Military government is the form of administration by which an occupying power exercises governmental authority over occupied territory. In other words, military government is the government of occupied territory, and Article 4(b) of the post-war treaty specifies the jurisdiction of the United States Military Government (USMG) over the Article 2(b) territory of Taiwan.
San Francisco Peace Treaty
April 28, 1952
Accordingly, the United States must be recognized as the legal occupier of Taiwan, and the Republic of China is merely a proxy occupying force.
With reference to international law, Oct. 25, 1945 can only be interpreted as the beginning of the military occupation of Taiwan, and certainly not "Taiwan Retrocession Day." A firm tenet of international law states that "Military occupation does not transfer sovereignty."
Japan recognizes the validity of dispositions of property of Japan and Japanese nationals made by or pursuant to directives of the United States Military Government in any of the areas referred to in Articles 2 and 3.
Due to an unfamiliarity with the laws of war, many researchers who read the SFPT completely fail to recognize an important point: After war, for territory separated from the "mother country" via the specifications of a peace treaty, the military government of the (principal) occupying power does not end with the coming into force of the peace treaty, but continues until legally supplanted (by a recognized civil government).
To date, USMG jurisdiction over Taiwan has not yet been legally supplanted, hence legally speaking, Taiwan is correctly classified as an overseas territory of the United States under military government.