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[Law Basis]
[Print]
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Chapter 1 General Provisions
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Article 1 These regulations are prescribed pursuant to Paragraph 2, Article 35 of
The Central Bank of the Republic of China(Taiwan) Act.
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Article 2 The provisions of these Regulations shall govern the foreign exchange
business of banking enterprises. Matters not provided herein shall be
subject to provisions under other relevant laws and regulations.
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[Authorized Circulars]
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Article 3 The term "banking enterprises" as used in these Regulations shall mean
banks, credit cooperatives, credit departments of farmers' associations,
credit departments of fishermen's associations, and the Chunghwa Post
Co., Ltd.
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Article 4
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[Authorized Circulars]
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The term " foreign exchange business" as used in these Regulations
comprises the following items:
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1.Foreign exchange business export related;
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2.Foreign exchange business import related;
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3.Inward and outward remittances;
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4.Foreign currency deposits;
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5.Foreign currency loans;
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6.Foreign currency payment guarantees;
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7.Foreign exchange derivatives business; and
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8.Other foreign exchange businesses.
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The term "foreign exchange derivatives business" as used in these
Regulations shall mean dealing, brokerage and agent activities of contracts
involving foreign exchange, and whose values are derived from assets, interest
rates, exchange rates, commodities, stock prices, indices, or other related
products.
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The term "contracts " as used in the preceding paragraph shall mean margin
contracts, futures, forward contracts, swaps, options, or other contracts of
a similar nature.
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Article 5 Unless otherwise provided by other laws or the competent authorities, banking
enterprises shall maintain the confidentiality of information concerning their
customers' deposits, loans, and remittances.
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Chapter 2 Commencement of Foreign Exchange Business
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Article 6
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A banking enterprise shall apply to the Central Bank of the Republic of China
(Taiwan)(hereinafter referred to as the Bank) for engaging in foreign exchange
business, and may engage in the said business only after being issued a
certificate of authorization or a letter of approval.
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Foreign exchange business may not be operated without the approval of the Bank.
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Article 7
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A bank may apply for engaging in all or part of the business categories
listed in Paragraph 1 of Article 4.
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Credit cooperatives, the credit departments of farmers' or fishermen's
associations may apply for purchasing and selling foreign currency cash
and traveler's checks.
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The Chunghwa Post Co., Ltd. may apply for engaging in international
remittances , purchasing and selling foreign currency cash and traveler's
checks.
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Article 8
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Unless otherwise provided by these Regulations or other laws and regulations,
domestic and foreign banks within the territory of the Republic of China that
apply to the Bank for engaging in foreign exchange business (hereinafter
referred to as authorized banks) shall comply with the following provisions:
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1.Domestic banks shall:
(1)Maintain capital to risk-weighted assets ratio at 8% or above;
(2)Deploy sufficient experienced personnel for conducting foreign exchange
business;
(3)Participate in joint processing of foreign exchange business with other
authorized banks for an accumulated amount up to United States dollars
400 million or up to 7,000 transactions; and
(4)Maintain a sound financial position for the last three years.
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2.Foreign banks shall be approved by Financial Supervisory Commission,
Executive Yuan (hereinafter referred to as "FSC") to establish branches in
Taiwan.
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When a bank applies to FSC for establishing a foreign department to engage in
foreign exchange business, FSC shall forward the application to the Bank to
review qualifications prescribed in Subparagraph 1 of the preceding Paragraph.
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Foreign banks approved to engage in foreign exchange business within the
territory of the Republic of China may remit inwardly or outwardly capital or
working capital only after having obtained a separate approval from FSC.
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Article 9
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Banks intending to become authorized banks shall submit written applications
with the following documents to the Bank for approval:
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1.Documents evidencing FSC's approval for registered establishment;
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2.Scope of foreign exchange business;
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3.Names and locations of overseas correspondent banks;
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4.Name and address of the statutory responsible person within the territory
of the Republic of China;
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5.Capital and working capital to be remitted to the territory of the Republic
of China, as well as the categories and amounts of foreign exchange funding
sources; and
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6.Other data or documents specified by the Bank.
