Title：
Directions Governing Banking Enterprises for Operating Foreign Exchange Business
Announced Date：August 6, 2003
Date：August 1, 2007
(Presentation of relevant regulations)
(Export related foreign exchange business)
2. Banks approved by the Central Bank of the Republic of China(Taiwan)(hereinafter referred to as the Bank) to operate foreign exchange business (hereinafter referred to as authorized banks) shall abide by the following provisions when operating export foreign exchange business :
(1) Export Negotiation , Collections, and Factoring Business :
i.Documents Required: Operate on the basis of transaction documents provided by domestic customers.
ii.Certificates Issued : Issue an export negotiation certificate when foreign exchange earned from exports is exchanged into New Taiwan dollar; while other transaction certificates shall be issued when the foreign exchange is not sold for New Taiwan dollar. The above certificates may be produced in electronic documents.
iii.Reporting Documents: A daily transaction report shall be submitted to the Department of Foreign Exchange of the Bank on the first business day following the transactions in accordance with the following provisions :
(i) When a daily transaction report is submitted in written form, certificates issued when operating foreign exchange transactions in person and a list of foreign exchange transactions made via the Internet and relevant data on a [electronic] medium shall be attached to the report.
(ii) When a daily transaction report is submitted on a [electronic] medium, data in the form of the [electronic] medium concering the foreign exchange business shall be attached.
(2) Export Letter of Credit Advising and Confirming Business : Documents required: Operate in accordance with documents entrusted by foreign correspondent banks.
(Import related foreign exchange business)
3. Authorized banks shall abide by the following provisions when operating import foreign exchange business :
(1) Documents Required: Issue letters of credit, collections and bills acceptance , and negotiations in accordance with transaction documents provided by domestic customers.
(2) Percentage of Margin Collected When Issuing a Letter of Credit: An authorized bank may decide of its own accord.
(3) Certificates Issued : Issue an import negotiation certificate when New Taiwan dollars are used to purchase foreign exchange needed for imports; issue other transaction certificates when the foreign exchange is not purchased with New Taiwan dollars. The above certificate may be produced in electronic document.
(4) Reporting Documents: A daily transaction report shall be submitted to the Department of Foreign Exchange of the Bank on the first business day following the transactions in accordance with the following provisions :
i.when a daily transaction report is submitted in written form, certificates issued when operating foreign exchange transactions in person and a list of foreign exchange transactions made via the Internet and relevant data on a [electronic] medium shall be attached to the report.
ii.When a daily transaction report is submitted on a [electronic] medium, data in the form of the [electronic] medium concerning the foreign exchange business shall be attached.
(Foreign exchange deposit business)
5. Authorized banks shall abide by the following provisions when operating foreign exchange deposit business:
(1) Documents Required: Operate in accordance with inward remittance notice, foreign currency loans, foreign currency notes, foreign currency banknotes, foreign exchange purchased with New Taiwan dollars, and deposit documents.
(2) Operating Restrictions: Shall not be operated with checking deposits or negotiable certificates of deposit.
(3) Purchase and Sale Procedures: When New Taiwan dollars are used to purchase foreign exchange for deposit and when funds from a foreign exchange deposit is sold for New Taiwan dollars, banking enterprises shall handle the purchase and sale that reaches the foreign currency equivalent of 500,000 New Taiwan Dollars in accordance with the Regulations for Declaration and the Directions for Declaration.
(4) Foreign Currency Deposit Transfers: Shall be performed by authorized banks; transferees shall deposit the foreign exchange received in a foreign currency deposit account at an authorized bank.
(5) Certificate issued: A foreign exchange sale memo shall be issued when the deposited amount is purchased with New Taiwan dollars. Other transaction certificates shall be issued when the foreign exchange is not purchased with New Taiwan dollars. A foreign exchange purchase memo shall be issued when funds from a foreign exchange deposit are sold for New Taiwan dollars. Other transaction certificates shall be issued when the foreign exchange is not sold for the New Taiwan dollar. The above certificates may be produced in electronic form.
(6) Reporting Documents: A daily transaction report and daily foreign exchange deposit report shall be submitted to the Department of Foreign Exchange of the Bank on the first business day following the transactions in accordance with the following provisions:
i.When a daily transaction report is submitted in written form, certificates issued when performing foreign exchange transactions in person, a list of foreign exchange transactions made via the Internet and relevant data on an [electronic] medium, Declaration Statement, documents approved by the Bank or other competent authorities, and other designated documents shall be attached to the report.
ii.When a daily transaction report is submitted on a [electronic] medium, data in the form of the [electronic] medium concerning the foreign exchange business, a written Declaration Statement, documents approved by the Bank or other competent authorities, and other designated documents shall be attached to the report.
