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Chapter 1 General Provisions
Article 1
(Legal Basis)
These Regulations are enacted pursuant to paragraph 4, Article 38 of the Act Governing Relations between Peoples of the Taiwan Area and the Mainland Area (hereinafter referred to as “the Act”).
Article 2
(Scope of Application)
The administration and settlement of currency issued in the Mainland Area (hereinafter referred to as “Renminbi”) in the Taiwan Area shall be governed by the provisions of these Regulations before the execution of a bilateral currency settlement agreement or the establishment of a bilateral currency settlement mechanism between the Taiwan Area and the Mainland Area.
Article 3
(Legal Trading of Renminbi)
Holders of Renminbi that enter Taiwan Area legally may engage in the purchase, sale, exchange or other transactions of Renminbi at a bank, credit cooperative, Chunghwa Post Co., Ltd., Agricultural Bank of Taiwan Co., Ltd., the credit department of farmers’ association, or the credit department of fishermen’s association (collectively referred to as “financial institutions” hereunder) or a foreign currency exchange bureau (referred to as “exchange bureaus” hereunder).
The financial institution or exchange bureau prescribed in the preceding paragraph shall be limited to those that have obtained approval according to the provisions of these Regulations herein.
The purchase, sale, exchange, or other transactions prescribed in paragraph 1 hereof shall be limited to the approved businesses of a financial institution or an exchange bureau in the preceding paragraph.
No entity may engage in any Renminbi related business without approval.
Article 4
(Scope of Business)
A financial institution must have obtained the required approval before engaging in the following businesses:
1. Purchase or sale of Renminbi against New Taiwan Dollars (referred to as “Renminbi purchase or sale business” hereunder);
2. Supply and repatriation of Renminbi notes and other accessory businesses (referred to as “Renminbi coverage business” hereunder) with financial institutions in areas outside Taiwan Area and other financial institutions in Taiwan Area.
An exchange bureau must have obtained the required approval before engaging in the business of Renminbi notes purchase (referred to as “Renminbi purchase business” hereunder).
Article 5
(Administration Mandate of Exchange Bureau)
The Central Bank of the Republic of China (Taiwan) (hereinafter referred to as “the Bank”) entrusts the Bank of Taiwan Co., Ltd. (referred to as “Bank of Taiwan” hereunder) to handle administrative affairs concerning the approval of the Renminbi purchase business of an exchange bureau, revocation or cancellation of such approval, and performance of operational audit when necessary.
The Bank of Taiwan shall draw up relevant rules with regard to the mandate prescribed in the preceding paragraph and submit to the Bank for reference.
The Bank of Taiwan may revoke or cancel its approval to any exchange bureau in Renminbi purchase business in the event of any of the following:
1.The exchange bureau has seriously violated these Regulations, administrative rules drawn up by the Bank of Taiwan pursuant to the preceding paragraph, or other applicable rules and regulations, or has failed to take remedial actions within the period specified by the Bank of Taiwan;
2. The exchange bureau does not purchase any Renminbi notes in two consecutive quarters or the amount of Renminbi notes purchased by the exchange bureau in four consecutive quarters is less than 30,000 RMB.
3. The Bank of Taiwan finds, after granting approval to the exchange bureau for Renminbi purchase business, that the exchange bureau’s original application contains false representation of a serious nature.
4. The exchange bureau suspends its business, is dissolved, or declares bankruptcy.
Where the documents submitted by an exchange bureau to apply for approval to engage in Renminbi purchase business are incomplete or the required information is incomplete, and supplementary information or documents asked by the Bank of Taiwan are not submitted prior to the deadline, the Bank of Taiwan may reject the application.
If deemed necessary, the Bank may perform audits of the Renminbi purchase business of an exchange bureau by itself or jointly with the Bank of Taiwan.
Article 6
(Obligation of Confidentiality)
Unless otherwise provided by law or the competent authorities, financial institutions and exchange bureaus shall maintain the confidentiality of information related to Renminbi purchase, sale, exchange, coverage and other transactions.