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Article 10
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When engaging in foreign exchange business listed in Subparagraphs 1
through 6, Paragraph 1, Article 4, the operations and auditing personnel
of an authorized bank shall hold foreign exchange business licenses or
meet the following qualifications:
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1.An operations personnel shall have at least three-month experience in
the relevant foreign exchange business.
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2.An auditing personnel shall have at least six-month experience in the
relevant foreign exchange business.
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Article 11 For the branches of an authorized bank to engage in the foreign exchange
business listed in Subparagraphs 1 through 6, Paragraph 1, Article 4, the
bank's head office shall apply to the Bank for approval by submitting
documentation detailing the intended scope of business, and attaching
photocopies of the bank's business license and the curriculum vitae of
operations and auditing personnel..
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Article 12
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When engaging in foreign exchange derivatives business listed in
Subparagraph 7, Paragraph 1, Article 4, the operations and management
personnel of an authorized bank shall meet at least one of the following
qualifications:
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1.To have completed courses on derivatives and risk management held by
domestic or foreign financial training institutions, the total amount
time spent on attending the courses shall be at least 3 months;
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2.To hold a foreign exchange derivatives business license;
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3.To have one year training or internship in foreign exchange derivatives
business at a domestic or foreign financial institution;
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4.To have at least six-month working experience in foreign exchange
derivatives business at domestic or foreign financial institutions.
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Article 13
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[Authorized Circulars]
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An authorized bank may engage in foreign exchange forward and swaps
transactions without application. However, to engage in any other foreign
exchange derivatives business, an authorized bank shall submit the
following documents according to the type of business intended and
apply to the Bank for approval:
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[Related Circulars]
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1.Foreign exchange derivatives business involving the New Taiwan dollar
exchange rate: Submit a statement of regulatory compliance, resolution
of board of directors to apply for foreign exchange derivatives business
for domestic banks or letter of authorization from the head office or
regional command centers for foreign banks, product profiles, operational
guidelines, risk management, risk disclosure statements, and curriculum
vitae of the relevant personnel.
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2.Any structure combination of foreign exchange derivatives business in the
preceding item with other business already authorized by the Bank or other
competent authorities: Submit documents listed in the preceding subparagraph.
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3.Foreign exchange derivative business not involving the New Taiwan dollar
exchange rate: For first time application by an authorized bank to engage in
foreign exchange derivatives business or new financial products not yet
approved by the Bank, documents listed in Item 1 shall be submitted.
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4.Foreign exchange derivatives business (not involving the New Taiwan dollar
exchange rate) already approved by the Bank and further structure
combinations thereof: Before engaging in this business, submit a statement
of regulatory compliance, resolution of board of directors to apply for
foreign exchange derivatives business for domestic banks or letter of
authorization from the head office or regional command centers for foreign
banks, risk disclosure statement, and curriculum vitae of the relevant
personnel. However an authorized bank may engage in structure combination
of foreign exchange derivatives that involve products in the same
categories and that are created through the same transaction contracts
without application.
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When an authorized bank, which has been approved to conduct derivatives
business pursuant to the preceding regulation, engages in the foreign exchange
derivatives business not involving the New Taiwan dollar, it should submit to
the Bank a product profile, product introduction, and the documents required
under Item 4 of the preceding paragraph within one week after such business
has commenced for record. If within three (3) weeks after receiving such report
, the Bank does not object thereto, the Bank's silence shall be deemed an
approval for record.
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[Authorized Circulars]
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The scope of the afore-mentioned foreign exchange derivatives business not
involving the New Taiwan dollar shall be determined by the Bank separately.
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Article 14 An authorized bank that has been approved by FSC to engage in money trust
business shall submit the following documents regarding outward and inward
remittance of trust funds to the Bank to apply for engaging in New Taiwan
dollar or foreign currency specific money trusts earmarked for investing
in securities denominated in foreign currencies :
1.Documents evidencing FSC's approval for engaging in money trust business;
2.To apply for the afore-mentioned business with the resolution of board of
directors for domestic banks or letter of authorization from the head office
or regional command centers for foreign banks;
3.Statement of foreign exchange regulatory compliance;
4.Descriptions of which currency shall be received and redeemed and foreign
exchange settlement procedures;
5.Other documents specified by the Bank.
