These Regulations are enacted pursuant to Paragraph 4 of Article 35, Paragraph 3 of Article 36, Paragraph 2 of Article 72, and Paragraph 3 of Article 73 of the Act Governing Relations Between the Peoples of the Taiwan Area and the Mainland Area (referred to as the “Act” hereunder).

The Competent Authority as referred to in these Regulations is the Financial Supervisory Commission.

The terms used in these Regulations are defined as follows:
1. “Subsidiary” means one of the following:
(1) A company with more than 50 percent of total outstanding voting shares or capital directly or indirectly owned by another company; or
(2) A company controlled by another company.
2. “Equity investment” means owning less than 50 percent of total outstanding voting shares or capital of an investee and not having controlling power over the investee.
3. “Mainland-area insurance enterprise” means an insurance enterprise duly organized and registered in accordance with the law of Mainland Area and under the supervision of insurance regulator in Mainland Area, excluding “foreign-funded insurance enterprises” in Mainland Area.
4. “Mainland-funded insurance enterprise” means an insurance enterprise duly organized and registered in accordance with the law in a third area, under the supervision of the insurance regulator in a third area, and having any of the following situations:
(1) More than 30 percent of its total outstanding voting shares or capital is directly or indirectly owned by individuals, juristic persons, organizations, or other institutions in Mainland Area; or
(2) Individuals, juristic persons, organizations, or other institutions in Mainland Area have controlling power over it.

When a Taiwan-area insurance enterprise, insurance agent company, insurance broker company, or insurance surveyor company applies to establish a representative office, branch, or subsidiary or make an equity investment in Mainland Area shall obtain approval from the Competent Authority in accordance with these Regulations.
The establishment of a branch or a subsidiary in Mainland Area or making equity investment in Mainland Area as referred to in the preceding paragraph shall in addition require applying to the Ministry of Economic Affairs for approval in accordance with the Act.

A Mainland-area insurance enterprise or Mainland-funded insurance enterprise wishing to establish a representative office or make equity investment in an insurance enterprise in Taiwan Area shall obtain approval from the Competent Authority in accordance with these Regulations.
When Mainland-area insurance enterprises or Mainland-funded insurance enterprises wish to make equity investment in Taiwan Area, only either the Mainland-area insurance enterprise or its Mainland-funded insurance enterprise may enter into Taiwan Area and make equity investment in only one insurance enterprise in Taiwan Area.
The establishment of a representative office or making equity investment in Taiwan Area as referred to in the first paragraph herein shall in addition require applying to the Ministry of Economic Affairs for approval in accordance with the Act.

When a Taiwan-area insurance enterprise, insurance agent company, insurance broker company, or insurance surveyor company applies to establish a branch or subsidiary, or make equity investment in Mainland Area, the cumulative allocated operating capital and total amount of investment therefor combined shall not exceed 40 percent of the owner’s equity of said insurance enterprise, insurance agent company, insurance broker company, or insurance surveyor company.

A Taiwan-area insurance enterprise, insurance agent company, insurance broker company, or insurance surveyor company that has established a representative office, branch or subsidiary, or make equity investment in Mainland Area shall still be required to act in compliance with the provisions of these Regulations when establishing a new representative office, branch or subsidiary, or making additional equity investment in Mainland Area.

With respect to the application made by a Taiwan-area insurance enterprise, insurance agent company, insurance broker company, or insurance surveyor company, or a Mainland-area insurance enterprise, or Mainland-funded insurance enterprise under these Regulations, if there are indications that the activities applied for are likely to adversely affect the sound business management of the applicant or fail to meet the requirements for financial supervision, the Competent Authority may disapprove the application, or annul the approval if an application has been approved.
Where an application mentioned in the preceding paragraph or the application item or the documentation submitted thereof is found to contain false representation after an approval is granted, the Competent Authority may revoke the approval.