Unless otherwise provided by these Regulations or the Bank, a banking enterprise may engage in foreign exchange business only after it has applied to the Bank and has been issued a certificate of authorization or a letter of approval.
For foreign exchange businesses that a banking enterprise may engage in after reporting to the Bank for record in accordance with these Regulations or other provisions of the Bank, such businesses shall be deemed to have been approved by the Bank after the banking enterprise has completed the reporting for record procedure according to rules.
Unless otherwise provided by these Regulations or the Bank, banking enterprises shall not engage in any foreign exchange business not yet approved by the Bank or reported to the Bank for record.

Banks and Agricultural Bank may apply for approval to engage in all or part of the business categories listed in Paragraph 1 of Article 4 herein.
Chunghwa Post may apply for approval to engage in outward and inward remittances or purchase and sale of foreign currency cash and traveler's checks.
Credit cooperatives and credit departments of farmers' or fishermen's associations may apply for approval to engage in purchase and sale of foreign currency cash and traveler's checks.

Unless otherwise provided by these Regulations or other laws and regulations, banks and Agricultural Bank that apply for approval to become authorized banks shall comply with the following provisions:
1.Maintain the ratio of regulatory capital to risk-weighted assets at a level in compliance with the requirements set forth by the competent authority;
2.Deploy qualified professional foreign exchange personnel to conduct foreign exchange businesses; and
3.Have not had any sanction or correction imposed by the competent authority due to violation of financial regulations in the past year or during the period from the date of establishment as approved by the competent authority to the date of application, or have made concrete improvements recognized by the competent authority if there has been any violation of financial regulations.

A bank or Agricultural Bank intending to apply for approval to become an authorized bank shall submit the following documents:
1.A photocopy of business license issued and business items approved by the competent authority;
2.Intended scope of foreign exchange business;
3.Names and locations of overseas correspondent banks;
4.Name of the responsible person in charge of foreign exchange business and business address within the territory of the Republic of China;
5.Capital and working capital to be remitted to the territory of the Republic of China, as well as sources and amounts of funds for the foreign exchange business;
6.Documents evidencing compliance with the provisions of the preceding article;
7.Business plan; and
8.Other data or documents specified by the Bank.
An authorized bank that subsequently intends to expand the scope of its foreign exchange business shall submit photocopies of approval documents from the competent authority and the curricula vitae of qualified foreign exchange business personnel deployed to apply to the Bank for approval and issue of a new certificate of authorization.

For the branches of an authorized bank to apply for approval to engage in the foreign exchange business listed in Subparagraphs 1 through 6, Paragraph 1, Article 4 herein, the head office of the domestic bank or Agricultural Bank, or the Taipei branch of a foreign bank (hereinafter referred to as "foreign bank") shall submit documentation detailing the intended scope of business, and attach photocopies of the branch's business license and the curricula vitae of operations and auditing personnel.

When an authorized bank engages in foreign exchange business listed in Subparagraphs 1 through 6, Paragraph 1, Article 4 herein, its operations and auditing personnel shall hold foreign exchange business licenses or meet the following qualifications:
1.An operations personnel shall have at least three-month experience in the relevant foreign exchange business.
2.An auditing personnel shall have at least six-month experience in the relevant foreign exchange business.
For branches of an authorized bank that have been approved to engage in only purchase and sale of foreign currency cash and traveler's checks, their operations and auditing personnel shall have at least five business days of working experience in related foreign exchange business.