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Article 15 To offer foreign currency automatic teller machine (ATM) services, an
authorized bank shall apply to the Bank by submitting relevant
operational guidelines and identifying the names of the offices
controlling the ATM, a list of locations, and risk control measures.
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Article 16
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To engage in electronic business involving foreign exchange, authorized
banks shall submit a description of relevant procedures when applying to
the Bank. Authorized banks applying for engaging in foreign exchange
receipts and disbursements or transactions with values equal to or over
New Taiwan dollars 500,000 on the Internet shall first pass the test of the
Online Civil Outward/Inward Remittances Declaration Yearly Aggregate
Settlement Amount Query System, and also be capable of performing
computerized review of transaction contents such as classification of
remittances.
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Before offering services in foreign exchange receipts and disbursements
or transactions on the Internet, an authorized bank shall first request the
customer to visit the bank in person to apply for and follow the
procedures stipulated. The authorized bank shall verify the customer's
identification documents or basic registration information when
processing an application.
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Article 17
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To engage in foreign exchange business outside business hours, an
authorized bank shall submit a description of relevant procedures when
applying to the Bank, and shall comply with the following rules:
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1.The amount of each foreign exchange settlement shall be limited to
New Taiwan dollars 500,000 or its equivalent in foreign currency; and
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2.Foreign exchange transactions conducted outside business hours shall
be included in the "Daily Transaction Report" and "Daily Foreign
Exchange Position Report" on the following business day.
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Article 18 Where the authorized bank has established its own domestic foreign
exchange processing center to process relevant foreign exchange back office
work, the bank shall submit the relevant operational guidelines and procedures
to the Bank within one week after the commencement of its operation. In the
event that the authorized banks use other methods to assign third parties to
process the relevant foreign exchange back office work, the banks shall apply
to the Bank for approval by submitting the operational plans for outsourcing.
If the Bank has not expressed a negative opinion within 15 days from the day
following receipt of the application, the bank may proceed to process the work
automatically.
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Article 19 Where there is a need to engage in purchasing and selling foreign currency
cash and traveler's checks by the branches of an authorized bank, or the banks
and their branches that have not been authorized by the Bank to engage in
foreign exchange business (hereinafter referred to as non-authorized banks),
the bank's head office shall submit to the Bank a description of the scope of
the intended business, a photocopy of the bank's business license (or a
photocopy of establishment letter issued by FSC) and the curriculum vitae of
operations and auditing personnel, except for the branches of an authorized
bank which only engage in the money exchange of foreign currency.
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Article 20 Operations and auditing personnel at the branches of authorized banks and
at non-authorized banks and their branches who engage in the purchasing and
selling of foreign currency cash and traveler's checks shall possess at least
one-week (five business days) experience in foreign exchange business.
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Article 21
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The provisions of Item 1 of Article 17 shall apply, mutatis mutandis, when
branches of authorized banks and non-authorized banks and their branches have
been authorized by the Bank to engage in the purchasing and selling of foreign
currency cash and traveler's checks outside business hours.
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Transactions conducted under the afore-mentioned business shall be included
in the "Daily Transaction Report" and "Daily Foreign Exchange Position Report"
on the following business day by the branches of authorized banks. Non-authorized
banks and their branches shall include the transactions in the "Daily Transaction
Report" on the following business day.
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Article 22 When a Credit Cooperative (head office or branch) first applies for approval
to purchase and sell foreign currency and traveler's checks, the head office of
the credit cooperative shall submit a written application together with a
photocopy of the credit cooperative's business license, the curriculum vitaes of
the operations and auditing personnel, the balance sheet and income statement of
the previous fiscal year, and shall truthfully explain the status of any
sanctions imposed on it for violation of financial regulations within the past
twelve (12) months.