7. When a company applying for a single import/export foreign currency loan that combines several import/export cases, the authorized bank shall operate according to the list of transaction documents provided by the company. Each transaction on the list shall be accompanied by a record of the name, number, and date of the transaction document, name of the foreign company involved, and the value of the transaction. The information indicated in the list concerning the transaction shall be authenticated. The company is required to preserve relevant transaction documents for reference.
(Foreign Currency Guarantee business)
8. Authorized banks shall abide by the following provisions when operating foreign currency guarantee business:
(1) Counterparties: Limited to domestic customers.
(2) Documents Required: Operate in accordance with documents provided by the domestic customers evidencing that there is a practical need for the foreign currency guarantee .
(3) Issuing of standby letter of credit: When issuing a standby letter of credit for a domestic customer to, directly or indirectly, guarantee the loan provided by an offshore financial institution to an offshore subsidiary (including subsidiaries located in Mainland China Area) of the domestic company, authorized banks shall carefully evaluate the financial status, business operation and the source used to repay the loan of the guaranteed offshore company.
(4) Exercise of Guaranteed Debt: Shall be processed by customers in accordance with the provisions of the Regulations for Declaration.
(5) Reporting Documents: The balance at the end of the month and the nature of guarantee shall be tabulated and submitted to the Department of Foreign Exchange of the Bank.
(Foreign currency ATM business)
11. Authorized banks approved by the Bank to engage in foreign currency ATM services shall abide by the following provisions:
(1) The cumulative daily amount of foreign currency banknotes withdrawn at a domestic foreign currency ATM by cardholders whose cards are issued by domestic banks shall be limited to United States dollars 10,000 or the foreign currency equivalent per person. The equivalent value in New Taiwan dollar of the above foreign currency banknotes plus the value of New Taiwan dollar banknotes withdrawn by the same cardholder from ATMs on the same day shall not exceed the accumulated daily withdrawal limit for New Taiwan dollar banknotes set by the ATM card issuing bank.
(2) An aggregate statement may be substituted for foreign exchange sale memos issued by the bank. The statement shall indicate the number of foreign currency purchase transactions, and their total value, made by ROC citizens and foreigners. It is not necessary to fill in the remittance serial number, customer's uniform number, amount of foreign currency, remittance classification and code number of remittance, and destination of the remittance.
(Purchase and Sale of foreign currency cash and traveler's check business)
14. Banking enterprises shall comply with the following provisions when processing the purchase and sale of foreign currency cash and traveler's checks:
(1) Exchange rates set comply with relevant regulations stipulated by the Department of Foreign Exchange of the Bank.
(2) The provisions of Item 1, Subparagraph 1, and Item 1, Subparagraph 2, Direction 4 are applicable to the said business.
(3) Authorized banks shall issue a foreign exchange sale (purchase) memo after accepting a customer’s request for purchasing and selling of foreign currency cash or traveler's checks. A Declaration Statement shall be filled out if the value of a foreign exchange transaction with a customer is equal to or over New Taiwan dollars 500,000.
(4) Banks that have not been authorized by the Bank for engaging in foreign exchange business (hereinafter referred to as "unauthorized banks"), credit cooperatives, and the credit departments of farmers' and fishermen's associations processing the purchase and sale of foreign currency cash and traveler's checks shall comply with the following provisions:
i.They may open foreign currency deposit accounts at authorized banks, but shall not establish correspondent relationships with foreign banks or other financial institutions outside the territory of the Republic of China.
ii.Subject to the provisions under the relevant regulations on the foreign currency risks limit prescribed by the relevant competent authority for financial institutions,they may hold overbought foreign exchange positions as long as such positions do not exceed the maximum permitted by the Bank; the limit of the oversold foreign exchange position is zero.
iii.They may proceed to purchase (or sell) foreign exchange needed for working capital from authorized banks by filling out the Declaration Statement pursuant to the Regulations for Declaration. There is no limit on the accumulated annual amount of this category of foreign exchange transactions, but the nature of this business shall be clearly indicated on the Declaration Statement together with the reference number assigned to the approval document from the Bank.