An authorized bank that has been approved by the Bank to engage in foreign exchange derivatives business may offer the following foreign exchange derivatives without application:
1.Foreign exchange forward (excluding New Taiwan dollar (NTD) non-deliverable forward).
2.Foreign exchange swap.
3.Combinations of foreign exchange derivatives not involving NTD exchange rate that the authorized bank may engage in according to rules and that are linked to the underlying asset with the same risk and combined through the same transaction contract, but excluding complex high-risk products involving foreign exchange that are offered to customers other than professional institutional investors and high net worth corporate investors.
4.Foreign exchange derivatives transactions not involving NTD exchange rate between domestic authorized banks and between a domestic authorized bank and a foreign bank.
5.Domestic and foreign futures contracts not involving NTD exchange rate traded by a futures trader.
An authorized bank that has been approved by the Bank to engage in foreign exchange derivatives business shall apply to the Bank for approval or report to the Bank for record based on the following criteria if it intends to offer the following foreign exchange derivative products:
1.Application for approval before commencing:
(1)Foreign exchange derivatives not yet approved by the Bank or have been approved for less than six months, and foreign exchange derivatives linked thereof.
(2)NTD non-deliverable foreign exchange forwards.
(3)Foreign derivatives involving NTD exchange rate.
(4)Discretionary foreign currency margin trading.
2.Reporting for record before commencing: The service of recommending those foreign exchange derivative products by the designated branch of an authorized bank under the authorization of its head office.
3.Reporting for record after commencing:
(1)Foreign exchange derivative products approved by the Bank for over six months and not involving NTD exchange rate.
(2)Foreign exchange derivative products offered to professional institutional investors and high net worth corporate investors without involving NTD exchange rate and not yet approved by the Bank or approved for less than six months, which comply with the relevant rules of the competent authority.
(3)Information and consulting services on offshore financial derivatives under the approval of the competent authority. The underlying asset shall not involve domestic interest rates, exchange rates, equities, indices, commodities, credit events, fixed-income or other interests.
Where a professional institutional investor accepts trading orders, signs a trust agreement, discretionary services agreement, investment-linked insurance contract or offers privately placed fund, and carries out transactions provided in Items 2 and 3, Subparagraph 3 of the preceding paragraph in its name, the trustors/mandatories, policyholders or subscribers shall also be a professional institutional investor or high net worth corporate investor.

An authorized bank shall submit the following documents when applying to the Bank for approval to offer products under Subparagraph 1, Paragraph 2 of the preceding article:
1.A statement of regulatory compliance;
2.Minutes with the resolution of the board of directors of the domestic bank or Agricultural Bank to offer such products or letter of authorization from the head office or the regional command center of a foreign bank;
3.Curricula vitae of operations and relevant management personnel;
4.Risk disclosure statement;
5.Product profiles;
6.Operational guidelines; and
7.Risk management related documents.
An authorized bank shall submit the following documents when reporting to the Bank for record to offer services under Subparagraph 2, Paragraph 2 of the preceding article and may commence the businesses only after receiving a letter of acknowledgement from the Bank:
1.A photocopy of letter of approval from the competent authority;
2.Minutes with the resolution of the board of directors of a domestic bank or Agricultural Bank to offer such services or letter of authorization from the head office or the regional command center of a foreign bank; and
3.Authorization guidelines set out according to relevant rules.
Within one week of carrying out the first transaction involving a product under Item 1 or 2, Subparagraph 3, Paragraph 2 of the preceding article, an authorized bank shall report to the Bank for record with the product description (must be a product actually transacted with the date of transaction, date of settlement, expiration date, notional principal amount, exercise price or other relevant indexes and parameters) and documents provided in Subparagraphs 1~5 of Paragraph 1 hereof. The authorized bank may continue to offer the product only after receiving a letter of acknowledgement from the Bank.
When an authorized bank offer services under Item 3, Subparagraph 3, Paragraph 2 of the preceding article, it shall summit a letter of approval from the competent authority and documents provided in Subparagraphs 1 ~ 3, Paragraph 1 hereof within one week after commencing the service.

