Taiwanese historian pointed out: After World War II ended, Republic of China officials went to Taiwan to accept the surrender of Japanese forces on behalf of the Allied Powers. Although they claimed that it was "Taiwan Retrocession", it was actually a provisional military occupation and was not a transfer of territories of Taiwan and Penghu. A transfer of territory requires a conclusion of an international treaty in order to be valid. But before the government of the Republic of China was able to conclude a treaty with Japan, it was overthrown by the Chinese Communist party and fled its territory. Consequently, that attributed to the controversy of the "Undetermined Status of Taiwan" and the controversy over "Taiwan Retrocession".
Writing in the American Journal of International Law in July 2000, Jonathan I. Charney and J. R. V. Prescott maintained that the Chinese Nationalists began a military occupation of Taiwan in 1945 as a result of Japan's surrender, and that none of the post-World War II peace treaties explicitly ceded sovereignty over Formosa and the Pescadores to any specific state or government.
The official position of both the People's Republic of China and the Republic of China is that Taiwan and Penghu were returned to the Republic of China according to the terms of the 1945 Japanese Instrument of Surrender, which stipulated Japan's compliance with the terms of the Potsdam Declaration. The Potsdam Declaration in turn included the terms of the Cairo Declaration, which required Japan to return all conquered territories to China, including Taiwan and the Pescadores.
The Democratic Progressive Party, which rejects the idea of Taiwan being taken back by China, downplayed the event during their two terms of presidency from 2000 to 2008.
Because the Republic of China officials who accepted the surrenders of Japanese Forces in 1945 were all representatives of the Allies of World War II, there are opinions that Japanese Forces on Taiwan actually surrendered to the Allies, not to the Republic of China, and therefore the so-called "Taiwan Retrocession Day" is merely "Surrenders of Japanese Forces to the Allies Day", which marked the beginning of military occupation and was not a retrocession. The opinions further believe that "Taiwan Retrocession" is a misleading term.
Supporters of Taiwan independence have argued that Taiwanese retrocession was invalid since there is no precedent in international law in which an instrument of surrender effected a transfer of sovereignty, and they base their belief in part on both a declassified CIA report from March 1949 confirming that Taiwan was not a part of the Republic of China and President Truman's 27 June 1950, statement regarding Taiwan's "undetermined status", which they hold as proof of the leading Allies' views. As late as November 1950, the United States State Department announced that no formal act restoring sovereignty over Formosa and the Pescadores to China had yet occurred; British officials reiterated this viewpoint in 1955, saying that "The Chinese Nationalists began a military occupation of Formosa and the Pescadores in 1945. However, these areas were under Japanese sovereignty until 1952."