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Article 23 For the credit departments of farmers' or fishermen's associations or their
branches to apply for the purchasing and selling of foreign currency cash
and traveler's checks, the farmers' or fishermen's association shall submit
a written application along with a photocopy of the business license,
curriculum vitae of operations and auditing personnel to be reviewed by to the
local competent authorities, who shall then forward the application to the
central competent authorities and then to the Bank.
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Article 24 For a post office under the Chunghwa Post Co., Ltd. to apply for international
remittances, to purchase and sell the foreign currency cash and traveler's checks
, the company's head office shall submit a written application along with a
photocopy of FSC's approval letter (for the post offices which were established
after January 1, 2003), and curriculum vitae of operations and auditing personnel
to the Bank for approval.
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Article 24-1
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If a relocation or name change is made by the branches of authorized banks,
non-authorized banks and their branches, the head office of credit cooperatives
and their branches, or the credit departments of farmer's or fishermen's
associations and their branches that have been approved to engage in the foreign
exchange business pursuant to Articles 11, 19, 22 and 23, depending on the type
of situation, it is required for them to apply for a new certificate or notify
the Bank within a week after the receipt of a business license or approval
certificate. In the event of relocation, the curriculum vitae of operations and
auditing personnel shall also be submitted to the Bank.
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If the relocation or name change is made by the post offices under the
Chunghwa Post Co., Ltd., which have been permitted to engage in foreign exchange
business pursuant to the preceding provisions, it is necessary for them to notify
the Bank within a week after the receipt of the letter issued by FSC or the letter
issued by its head office. In the event of relocation, the curriculum vitae of
operations and auditing personnel shall also be submitted to the Bank.
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Article 25 The provisions of Article 10 shall apply, mutatis mutandis, to operations and
auditing personnel performing international remittances business at post offices
under Chunghwa Post Co., Ltd.
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Article 26 The provisions of Article 20 shall apply, mutatis mutandis, to operations and
auditing personnel at credit cooperatives, the credit departments of farmers'
or fishermen's associations and their branches and post offices under Chunghwa
Post Co., Ltd. that engage in the purchasing and selling of foreign currency
cash and traveler's checks.
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Article 27
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The provisions of Subparagraph 1 of Article 17 shall apply, mutatis mutandis,
to credit cooperatives and the credit departments of farmers' or fishermen's
associations and their branches that have been authorized by the Bank to engage
in the purchasing and selling of foreign currency cash and traveler's checks, as
well as to post offices under the Chunghwa Post Co., Ltd. that have been
authorized by the Bank to engage in international remittances, purchasing and
selling foreign currency cash and traveler's checks.
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Transactions conducted under international remittances and purchasing and
selling of foreign currency cash and traveler's check transactions by the
afore-mentioned banking enterprises outside business hours shall be included
on the ''Daily Transaction Report'' or ''Daily Details Table''on the following
business day.
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Article 28 Banking enterprises applying for foreign exchange business will be granted a
designated period for providing supplementary information and making
corrections if the documentations submitted were found to be incomplete.
The Bank may reject the application if supplementary information and corrections
were not submitted during the designated period.
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Article 29
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The Bank may reject a banking enterprise's application for foreign exchange
business in the event of any of the following:
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1.Qualifications of the applicant do not comply with regulations;
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2.The applicant has failed to fully assist declarants to fill out the
Declaration Statement of Foreign Exchange Receipts and Disbursements or
Transactions(hereinafter referred to as Declaration Statement);
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3.A high number of errors in the certificates, reports and forms prepared
by the applicant;
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4.The applicant had seriously violated the provisions of these Regulations and
was rectified by the Bank, but has failed to improve within the period
specified by the Bank;
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5.There is evidence indicating that the applicant may hinder sound operations
of the business, or that the applicant is unable to meet financial policy
requirements.
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Article 30
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The Bank may revoke or cancel its approval to any banking enterprise engaging
in foreign exchange business in the event of any of the following:
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1.The banking enterprise fails to commence operation within six months after
being issued a certificate of authorization or letter of approval.
