In Taiwan, venture funds are established as corporations. Capital is raised from corporate investors, financial holding companies, banks, insurance companies, securities firms, and individuals. Currently, pension funds do not participate in the venture capital industry.

The formation and operation of venture funds is governed by the "Scope and Guidelines for Venture Capital Investment Enterprises" (Scope). Under Scope, applications for the establishment of venture funds are filed with the Ministry of Economic Affairs' Department of Commerce, Civil Services. A prospective venture fund with capital commitments from banks, insurance companies, securities firms, or financial holding companies, need to also apply for a recommendation from the MOEA's Industrial Development Bureau. Said banks, insurance companies, and securities firms can only invest in the venture fund if the recommendation is approved by the government.

Venture funds that wish to apply for capital from the Executive Yuan Development Fund NT$ 100 billion venture capital fund need to file an application with the Trust Department of the International Commercial Bank of China. Once applicants are approved by the Investment Review Committee of the Executive Yuan Development Fund, they can then set up a venture fund and commence investment activities in accordance with the Development Fund guidelines and regulations. The Development Fund's investment scope, which previously limited investee funds to investing in the manufacturing industry, has now been widenend to include the service industry.

On March 31, 2006, the MOEA completed a draft amendment of "Scope" to relax restrictions on venture capital fund sources, allowable investment targets, and usage of idle capital. The Council for Economic Planning and Development (CEPD) is also assessing the feasibility of venture capital funds incorporating in the form of limited partnerships, which would greatly benefit venture funds during the fundraising process. The resulting draft bill is being evaluated by the Executive Yuan, and if passed, would bring domestic venture fund regulations into line with those of other nations with developed venture capital industries.