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Laws & Regulations Database of The Republic of China (Taiwan)

Print Time:2024/05/21 22:07
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Chapter Law Content

Title: Medical Care Act CH
Category: Ministry of Health and Welfare(衛生福利部)
Chapter III Medical Juridical Persons in Medical Care
Section I General Provisions
Article 30
The establishment, organization, and management of medical care corporate shall be conducted in accordance with the provisions under the Act. Any matter not provided for in the Act shall be governed by the Civil Code.
Medical care corporations shall be established in accordance with the provisions under the Act. The organization, management, rights and obligations of the directors, bankruptcy, dissolution, and liquidation of medical corporations not provided for in the Act shall be governed by the Civil Code.
Article 31
Juridical persons in medical care may establish hospitals, clinics, and other medical care institutions. The number and scale of said establishments may be restricted as necessary.
The restrictions of number and scale of establishments as referred to in the preceding paragraph shall be determined by the central competent authority.
Juridical persons in medical care may establish the following subsidiary institutions with the approval of the central competent authority and the competent authority governing the related practice:
1. Nursing institutions, psychiatric rehabilitation institutions;
2. Medical research institutions;
3. Welfare institutions stipulated in accordance with the Law Governing Benefits for Senior Citizens and other welfare related laws.
The establishment criteria, procedure, and other observances of subsidiary institutions referred to in the preceding Paragraph shall be conducted in accordance with the provisions in related laws.
Article 32
Juridical persons in medical care shall have the necessary as sets to achieve the purpose of establishment.
The necessary assets referred to in the preceding Paragraph shall be determined by the central competent authority in accordance with the scope of establishment and conditions for operations.
Article 33
A juridical person in medical care shall establish a board of directors with one chairperson, who shall represent said juridical person.
A juridical person in medical care shall establish bylaws governing the organization and powers of the board of directors and supervisor, the qualification, selection and dismissal procedure for directors, chairperson, and supervisors, meeting and resolutions procedure, and other observances, which shall be submitted for approval to the central competent authority.
Article 34
Juridical persons in medical care shall establish an accounting system, adopting a fiscal year system and accrual system. The legal certificates of financial income and expenses shall conform to publicly-acknowledged accounting standards, and shall be kept on record.
Juridical persons in medical care should submit the annual financial report approved and recognized by the board of directors and supervisors to the central competent authority within five months after the end of the fiscal year.
The principles regarding the compilation of the financial report referred to in the preceding paragraph shall be determined by the central competent authority.
In addition to compliance with provisions stated above, accounting systems of juridical persons in medical care shall be conducted in accordance with related provisions of the Company Law.
The competent authority may order juridical persons in medical care to submit financial and operations reports, or inspect financial or operation situations at any time.
Juridical persons in medical care shall not avoid, obstruct, or refuse the order or inspection referred to in the preceding paragraph.
Article 35
Juridical persons in medical care shall not be unlimited liability shareholders of a company or a partner of a partnership enterprise. In the case that a juridical person in medical care is a limited liability shareholder of a company, the total investment and investment in a single company or the ratio of investment may not exceed a certain restriction.
The restrictions of investment referred to in the preceding Paragraph shall be determined by the central competent authority.
Surplus shares given to juridical persons in medical care by the invested company shall not be taken account into the total investment or investment amount referred to in the preceding Paragraph.
Article 36
The assets of juridical persons in medical care shall be registered or saved in the name of juridical person, and the use of which shall be supervised by the central competent authority.
Juridical persons shall not loan, rent out, create a right in rent over, change to the use of its real estate, or create a right in rent over its facilities, without authorization from the central competent authority.
Article 37
Juridical persons in medical care shall not be guarantors. The capital of juridical persons in medical care shall not be loaned to directors, members, other persons, or non-financial institutions. The assets of juridical persons in medical care shall not be guarantee for directors, members, or other persons.
Article 38
Personal contributions or contributions by organizations to medical care corporate shall be tax-deductible in accordance with related tax laws.
The deduction or exemption of income tax, land tax, or house tax for medical care corporate shall be conducted in accordance with the provisions of tax related laws.
Private medical care institutions established prior to the implementation of the amendment of the Act, which change to juridical person in medical care within three Years of implementation, and transfer original medical lands to juridical person in medical care for continued use without cost, shall be exempt from added value land tax. However, in the case the land is transferred again to a third party, added value land tax shall be collected according to the total added value from the original land value of previous or current transfer.
Article 39
Juridical persons in medical care may merge with other similar juridical persons in medical care under the approval of the central competent authority.
Juridical persons in medical care shall produce a financial statement and balance sheet, and notify obliges within two weeks of merging with the approval of the central competent authority. The provisions of Paragraph 2 of Article 73 and Paragraph 1of Article 74 of the Company Law shall apply mutatis mutandis.
The rights and obligations of juridical persons in medical care eliminated due to mergers shall be accepted in its entirety by the remaining or new medical juridical person.
Article 40
Non-medical care juridical persons may not use the names of, or similar to, medical juridical persons in medical care.
