{"id":6007,"date":"2026-03-06T19:10:30","date_gmt":"2026-03-06T11:10:30","guid":{"rendered":"https:\/\/www.lexgroup.com.tw\/6007\/"},"modified":"2026-03-06T19:22:51","modified_gmt":"2026-03-06T11:22:51","slug":"%e6%83%87%e5%ae%89%e6%b3%95%e4%bb%a4%e9%9b%99%e9%80%b1%e5%88%8a%e7%ac%ac483%e6%9c%9f","status":"publish","type":"post","link":"https:\/\/www.lexgroup.com.tw\/en\/6007\/","title":{"rendered":"Lexgroup Newsletter (Issue No. 483)"},"content":{"rendered":"\n

Banking<\/strong><\/strong><\/p>\n\n\n\n

1.Draft amendment to Implementation Rules of Internal Audit and Internal Control System of Financial Holding Companies and Banking Industries<\/u><\/em><\/strong><\/p>\n\n\n\n

On 12 February 2026, the Financial Supervisory Commission (FSC) announced the draft amendment to “Implementation Rules of Internal Audit and Internal Control System of Financial Holding Companies and Banking Industries.”\u00a0 We summarize below:<\/p>\n\n\n\n

(1) Enhancement of the Self-Inspection System:<\/p>\n\n\n\n

(a) The \u201cThree Lines of Defense\u201d shall be amended to the \u201cThree Lines Model\u201d in order to strengthen collaboration and coordination among the three lines.<\/p>\n\n\n\n

(b) It is newly provided that banks adopting a risk-based audit system may also prescribe the general frequency, key focus areas, and scope of self-inspections.<\/p>\n\n\n\n

(c) With respect to the internal control Three Lines Model, the adoption of a Code of Ethical Corporate Management and a Business Continuity Management mechanism, the risk management framework, and the duties and powers of dedicated risk management and information security units, a six-month transitional period shall be granted.<\/p>\n\n\n\n

(d) Considering that the supervisory unit responsible for overseeing the implementation and review of self-inspection procedures has been reassigned to the second line unit, the transitional period shall be adjusted to one year.\u00a0<\/p>\n\n\n\n

(2) Strengthening Compliance, Risk Management, and Information Security Systems:<\/p>\n\n\n\n

(a) Financial holding companies and banks shall each appoint a Chief Compliance Officer (formerly the Head of Compliance at the head office), a Chief Risk Officer, and a Chief Information Security Officer. <\/p>\n\n\n\n

(b) Dedicated Units: Both financial holding companies and banks shall establish dedicated units for compliance, risk management, and information security reporting directly to the President.\u00a0 Such units shall not concurrently undertake any business that may give rise to conflicts of interest with their official duties.<\/p>\n\n\n\n

(c) Banks shall establish a bank-wide compliance risk management and supervisory framework, and shall file the same with the FSC for recordation within two years from the establishment of the dedicated compliance unit.<\/p>\n\n\n\n

(d) It is newly provided that, upon any change in the Chief Auditor, financial holding companies and banks shall report in writing to the competent authority the reasons for and details of such change.\u00a0 In addition, they shall establish communication channels and mechanisms between independent directors, the audit committee or supervisors, and the internal audit unit.<\/p>\n\n\n\n

(3) Strengthening CPA Audit System:<\/p>\n\n\n\n

(a) The audit report on internal control systems of banks shall be revised from an agreed-upon procedures report to a reasonable assurance report.<\/p>\n\n\n\n

Reported by: Stacy Lo \/ Hank Chang<\/strong><\/strong><\/p>\n\n\n\n

2.Amendment to Regulations Governing Domestic Branches of Financial Institutions<\/u><\/em><\/strong><\/p>\n\n\n\n

On 13 February 2026, the FSC announced the amendment to the “Regulations Governing Domestic Branches of Financial Institutions”.\u00a0 We summarize below:<\/p>\n\n\n\n

(1) Financial institutions that do not meet the relevant financial requirement regarding average pre-tax return on net worth may nevertheless apply to establish additional branches each year, subject to the applicable limit on the number of branches; and<\/p>\n\n\n\n

(2) To specify that the competent authority shall determine the list of financial institutions permitted to establish such additional branches, based on the financial and business conditions of the relevant financial institutions.<\/p>\n\n\n\n

Reported by: Stacy Lo \/ Linda Guo<\/strong><\/strong><\/p>\n\n\n\n

Securities<\/strong><\/strong><\/p>\n\n\n\n

3.Draft Amendment to the Regulations Governing Securities Firms Accepting Orders to Trade Foreign Securities and Directions for the Conduct of Wealth Management Business by Securities Firms<\/u><\/em><\/strong><\/p>\n\n\n\n

On 12 February 2026, the FSC announced the draft “Regulations Governing Securities Firms Accepting Orders to Trade Foreign Securities” and “Directions for the Conduct of Wealth Management Business by Securities Firms” for public consultation.\u00a0 We summarize below:<\/p>\n\n\n\n

(1) To relax the eligibility requirements for securities firms applying to conduct high-asset customer business by removing the net worth requirement under the financial criteria and the specific commitment requirements regarding capital introduction and talent recruitment; and to additionally introduce new requirements, including that the company has no accumulated losses and that its financial condition complies with the relevant regulatory ratio requirements under the Regulations Governing Securities Firms (such as the debt-to-equity ratio).<\/p>\n\n\n\n

(2) To expand the eligible investors for offshore structured products issued by overseas subsidiaries of securities firms.\u00a0 In addition to \u201chigh-asset customers, professional institutional investors, and high-net-worth corporate investors\u201d the scope will be extended to include \u201cprofessional institutional or fund investors and professional individual investors.\u201d\u00a0 Furthermore, securities firms conducting wealth management business in the form of trust arrangements will be permitted to, under such structure, to provide foreign currency-denominated structured notes issued by domestic banks to professional investors.<\/p>\n\n\n\n

Reported by: Jeffrey Liu \/ Zoe Chen<\/strong><\/strong><\/p>\n\n\n\n

Trade<\/strong><\/strong><\/p>\n\n\n\n

4. Amendments to Export Control List for Dual Use Items and Technology and Common Military List governed by Types of Strategic High-Tech Commodities, Specific Strategic High-Tech Commodities and Exportation to Restricted Regions<\/u><\/em><\/strong><\/p>\n\n\n\n

On 11 February 2026, the Ministry of Economic Affairs announced to amend the “Export Control List for Dual Use Items and Technology” and the “Common Military List” governed by the “Types of Strategic High-Tech Commodities, Specific Strategic High-Tech Commodities and Exportation to Restricted Regions.”\u00a0 The amendments were made to align with the updated international export control regimes and to meet administration requirements.<\/p>\n\n\n\n

Reported by: Kang-Shen Liu \/ Sean Tsai<\/strong><\/strong><\/p>\n\n\n\n

Editors:<\/strong>
Mike Lu\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0(Partner)<\/strong>
Stacy Lo\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0(Partner)<\/strong>
Jeffrey Liu\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0(Partner)<\/strong>
Kang-Shen Liu\u00a0\u00a0(Partner)<\/strong>
David Tsai\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0(Partner)<\/strong>
Angela Lin\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0(Partner)<\/strong>
Paul Hsu\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0(Partner)<\/strong>
Alex Li\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0(Partner)<\/strong><\/td>		Counselors:<\/strong>
Echo Yeh<\/strong>
Sue Su<\/strong>
Jolene Wang (Lexcel Partners IP Firm)<\/strong><\/td><\/tr><\/tbody><\/table><\/figure>\n","protected":false},"excerpt":{"rendered":"

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