Chapter 2 Business Application
Article 7
(Application Criteria)
When a financial institution that meets the following criteria engages in Renminbi purchase or sale business for the first time, the Bank will consult with the Financial Supervisory Commission, Executive Yuan (referred to as the “FSC” hereunder) or the Council of Agriculture, Executive Yuan (referred to as the “COA” hereunder) to seek their consent before approval:
1. Its personnel dealing with the Renminbi purchase or sales business have had business experience in buying and selling Renminbi notes or have been trained to authenticate Renminbi notes; and
2. Having the ability to arrange Renminbi notes coverage.
The branch of a financial institution in the preceding paragraph that has obtained approval may proceed to engage in Renminbi purchase or sale business, provided the branch meets the criteria set forth in subparagraph 1 of the preceding paragraph and is free of violation in its foreign exchange business in the past three months, and has filed a report with the Bank and the FSC or the COA for reference two weeks before it commences the business. Where the branch of a financial institution has suspended the aforesaid business, the financial institution shall file a report with the Bank and the FSC or the COA for reference in two weeks after business suspension.
An exchange bureau meeting the criteria set forth in subparagraph 1of paragraph 1 may apply to the Bank of Taiwan for approval to engage in Renminbi purchase business.
A financial institution that meets the following criteria may engage in Renminbi coverage business under the Bank’s approval after obtaining the consent of the Bank in consultation with the FSC:
1. The financial institution is an authorized foreign exchange bank;
2. The assets of the financial institution as stated in its latest CPA-certified financial report are worth NT$2 trillion or more;
3. The financial institution’s latest long-term debt rating is A3 or higher from Moody’s Investors Service or A- or higher from Standard and Poor’s Corp;
4. The financial institution’s monthly average purchase and sale of Renminbi notes combined in the past year is 100 million RMB or more;
5. The financial institution’s ratio of equity capital to risk-weighted assets in the latest quarter is 10% or higher; and
6. The financial institution’s non-performing loan ratio is less than 1.5% in the latest quarter.
Article 8
(Document Review and Submission of Additional Documents)
When a bank, credit cooperative or Chunghwa Post Co., Ltd. applies for approval specified in the paragraph 1 of the foregoing article, the head office of the financial institution shall submit the following documents to the Bank and the FSC:
1.A business plan;
2.Names of branches to engage in the business and documents evidencing the experiences of personnel dealing with or checking the purchase and sale of Renminbi or the qualification of having attended trainings on authenticating Renminbi notes;
3.Supporting documents evidencing the ability to arrange Renminbi notes coverage;
4.Supporting documents evidencing the ability to authenticating Renminbi notes and a risk management statement; and
5.Other designated documents.
When the Agricultural Bank of Taiwan Co., Ltd. (referred to as the “Agricultural Bank of Taiwan” hereunder), the credit department of farmers’ association or the credit department of fishermen’s association applies for approval specified in paragraph 1 of the foregoing article, the Agricultural Bank of Taiwan shall submit the following documents to the Bank and the FSC:
1. Application form;
2. A business plan;
3. The minutes of the board of directors’ meeting;
4. Supporting documents evidencing compliance with the criteria set forth in paragraph 4 of the foregoing article; and
5. Other designated documents.
Where the documents submitted by a financial institution to apply for approval to engage in Renminbi purchase or sale business or Renminbi coverage business are incomplete or the required information is incomplete, and supplementary information or documents asked by the Bank are not submitted prior to the deadline, the Bank may reject the application.
Article 9
(Rejection of Application)
The Bank may reject the application of a financial institution to engage in Renminbi purchase or sale business or Renminbi coverage business in any of the following situations:
1. The applicant fails to meet the qualification requirements set forth in the paragraph 1 or paragraph 4 of Article 7 herein;
2. The applicant’s license was revoked or cancelled by the Bank, FSC, or COA in the past year or the applicant had violated any of the Regulations herein or any other relevant foreign exchange or Renminbi notes regulations of a serious nature, or has failed to take remedial actions within the period specified by the Bank in the past year;
3. There is evidence indicating that the applicant may hinder the sound operation of the business, or that the applicant is unable to meet financial policy requirements.
