Labor
1. A Ruling Regarding to the Prohibition on Female Laborers Working at Night During the Breast-feeding Period
The Ministry of Labor announced on March 8, 2016, a ruling for the prohibition on female laborers working at night during the breast-feeding period. The ruling provides that breast-feeding includes both breast-feeding and milk feeding, and, by principle, the period is one year after the birth of the child.
Reported by: David Tsai / Mark Chen
Food and Drug Administration
2. Promulgation of Regulations Stipulating the Generic Names of Food Additives
The Ministry of Health and Welfare (MOHW) announced on March 4, 2016, the promulgation of and enforcement of the “Regulations Stipulating the Generic Names of Food Additives”, the draft version of which was reported on our Newsletter Issue No. 235 dated November 6, 2015. Compared to the draft version, the promulgated Regulations further stipulate the generic names of xanthan gum, D-sorbitol and vitamins.
Reported by: Jolene Wang / Crick Liang
3. Schedule for Implementation of Chapter 3 (“Distribution”) of Good Manufacturing Practices for Western Pharmaceuticals
On February 18, 2016, the MOHW announced the schedule for implementation of Chapter 3 (“Distribution”) of Good Manufacturing Practices for Western Pharmaceuticals. For newly established, relocated or resumed western medicament manufacturers (including manufacturers of medical gases) as well as logistics industries thereof handling the labeling and packaging of western pharmaceuticals, the implementation date is July 1, 2016, while for other western medicament manufacturers and logistics industries, the implementation date is January 1, 2019.
Reported by: Jolene Wang / Crick Liang
4. Draft Regulations Governing the Product Names and Labeling of Butter, Cream, Artificial butter and Related Products
The MOHW announced on March 10, 2016, the draft “Regulations Governing the Product Names and Labeling of Butter, Cream, Artificial butter and Related Products”, which is scheduled to take effect on January 1, 2017. These Regulations provide respective definitions for food products with product names of “butter”, “cream” (or “milkfat”), “artificial butter” and “fat spread”. Further, it is stipulated that an artificial butter product is prohibited from being labeled with a description denoting it is vegetable butter.
Reported by: Jolene Wang / Crick Liang
Tax
5. Attention to Profit-seeking Enterprises Presenting Clients with Bought Merchandise
On March 3, 2016, National Taxation Bureau of the Northern Area, Ministry of Finance (NTB) issued a press release to remind that if a profit-seeking enterprise plans to buy a complimentary gift for a client such that it needs to list the item as an expense, it will be required to comply with the ruling of the Ministry of Finance dated December 17, 1976, (Ref. No.:Tai-Cai-Shui No.38342) when filing a profit-seeking enterprise income tax return for the year 2015. According to the ruling, the complimentary gift to the client must be listed as an asset upon purchase and shall not be transferred to expenses until given away to the client. The NTB also emphasized that whether a complimentary gift can be listed as an expense shall be subject to whether it has been given away.
Reported by: Jeffrey Liu / Peter Huang
6. Withholding Tax
The Ministry of Finance announced a ruling on March 3, 2016, stating that certain small amounts are subject to the withholding tax. For instance, withholding applies when interest accrued from the portion of the pecuniary amount realized by short-term commercial papers at their maturity are greater than the selling price at their initial issuance.
Reported by: Kang-Shen Liu / Mark Chen
REITS
7. Investment Objects of Real Estate Investment Trust Funds
On March 2, 2016, the FSC issued a ruling (Ref. No.: Jin-Guan-Yin-Piao-Zi- 10540000410) to broaden the investment objects of Taiwan's Real Estate Investment Trust Funds (REIT Funds), together with their limitations. We summarize the key points below:
(1) Total amount invested in offshore REIT Funds and beneficial securities and asset-backed securities issued or delivered by other trustees or special-purpose companies pursuant to the Real Estate Securitization Act or the Financial Asset Securitization Act shall not exceed 25% of the net asset value of the fund.
(2) Amount invested in a single offshore REIT Fund shall not exceed 5% of the net asset value of the fund.
(3) Total amount invested in offshore real estate and an offshore REIT Fund shall not reach 50% of the net asset value of the fund.
Reported by: Jeffrey Liu / Judy Tai
Securities
8. Draft Amendment to the ''Regulations Governing Securities Investment and Futures Trading in Taiwan by Mainland Area Investors''
On February 26, 2016, the FSC issued a ruling to announce the draft amendments to the ''Regulations Governing Securities Investment and Futures Trading in Taiwan by Mainland Area Investors''(Regulations). We summarize the key points below:
(1) Natural persons of the Mainland area who enter into the Taiwan area and Taiwan enterprises invested in by China investors which meet certain conditions may invest in funds and bonds denominated in foreign currencies in Taiwan. In addition, other Mainland area investors may invest in products denominated in foreign currencies which do not involve foreign exchange settlements against the New Taiwan dollar.
(2) Where Mainland area investors only invest in products denominated in foreign currencies, certain provisions under these Regulations shall not apply.
(3) Qualified China institutional investors approved by the relevant competent authorities in charge of securities, banking and insurance in Mainland area may invest in emerging stocks.
(4) Securities firms may act as Mainland area investors' custodians and agents designated by the institutional investors for futures trading.