The applicant may request for an extension with appropriate reasons. If
approved, the banking enterprise may have an extension of no more than three
months. An institution may apply for extension only once;
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2.The banking enterprise has seriously violated the provisions of these
Regulations and was rectified by the Bank, but has failed to rectify within
the period specified by the Bank;
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3.After being issued a certificate of authorization or letter of approval, or
after being approved to engage in various foreign exchange business, the
banking enterprise was found to have provided false information in its
application which is deemed a serious violation; or
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4.The banking enterprise suspends operations, is dissolved, or declares
bankruptcy.
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Chapter 3 Management of Foreign Exchange Business
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Article 31 Banking enterprises engaging in foreign exchange business shall first verify
the identity or primary registration data of the customer, and ensure that
supporting documents comply with regulations.
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Article 32 Banking enterprises shall accept a customer's request for purchasing and
selling of foreign exchanges in accordance with regulations provided by the
Bank.
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Article 33
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The exchange rates used for foreign exchange transactions between a banking
enterprise and a customer may be solely determined by the banking enterprise.
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The exchange rate for a single non-cash foreign exchange transaction with a
customer for an amount of less than ten thousand United States dollars (
US$10,000) shall be posted at the banking enterprises' business premises before
9:30 AM on each business day. The bid/ask spread shall be reported to the Bank
for record. Any change to the spread shall also be reported.
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Article 34
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When submitting reports and forms prescribed in these Regulations, banking
enterprises shall attach relevant supporting documents and appendices.
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The Department of Foreign Exchange of the Bank may request banking
enterprises to fill out additional reports and forms if necessary.
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The formats, contents, and completion instructions of the reports and forms
prescribed in the previous two paragraphs shall conform to the "Directions
Governing Banking Enterprises in Conducting Foreign Exchange Business"
separately provided by the Bank, as well as other relevant regulations.
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Article 35 With regard to the review of reports and forms submitted by authorized
banks, the Bank may dispatch personnel to inspect the relevant account books
and documents of banking enterprises, or may request banking enterprises to
provide truthful financial reports or other relevant information within a
prescribed period of time if deemed necessary.
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Article 36
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Where an authorized bank operates foreign exchange derivatives business
involving the New Taiwan dollar exchange rate, the following rules shall
apply:
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1.Delivery foreign exchange forward business "between the New Taiwan
dollar and foreign currency"
(1)Actual for demand foreign exchange receipts or disbursements, but
one receipt or disbursement of foreign exchange may not be used in
multiple contracts.
(2)Entering into contracts or processing settlements with clients,
either transaction documents supporting actual for demand foreign
exchange receipts or disbursements, or a written approval from the
competent authorities shall be verified.
(3)Maturity: determined according to actual for demand foreign exchange
receipts or disbursements.
(4)The price of a rollover transaction shall be based on the current
market exchange rate rather than the rate of the original contracts.
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2.Foreign exchange swaps business "between the New Taiwan dollar and foreign
currency"
(1)In swaps transactions, when entering into spot foreign exchange
settlement or a forward sale (forward purchase) of foreign exchange, the
authorized bank shall enter into a foreign exchange forward contract with
the same amount in the opposite direction at the same time.
(2)Counterparties:
Domestic legal entities: no documents required.
Foreign legal entities and natural persons: documents of approval issued
by the competent authorities shall be verified.
(3)In the settlement of swaps transactions, the Declaration Statement shall
be filled out pursuant to the "Regulations Governing the Declaration for
Foreign Exchange Receipts and Disbursements or Transactions" (hereinafter
referred to as the Regulations for Declaration). Column 4 of the
Declaration Statement "Nature of Foreign Exchange Receipts and
Disbursements or Transactions" shall be filled out according to the nature
of the actual transaction, and also noted as "foreign exchange swaps
transaction'. In addition, the "remittance classification and code number"
provided by the Department of Foreign Exchange of the Bank shall be
indicated on the foreign exchange memo, and included in the daily foreign
exchange transaction report along with the Declaration Statement.