Article 41
The competent authority may reform, give a deadline to make improvements, cease all or part of clinical or hospital practices, order the suspension of practice, or revoke the license of juridical persons in medical care which are ill-conducted, or in violation of laws or original establishment criteria, in accordance with the seriousness of the situation.
In the case that juridical persons in medical care fail to conform to the provisions of Paragraph 2 of Article 32 due to decrease of assets, suspension or alteration of the established institution, or revocation of license, the central competent authority shall give a deadline to make improvements. Those who fail to comply shall be subject to revocation of license.
The central competent authority may annul the permit license of juridical persons in medical care which fall under the following conditions:
1. Those that have been approved for termination of practice, and fail to apply for resumption of practice within the given time limit.
2. Those that have been ordered to terminate all or part of clinical or hospitalization practices, and do not comply.
3. Those that have been ordered to terminate practice and do not comply, or fail to make improvements within the given time limit.
4. Those imposed with revocation of practice license.
Section II Medical Care Corporate
Article 42
Medical care corporate shall submit endowment charter, establishment plan, and related documents for approval by the central competent authority for establishment. After approval for the medical care corporate referred to in the preceding Paragraph, the founder or executor of will shall appoint directors and establish a board of directors within 30 days.
The founder or executor of the will shall submit the list of directors for authorization from the central competent authority within 30 days of establishment of the board of directors, which shall be submitted to the respective court for registration of juridical person within 30 days of authorization.
The founder or executor of the will shall transfer the endowment to the juridical person within three months of the date of registration completion for the medical care corporate, and shall notify the competent authority.
The founder or executor of the will shall be given a time limit within which to transfer the endowment to the juridical person; those who fail to comply shall be subject to revocation of license by the central competent authority.
Article 43
There shall be nine to fifteen directors for a medical foundation.
The requirements for the composition of directors are as follows:
1. No less than one-third of the directors shall be qualified medical personnel, and there shall be at least one physician.
2. No more than one-third of the directors shall be foreigners.
3. No more than one-third of the directors shall be spouses or relatives within the third degree of kinship of other directors.
The term of office for a director shall not exceed four years, but may be renewed through re-election. However, no more than two-thirds of the directors shall have their term of office renewed for each re-election.
In the event where a medical foundation stipulated in the articles of association a term of office of directors more than the period of time specified in the preceding paragraph prior to the enforcement of the provisions amended on November 26, 2013, its directors may continue to hold office till expiration of the current term of office. This rule also applies to succeeding directors who are elected to fill a vacancy.
Directors shall personally attend board of directors meetings, and shall not authorize an agent to represent him/her.
Article 44
Changes to the endowment charter of medical care corporate shall be made with the approval of the central competent authority.
In the case that there are any changes made in chairman, directors, assets, or any other registered particulars, the medical care corporate shall apply for approval in accordance with provisions by the central competent authority.
The changes referred to in the preceding two Paragraphs shall be registered at court within 30 days of approval by the central competent authority.
Article 45
In the case that a medical care corporate director is not elected or replaced after the previous one has fulfilled his/her term, which results in clear damage to the organization of the board of directors, the central competent authority shall appoint a replacement director according to the petition of other directors or interested parties.
The regulations regarding appointment shall be determined by the central competent authority.
In the case that a medical care corporate director is in violation of the law or bylaws, resulting in harm done to the juridical person, is harmful to the interests of the established institution, and causes an inability to operate normally, the central competent authority may order said director to temporarily cease from his/her duties or dismiss him/her according to the petition of other directors or interested parties.
The temporary cessation from duties referred to in the preceding Paragraph shall not exceed six months. In the case that the cessation from duties results in clear damage to the organization of the board of directors, the central competent authority shall appoint a temporary director in replacement. The appointment of the temporary director shall be exempt from registration, and shall be appointed in accordance with provisions provided for in the first Paragraph.
Article 45-1
Any person with any of the following conditions must not serve as a director or supervisor:
1. The person has violated Articles 121 to 123 and Article 131 of the Criminal Code or Articles 4 to 6-1 or Article 11 of the Anti-Corruption Act and has been convicted of the offense or issued a wanted circular for an unclosed case. However, this rule does not apply to the cases where probation is pronounced or the punishment has been commuted to a fine and the fine has been paid in full.
2. The person has been charged with misappropriation, fraud, or breach of trust and has been convicted of the aforesaid offenses or issued a wanted circular for an unclosed case. However, this rule does not apply to the cases where probation is pronounced or the punishment has been commuted to a fine and the fine has been paid in full.
3. The person is faced with the pronouncement of custodial protection or aid that has not been revoked yet.
4. The person has been appraised by physicians to be suffering from mental illness or any other physical or mental impairment that prevents him/her from engaging in professional practice.
5. The person had assumed the post of chairman of the board, director or supervisor and was dismissed pursuant to Paragraph 2 of the preceding article or Subparagraph 3, Paragraph 1 of Article 45-2.
6. The person has been adjudicated bankrupt or subject to the commencement of the liquidation process as ruled, and has not been reinstated to his/her rights and privileges.