When engaging in the foreign exchange derivatives business listed in Subparagraph 7, Paragraph 1, Article 4 herein, the operations and management personnel of an authorized bank shall meet at least one of the following qualifications:
1.Having completed at least 60 hours of training on derivatives and risk management held by domestic financial training institutions and received a certificate therefor; the training must cover theories and practices on foreign exchange derivatives transactions, relevant laws and regulations, accounting and risk management;
2.Having one year of internship in the foreign exchange derivatives business at a domestic or foreign financial institution; or
3.Having at least six-month working experience in the foreign exchange derivatives business at domestic or foreign financial institutions.
Operations and management personnel handling the recommendation of foreign exchange derivatives shall meet at least one of the following qualifications:
1.Having one of the qualifications listed in the preceding paragraph;
2.Having passed the qualification exam for structured products salesperson held by domestic financial training institutions and received a certificate therefor ; or
3.Having passed the qualification exam for financial derivatives salesperson held by domestic financial training institutions and received a certificate therefor.
Operations and management personnel handling the trading, marketing, risk management, settlement or accounting, as well as compliance personnel, auditing personnel, and operations and management personnel handling the recommendation of foreign exchange derivatives shall attend at least 6 hours of training courses on derivatives. The training courses on derivatives offered by domestic financial training institutions regarding relevant regulations or non-compliance cases shall comprise no less than one half of the total hours of training received.
Personnel of an authorized bank handling the foreign exchange derivatives business shall possess professional ability, and the authorized bank shall draw up professional qualification requirements and a related training system.

To engage in foreign currency settlement business through a domestic clearing institution, authorized banks shall apply to the Bank for approval to become a foreign currency settlement bank.
Authorized banks making an application mentioned in the preceding paragraph shall submit the following documents and information to the Bank for review within the designated period set by the Bank. The Bank will select and give approval to one bank to conduct the foreign currency settlement business after reviewing those documents:
1.A business plan to engage in foreign currency settlement business;
2.The latest audited financial report; and
3.Other information that supports the applicant's eligibility.
The designated period referred to in the preceding paragraph will be announced by the Bank.
A foreign currency settlement bank approved by the Bank shall be granted a five-year concession period to engage in the foreign currency settlement business, starting from the date of commencement.

An authorized bank concurrently conducting the trust business that engages in the NTD or foreign currency non-discretionary money trust business investing in foreign-currency denominated securities shall submit the following documents to the Bank for approval:
1.Approval documents from the competent authority;
2.Minutes with the resolution of the board of directors to engage in the NTD or foreign currency non-discretionary money trust business for a domestic bank and Agricultural Bank or a letter of authorization from the head office or a regional headquarters of a foreign bank;
3.A regulatory compliance statement;
4.Descriptions of the designated currency for receipts and disbursements and foreign exchange settlement procedures; and
5.Other documents specified by the Bank.

An authorized bank concurrently conducting the trust business that engages in the foreign currency denominated collective investment trust account business or offers and issues foreign currency denominated collective trust funds inside the ROC shall submit the following documents to the Bank for approval before establishing or offering such fund for the first time:
1. Approval documents from the competent authority. Exemptions:
(1)Banks that establish foreign currency denominated collective investment trust accounts which accept funds from professional investors referred to in the Regulations Governing Offshore Structured Products (it should be stated in the application letter) only ; or
(2)Banks that offer and issue the foreign currency denominated collective trust fund;
2. A management and utilization plan for the foreign currency denominated collective investment trust account established for the first time or an offering and issuance plan for the collective trust fund offered for the first time;
3. A resolution of the board of directors for a domestic bank and Agricultural Bank to engage in the foreign currency denominated collective investment trust account business or a letter of authorization from the head office or the regional headquarters of a foreign bank;
4. A regulatory compliance statement; and
5. Other documents required by the Bank.
An authorized bank that has obtained approval from the Bank to engage in the business mentioned in the preceding paragraph is not required to apply to the Bank for approval on a case-by-case basis subsequently.