(4)The swap transaction amount need not be included in the foreign exchange
settlement and remittance aggregate amount as specified in subparagraph 3,
Paragraph 1, Article 4 of the Regulations for Declaration.
(5)The prices of rollover transactions shall be based on the current market
exchange rates rather than the rates of the original contracts.
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3.Non-Delivery New Taiwan dollar foreign exchange forward business (NDF):
(1)Counterparties are limited to domestic authorized banks and the overseas
branches or head offices of authorized banks.
(2)The format, content, and accounting treatment of contracts shall be
segregated from those of delivery foreign exchange forward (DF) business.
(3)Contracts under this item may not be rolled over or terminated before
maturity.
(4)Net cash settlement shall be applied uniformly upon maturity.
(5)Transactions do not allow margin trade.
(6)Without the approval of the Bank, contracts may not be structured to
combine with other foreign exchange derivatives products, New Taiwan
dollar deposits, foreign currency deposits, or other products.
(7)For non-delivery New Taiwan dollar foreign exchange forward
transactions of United States dollars 5 million or above, the
Department of Foreign Exchange of the Bank shall be notified
immediately by telephone.
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4.New Taiwan dollar exchange rate option business:
(1)Counterparties are limited to domestic and foreign legal entities.
(2)Both net amount settlement and gross amount settlement upon maturity
are allowed, but the settlement method shall be specified in the
contracts.
(3)The currency used for option premium and settlement if the option is
exercised may be either in the denominated foreign currency or New
Taiwan dollar, but shall be specified in the contract.
(4)Only "plain vanilla" options may be transacted. Without the approval
of the Bank, contracts may not be structured to combine with options
or other foreign exchange derivatives products, New Taiwan dollar
deposits, foreign currency deposits, or other products.
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5.Cross currency swaps business "between the New Taiwan dollar and foreign
currency":
(1)Counterparties are limited to domestic and foreign legal entities.
(2)For cross currency swaps involving the exchange of principal both at
inception and maturity, domestic legal entities are not required to
submit transaction documents. Both the principal and interest need not
be included in the remittance aggregate amount as specified in
Subparagraph 3, Paragraph 1, Article 4 of the Regulations for
Declaration.
(3)For other types of cross currency swaps, the bank shall request its
customer to submit documents evidencing actual demand at the time of
transaction, the transaction amount shall be included in the remittance
aggregate amount as specified in Subparagraph 3, Paragraph 1, Article 4
of the Regulations for Declaration. However, if the foreign exchange
receipts and disbursements or transactions are for the export or import
of goods, providing services, or other uses approved by the competent
authorities, they need not be included in the remittance aggregate amount.
(4)In the settlement of cross currency swaps transactions, the Declaration
Statement shall be filled out pursuant to the Regulations for Declaration.
Column 4 of the Declaration Statement "Nature of Foreign Exchange Receipts
and Disbursements or Transactions" shall be filled out according to the
nature of the actual transaction, and also noted as "cross currency swaps
transaction". In addition, the "remittance classification and code number"
provided by the Department of Foreign Exchange of the Bank shall be shown
on the foreign exchange memo, and included in the daily foreign exchange
transaction report along with the Declaration Statement.
(5)The exchange of principal or interest in each term in the future is deemed
as a foreign exchange forward contract, and shall be reported on the daily
foreign exchange forward transaction report when entering into contract.
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Article 37
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[Related Regulations]
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Authorized banks shall comply with the following regulations when engaging in
foreign exchange derivatives business not involving the New Taiwan dollar exchange
rate:
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1.Foreign currency margin trading business:
(1)May not be conducted with foreign currency loans, and the bank shall set a
separate line of credit for each customer.
(2)Without the approval of the Bank, authorized banks may neither provide full
discretionary account management nor "joint account" in conducting the
business. Regulations governing full discretionary account management shall
be separately provided by the Bank.
(3)Certificates of deposit or other collateral not under the name of the
customer may not be pledged to the authorized bank as collateral for foreign
currency margin trading.
