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Order of Financial Supervisory Commission
Issue date: September 16, 2015
Doc. No.: Jin-Guan-Yin-Kong-Zi-10460003280
1.This order is issued pursuant to Paragraph 4, Article 74 of the Banking Act and Subparagraph 11, Paragraph 2, Article 36 of the Financial Holding Company Act.
2.The following enterprises applied for investment by a bank or a financial holding company are considered “other financial related businesses designated by the Competent Authority”under Paragraph 4, Article 74 of the Banking Act and “other enterprises for which the Competent Authority determines to be financial related”under Subparagraph 11, Paragraph 2, Article 36 of the Financial Holding Company Act:
(1)Information service enterprise: It meansan enterprise whose main business is electronic data processing that is closely related to the data processing operation of financial institutions, or e-commerce trading information processing involving the accounts of financial institutions, or research, development and design of financial informationsystem for supporting the business development of financial institutions.
(2)Financial technology enterprise: It means an enterprise whose main business is one of the following:
a.Using information or network technologies to aid the business development of financial institutionsin data gathering, processing, analysis or supply (e.g.: big data, cloud computing, machine learning etc.).
b.Using information or network technologies to improve the efficiency or security of financial service or operating process (e.g.: mobile payment, automated investment advisor, blockchain technology, biometrics, etc.).
c.Designing or developing other digital or innovative financial services based on information or technology.
3.The main business of the aforementioned information service enterpriseor financial technology enterprisemay not includemanufacture, sale or leasing of hardware equipment. If such information service enterpriseor financial technology enterpriseprovides hardware equipment, the purpose of the hardware equipment must be congruent with the nature of business or data mentionedin the preceding point and associated withthe design offinancial related applications.
4.For information serviceenterprises or financial technology enterprises thatengage in businessesor activities provided in Point 2 and latter section of the preceding point, the portion of its annual operating costs or operating revenue derived from financial enterprises(including financial holding companies, banks, securities firms, insurance companies and their subsidiaries)andfinancial servicesshall make up 51 percent or more of its total operating costs or operating revenue for the year. The preceding provision does not apply if the investment of the bank or financial holding company in said information service enterprise or financial technology enterprise is for the purpose of strategic alliance or enhancingbusiness cooperation, and the bank or financial holding companydoes not have control or material influence over the enterprise as provided in the Regulations Governing the Preparationof Financial Reports by Public Banksor Regulations Governing the Preparationof Financial Reports by Financial Holding Companies(ex:shareholding in the enterprise is below 20 percent).
5.Banks and financial holding companies shall, within one month after the end of each fiscal year, report the percentage of annual operating costs and operating revenue of their invested information service enterprise or financial technology enterprise derived from financial enterprises and financial services to the competent authority for recordation. Should the percentage fail to comply with the preceding point, the bank or the financial holding company shall make adjustment to become compliant within two years from the year of reporting, and may apply for an extension once for a period of one year with reasons stated if the adjustment cannot be completed within the prescribed period. If the bank or the financial holding company is still non-complying past the prescribed and extended period, it shall submit a sharedisposal plan to the competent authority to reduce its amountof investmentor shareholdingin the information service enterprise or financial technology enterprise to not more than 5 percent of the total paid-in capital or issued and outstanding shares of the enterprise, or make adjustment to become compliant with the latter section of the preceding point.
6.This order takes effect immediately. |