| Article 72 | A Mainland commercial bank or Mainland-funded bank that meets the following requirements may apply to the Competent Authority for approval to make equity investment in a financial institution in Taiwan Area:
1. The bank is in compliance with the law, soundly managed and has not committed any major regulatory violation within five (5) years prior to application;
2. The bank is ranked, in terms of capital or assets, among the top two hundred banks in the world within one year prior to application;
3. The bank engages in international banking business with a sound financial structure and its financial ratios comply with the standards prescribed by the competent authority;
4. The bank has established a branch and operated business in a member country of OECD for five years or longer;
5. The bank has comprehensive internal control systems and transparent financial and business information;
6. The sources of funds for investment are clear; and
7. No other facts indicate that the sound business operations of the bank may be hindered.
The term “financial institution in Taiwan Area” as used in the preceding paragraph is limited to banks and financial holding companies. However if the economic cooperation agreement between Taiwan Area and Mainland Area provides otherwise, such agreement shall prevail. |
| Article 73 | A Mainland commercial bank or Mainland-funded bank intending to make equity investment under these Regulations shall submit the following documents to the Competent Authority for approval:
1. Application;
2. Investment plan, including the strategic objective and method of investment, expected benefits, sources of funds and fund utilization plan;
3. Particulars of the bank;
4. The bank’s ranking among the world’s leading banks by capital or assets for the year before application;
5. Documents describing sources of funds, regulatory compliance, financial integrity, and past investment experience of the bank;
6. Minutes of the board resolution approving the filing of an application to invest in Taiwan Area;
7. A document issued by the financial authority at the place of registration approving the equity investment in a financial institution in Taiwan Area; and
8. Such other information or documents as may be required by the Competent Authority.Documents mentioned in Subparagraphs 6 and 7 in the preceding paragraph shall be certified by a notary public or a notarization institution at the bank’s place of registration. In addition, documents produced in a third area must be authenticated by a Overseas mission; documents produced in Mainland Area must be authenticated or verified by the institution set up or designated, or by the private organization entrusted by the Executive Yuan.
All documents referred to in Paragraph 1 hereof must be attached with a traditional Chinese counterpart. |
| Article 74 | The cumulative investment of a Mainland commercial bank or Mainland-funded bank in a single financial institution in Taiwan Area shall not exceed 5 percent of said institution’s total outatanding voting shares or capital.
The total investment of a Mainland commercial bank or Mainland-funded bank and the investment of Mainland Area Investors in a same financial institution in Taiwan Area combined shall not exceed 10 percent of said institution’s total voting shares outstanding or total capital.
The term “Mainland Area Investors” as used in the preceding paragraph are limited to those defined in the Regulations Governing Securities Investment and Futures Trading in Taiwan by Mainland Area Investors. |
| Article 75 | Before a Mainland commercial bank or Mainland-funded bank (with equity investment in Taiwan Area) elect or appoint a director of the invested financial institution in Taiwan Area, the relevant evidentiary information and documents shall be submitted to the Competent Authority for approval.
If deemed necessary, the Competent Authority may order the Mainland commercial bank or Mainland-funded bank to provide necessary information and documents or assign a person to the Competent Authority to answer questions. |
| Article 76 | A Mainland commercial bank or Mainland-funded bank that has been approved to make equity investment in Taiwan Area shall remit in the funds within the time period approved by the Competent Authority and report same to the Competent Authority after the remittance. The aforementioned bank will be denied future investment if it fails to remit in the funds within the approved time period. However, before expiration of the approved time limit, an application may be filed with the Competent Authority for an extension if there is a legitimate reason. |
| Article 77 | When a Mainland commercial bank or Mainland-funded bank with equity investment in a financial institution in Taiwan Area under the approval of the Competent Authority intends to transfer its shares, the transferor and the transferee shall jointly apply to the Competent Authority for approval.
If a Mainland commercial bank or Mainland-funded bank violates the provisions in the preceding paragraph, the Competent Authority may annul the approval for its investment or take other necessary measures. |
| Article 78 | A Mainland commercial bank or Mainland-funded bank may apply for exchange settlement for the dividends or earnings distribution it has earned from its investment in Taiwan Area.
If a Mainland commercial bank or Mainland-funded bank has transferred its shares with the approval of the Competent Authority or its invested financial institutions undergoes capital decrease, such bank may apply for exchange settlement for the total amount of investment as approved by the Competent Authority. The same provisions apply to any capital gain derived from the investment.
A Mainland commercial bank or Mainland-funded bank may not transfer its right of exchange settlement under these Regulations, unless it is otherwise approved by the Competent Authority in consultation with the Central Bank. |
| Article 79 | A Mainland commercial bank or Mainland-funded bank (with equity investment in Taiwan Area) shall promptly report to the Competent Authority if it has any of the following situations:
1. Dissolved or suspended business.
2. Undergoing reorganization, liquidation or bankruptcy proceedings, or its business permit has been revoked or annulled by the financial authority at the place of registration.
3. Merging, transferring, or assuming all or an essential part of assets or business of another financial institution.
4. Has incurred losses which exceed one third (1/3) of its capital.
5. Changing the name of bank.
6. Other matters required reporting by the Competent Authority. |
| Article 80 | An invested financial institution in Taiwan Area shall input the basic and shareholding information of the Mainland commercial bank or Mainland-funded bank into an information reporting system designated by the Competent Authority, and update such information when changes occur. |