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2.Foreign exchange derivatives business involving stock prices or stock indices:
(1)The "underlying products" shall mean foreign currencydenominated, foreign
market related stock prices, stock beneficiary certificates, or stock
indices.
(2)The underlying products shall not include any stock indices, stock prices,
or stock beneficiary certificates listed on any stock exchange in Taiwan or
Mainland China.
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3.Forward and swaps business between foreign currencies:
The prices of rollover transactions shall be based on the current market
exchange rates rather than the rates of the original contracts.
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4.Cross currency swaps business between foreign currencies:
When providing this service, after settlement, the appropriate "
remittance classification and code number" shall be indicated on other
transaction certificates and included in the foreign exchange
transaction daily report.
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5.Structured products business linked to deposits:
(1)When providing "structured deposits" linked to foreign exchange
derivatives products with principal protection, or "structured
products" linked to foreign exchange derivatives products without
principal protection, the underlying targets are limited to foreign
exchange derivatives products already approved by the Bank.
(2)The business shall be conducted in compliance with the respective
restrictions or regulations governing each type of businesses that
have been structured into this business.
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6.Structured business linked to loans:
(1)For "structured loans" linked to foreign currency loans, the underlying
targets are limited to foreign exchange derivatives products already
approved by the Bank.
(2)The business shall be conducted in compliance with provisions of the "
Directions Governing Banking Enterprises for Operating Foreign Exchange
Business", as well as the respective restrictions or regulations governing
each type of businesses that have been structured into this business.
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Article 38
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For a new foreign exchange derivatives business that has not yet been
approved, an authorized bank shall apply for approval pursuant to the
procedures set forth in Article 13; the relevant guidelines concerning the
business shall be specified in the letter of approval issued by the Bank.
The Bank may authorize the "Taipei Foreign Exchange Market Development
Foundation" (" the Foundation") to coordinate with "R.O.C. Bankers
Association" ("BA") to formulate guidelines for contract signing, transaction
and settlement methods, the contents of risk disclosure statements, accounting
principles, formats of financial statements and reports, information disclosure
methods, methods for dispute resolution, procedure for reporting incompliance
to the Bank and other related matters. Such guidelines will become effective
after the Bank's approval. The same procedure shall be followed for any
amendments.
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An authorized bank shall act in accordance with relevant regulations and
the above guidelines when conducting the foreign exchange derivatives
business.
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Article 39 An authorized bank may accept the entrustment of the offshore banking unit
(OBU) of the same bank to engage in OBU business. The scope and relevant
regulations governing the business shall be separately provided by the Bank.
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Article 40
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For foreign currency deposits business, an authorized bank shall follow
international business practice in determining and posting its own
minimum deposit interest rates. The applicable interest rates for
maturities not posted shall be negotiated between the authorized bank and
its customer with reference to other posted rates with similar maturities.
Interest rates that are subject to negotiation shall be announced publicly.
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The announcement in the preceding paragraph shall be displayed in the
business hall, and also posted on a publicly accessible website or
disclosed to the general public through other means.
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Article 41
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An authorized bank may purchase or sell foreign exchange on the foreign
exchange market or with the Bank, and may also hold long or short positions
within the limits set by itself.
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An authorized bank participating in the inter-bank foreign exchange market
shall comply with the rules formulated by the Foundation after coordination
with BA, and with reference to international customs and had reported to the
Bank.
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Article 42
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An authorized bank shall set its total position limits for transactions
between the New Taiwan dollar and foreign currency, which shall be submitted
along with its board resolution (the Taiwan branches of foreign banks shall
submit documentation of approval issued by their head offices) to the
Department of Foreign Exchange of the Bank.
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The combined position of non-delivery New Taiwan dollar forward contracts
and New Taiwan dollar exchange rate options may not exceed one-third of the
afore-mentioned total position limit.
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Article 43 An authorized bank shall determine its position limits including "
transaction positions for individual currencies" and "overnight positions
for each trader". All its offices shall abide by these position limits and
make auditing regularly.