An authorized bank concurrently conducting the trust business that engages in foreign currency trust businesses other than those under the preceding two articles shall submit the following documents to the Bank for approval:
1. Approval documents from the competent authority or relevant supporting documents that meet the requirements under Article 5 of the Regulations Governing the Scope of Business, Restrictions on Transfer of Beneficiary Rights, Risk Disclosure, Marketing, and Conclusion of Contract by Trust Enterprises;
2. Description of operations (exempted for applications for engaging in the foreign currency money trust or foreign currency securities trust), which should include the following particulars:
(1) Name of business (according to the business activities and classification provided in Article 16 of the Trust Enterprise Act and Articles 6 ~ 8 of the Enforcement Rules of the Trust Enterprise Act);
(2) Introduction of business;
(3) Operation process; and
(4) Description of receipts and payments of funds;
3. A resolution made by the board of directors of a domestic bank or the Agricultural Bank of Taiwan to engage in the business or a letter of authorization from the head office or the regional headquarters of a foreign bank;
4. A regulatory compliance statement; and
5. Other documents required by the Bank.

To set up automatic teller machines to process foreign exchange businesses, an authorized bank shall meet all regulations set forth by the competent authority regarding service items that may be provided by automatic teller machines and related operation security control and management regulations. It shall also submit the description of operations and identify the names of the offices controlling automatic teller machines and their locations, and report to the Bank for record before offering the foreign exchange services.
If there are subsequently changes in the description of operations regarding principles of exchange rate determination, exchange rate disclosure methods, foreign exchange declaration methods, or reduction in services offered, the authorized bank shall report to the Bank for record before the change takes place.
If an authorized bank subsequently sets up additional automatic teller machines or to close automatic teller machines for foreign exchange business, the authorized bank is only required to inform the Bank by submitting a document identifying the names of the offices controlling automatic teller machines and the location of setup or closing within one week after the setup or closing of automatic teller machines.

When engaging in foreign exchange businesses through electronic or communications equipment, authorized banks and Chunghwa Post shall meet all regulations set forth by the Financial Supervisory Commission (hereinafter referred to as the "FSC") regarding he scope of services that may be provided by banks and apply to the Bank for approval. However, if the scope of service meets the provisions of the Bank, authorized banks or Chunghwa Post may proceed with those businesses without making an application or by reporting to the Bank for record.
Authorized banks and Chunghwa Post that apply to the Bank for approval in accordance with the preceding paragraph shall submit the following documents:
1.The description of operations;
2.The code of remittance classification;
3.The statement signed by the head office chief compliance officer, chief auditor and head of information department; and
4.Controls for preventing customers from dodging reporting obligation as required by law through breaking up a single, large settlement amount into multiple smaller ones (exempted if the operation does not involve the foreign exchange settlement against NTD).
An authorized bank that reports to the Bank for record in accordance with Paragraph 1 hereof shall submit the documents provided in the preceding paragraph and a simulation test report on its foreign exchange operation process of online banking system.
Authorized banks and Chunghwa Post that engage in businesses mentioned in Paragraph 1 hereof shall comply with the following provisions:
1.The system shall have a function of computerized verification of the code of remittance classification and a mechanism to ensure compliance with the provisions governing renminbi exchange or remittance to Mainland China Area.
2.For an authorized bank that allows customers to make the declaration of foreign exchange settlement against NTD through the Internet in accordance with Paragraph 1, Article 10 of the Regulations Governing the Declaration of Foreign Exchange Receipts and Disbursements or Transactions (hereinafter referred to as Regulations for Declaration), its system shall first pass the test of connection with the Bank's Foreign Exchange Data Processing System before applying to the Bank for approval or reporting to the Bank for record.
3.Other provisions set forth by the Bank for proper administration of businesses under Paragraph 1 hereof.
An Internet-only bank that engages in foreign exchange businesses involving the foreign exchange settlement against NTD through electronic or communications equipment with a value equal to or over an equivalent of NTD 500,000 shall allow declarants to make the declaration of foreign exchange settlement against NTD through the Internet in accordance with Paragraph 1, Article 10 of the Regulations for Declaration.
The provisions mentioned in Paragraph 1 hereof that allow for proceeding with businesses by reporting to the Bank for record or without making an application and the other provisions mentioned in Subparagraph 3, Paragraph 4 will be prescribed separately by the Bank.

