This Act is enacted to strengthen the supervision and management of Bills Houses, to meet national financial policies, to promote the sound development of the money market, and to protect buyers/sellers rights in the market.

The supervision of Bills Houses and bills finance activities shall be governed by this Act; matters not provided for in this Act shall be governed by other relevant laws.

The term, "Competent Authority", as used in this Act, shall mean the Financial Supervisory Commission.

The following terms as used in this Act shall have the following meanings:
1. "Short-Term Bill" shall mean a debt instrument maturing within one(1) year, being a:
(1) Treasury bills;
(2) Negotiable certificates of deposit issued by a bank;
(3) Commercial papers or bills of exchange issued by a company or a state-owned enterprise or institution; or
(4) Another short-term debt
instrument designated by the Competent Authority.
2. "Bills Finance Business" shall mean the business of certifying, underwriting, brokering, and trading Short-Term Bills;
3. "Bills Finance Company" shall mean a company limited by shares established for the purpose of operating, and licensed by the Competent Authority to conduct Bills Finance Business;
4. "Bills House" shall mean a Bills Finance Company or a financial institution approved by the Competent Authority to operate Bills Finance Business;
5. "Certification" shall mean the authentication, under the authorization of an issuer, of signatures on the issuer's Short-Term Bills or bonds, review of matters which must be recorded, and issuance of a certificate authenticating a signature;
6. "Underwriting" shall mean underwriting, as agent of an issuer, such issuer’s Short-Term Bills or bonds pursuant to an underwriting contract;
7. "Brokering" shall mean acting as an intermediary in the buying and selling of Short-Term Bills or bonds;
8. "Trading" shall mean buying and selling Short-Term Bills or bonds to/from customers for one's own account as a dealer; and
9. "Repo and Reverse Repo" shall mean a transaction where a seller or a buyer agrees to buy or sell back the original Short-Term Bills or bonds at a mutually agreed price and date.

A Bills House shall not certify, underwrite, broker or trade, an issuer's Short-Term Bills that are not rated by a credit rating agency except for the following which are exempt from this rating requirement;
1. Treasury notes;
2. Commercial papers or bills of exchange endorsed by the recipient as part of the sale of goods or services; and
3. Short-Term Bills guaranteed by a financial institution which institution is rated by a credit rating agency.

A firm which is not a Bills House, shall not engage in the business of certifying, underwriting, brokering or trading Short-Term Bills.

A firm conducting centralized custody, settlement, and clearing of Short-Term Bills is not allowed to engage in the above business until receiving approval from the competent authority. However, if the transfer or clearing business involves large sums, approval from the Central Bank of China ("CBC") shall also be required.
The conditions and procedures for applying for the approval referred to in the preceding paragraph, the conditions under which such approval will be revoked, and regulations governing the relevant business scope, capital and staff, as well as other relevant matters, shall be prescribed by the Competent Authority after consulting with the CBC.

No firm other than a Bills House may use a name that may lead the public to believe that the firm is a Bills House.
The name of a Bills Finance Company shall include the words "Bills Finance".

The minimum paid-in capital of a Bills Finance Company shall be as determined or adjusted, as applicable, by the Competent Authority based on economic conditions.
In the event that a Bills Finance Company's paid-in capital falls below such minimum [as the result of] an adjustment as above, the Competent Authority shall prescribe a period of time within which such Bills Finance Company shall increase its capital [to meet the adjusted requirement]. If a Bills Finance Company fails to increase its capital within this period its operating approval shall be revoked.

If, during any given month, a director, supervisor, manager and/or any person who holds more than ten percent (10%) of the issued voting shares of a Bills Finance Company changes its/his/her shareholding, such person shall notify the company of the change by the fifth (5th) day of the following month and the company shall, prior to the fifteenth (15th) day of such month, report the change to the Competent Authority or the institution designated by the Competent Authority.
The term "such person" as used in the preceding paragraph shall include a spouse, minor children and any nominee.
If shares held by persons referred to in Paragraph 1 [of this article], are pledged, the pledgor shall notify the Bills Finance Company thereof immediately and the Bills Finance Company shall report such pledge to the Competent Authority or the institution designated by the Competent Authority within five (5) days after the date of the pledge.

Guidelines for qualifications of the responsible person of a Bills House and other guidelines which responsible persons must follow shall be prescribed by the Competent Authority.
Neither the responsible person nor any staff member of a Bills House shall accept, under any pretense, commissions, rebates or any other unwarranted benefit from customers, buyers/sellers, guarantors or others.
Neither the responsible person nor any staff member of a Bills Finance Company may concurrently hold a position in another Bills Finance Company except in the capacity of a director or supervisor of an invested Bills Finance Company or financial institution owing to an investment relationship and then only with the prior approval of the Competent Authority.

The business staff members of a Bills House shall be registered with the Bills Houses Association ("BHA") prior to commencing their work.
Regulations regarding the qualifications of the business staff of a Bills House, staff registration, training and other management matters [for such staff] shall be as prescribed by the Competent Authority.
A person who has served on the business staff of a Bills House prior to this Act coming into effect shall register with the BHA within six (6) months from the day this Act comes into effect in order to continue in their position. No one may continue in their position after said (6) months absent registration with the BHA.
The business staff of a Bills House, who has registered pursuant to the preceding paragraph, shall achieve the qualifications referred to in Paragraph 2 [of this article] within three (3) years from the date this Act comes into effect. If he/she does not achieve such qualifications within said period, the BHA shall revoke his/her registration.