|
Financial
9. Draft Amendment to Regulations Governing Information to Be Published in Annual Reports of Financial Holding Company, Regulations Governing Information to Be Published in Annual Reports of Bank, Regulations Governing Information to Be Published in Annual Reports of Bills Finance Company and Regulations Governing Information to Be Published in Financial Institution Prospectuses for Offering and Issuance of Securities
On 21 January 2020, the FSC announced the draft amendments to the "Regulations Governing Information to be Published in Annual Reports of Financial Holding Company", the Regulations Governing Information to be Published in Annual Reports of Bank, the "Regulations Governing Information to Be Published in Annual Reports of Bills Finance Company" and the "Regulations Governing Information to Be Published in Financial Institution Prospectuses for Offering and Issuance of Securities for public consultation". We summarize below:
(1) To enhance the disclosure of corporate governance operation:
(a) Where the chairman and the general manager or the equivalent (the highest level of managers) are the same person, couples or the relatives within first degree of kinship, the company shall disclose relevant information, including the reasons, reasonableness, necessity and the response measures, etc.
(b) The resignation and discharge of the corporate governance officer shall be disclosed.
(2) To enhance the transparency of the remuneration of the directors, supervisors and senior managers, as well as its reasonableness:
(a) The number of remuneration range is revised from 8 to 10 if the company chooses to disclose aggregate remuneration information with the name(s) indicated for each remuneration range.
(b) To add the circumstances where the company shall disclose in its financial report (a) the remuneration of each director, supervisor, etc.; and (b) the top five manages receiving the highest remuneration.
(c) The company shall disclose the remuneration policy of the independent directors and the remuneration which the directors, supervisors and senior managers receive from the parent company.
(d) The information related to self-evaluation (or peer evaluation) of the board of directors conducted by Taiwan Stock Exchange listed or Taipei Exchange traded companies.
(3) To improve the disclosure quality of non-financial information:
(a) The matters required to be disclosed related to the performance of corporate social responsibilities are amended.
(b) The disclosure of any penalties imposed upon the company and its internal personnel is limited to where the outcome could materially impact shareholders' equity or the prices of the company's securities.
(c) The relevant information regarding the decrease in audit fees shall be disclosed if the audit fees for the current fiscal year are lower than that in the preceding financial year by 10% or more, instead of 15%.
(d) The relevant information regarding the execution rate of treasury shares shall be disclosed.
Reported by: Stacy Lo / Mindy Liao
SITE/SICE
10. Amendment to Appendix to Securities Investment Trust and Consulting Association of the R.O.C.'s Model Guidelines for Securities Investment Trust Enterprises and Securities Investment Consulting Enterprises Anti-Money Laundering and Counter Terrorism Financing Policies and Procedures
On 22 January 2020, the Securities Investment Trust and Consulting Association (SITCA) announced an amendment to the Appendix (defined below) to the Securities Investment Trust and Consulting Association of the R.O.C.'s Model Guidelines for Securities Investment Trust Enterprises and Securities Investment Consulting Enterprises Anti-Money Laundering and Counter Terrorism Financing Policies and Procedures, named Suspected Money Laundering, Financing of Terrorism or Financing of Proliferation of Weapons (Appendix). To enhance the identification of suspected financing of proliferation of weapons activities, the Appendix further added the supervisory transaction types related to financing of proliferation of weapons. For example, where the customer, the agent or the beneficial ownership is the natural person, juridical person or group of targeted financial sanctions for financing of proliferation of weapons announced by foreign governments or international organizations and forwarded by the Financial Supervisory Commission.
Reported by: Jeffrey Liu / Melissa Tsai
11. Amendment to Corporate Governance Guideline on Securities Investment Trust Enterprises and Securities Investment Consulting Enterprises
On 17 January 2020, SITCA announced an amendment to the "Corporate Governance Guideline on Securities Investment Trust Enterprises and Securities Investment Consulting Enterprises" (Guideline) so as to align with the FSC ruling dated 2 August 2019, under which it is expressly specified that certain provisions of the Company Act as amended in 2018 are not applicable to securities investment trust enterprises and securities investment consulting enterprises.