To engage in foreign exchange business during non-standard business hours, an authorized bank shall submit a description of the relevant operations (including the cut off time for including the relevant transactions in the same-day or next-day "Daily Transaction Report" and "Daily Foreign Exchange Position Report"; the preceding provision applies when there is a change to the services.
Designated branches of an authorized bank that has been approved by the Bank according to the preceding paragraph are not required to apply for separate approval on a case-by-case basis to conduct the business, provided the branches engage in the foreign exchange business in the preceding paragraph in accordance with the authorized bank's description of operations.

Where an authorized bank has established its own domestic foreign exchange processing center to process relevant foreign exchange operations, it shall submit a description of relevant operations, operating procedures, and the curricula vitae of operations and auditing personnel to the Bank for record within one week after commencing its operation. In the event that an authorized bank uses other methods to assign a third party to process relevant foreign exchange operations, the bank shall apply to the Bank for approval by submitting the operational plans for outsourcing. If the Bank has not objected within 15 days from the day following receipt of the application, the bank may proceed to process the operation straightway.

To issue foreign exchange bank debentures, an authorized bank shall, within one week after issuance, submit the letter of approval (letter of acknowledgement) from the competent authority and relevant information (including issue date, issue amount, terms and conditions, region or country in which the debenture will be issued and the fund utilization plan) to the Bank for record. However, pursuant to the Regulations Governing the Offering and Issuance of Overseas Securities by Issuers, the procedure for applying for issuing foreign exchange convertible bank debentures, foreign exchange exchangeable bank debentures or other foreign exchange bank debentures involving equities outside the ROC should follow the provisions of the aforementioned regulations.

Banking enterprises other than authorized banks that apply to the Bank for approval to engage in purchase and sale of foreign currency cash and traveler's checks shall proceed according to the following rules:
1.For domestic banks and their branches or for foreign banks, their head office or Taipei branch shall submit a written application together with a photocopy of its business license (or a photocopy of establishment approval letter issued by the competent authority) and the curricula vitae of operations and auditing personnel.
2.For credit cooperatives (head office or branches), the head office shall submit a written application together with a photocopy of the credit cooperative's business license, the curricula vitae of the operations and auditing personnel, the balance sheet and statement of comprehensive income of the preceding fiscal year, and documents evidencing whether the credit cooperative has been subject to any sanctions for violation of financial regulations in the past year.
3.For the credit departments of farmers' or fishermen's associations and their branches, the farmers' or fishermen's association shall submit a written application along with a photocopy of the approval certificate and curricula vitae of operations and auditing personnel to be reviewed and approved by the Council of Agriculture, Executive Yuan before the application is forwarded to the Bank for approval.
4.For Chunghwa Post and its post offices, Chunghwa Post's head office shall submit a written application along with a photocopy of the FSC's letter of approval (for post offices established after January 1, 2003), and curricula vitae of operations and auditing personnel to the Bank for approval.
The provisions of Paragraph 2 of Article 11 herein shall apply mutatis mutandis to the qualifications of operations and auditing personnel handling the business mentioned in the preceding paragraph.
The provisions of Subparagraph 4, Paragraph 1 hereof shall apply mutatis mutandis to the approval process for outward and inward remittance business of Chunghwa Post and its post offices, and the provisions of Paragraph 1 of Article 11 herein shall apply to the qualifications of their operations and auditing personnel.

When a banking enterprise that has been approved to engage in foreign exchange business pursuant to Article 9, Article 10 or Paragraph 1 and Paragraph 3 of the preceding article changes its address or name, the banking enterprise shall, within two weeks before or after the changes take effect, submit the following documents to the Bank to apply for a updated certificate of authorization or report to the Bank for record:
1.Chunghwa Post and its post offices: A photocopy of the letter of approval from the FSC or the letter of approval from its head office; In the event of relocation, the curricula vitae of operations and auditing personnel.
2.Banking enterprises other than those mentioned in the preceding subparagraph: Approval documents from the competent authority, a photocopy of the updated business license or the approval certificate received; in the event of relocation, the curricula vitae of operations and auditing personnel.
When a banking enterprise that has been approved to engage in foreign exchange business is closed, or terminates part or all of its foreign exchange business, the banking enterprise shall, within one week after the closure or termination, turn in the certificate of authorization to the Bank, or apply to the Bank for a updated certificate, or report to the Bank for record.