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Article 44
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Authorized banks shall fill out "Foreign Exchange Position Daily
Reports" for all foreign exchange transactions involving the New Taiwan
dollar on a daily basis, and submit the reports to the Department of
Foreign Exchange of the Bank on the following business day. Foreign
exchange positions recorded on internal books of authorized banks shall
be identical to those submitted to the Foreign Exchange Department.
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Authorized banks shall report the estimated foreign exchange positions
for the day to the Department of Foreign Exchange of the Bank by
telephone at the end of each business day.
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Article 45
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Authorized banks, when engaging in large spot or forward transactions
with clients over the counter, shall use the "Large Spot, Forward, and
Cross Currency Swap (CCS) Transactions Information Online Transmitting
System" under the "Online Civil Outward/ Inward Remittances Declaration
Yearly Aggregate Settlement Amount Query System" to transmit relevant
data to the Department of Foreign Exchange of the Bank pursuant to the
following regulations:
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1.Data on foreign exchange purchase or sale of United States dollars
1 million or above or its equivalent in other foreign currencies by
a company or firm (excluding transactions from the export or import
of goods processed with documentary bills), or of United States
dollars 500,000 or above or its equivalent in other foreign currencies
by an individual or an association shall be transmitted immediately on
contract day.
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2.Data on forward contracts transactions, and cross currency swap (CCS)
transactions involving the conversion of New Taiwan dollars against
foreign curriencies for United States dollars 1 million or above or its
equivalent in other foreign currencies shall be transmitted before 12:00
noon on the business day following the contract.
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3.Relevant transmitting operations shall be processed in accordance with
the "Manual for the Online Data Transmitting System on Large Spot,
Forward, and Cross Currency Swap (CCS) transactions" prescribed by the
Department of Foreign Exchange of the Bank.
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Authorized banks, when engaging in large spot or forward transactions
involving the conversion of the New Taiwan dollars through their internet
bank network, shall first pass the Bank's requirments of the "Internet Bank's
Large Spot and Forward Transactions Information of Internet Bank Online
Transmitting System"; they shall use the "Large Spot and Forward Transactions
Information Online Reporting and Transmitting System", which is linked under
the "Outward/Inward Remittances yearly Aggregate Settlement Amount Online Query
System", to transmit relevant data to the Department of Foreign Exchange of the
Bank pursuant to the following regulations:
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1.After verifying the relevent transaction documents, data on foreign exchange
purchase or sale of United States dollars 1 million or above or its equivalent
in other foreign currencies by a company or firm (excluding transactions from
the export or import of goods processed with documentary bills), or of United
States dollars 500,000 or above or its equivalent in other foreign currencies
by an individual or an association, shall be transmitted immediately on the
contracting day.
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2.After verifying the relevent transaction documents, data on forward contracts
transactions involving the conversion of New Taiwan dollars against foreign
currencies for 1 million or above or its equivalent in other foreign
currencies shall be transmitted immediately on the contract day.
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Article 46
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The relevant timetable for the authorized banks to transmit reports to the
Department of Foreign Exchange of the Bank:
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1.Daily Report: Before 12:00 noon of the following business day.
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2.Monthly Report: Within ten (10) days after the end of each month.
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The scope of the daily report and monthly report described in the preceding
Paragraph shall be separately regulated by the Bank.
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Article 47 (repealed)
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Article 48 Non-authorized banks, credit cooperatives, and credit departments of farmer's
or fishermen's associations shall submit daily reports of purchasing and selling
foreign currency cash and traveler's check to the Department of Foreign Exchange
of the Bank before 12:00 noon on the following business day.
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Article 49 (repealed)
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Article 50 The Chunghwa Post Co., Ltd. shall submit daily details tables for inward and
outward international remittances to the Department of Foreign Exchange of the
Bank before 12:00 noon on the following business day.
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Chapter 4 Supplementary Provisions
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Article 51 The Bank may take action pursuant to the provisions of the Administrative
Enforcement Law against any banking enterprise that fails to operate in
accordance with the provisions of these Regulations.
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Article 52 These Regulations shall become effective on the date of promulgation.
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