Whistle-blower Protection
1.Announcement of “Public Interest Whistle-blower Protection Act”
On January 22, 2025, the President announced the “Public Interest Whistle-blower Protection Act”. We summarize the protection of whistle-blowers below:
(1) Prevention from unfavorable treatments: Government agencies (or institutions), legal persons, organizations, or individuals are prohibited from taking unfavorable treatments (including but not limited to dismissal, termination of contracts, demotion, salary reduction, other unfavorable changes to working conditions, or unlawful disclosure of the whistle-blower’s identity) against whistle-blowers for reporting scandals, cooperating for investigations, refusing to participate in scandals, or seeking remedies against unfavorable treatments.
(2) Confidentiality: Agencies receiving whistle-blower reports and their investigation personnel shall keep confidential and shall not disclose the identity of the whistle-blower, unless otherwise consented by the whistle-blower. Unless otherwise provided for under law or no longer requiring keeping confidential the identity, whistle-blowers may request producing transcripts or documents with aliases, redacting their name, gender, date of birth and other information that may directly or indirectly identify them, masking, altering voice, distorting image, or other appropriate means of isolation.
(3) Remedy for being unfavorably treated: Whistle-blowers who have been subject to unfavorable treatments may request for reinstatement of their original position or previous working conditions, and seek compensation for both pecuniary and non-pecuniary damages.
(4) Exemption from non-disclosure obligation: Whistle-blowers who provide information to the accepting agency that involves national or trade secrets, or other information subject to confidentiality by laws are not held civilly, criminally, administratively accountable, nor subject to disciplinary actions under professional ethic for any breach thereof. The same applies if the whistle-blower consults a lawyer for legal advice for the matters involving the above.
(5) Reduction or exemption of Sentence: If a whistle-blower is a principal offender or an accomplice in a crime related to the content of the whistleblowing and is willing to testify in the court or during the prosecutor’s investigation, accept cross-examination, and provide important information related to the case subject to being proofed, or other evidence against other principal offenders or accomplices, which enables the prosecutor to prosecute other offenders or accomplices in the case, the whistle-blower may receive a reduced or exempted sentence, provided that prior consent is given by the prosecutor.
(6) Personal safety protection: If a whistle-blower is willing to testify in the court or during the prosecutor’s investigation, and accept cross-examination in accordance with laws, the personal safety protection measures may be applied to him/her/it or the closely related persons.
(7) For other points, please also refer to our “Alert Sheet from Lexcel Partners – Public Interest Whistleblower Protection Act” issued on 24 January 2025.
Reported by: Paul Hsu / Julia Kuo
Labor
2.Amendment to Item 2 of Other Required Documents in Employer’s Application for Employment of Category 1 Foreign Professionals
On 24 January 2025, the Ministry of Labor announced the Amendment to Item 2 of the “Other Required Documents in Employer’s Application for Employment of Category 1 Foreign Professionals,” to provide the required documents for the application of work permit for bartending work.
Reported by: David Tsai / Joe Liao
Telecom
3.Amendment to Administrative Regulations on Manufacturing, Import and Report of the Controlled Telecommunications Radio-Frequency Devices and Article 14 of Fee-charging Standards of Processing Telecommunications Management
On 3 February 2025, the National Communications Commission (NCC) announced the Amendment to the “Administrative Regulations on Manufacturing, Import and Report of the Controlled Telecommunications Radio-Frequency Devices” and Article 4 of the “Fee-charging Standards of Processing Telecommunications Management.” We summarize below, among others:
(1) To amend the definition of Class 1 Controlled Telecommunications Radio-Frequency Devices (“CTRFDs”).
(2) To amend the required documents for applying for an import permit for Class 1 CTRFDs.
(3) To add provisions for applying for approval of import and usage plans for Class 1 CTRFDs, specify the required documents and revise related procedures and annexes accordingly.
(4) To amend the reporting system for CTRFDs that have obtained a radio station license and the management of certified amateur radio stations.
(5) To revise the fee standards for the manufacturing, import review, inspection, and registration of CTRFDs.