Article 45-2
The chairman of the board, a director or a supervisor shall be dismissed if any of the following circumstances occurs during his/her term of office:
1. Having a letter of resignation presented to a board of directors meeting and included in the meeting’s minutes.
2. Meeting one of the conditions as set forth in the preceding article.
3. Having abused the power gained from his/her position or status to commit crimes and been convicted.
4. The chairman of the board convening no board of directors meetings within one year without reason.
In the event where the chairman of the board, a director or a supervisor abused the power gained from his/her position or status to commit crimes and a prosecutor files a public prosecution, his/her duties shall be suspended.
The chairman of the board, a director or a supervisor who represents a government agency or was recommended by other corporations or organizations shall hold or be removed from office when his/her original position changes. Recommended successors shall be elected and engaged by the board of directors, and their term of office expires on the day when the original term of office expires.
Article 46
Medical care corporate shall allot at least ten percent of the annual medical care income to conduct related research and development, professional training, and health education. Medical care corporate shall allot at least ten percent of the annual medical care income to conduct medical relief, community medical care services, and other community services. Those without standing achievements shall be rewarded by the central competent authority.
Section III Medical Care Corporations
Article 47
Medical care corporations shall submit organization bylaws, establishment plan, and related documents for approval by the central competent authority for establishment.
After approval from the central competent authority referred to in the preceding Paragraph, said medical care corporation shall establish aboard of directors in accordance with its bylaws within 30 days. Within 30 days of establishment of board of directors, the medical care corporation shall report to the central competent authority for registration and issuance of juridical person registration license.
Article 48
When a medical corporation is established, the following entries shall be registered:
1. Purpose and name of juridical person;
2. The principal and branch of ices;
3. Name and domicile of directors, chairperson, and supervisors;
4. Classification and number of assets;
5. Location, classification, and scope of established institution;
6. Total number of assets and contributions from each member;
7. Year, month, and date of permit license.
Article 49
The juridical person may not be a member of the medical care corporation.
All members of medical care corporations have aright to vote, regardless of the amount of contribution. However, the right to vote shall be distributed in proportion to the contribution in accordance with the bylaws of said medical care corporation.
The bylaws of medical care corporations shall clearly state that members shall retain rights to the assets of the juridical person in relation to their contributions, which may be transferred, in part or in whole, to third persons.
In the case that members who jointly serve as directors or supervisors transfer their rights to third persons in the situation referred to in the preceding Paragraph, said persons shall notify the central competent authority. Those who transfer all of their rights to the assets shall be dismissed from their duties automatically.
Article 50
The directors of medical care corporations shall be limited to three to nine persons, in which no less than two-thirds shall be physicians or other medical personnel.
No more than one-third of the total number of directors shall be foreigners. Furthermore, foreigners shall not be the chairperson.
Medical care corporations shall establish supervisors, the number of which shall not exceed one-third of the number of directors.
Supervisors shall not serve concurrently as a director or employee.
Directors shall personally attend the board of directors meeting, and shall not authorize an agent to represent him/her.
Article 51
The alteration of the bylaw of a medical care corporation shall be reported to the central competent authority for approval.
In the case that there is a change in chairperson, directors, or alteration in assets or other registered particulars, the medical care corporation shall register the alteration in accordance with regulations by the central competent authority.
In the case of dissolution, the medical care corporation shall register the dissolution.
Article 52
In the case that a medical care corporation director is not elected or replaced after the previous one has fulfilled his/her term, which results in clear damage to the organization of the board of directors, the central competent authority shall order an immediate general meeting for the appointment of a replacement director according to the petition of other directors or interested parties. In the case that the general meeting cannot be called, the replacement director shall be appointed by the central competent authority. Regulations regarding appointment shall be determined by the central competent authority.
In the case that a medical care corporation director is in violation of the law or bylaws, resulting in harm done to the juridical person, is harmful to the interests of the established institution, and causes an inability to operate normally, the central competent authority may dismiss said director according to the petition of other directors or interested parties.
In the case that the resolution of board of directors of a medical care corporation is in violation of the law or bylaws, resulting in harm done to the juridical person, is harmful to the interests of the established institution, or causes an inability to operate normally, the central competent authority shall dismiss the board of directors and call for a general meeting in which to appoint new directors.
Article 53
Medical care corporations shall allot at least ten percent of the income to conduct research and development, professional training, and health education, medical relief, community medical care services, and other community services. Medical care corporations shall allot at least twenty percent of the income as the operation fund.
Article 54
Medical care corporations shall be dissolved under any of the following circumstances:
1. Occurrences calling for dissolution under the bylaw;
2. In the case that the established purpose can not be fulfilled;
3. Consolidation with other juridical persons in medical care;
4. Bankruptcy;
5. Revocation of license or order for dissolution by the central competent authority;
6. General resolution;
7. Lack of members.
Dissolution in accordance with Subparagraph1of the preceding Paragraph shall be reported to the central competent authority. Dissolution in accordance with Subparagraphs2 through7ofthe preceding Paragraph shall meet with the approval of the central competent authority.
Article 55
The remaining assets shall be dispersed in accordance with provisions under the organization bylaw after the dissolution of the medical corporation, with exception of consolidations and bankruptcies.
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