September 11, 2009—Former President Chen Shui-bian was given a life sentence on corruption charges. 96-8 ), remains rooted in a general notion of maintaining the "status quo" as it existed when the TRA was enacted. Complex political changes have occurred in both Taiwan and the PRC. U.S. unofficial relations with Taiwan since then have been built on the framework of the 1979 Taiwan Relations Act ( P.L. 96-8 ) and further shaped by three U.S.-China communiqués. Absent formal diplomatic relations, the United States continues to maintain substantial economic and security relationships with Taiwan, including the sale of defensive military weapons and services. Other CRS reports provide more details about the myriad historical complexities of Taiwan's current situation in U.S. policy, such as: historical background about how the ROC on Taiwan went from a U.S. ally to a government with no diplomatic U.S. relations, including the fundamentals governing U.S. policy toward Taiwan today (CRS Report RS22388, Taiwan's Political Status: Historical Background and Its Implications for U.S. Policy ); the increase in U.S.-Taiwan tensions under the former administration of President Chen Shui-bian (CRS Report RL33684, Underlying Strains in Taiwan-U.S. Fundamentals of U.S. Policy

The fundamental framework of U.S. policy toward Taiwan was laid down decades ago, beginning with the Nixon opening to the People's Republic of China (PRC) in 1971 that resulted in the severing of official relations with the government on Taiwan in 1979. the Communiqué on Normalization of Relations with the PRC (1979), in which the United States recognized the PRC government as the sole legitimate government of all China and "acknowledge[d] the Chinese position that there is but one China and Taiwan is part of China", and
the August 17 Communiqué on Arms Sales to Taiwan (1982), in which the United States stated it had no intention of pursuing a "two-China" policy; that it appreciated China's pledges to strive for a peaceful solution to the Taiwan question; and that it did not plan on a long-term policy of arms sales to Taiwan. Under Taiwan's new KMT government, then, the United States faces new challenges concerning the popularity of the elected government, the implications of closer and more cordial ties between Taiwan and the PRC for U.S. interests, and what role, if any, Washington should play in cross-strait relations. A second round in Taiwan on November 4-7, 2008, resulting in four agreements on direct sea transportation, air transportation, food safety, and direct postal links. PRC and Taiwan officials also have talked about creating a comprehensive agreement to expand economic cooperation between Taiwan and China—the Economic Cooperation Framework Agreement (ECFA)—discussed elsewhere in this memo. Several aspects of the judicial proceedings against Chen have led to criticism of the Taiwan government under Ma Ying-jeou. On January 16, 2009, the USTR announced that Taiwan had made sufficient improvements to be removed from the list. To date, U.S.-Taiwan trade discussions have been held under a 1994 Trade and Investment Framework Agreement (TIFA), a non-binding consultative mechanism the United States employs for resolving trade and investment difficulties with countries still opening their economies. Visa Waiver Program (VWP)

Taiwan also has sought to qualify for coverage under the U.S. Visa Waiver Program (VWP), which eliminates some visa requirements for qualified countries, allowing their citizens to make temporary U.S. visits without first obtaining a valid visa. Whether such nuance will continue in the Obama Administration remains to be seen. The Taiwan Relations Act and the current policy approach, according to these proponents, should be maintained and regularly reaffirmed. With Taiwan under the KMT government, the United States will be faced with some challenges familiar from past years, including decisions on: new arms sales; how to accommodate requests for visits to the United States by President Ma and other senior Taiwan officials; the level of U.S. relations with the Ma government; and whether to pursue closer economic ties, such as through a Free Trade Agreement. Legislation in the 111th Congress

S. 1390 (Levin)
National Defense Authorization Act for FY2010. H.Con.Res. H.Con.Res. The resolution reaffirms the unwavering U.S. commitment to the Taiwan Relations Act, reaffirms strong U.S. support for Taiwan's democratic development, and supports deepening U.S.-Taiwan ties.
U.S. policy toward Taiwan is unique. Since both the Chinese governments on Taiwan and on mainland China held that they alone were China's legitimate ruling government, U.S. diplomatic relations with Taiwan had to be severed in 1979 when the United States recognized the People's Republic of China (PRC) government as China's sole legitimate government. While maintaining diplomatic relations with the PRC, the United States maintains extensive but unofficial relations with Taiwan based on the framework of the 1979 Taiwan Relations Act (TRA—P.L. 96-8) and shaped by three U.S.-PRC communiqués. U.S. interests in Taiwan include significant commercial ties, objections to PRC military threats against Taiwan, arms sales and security assurances, and support for Taiwan's democratic development. U.S. policy remains rooted in a general notion of maintaining the "status quo" between the two sides. But other factors have changed dramatically since 1979, including growing PRC power and influence, Taiwan's democratization, and the deepening of Taiwan-PRC economic and social linkages. These changes have led to periodic discussions about whether or not U.S. policy should be reviewed or changed.
Taiwan's current president, Ma Ying-jeou, elected in March 2008, moved quickly to jump start Taiwan-PRC talks that had been stalled since 1998. The talks to date have yielded agreements to establish regular direct charter flights, direct sea transportation, postal links, and food safety mechanisms. Taiwan also has lifted long-standing caps on Taiwan investment in the PRC and lowered the profile of its bids for participation in U.N. agencies. Many welcome these and other initiatives as contributing to greater regional stability. More pessimistic observers believe growing PRC-Taiwan ties are eroding U.S. influence, strengthening PRC leverage and, particularly in the face of expanding economic links, jeopardizing Taiwan autonomy and economic security.
The changing dynamic between Taiwan and the PRC poses difficult, competing policy challenges for the United States. Along with new challenges—such as what U.S. policy should be if Taiwan continues to move closer to the PRC; and how U.S. officials should respond to the life sentence on corruption charges given to former President Chen Shui-bian—the Obama Administration faces other challenges familiar from past years, including decisions on new arms sales to Taiwan, which are anathema to the PRC; how to accommodate requests for visits to the United States by President Ma and other senior Taiwan officials; the overall nature of U.S. relations with the Ma government; whether to pursue closer economic ties with Taiwan; what role, if any, Washington should play in cross-strait relations; and more broadly, what form of defense assurances to offer Taiwan. In addition, the Taiwan government also seeks to raise its international profile in other ways involving the United States. Taiwan successfully has sought to be removed from the U.S. Special 301 "Watch List" for intellectual property rights violations, and it is seeking to qualify for the U.S. Visa Waiver Program (VWP), which eliminates some visa requirements for qualified countries. The Taiwan government also continues to ask for a U.S.-Taiwan Free Trade Agreement (FTA), which would broaden the current and stalled avenue for U.S.-Taiwan trade discussions, the 1994 Trade and Investment Framework (TIFA).
Legislation in the 111th Congress concerning Taiwan includes H.Con.Res. 18, urging that the United States resume diplomatic relations with Taiwan; H.Con.Res. 55, expressing U.S. support for and commitment to Taiwan; and S. 1390/H.R. 2647, including a mandatory report assessing the strength and capacity of Taiwan's air force. This report will be updated as events warrant.