Other pages on this website provide a careful overview of the key elements of Taiwan and Chinese history from 1895 to the present.  However, after a close examination of numerous historical treatises, encyclopedias, and scholarly journals, the author finds a large number of sources which have misinterpreted the history of Taiwan after the surrender of Japanese troops in October 1945 up to the present era.  

The following corrections are offered for clarification. 

Terminology: "Formosa and the Pescadores," along with other subsidiary islands, are collectively called Taiwan.

FLAG & ALLEGIANCE (expanded)

The issues of Flag, Allegiance, and Sovereignty are examined in more detail below. 

SOVEREIGNTY

Scenario 1: The sovereignty of Taiwan dried up, disappeared, or was lost.
Scenario 2: The sovereignty of Taiwan is held by the United States.
Scenario 3: The sovereignty of Taiwan is held by the Taiwan people.

Scenario 1 analysis: Sovereignty contains components of "defined territory" and "permanent population." Since Taiwan's defined territory and permanent population have continued to be in place during this period, it is impossible to see how the sovereignty could dry up, disappear, or be lost.

Scenario 2 analysis: This conforms to the stipulations in Article 2b and Article 23 of the San Francisco Peace Treaty (1951), which state: 

Japan renounces all right, title and claim to Formosa and the Pescadores.

The present Treaty shall be ratified by the States which sign it, including Japan, and will come into force for all the States which have then ratified it, when instruments of ratification have been deposited by Japan and by a majority, including the United States of America as the principal occupying Power . . . . . 

The position of the United States military authorities in Cuba, before the Spanish authorities abandoned the island in 1899, was one of military occupation, pure and simple; after that event, it was military occupation of a particular kind -- namely, wherein the dominant military power exercised authority over the island as trustee for a Cuban nation not yet in existence, but the creation of which was promised and which was to have the assistance of the United States in establishing itself.

In one of the opinions just delivered the case of Neely v. Henkel, 180 U.S. 119 , ante, 302, 21 Sup. Ct. Rep. 302, is cited in support of the proposition that the provision of the Foraker act here involved was consistent with the Constitution. If the contrary had not been asserted I should have said that the judgment in that case did not have the slightest bearing on the question before us. The only inquiry there was whether Cuba was a foreign country or territory within the meaning, not of the tariff act, but of the act of June 6th, 1900 (31 Stat. at L. 656, chap. 793). We held that it was a foreign country. We could not have held otherwise, because the United States, when recognizing the existence of war between this country and Spain, disclaimed 'any disposition or intention to exercise sovereignty, jurisdiction, or control over said island except for the pacification thereof,' and asserted 'its determination, when that is accomplished, to leave the government and control of the island to its people.' We said: 'While by the act of April 25th, 1898, declaring war between this country and Spain, the President was directed and empowered to use our entire land and naval forces, as well as the militia of the several states, to such extent as was necessary to carry such act into effect, that authorization was not for the purpose of making Cuba an integral part of the United States, but only for the purpose of compelling the relinquishment by Spain of its authority and government in that island and the withdrawal of its forces from Cuba and Cuban waters.

The legislative and executive branches of the government, by the joint resolution of April 20th, 1898, expressly disclaimed any purpose to exercise sovereignty jurisdiction [182 U.S. 244, 388] , or control over Cuba 'except for the pacification thereof,' and asserted the determination of the United States, that object being accomplished, to leave the government and control of Cuba to its own people. All that has been done in relation to Cuba has had that end in view, and, so far as the court is informed by the public history of the relations of this country with that island, nothing has been done inconsistent with the declared object of the war with Spain. Cuba is none the less foreign territory, within the meaning of the act of Congress, because it is under a military governor appointed by and representing the President in the work of assisting the inhabitants of that island to establish a government of their own, under which, as a free and independent people, they may control their own affairs without interference by other nations. The occupancy of the island by troops of the United States was the necessary result of the war. That result could not have been avoided by the United States consistently with the principles of international law or with its obligations to the people of Cuba. It is true that as between Spain and the United States, -- indeed, as between the United States and all foreign nations, -- Cuba, upon the cessation of hostilities with Spain and after the Treaty of Paris, was to be treated as if it were conquered territory. But as between the United States and Cuba, that island is territory held in trust for the inhabitants of Cuba to whom it rightfully belongs, and to whose exclusive control it will be surrendered when a stable government shall have been established by their voluntary action.'

In Neeley v. Henkel ( 180 U. S. 109), with reference to the status of Cuba during American occupation, the Supreme Court said: "Cuba is none the less foreign territory, within the meaning of the act of Congress, because it is under a military governor appointed by and representing the President in the work of assisting the inhabitants of that island to establish a government of their own, under which, as a free and independent people, they may control their own affairs without interference by other nations. The occupancy of the island by the troops of the United States was the necessary result of the war. That result could not have been avoided by the United States consistently with the principles of international law or with its obligations to the people of Cuba." 

"It is true that as between Spain and the United States -- indeed, as between the United States and all foreign nation -- Cuba, upon the cessation of hostilities with Spain and after the Treaty of Paris, was to be treated as if it were conquered territory. But as between the United States and Cuba that island is territory held in trust for the inhabitants of Cuba, to whom it rightfully belongs, and to whose exclusive control it will be surrendered when a stable government shall have been established by their voluntary action." 

In Dooley v. United States ( 182 U. S. 222), one of the "Insular Cases" decided in 1901, the doctrine of Fleming v. Page was applied in fixing the status of Porto Rico while under the military government of the United States, but prior to the ratification of the treaty of peace ceding the island to the United States. The court said: "[During this period] the United States and Porto Rico were still foreign countries with respect to each other, and the same right which authorized us to exact duties upon merchandise imported from Porto Rico to the United State. authorized the military commander in Porto Rico to exact duties upon goods imported into that island from the United States. The fact that, notwithstanding the military occupation of the United States, Porto Rico remained a foreign country within the revenue laws, is established by the case of Fleming v. Page."  

CONCLUSION: 

During the 1945 to 1952 period of belligerent occupation, and during the 1952 to present period of friendly occupation, the sovereignty of Taiwan is held in trust by the United States Military Government (USMG).