(Credit card business)
15. Enterprises and card issuing banks operating credit card, finance card, or account transfer card business shall apply to the Bank to handle the relevant foreign exchange business in writing from the head office for approval before commencing operation, and shall abide by the following provisions :
(1) If a foreign natural person is issued a card, the card-issuing bank shall strengthen the credit investigation and the solvency evaluation of the cardholder, and pay attention to risk control.
(2) A cardholder's settlement amount or qualifications shall comply with the provisions of the Regulations for Declaration, these Directions and other relevant regulations. If there is any breach, the financial institution shall cancel the cardholder's foreign exchange settlement.
(3) With regard to reporting cardholders' foreign exchange settlements by transaction or accumulated daily amount according to Regulations for Declaration, please send an itemized computer statement of all the relevant foreign exchange settlements during the previous month to the Department of Foreign Exchange of the Bank before the tenth day of each month, and designate a specific person to perform the relevant control tasks. Please securely preserve computer files containing itemized lists of cardholders' authorized foreign exchange settlement transactions (shall include columns for card type, bank code, serial number, transaction date, cardholders name or company name, ID card or profit-seeking enterprise uniform number, date of birth or date of establishment, amount of settlement in United States dollar, nationality, and date of issuance of Alien Resident Certificate) and total amounts of foreign exchange settlements.
(Certificates)
(1) Imports/exports negotiation certificates and other transaction certificates connected with imports/exports foreign exchange:Please indicate the type of payment and the destination of payment or origin of receipt; the type of payment may be indicated with the following code: 1. for sight L/C, 2. for usance L/C, 3.for D/A, 4.for D/P. If Mainland China is the destination of payment or origin of receipt, the paying or receiving bank in Mainland China shall be noted, and may also be identified by the SWIFT code.
(2) Foreign exchange purchase or sale memos and other transaction certificates connected with inward and outward remittances: Apart from indicating the accordance with the " Classification and Description of Inward and Outward Remittance" listed in Attachment 18, banking enterprises shall also indicate the identity of the foreign ordering institution or beneficiary (government, state-run enterprise, private entity), destination of payment or origin of receipt, and the category of the remittance. The category of the remittance may also be indicated with the following code: electronic transfer - 0 for telegraphic, 1 for draft transfer, 2 for mail transfer, C for foreign currency banknotes or traveler's check, 5 for others. A foreign exchange purchase memo and other transaction certificates shall indicate the name of the ordering institution and the paying bank when a telegraph transfer is made, and the bank name may also be identified by SWIFT code. A foreign exchang e sale memo and other transaction certificates shall indicate the beneficiary's name, account number, and the name of the receiving bank, and the bank name may also be indicated by the SWIFT code.
(Report forms)
(1) Daily Report of Foreign Exchange Position (Attachment 1).
(2) Daily Transaction Report of Export and Inward Remittances (Attachment 2).
(3) Daily Transaction Report of Import and Outward Remittances (Attachment 3).
(4) Daily Report of Foreign Exchange Deposits (Attachment 4).
(5) Daily Report of Forward Foreign Exchange (Attachment 5).
(6) Daily Transaction Report of NT Dollar Exchange Rate Options (Attachment 6).
(7) Daily Report of NT Dollar Non-Delivery Forward Foreign Exchange (on [electronic] medium) (Attachment 7).
(8) Daily Report of Foreign Liability Balance (Attachment 8).
(9) Monthly Report of Balance of Foreign Currency Loan and Foreign Currency Guarantee (Attachment 9).
(10) Monthly Report of Foreign Exchange Transactions Involving a Third Currency (Attachment 10).
(11) Report of Taiwan Area Company Negotiation of Drafts in Taiwan for Exports from Mainland China (Attachment 11).
(12) Report of Taiwan Area Company Applying for issuance of Letter of Credit in Taiwan for Imports to Mainland China (Attachment 12).
(13) Detailed Daily Table of Inward and Outward International Remittance Amounts (Attachment 13).
(14) Daily Transaction Report of Purchase and Sale of Foreign Currency Banknote and Traveler's Checks (Attachment 14).
(Operating manuals and other explanatory information)
18. Relevant operating manuals and explanatory information designated by the Bank are as follows:
(1) Large Spot and Forward Transactions Online Information Transmission System Operating Manual (Attachment 15).
(2) Instructions for Completing Daily Transaction Reports on Short, Medium, and Long Term Foreign Currency Loans Made by Authorized Banks (Attachment 16).
(3) Formats of Various Certificates Issued in Connection with the Foreign Exchange Business (Attachment 17).
(4) Classification and Description of Inward and Outward Remittances (Attachment 18).