

Every month. Companies listed on the Taiwan Stock Exchange and the Taipei Exchange report the previous month's revenue by the 10th of the following month on MOPS, Taiwan's filing system. The figure is revenue only, with no margin information.

[^rates]: Checked on October 31, 2026. Market size and listings, January 2026: [World Federation of Exchanges, market statistics](https://focus.world-exchanges.org/issue/march-2026/market-statistics) (Japan Exchange Group, Korea Exchange, Taiwan Stock Exchange and Taipei Exchange against the NYSE and Nasdaq). Korea's transaction tax: [EY Global Tax News, "Korea enacts 2026 tax reform bill"](https://globaltaxnews.ey.com/news/2026-0126-korea-enacts-2026-tax-reform-bill), January 2026. Korea's local income tax on treaty dividends: [Ansenext, Korean withholding tax on dividends](https://international.ansenext.com/insights/korea-withholding-tax-dividends-interest-royalties-treaty-rates/). Japan's tender-offer rule: [law.asia, Japan M&A market trends 2026](https://law.asia/japan-mergers-acquisitions-market-trends-2026/). Taiwan's tender-offer rule: [Baker McKenzie, Global Public M&A Guide: Taiwan](https://resourcehub.bakermckenzie.com/en/resources/global-public-ma-guide/asia-pacific/taiwan/topics/effecting-a-takeover). Korea's mandatory bid bill: [Kim & Chang, recent developments in corporate governance regulations](https://www.legal500.com/firms/30184-kim-chang/c-south-korea/news-and-developments/legislative-insights-recent-developments-in-corporate-governance-regulations-to-enhance-shareholder-oriented-corporate-governance) and [Cheongchul, committee passage of the Capital Markets Act amendment](https://cheongchul.com/en/blog/%EC%9D%98%EB%AC%B4%EA%B3%B5%EA%B0%9C%EB%A7%A4%EC%88%98%EC%A0%9C-%EB%B6%80%ED%99%9C-%EC%9E%90%EB%B3%B8%EC%8B%9C%EC%9E%A5%EB%B2%95-%EA%B0%9C%EC%A0%95%EC%95%88-%EA%B5%AD%ED%9A%8C-%EC%A0%95%EB%AC%B4%EC%9C%84-%ED%86%B5%EA%B3%BC), September 2026. The US–Taiwan double-tax relief bill passed the House in January 2025 and has not become law: [H.R. 33, 119th Congress](https://www.congress.gov/bill/119th-congress/house-bill/33/text).

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