(5) Related operation procedures concerning fund remittance and foreign exchange settlements are revised to reflect the aforementioned amendments.
Reported by: Jeffrey Liu / Caitlyn Kao
Personal Information
9. The Range of Information Shared within Group Companies for Anti-money Laundering and Counter-terrorism Purposes
On March 3, 2016, the FSC announced that, under law, a financial holding company and its subsidiaries are required to keep their clients' personal data, trading information, and any other relevant information confidential, unless policy and procedures for sharing within the group companies for the purposes of countering money laundering and the financing of terrorism are established (Article 42 of the Financial Holding Company Act and Article 37 of the Implementation Rules of Internal Audit and Internal Control System of Financial Holding Companies and Banking Industries Implementation Rules). The ruling clarifies that such sharing within the group does not include sharing of documentation, drawing, information, or objects that are considered “suspicious” of being related to underlying crimes or transactions that would constitute a violation of Article 11 of the Anti-Monetary Laundering Act (AML). (Article 13 of the AML)
Reported by: David Tsai / Naiju Kuan
10. The Notification Obligation of a Non-governmental Agency under Article 9 of the PIPA
The FSC issued a ruling on February 19, 2016, that upon the amendment to Article 54 of the ''Personal Information Protection Act'' (PIPA) taking effect, a non-governmental agency shall fulfill of the notification obligation according to Article 9 of the PIPA. We summarize the ruling below:
(1) For information collected before October 1, 2012, which was not provided by the data holder:
a. To legally process and use such information before Article 54 of the PIPA takes effect (which is before March 15, 2016), the notification obligation under Article 9 of the PIPA will not be retroactively required.
b. To legally process and use such information after Article 54 of the PIPA takes effect (which is after March 15, 2016), the notification obligation under Article 9 of the PIPA shall be fulfilled before the process and use of the information, and can be done upon the first use after Article 54 of the PIPA takes effect.
(2) For information legally collected after October 1, 2012, the notification obligation under Article 9 of the PIPA shall be fulfilled.
Reported by: David Tsai / Naiju Kuan
11. Collection and Use of Personal Information
The Financial Supervisory Commission (FSC) announced the draft "Regulations Governing Methods of Written Consent, Business Scope and Other Requirements Under Paragraph 2, Article 177-2 of the Insurance Act" on March 8, 2016. We summarize the key points below:
(1) The written consent shall be in writing or electronic documents under the Electronic Signatures Act, and the draft requires specific content of the written consent.
(2) The content of written consent may be in a separate document or be consolidated into the insurance application form, insurance claim documents or other relevant documents.
(3) This draft provides the business for which the insurance enterprises, insurance agents, brokers, and surveyors may collect, process and use personal information of medical records, medical treatment or health examination.
(4) Proper security measures and confidentiality mechanisms shall be adopted for collection and use of personal information.
(5) The insurance enterprises, insurance agents, brokers and surveyors shall establish an internal processing procedure and submit the same to the board of directors for approval. In general, such internal processing procedures shall be included in the internal audit and internal control system, and the audit shall be proceeded accordingly.
Reported by: Stacy Lo / Mark Chen
Insurance
12. Draft Amendment to the Regulations Governing Foreign Exchange Business of Insurance Enterprises
The Central Bank of the Republic of China (Taiwan) announced the draft amendment to the Regulations Governing Foreign Exchange Business of Insurance Enterprises (Regulations) on March 1, 2016. We summarize the key points below:
(1) Insurance enterprises may engage in property insurance business with foreign currency for receipt and as payment, and the subject insured need not be offshore real properties, provided that such business complies with the business scope stipulated by the FSC.
(2) Insurance enterprises may engage in foreign currency loans to participating banks of foreign-currency syndicated loans. Application documents and matters to be complied with are also provided under the Regulations.
(3) Insurance enterprises may stipulate the foreign currency for receipt and as payment of property insurance and reinsurance with foreign currency for receipt and as payment. If any currency exchange is involved, insurance enterprises shall handle these matters with banking enterprises.
Reported by: Stacy Lo / Angela Lin
13. Draft Amendment to the Regulations Governing Insurance Enterprises Engaging in Operating Reinsurance and Other Risk Spreading Mechanisms
The FSC announced the draft amendment to the Regulations Governing Insurance Enterprises Engaging in Operation Reinsurance and Other Risk Spreading Mechanisms (Regulations). We summarize the key points below:
(1) To avoid a conflict of interest and double agency, for the facultative reinsurance business arranged through the insurance agent, the insurance agent shall not be the same person or the same concerned party of the insurance agent for the original insurance policy.
(2) Property insurance enterprises shall not assume reinsurance ceded by itself. Relevant requirements for the fee rates of reinsurance business are also amended in the Regulations.
Reported by: Stacy Lo / Angela Lin
Fair Trade
14. Concerted Action
The Fair Trade Commission issued a ruling on March 1, 2016, on concerted actions. Where the total market share of the participants in relevant markets is less than 10%, the concerted action is presumed to have no impact on the market in terms of production, trade in goods, or supply and demand of services. This presumption is not applicable if a concerted action aims to restrict the price, quantity, trading counterpart or trading territory of the goods or services.
Report by: Kang-Shen Liu / Judy Tai
2016-03-22
