In recent decades, informed consent has become a core issue in medical ethics. Of the five elements of informed consent, namely: competence, information, voluntariness, comprehension, and decision (consent or refusal), competence has drawn much clinical and academic attention because it forms the basis of autonomy. The MacArthur Treatment Competence Study is currently the most thorough study in this field and it proposes four functional abilities to assess competence: (1) communicating a stable choice, (2) understanding, (3) appreciation, and (4) reasoning. However, this cognitive-based approach to competence remains debatable and the best approach to competence in treatment decision making in Taiwan's legal context is still unclear. This paper first explores the concepts and formulations of competence. Second, the characteristics and construct of competence as proposed by the MacArthur Treatment Competence Study's competence formula are delineated. Third, debates on the above formula, especially on those about emotion and authenticity, are addressed. Fourth, it focuses on how to set the threshold of competence in treatment decisions. Lastly, to conclude, it explores and proposes the substance and procedure of competence assessment in Taiwan's legal context.