Banking enterprises other than authorized banks that plan to engage in the Bank-approved business of purchase and sale of foreign currency cash and traveler's checks during non-standard business hours are not required to apply to the Bank for approval.
The provisions of Article 20 herein shall apply mutatis mutandis to Chunghwa Post and its post offices conducting Bank-approved outward and inward remittance business during non-standard business hours.

Banking enterprises applying for foreign exchange business or reporting the business for record will be granted a designated period for providing the supplementary documentation or information and making corrections if the documentation or required information submitted were found to be incomplete. The Bank may reject the application or reporting if the supplementary documentation or information and corrections were not submitted during the designated period.

The Bank may reject a banking enterprise's application for foreign exchange business in the event of any of the following:
1.Qualifications of the applicant do not comply with the regulations or false documents are submitted;
2.The applicant has failed to assist declarants to fill out the Declaration Statement of Foreign Exchange Receipts and Disbursements or Transactions (hereinafter referred to as "Declaration Statement") as required;
3.A high error rate in the certificates, reports and forms prepared by the applicant;
4.The applicant had violated the provisions of these Regulations or relevant rules in the past year and the violation is of a serious nature; the applicant was ordered to rectify the situation by the Bank, but has failed to do so within the period specified by the Bank; or
5.Other facts that are sufficient to indicate that the applicant may hinder sound operations of the business, or that the applicant is unable to meet financial policy requirements.
When a banking enterprise reports to the Bank for record with regard to the foreign exchange business it engages in, if the banking enterprise submits false documents or the business reported does not fall under the types of business that allow reporting for record, the Bank will reject the reporting, and depending on the severity of the situation, impose a warning, demand remedial action, or suspend the specific foreign exchange business for a specified period of time, or withdraw the banking enterprise's privilege of commencing a foreign exchange business that requires reporting for record according to these Regulations by reporting the business to the Bank for record.

If a banking enterprise has any of the following situations in conducting foreign exchange business, the Bank may, depending on the severity of the situation, order the banking enterprise to suspend the business for a specified period of time, revoke or cancel all or part of the approved businesses, or bar the banking enterprise from applying for new foreign exchange business or add new branches to conduct the foreign exchange business for a specified period of time:
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 valid reasons. If agreed by the Bank, the banking enterprise may have an extension of no more than three months. An institution may apply for an extension only once;
2.The banking enterprise has violated the provisions of these Regulations and the violation is of a serious nature; or was ordered to rectify the situation by the Bank, but has failed to do so within the period specified by the Bank;
3.After the banking enterprise has been approved to engage in various foreign exchange businesses, its original documents submitted were found to contain false information or representation of a serious nature;
4.The banking enterprise suspends operations, is dissolved, or declares bankruptcy; or
5.Other facts that are sufficient to indicate that the banking enterprise may hinder sound operations of the business, or that the banking enterprise is unable to meet financial policy requirements.
A banking enterprise whose approval is revoked or cancelled in accordance with the preceding paragraph shall, within seven days from receiving the disposition, turn in its certificate of authorization or letter of approval; should the banking enterprise fails to do so, the Bank will nullify the certificate or the approval.
A banking enterprise that is ordered by the Bank or the relevant competent authority to suspend or stop applying for foreign exchange business for a specified period of time shall not commence any foreign exchange business that requires reporting for record according to these Regulations by reporting the business with the Bank for record if the period of suspension has not expired or if it fails to propose proper, concrete improvement measures during the period of suspension, or if its proposed improvement measures have not been accepted by the competent authority.