Article 10
(Revocation or cancellation of Approval)
The Bank may revoke or cancel the approval for a financial institution to engage in Renminbi purchase or sale business in the event of any of the following, depending on the seriousness of the violation:
1. The financial institution fails to commence operation in six months after the letter of approval has been issued. A financial institution may request for an extension of the aforesaid deadline. Only one extension of no more than three months can be granted;
2. The financial institution has violated paragraph 3 of Article 4 or any other provisions of these Regulations seriously, or the applicant has failed to take remedial actions within the period specified;
3. After obtaining approval to engage in Renminbi purchase or sale business, the financial institution is found to have provided false information in its application;
4. The financial institution suspends its business, is dissolved, or declared bankruptcy; or
5. There is evidence indicating that the financial institution may hinder the sound operation of the business, or that the financial institution is unable to meet financial policy requirements.
If a financial institution that has been approved to engage in Renminbi coverage business (referred to as “covering bank” hereunder) is found to be in any of the following situations, the Bank may revoke or cancel the approval for its coverage business:
1. The financial institution does not arrange the coverage of Renminbi notes with any financial institutions in areas outside Taiwan Area in three months after the letter of approval has been issued. But with legitimate reasons, the financial institution may request for an extension of the aforementioned deadline.
2. The financial institution refuses to supply or accept Renminbi notes from other financial institutions in the Taiwan Area without legitimate reasons and the situation is of a serious nature or the financial institution has failed to take remedial actions within the period specified.
3. The original application is found to contain false representation after the issuance of an approval letter, or the financial institution subsequently fail to comply with the approval requirements set out in paragraph 4 of Article 7.
4. The financial institution is found to be in a situation prescribed in subparagraph 4 or 5 of the preceding paragraph.
Chapter 3 Business Operation
Article 11
(Verification of Documents)
When buying or selling Renminbi notes, a financial institution shall verify the following identification documents, depending on the status of the customer:
1. Mainland Area residents: Taiwan Entry Permit (referred to as “Entry Permit” hereunder) or Residence Permit issued by the National Immigration Agency, Ministry of the Interior.
2. Taiwan Area residents: Personal identification document.
3. Residents of other countries or districts: passport, Entry Permit or Residence Permit.
4. Customers other than those described in the preceding three subparagraphs: An approval letter of the Bank.
The provisions in subparagraphs 1 to 3 of the preceding paragraph shall apply mutatis mutandis to exchange bureaus that have been approved to engage in Renminbi purchase business.
Article 12
(Transaction Limit)
The amount of Renminbi notes purchased or sold by a financial institution or purchased by an exchange bureau in each transaction shall not exceed the ceiling on Renminbi notes that may be carried in or out of the Taiwan Area as set by the FSC.
Article 13
(Agency of Purchase/Sale)
A person may authorize a travel agent or tour guide to purchase or sell Renminbi notes on his/her behalf. In such cases a financial institution must first verify the following particulars. If the total value of the transactions is NT$500,000 or above, the authorized person shall, in compliance with the Regulations Governing the Declaration of Foreign Exchange Receipts and Disbursements or Transactions, fill out a “Declaration Statement of Foreign Exchange Receipts and Disbursements or Transactions”, and indicate the nature of his/her agency status:
1. Transaction information: including name, personal identification number of the buyer/seller, transaction amount and date.
2. The Entry Permit, residence permit, passport, or personal identification document of the buyer/seller.
3. Joint power of attorney issued by the buyers/sellers to authorize the travel agent or tour guide to handle the purchase or sale of Renminbi notes.
4. A joint statement issued by the buyers/sellers to waive the request for individual exchange memos.
The aforesaid transaction made by an authorized person will not be included in the yearly aggregate settlement amount.
Article 14
(Exchange Rate)
A financial institution may decide on its own accord the exchange rate of Renminbi against New Taiwan Dollars, and post such information on its business premises.
An exchange bureau should refer to the exchange rate of financial institutions for purchasing Renminbi notes and post such information on its business premises.
Article 15
(Settlement)
A covering bank shall observe the following rules in its Renminbi coverage business:
1. Any agreement on Renminbi coverage entered by the covering bank and a financial institution in areas outside the Taiwan Area shall not take effect without the approval of the Bank in consultation with the FSC.