Reported by: Kang-Shen Liu / Joe Liao
Trust
4.Measures related to inability to obtain financial statements of a controlled foreign corporation (CFC) within the trust income declaration period when the shares or capital of affiliated companies in low-tax jurisdictions outside of Taiwan are trust property
On 4 February 2025, the Ministry of Finance issued a ruling on the measures related to inability to obtain financial statements of a CFC within the trust income declaration period when the shares or capital of affiliated companies in low-tax jurisdictions outside of Taiwan are trust property. We summarize below:
(1) When the trustor uses shares or capital of affiliated companies in low-tax jurisdictions outside of Taiwan as trust property, the trustee shall, by the end of January each year (or by February 5 if there are three consecutive public holidays or more in January), complete the declaration of trust’s property inventory, income and expenditure statement, and the income amount to be calculated or allocated to the beneficiaries.
(2) If the trustee is unable to obtain the CFC financial statement for individual or other documents before the aforementioned deadline due to the time required for the CFC to prepare financial statements, for the appointed CPA to audit, or to obtain other sufficient proof of the authenticity of the CFC financial statements as confirmed by the tax authorities of the individual’s registered domicile and the business entity’s location, the trustee may use the CFC’s preliminary earnings under the non-audited financial statement for the trust income declaration. If the amount of earning in the CFC financial statements, after being audited by a CPA or confirmed by the tax authorities, differs from the preliminary earnings, the trustee shall submit the relevant documents and file a corrected trust income declaration before the deadline for the beneficiary to file annual income tax return, and notify the beneficiary of the corrected CFC business income or investment earnings. When a trustee files a corrected trust income declaration in accordance with the above, he/she shall be exempt from penalties under Paragraph 3, Article 111-1 of the Income Tax Act.
(3) When an offshore trustee entrusts an individual residing in Taiwan or an enterprise, institution, organization or association with a fixed place of business within Taiwan as an agent (onshore agent), the entrusted items shall include applying for a dedicated taxpayer unified number for the trust, handling matters related to trust income tax filing, and paying any fines incurred due to violations of the aforementioned regulations on behalf of the offshore trustee.
(4) The onshore agent shall inform the offshore trustee of the documents and information required under the Income Tax Act and relevant regulations of Taiwan, as well as the penalties for violations of such laws and regulations. The onshore agent shall also notify the offshore trustee that, in accordance with Article 103 of the Civil Code, any declaration of intent made within the scope of the agency authority in the name of the principal shall have direct legal effect on the principal. If the onshore agent fails to file the trust income tax return within the deadline or submits an untruthful filing, the tax authorities shall impose penalties on the trustee pursuant to Paragraph 3, Article 111-1 of the Income Tax Act.
Reported by: Stacy Lo / Zoe Chen
Financial
5.Amendment to Regulations Governing Internal Operating Systems and Procedures for Banks Conducting Financial Derivatives Business
On 4 February 2025, the Financial Supervisory Commission (FSC) announced the draft amendment to Article 29-1 of the “Regulations Governing Internal Operating Systems and Procedures for Banks Conducting Financial Derivatives Business” For public consultation. The amendment removes the provision that restricted banks from promoting structured products to individuals aged 70 and above through face-to-face meetings, phone calls, emails, or by sending product brochures when providing structured product transaction services to general customers.
Reported by: Stacy Lo / Sunny Lan
Insurance
6.Amendment to Promoting Insurance Service Business Through Collaboration with Business Entities in Other Industries
On 7 February 2025, the FSC announced the amendment to the “Directions for Promoting Insurance Service Business Through Collaboration with Business Entities in Other Industries.” We summarize below:
(1) To add “mobile communication service providers” as the types of businesses eligible for cross-industry collaboration of “ancillary insurance products”.
(2) To add internal control requirements to be followed by insurance enterprises, insurance agents, or insurance brokers when handling related businesses.
Reported by: Stacy Lo / Joe Liao
| Editors: Mike Lu (Partner) Stacy Lo (Partner) Jeffrey Liu (Partner) Kang-Shen Liu (Partner) David Tsai (Partner) Angela Lin (Partner) Paul Hsu (Partner) Alex Li (Partner) | Counselors: Echo Yeh Sue Su Jolene Wang (Lexcel Partners IP Firm) |