Reported by: Jeffrey Liu / Jack Tai
Taxation
12. Ruling for Value-Added and Non-Value-Added Business Tax Act
On 15 January 2020, the Ministry of Finance (MOF) issued a ruling providing that an individual who for the profit seeking purpose sells goods or service through internet shall apply for taxation registration with the National Taxation Bureau right as soon as the sales of the month reaches the taxation threshold (i.e., NTD40,000 or NTD80,000 depending on the industry).
Reported by: Stacy Lo / Alex Li
13. Agreement between Taiwan and Czech for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income
On 12 February 2020, the Agreement between Taiwan and Czech for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income was signed off by the president of Czech Republic and the local procedure in Czech has been completed. According to the agreement, the Czech Republic will inform Taiwan of the implementation date, which will be further confirmed by Taiwan. The agreement is scheduled to be implemented on 1 January 2021.
Reported by: Stacy Lo / Paul Hsu
Insurance
14. Ruling Related to Calculation of Terms of Independent Directors of an Insurance Enterprise
On 3 January 2020, the FSC issued a ruling stating that in respect of the requirement under Paragraph 4, Article 25 of the Code for Corporate Governance in the Insurance Enterprises, where an independent director of an insurance enterprise shall not be re-elected for more than three terms, the number of terms of the independent directors of the dissolved company before the merger and the surviving company after the merger shall be counted together.
Reported by: David Tsai / Aaron Lai
15. Draft Amendment to Regulations Governing Transactions Other Than Loans between Insurance Enterprises and Interested Parties
On 22 January 2020, the FSC announced the draft amendment to the "Regulations Governing Transactions Other Than Loans between Insurance Enterprises and Interested Parties" (Regulations) for public consultation. We summarize below:
(1) Where an interested party of the insurance enterprise is not involved in the direct transactions between the insurance enterprise and a third party, and the two transactions are different contracts, the Regulations do not apply.
(2) The acquisition and disposal of the Exchange Traded Note issued by an interested party may be conducted by general authorization.
(3) Where an interested party of the insurance enterprise is a company concurrently operating securities investment trusts business or securities investment consulting business, the transactions using entrusted assets in accordance with the "Regulations Governing the Conduct of Discretionary Investment Business by Securities Investment Trust Enterprises and Securities Investment Consulting Enterprises" can be conducted by general authorization.
Reported by: David Tsai / Aaron Lai
16. Draft Amendment to Regulations Governing Required Qualifications for Responsible Persons of Insurance Enterprises
To reinforce the corporate governance of insurance enterprises and improve the professional degree and stability of their board of directors, on 11 February 2020, the FSC announced the draft amendment to the "Regulations Governing Required Qualifications for Responsible Persons of Insurance Enterprises (Regulations). We summarize below:
(1) To provide that the current responsible person of an insurance enterprise who is not eligible under the Regulations shall be subject to mandatory discharge.
(2) To provide the legal effect of discharge for the violation of double hatting restriction on responsible persons of an insurance enterprise and the regulation of self-governance.
(3) To specify that the conflict of interest exists when a director or a supervisor of an insurance enterprise or their related person concurrently acts as a director or a supervisor of other financial institution, unless otherwise provided in the Regulations or said insurance enterprise and said financial institution are in parent company subsidiary relationship under the Company Act.
(4) To increase the numbers of directors and supervisors for insurance enterprises whose assets reach more than NTD1,000 billion.
(5) To provide that unless the insurance enterprise is a subsidiary solely owned directly or indirectly by the government or sole legal person, the professional director of an insurance enterprise shall be a natural person. Where there are 13 or more directors, at least 5 of them shall be natural persons.
(6) To provide that if the supervisor of the insurance enterprise who is a representative of the government/legal person or the delegation by the government/legal person to perform the duty, certain relatives of such person may not serve as a director or manager at the same insurance enterprise.
(7) To provide the report obligation of responsible persons and insurance enterprises in the event of mandatory discharge.
Reported by: David Tsai / Cindy Chien
|
2020-02-21
