With approval of the Competent Authority, the third-area branches and OBUs of a Taiwan bank may engage in the following financial activities with individuals, juristic persons, organizations, other institutions in Mainland Area and their branches in any country and area outside Mainland Area:
1. The third-area branches: The businesses as approved by local financial competent authority. But those do not comply with Taiwan area financial laws and regulations shall be reported to the Competent Authority for prior approval.
2. OBUs: The businesses shall be limited to those a commercial bank may operate under the Offshore Banking Act.
Where the counterparty to a business transaction has obtained a residence permit or has been granted a business registration certificate or license in Taiwan Area, the business transaction shall be handled in accordance with the rules and regulations applicable to individuals, juristic persons, organizations and other institutions in Taiwan Area.

The aggregate amount of credit that third-area branches and OBUs of a Taiwan bank extend in the business in Paragraph 1 of preceding article plus the aggregate amount of credit they extend to juristic persons in any country and area outside Mainland Area in which the credit line or funds are transferred for use by any individuals, juristic persons, organizations, other institutions in Mainland Area or their branches in any country and area outside Mainland Area may not exceed 30 percent of the combined net assets of the Taiwan bank’s third-area branches and OBUs after final settlement of accounts in the previous fiscal year. However, the amounts of short-term trade financing and international syndicated loans are not included in the calculation.
For a Taiwan bank that meets the following criteria, the Competent Authority may, after consulting the Central Bank with respect to the application, raise the percentage of aggregate amount of credit to net assets up to 50 percent for the credit extension business under the preceding paragraph:
1. The bank’s average non-performing loan ratio during the half year before application is below 1.5%;
2. The bank’s average loan loss coverage ratio during the half year before application is 80% or higher;
3. The bank’s ratio of equity capital to risk-weighted assets for the latest fiscal half year is 10% or higher; and
4. The percentage of aggregate amount of credit to the net assets of the bank’s third-area branches and OBUs for credit extension business under the preceding paragraph is already more than 20 percent before the application is made.
After a Taiwan bank has been approved by the Competent Authority to raise the percentage (of net assets) for credit extension business according to Paragraph 1 hereof, the Taiwan bank shall report to the Competent Authority on the ratios set out in Subparagraphs 1 to 3 of the preceding paragraph before the end of January and July each year. If the bank fails to comply with the preceding provision, the Competent Authority may reduce the percentage for its credit extension business, and concurrently inform the Central Bank.

For its business activities with any individuals, juristic persons, organizations, other institutions in Mainland Area or their branches in any country and area outside Mainland Area, a Taiwan bank shall have appropriate risk management mechanism and truly evaluate the risk of each transaction to ensure safety of its assets.
For a Taiwan bank’s business activities in Mainland Area, its aggregate amount of credit, investment and interbank loan and deposit may not exceed 100 percent of the bank's net worth as of the end of the preceding fiscal year; The calculation methods shall be as prescribed by the Competent Authority after consultation with the Central Bank.
Based on the economic or financial situation and actual needs, the above-mentioned ceiling may be adjusted by the Competent Authority after consultation with Central Bank.
A Taiwan bank fails to comply with the provisions of Paragraph 2 hereof before the amendment of the Regulation on September 7, 2011 shall make adjustment within one (1) year from the implementation date of the said amendment.

With approval of the Competent Authority, Taiwan banks approved by the Central Bank to handle foreign exchange business (referred to as “designated FX banks”) and Chunghwa Post may conduct foreign currency business with individuals, juristic persons, organizations, and other institutions in Mainland Area and their branches established in any country and area outside Mainland Area; Scope of foreign exchange business is that designated FX banks may conduct in compliance with the Central Bank’s rules. But for outward and inward remittance business, it excludes outward and inward remittance for purposes of unapproved direct investment or securities investment, or other activities not yet approved according to law.
Where the counterparty to a business transaction has obtained a residence permit or has been granted a business registration certificate or license in Taiwan Area, the business transaction shall be handled in accordance with the rules and regulations applicable to individuals, juristic persons, organizations and other institutions in Taiwan Area.

Unless it is otherwise provided by the Competent Authority, the currencies used for activities referred to in Article 11 and the preceding article shall be limited to currencies issued in a third area other than Taiwan Area and Mainland Area.

A Taiwan bank or Chunghwa Post applying to the Competent Authority for approval to conduct business pursuant to Article 11 or Article 13 herein shall submit the following:
1. The name and address of the head office and the name of the responsible person;
2. A business plan stating the business items applied for, business development plan, and the measures for dispute handling, preservation of claims and risk management;
3. A CPA audited financial report of the head office for the latest fiscal year and a calculation of the ratio of equity capital to risk-weighted assets for the latest fiscal half year; and
4. A description of the amount and the ratio of non-performing loans and non-accrual loans and the amounts and ratios of all loss reserves set aside for the latest quarter.

Banks, credit cooperatives, bills finance companies, institutions engaging in credit card business, and Chunghwa Post may engage in NTD financial activities with individuals, juristic persons, organizations, other institutions in Mainland Area or their branches in any country and area outside Mainland Area.
Where the counterparty to a business transaction has obtained a residence permit or has been granted a business registration certificate or license in Taiwan Area, the business transaction shall be handled in accordance with the rules and regulations applicable to individuals, juristic persons, organizations and other institutions in Taiwan Area. Where the counterparty to a business transaction has not obtained a residence permit or has not been granted a business registration certificate or license in Taiwan Area, the business activities shall be handled in accordance with the rules and regulations applicable to individuals, juristic persons, organizations and other institutions in a third area that do not have a residence permit or a business registration certificate or license in Taiwan Area, except for the business of NTD credit extension to Mainland individuals without Taiwan residence permit by banks and credit cooperatives, which is limited to real estate secured loan and the borrower must have acquired and set real estate property rights in Taiwan Area in accordance with the Regulations on Permit for the Mainland individuals to Acquire, Set or Transfer the Property Rights of Real Estates.
The eligible borrowers, limits, term, collateral, purposes for the funds, percentage of loan and other matters of attention relating to the real estate secured loan business of Taiwan banks and credit cooperatives as described in the preceding paragraph shall be prescribed separately by the Competent Authority.

With approval of the Competent Authority, financial institutions in Taiwan may engage in the following credit card or debit card businesses with institutions engaging in inter-bank information exchange and funds clearing services for credit cards and debit cards:
1. Acquisition business in connection with credit card or debit card transactions;
2. Providing services in connection with authorization or settlement of credit card transaction; and
3. Other businesses as approved by the Competent Authority.
A financial institution in Taiwan Area shall submit the following documents when applying to the Competent Authority for approval under the preceding paragraph:
1. A business plan stating the business items applied for, terms and conditions for the business collaboration, benefit analysis, and the measures for dispute handling and risk management;
2. The construction and the flow process of transaction authorization and settlement system, provided the application is for the business mentioned in Subparagraph 2 of the preceding paragraph; and
3. Such other information or documents as may be required by the Competent Authority.

Financial institutions in Taiwan Area that have been permitted to engage in activities under these Regulations shall submit, via their head office, monthly business reports to the Competent Authority and the Central Bank for recordation.

For the necessity of maintaining the stability of the domestic financial market, the Competent Authority may, after obtaining approval from the Executive Yuan, restrict or prohibit the activities under these Regulations.