Electronic Signature
1. Amendment to “Electronic Signatures Act”
On 15 May 2024, the President announced the amendment to the “Electronic Signatures Act”, which took effect on the announcement date. We summarize below:
(1)To specify that digital signature is a type of electronic signature.
(2)To specify that the legal effect of electronic record and electronic signature cannot be denied solely because of their electronic form.
(3)Unless the counterparty consents to the use of electronic form, the counterparty shall be given an opportunity to refuse before using electronic form, and be notified that it is presumed consent if not refused.
(4)The digital signature issued by the government permitted certification service provider is presumed being personally signed.
(5)The administrative authority can only exclude the application of this Act through the laws, and the announcement of excluding the application of the Act made by the administrative agency prior to the amendment shall cease to take effect one (1) years after the implementation of this amendment. However, with the approval of the competent authority, the exclusion date may be extended one (1) time for a period of two (2) years.
(6)The matters to be considered for the competent authority to permit foreign certification service provider includes technical docking cooperation in addition to the principles of reciprocity under equivalent security requirements.
Reported by: Stacy Lo / Zoe Chen
Real estate
2. Amendment to Regulations Governing Approval for Private Legal Entities to Purchase Residential Houses
On 17 May 2024, the Ministry of the Interior announced amendments to the Regulations Governing Approval for Private Legal Entities to Purchase Residential Houses. We summarize below:
(1)For private legal entities purchasing houses to use as employee dormitories, the amendment provides that the purchase should, in principle, be of completed houses. Additionally, the purchase of high-priced residences is prohibited and the private legal entity must employ five regular employees or more to apply for purchase of residential house for employee dormitories use.
(2)For private legal entities purchasing houses for rental business purposes, ownership transfer registration must be completed simultaneously when the purchase is approved.
Reported by: Alex Li
Securities
3. Draft Amendment to “Regulations Governing Borrowing or Lending Money in Connection with Securities Business by Securities Firms “
On 21 May 2024, the Financial Supervisory Commission (FSC) announced the draft amendments to “Regulation Government Borrowing Lending Money in Connection with Securities Business by Securities Firms.” We summarize below:
(1)To allow new shares of a company subscribed by its employees or original shareholders due to its initial public offering or secondary public offering to be taken by securities firms as collaterals for loan;
(2)To add types of non-permitted collateral for loan;
(3)To supplement required items for the template of loan agreement; and
(4)To include the Taiwan Depository & Clearing Corporation (TDCC) as one of the governing entities for the regulations governing business operations of the subject business.
Reported by: Jeffrey Liu / Eva Chiu
SITE/SICE
4. Amendment to “Guidelines for Advertisements and Business Activities Performed by Members and Their Sales Agent”
On 17 May 2024, the Securities Investment Trust and Consulting Association (SITCA) announced the amendment to “Guidelines for Advertisements and Business Activities Performed by Members and Their Sales Agent”(Guidelines). We summarize below:
(1)To add that the SITEs, master agents, and sales agents, along with influencers who regularly share information online (internet celebrities) must adhere to the Guidelines and establish pre-event, during-event, and post-event verification management mechanisms when advertising and conducting business activities related to fund products. These requirements should be clearly defined in their internal control systems. Furthermore, the internet celebrities must meet the qualifications listed in Items 1 to 3 of Paragraph 1, Article 6-1 of the Regulations Governing Responsible Persons and Associated Persons of Securities Investment Trust Enterprises;
(2)To add that within 10 days of collaboration with internet celebrities, SITEs, master agents, and sales agents must report the relevant information of such advertising and business activities to the SITCA; and
(3)To add that the SITCA should conduct regular inspections on the information reported by SITEs, master agents, and sales agents regarding their collaborations with internet celebrities and relevant forms provided.
Reported by: Jeffrey Liu / Winnie Su
5. Amendment to the “Guidelines on the Business of Securities Investment Trust Enterprises”
On 24 May 2024, the SITCA announced the amendment to the “Guidelines on the Business of Securities Investment Trust Enterprises” (Business Guidelines of SITEs). We summarize below:
(1)Addition of Point 14: When the SITE receives training from the fund’s foreign investment advisor or foreign management institution, a training plan shall be signed and may be incorporated into the contract. The training plan shall include required items, and the SITE shall establish the criteria for selecting participants for the training.
(2)Addition of Point 15: The SITE shall clearly define in its internal control system the mechanisms for identifying and preventing conflicts of interest or potential conflicts of interest arising from the business of securities investment trust funds.
Reported by: Jeffrey Liu / Jason Su
6. Amendment to Q&A of Questions and Explanations for Application in relation to “Directions for Matters of SITE/SICE Outsourcing to Others”
On 24 May 2024, the FSC announced the amendments to Q&A of Questions and Explanations for Application in relation to “Directions for Matters of SITE/SICE Outsourcing to Others” (New Q&A). The amendment model can be generally divided into three types with examples (not exhaustive) respectively as follows:
(1)New added explanation: For example, operations such as using market information services and trading and communication platforms (e.g. Bloomberg) and handling of anti-money laundering and prevention operations by using the Taiwan Central Depository and Clearing Corporation’s anti-money laundering and counter-terrorism searching system are further supplemented to Item 1 of the NEW FAQ to be excluded from the scope of outsourcing to others to handle for SITE/SICE;
(2)Integration: For example, the FSC consolidated the responses to the application of outsourcing directions to the outsourced matters of the SITE/SICE involving its affiliated group company to Item 2 of the New Q&A; and
(3)Further clarification: For example, Item 8 of the New Q&A further clarified the application procedures for the changes after receiving the approval from the FSC, which can be divided into the following situations: (1) change or addition of a new service provider; (2) the service provider is not changed, but the data processing or storage location is changed or added; or (3) the service provider remains unchanged, but changes or additions to the outsourced content will materially increase the relevant risks, and the original risk control and internal control mechanisms will need to be adjusted.
Reported by: Jeffrey Liu / Amy Su
| Editors: Mike Lu (Partner) Stacy Lo (Partner) Jeffrey Liu (Partner) Kang-Shen Liu (Partner) David Tsai (Partner) Angela Lin (Partner) Paul Hsu (Partner) | Counselors: Echo Yeh Sue Su Jolene Wang (Lexcel Partners IP Firm) |