2. The covering bank should provide ample supply of Renminbi to and repatriate Renminbi from other financial institutions in Taiwan Area in accordance with the covered denominations and exchange rate as offered or agreed. The fees charged by the covering bank should be reasonable.
3. The covering bank shall submit a monthly report on its coverage business in accordance with the Bank’s requirements, and obtain the Bank’s consent before it provides related information to agencies or financial institutions in areas outside Taiwan Area upon request.
Financial institutions shall arrange Renminbi coverage with a covering bank. However financial institutions may arrange Renminbi coverage with any counterparty before a covering bank has entered a coverage agreement with a financial institution in areas outside the Taiwan Area and obtained the supply for its Renminbi coverage business.
An exchange bureau that purchases Renminbi notes shall settle the Renminbi notes with the Bank of Taiwan on a ten-day basis.
Article 16
(Filing and Safekeeping of Transaction Documents)
A financial institution engaging in Renminbi purchase or sale business shall keep account books, accounting statements and exchange memos, and unless it is otherwise provided by the Bank, record itemized transaction information below, and file and safekeep such information in a database for future examination:
1. Case number;
2. Name and personal identification number of the customer; and
3. Amount and date of purchase or sale.
The above mentioned account books and accounting statements shall be kept for at least ten (10) years; relevant exchange memos shall be kept for at least five (5) years.
The provisions in the preceding two paragraphs shall apply mutatis mutandis to exchange bureaus when engaging in Renminbi purchase business.
Article 17
(Daily Report)
For financial institutions engaging in Renminbi purchase or sale business, their head office or the Agricultural Bank of Taiwan shall complete and submit a daily Renminbi transaction report (in a format as presented in Attachment 1 or Attachment 2) by electronic means to Department of Foreign Exchange of the Bank before 10:00 AM the next business day; transactions taken place outside business hours and on non-business days shall be counted as transactions of the following business day.
Article 18
(Handling of Counterfeits)
Upon discovering that the Renminbi notes presented by a customer for exchange are counterfeit (altered), a financial institution shall inform the owner of the fact on the spot, and in addition, stamp “Counterfeit (Alteration) - Void” thereon, and with the consent of the holder, retain the original notes while issuing a receipt to the owner.
Where the counterfeit (altered) Renminbi notes discovered has any of the following conditions, the financial institution shall immediately record the real name, nationality, occupation and address of the owner and report the matter to the police for investigation:
1. The total value of counterfeit (altered) Renminbi notes presented for exchange is 1,000 RMB or more; or
2. The total value of counterfeit (altered) Renminbi notes presented for exchange is less than 1,000 RMB, but the holder looks suspicious or declines to let the financial institution retain the original notes.
A financial institution should set up a file and safekeep the counterfeit (altered) Renminbi notes it retains, unless it is necessary to turn them over to the Investigation Bureau of the Ministry of Justice or the International Criminal Police for examination and investigation. For counterfeit (altered) Renminbi notes that have been kept for more than five (5) years, the financial institution may, together with its accounting department, destroy such notes while maintaining a record of them.
The provisions in the foregoing three paragraphs shall apply mutatis mutandis to the Renminbi purchase business of exchange bureaus.
Chapter 4 Supplemental Provisions
Article 19
(Illegal Transactions and Illegal Business Practice)
Engaging in the purchase or sale, exchange ,or other transactions of Renminbi in violation of the provisions set forth in the paragraph 4 of Article 3 herein shall result in the confiscation of Renminbi and the equivalent amount in the other currency involved pursuant to paragraph 2, Article 92 of the Act.
A financial institution or a exchange bureau that violates the provisions in the paragraph 4 of Article 3, Article 4, Article 6 or Section 3 herein shall be subjected to fines set forth in paragraph 2, Article 92 of the Act.
Article 20
(Assistance in Crackdown)
When executing an action according to the provisions in the foregoing article, the Bank may ask for the assistance of the police authorities pursuant to paragraph 3, Article 92 of the Act.
Article 21
(Date of Implementation)
These Regulations shall be implemented on the date of promulgation.
Web site:Laws & Regulations Database of The Republic of China