Chapter Four Consumer Protection |
| Article 39 |
A card issuer may not issue a credit card before completing the application and review procedures of the applicant. The preceding provision does not apply for an applicant who already holds a credit card(s) issued by the card issuer and has any of the situations below:
1. A new card is issued because the cardholder's original card is lost, stolen, counterfeited, or could be counterfeited, or the original card is no longer usable due to damage, demagnetization, scratches or other reasons.
2. A new card is issued upon the expiration of the prior card, in cases where the cardholder has not terminated the contract, provided, that review procedures have been completed.
3. A contract with a merchant for a co-branded card, affinity card or private label card has been terminated and a new card is issued according to the original agreement entered into between the card issuer and the cardholder; provided, that a prior notice is sent to such cardholder in writing or by electronic document as agreed with the cardholder in advance.
4. A new card is issued because a spin-off, merger or other credit card asset transfer occurred to the original card issuer; provided, that prior notice is sent to such cardholder in writing or by electronic document as agreed with the cardholder in advance.
5. A new card is issued because the card issuer has upgraded the cards it issues from magnetic card to IC card; provided, that a prior notice is sent to such cardholder in writing or by electronic document as agreed with the cardholder in advance.
6. Other situations as specified by the Competent Authority.
A cardholder shall be deemed to have given his/her consent if such cardholder does not express an objection to a notice referred to in Subparagraphs 3 through 5 of the preceding paragraph.
A card issuer must obtain the consent of the cardholder before adding new functions to a card it has already issued.
If the entity of the original card issuer changes as a result of spin-off, merger or other credit card asset transfer, the new card issuer shall replace the original cards with new cards in one (1) year from the effective date of change. The aforementioned deadline may be extended if the new card issuer has justified reasons and obtained approval of the Competent Authority. |
| Article 40 |
When receiving a written application, a card issuer shall notify the applicant in writing or by electronic document of the following particulars:
1. Annual fees and various handling fees which the credit card holder is required to pay, calculation methods for revolving credit interest rate and interest on revolving credit, penalty fees and other costs/fees which are likely to be borne by a cardholder. The revolving credit interest rate should be expressed as an annualized rate, and the calculation methods for revolving credit interest and penalty fees should be expressly stated in plain language supplemented with examples and illustrations;
2. The use of credit card and the procedure for handling lost, stolen, or destroyed credit cards;
3. Rights and obligations of cardholder arising out of unauthorized third party use of his or her credit card;
4. The procedures in the event of a discrepancy regarding a credit card transaction and important rules of international credit card organization regarding the rights and obligations of cardholders;
5. The duration and conditions for rights, benefits of, or services provided to, cardholders; and
6. Other matters as determined by the Competent Authority.
The notification as referred to in the preceding paragraph shall be made in clear and plain language, and the important terms contained therein which will affect cardholders' interests should be highlighted.
Card issuers shall state in the credit card agreement the frequency of adjusting matters set out in Subparagraphs 1 through 5 of Paragraph 1 hereof. |
| Article 41 |
The contents of a notification given under Paragraph 1 of the preceding paragraph shall be binding to all card issuers. In case of any of the following situations, a card issuer shall give the cardholder at least a 60-day notice in writing or by electronic document as agreed with the cardholder in advance. A cardholder may terminate his or her agreement with the card issuer if he/she does not agree to such change.
1. Possible increase of expenses/costs to cardholder.
2. An increase in the interest rate of revolving credit.
3. Change in the benchmark rates originally chosen by the cardholder in case of floating interest rate.
4. Change to the method of calculating interest on revolving credit.
5. Change to any of the items provided in Subparagraphs 2 to 5, Paragraph 1 of the preceding article.
A card issuer that adopts floating interest rates for the revolving credit may not change the benchmark rates chosen by the cardholder, unless such change is due to causes not attributable to the fault of card issuer.
When a card issuer mentioned in the preceding paragraph adjusts benchmark rates, it shall post an announcement of such an adjustment at its business place and on its website, and in addition, inform the cardholder in writing or in a manner as agreed with the cardholder in advance. When the benchmark rates are raised, the provision on the 60-day notice mentioned in Paragraph 1 hereof does not apply to the card issuer. |
| Article 42 |
A card issuer shall include at least the following items under the section of Applicant's Statement and Consent in the application form and ask the applicant to confirm by signature or take other methods that can authenticate the applicant identity and confirm the intent expressed by the applicant:
1. Interest rates and fees to be charged, and detailed description of fees schedule and conditions under which fees are charged.
2. Where the cardholder fails to make payment as agreed when due, the record will be posted with the JCIC and adversely affect the cardholder's rights to obtain other loans.
3. Where the card issuer's collaboration with a third party will involve the use of cardholder's information by the third party, the card issuer shall design a field in the section for the applicant to check whether he or she consents to the use of personal information by such third party and specify the purposes of use.
The information under Subparagraph 1 of the preceding paragraph shall be disclosed on the website of the card issuer.
A card issuer may not state in the credit card application that "The principal card applicant may sign on behalf of the supplementary card applicant for the application of a supplementary card" as a way of accepting supplementary card.
If a card issuer asks a credit card applicant to provide information on a third person other than the principal and supplementary cardholders and the guarantor, the card issuer shall comply with the following provisions:
1. The card issuer shall not make it (the provision of third party's information) compulsory or use it as a basis for approving or rejecting an application.
2. The card issuer shall explain to the applicant the purpose of requesting such personal information.
3. The card issuer shall not use such personal information in credit checking or collection operation.
4. The card issuer shall immediately stop the use of such personal information if so requested by the third party. |
| Article 43 |
If a cardholder notifies the relevant card issuer of termination of credit card agreement within seven (7) days after the receipt of the credit card issued by such institution, the card issuer may not charge or claim any fee from such cardholder unless such cardholder has already used the credit card. |
| Article 44 |
A card issuer must periodically deliver to each cardholder a statement of credit card transactions in writing or through electronic documents as agreed with the cardholder in advance.
The statement referred to in the preceding paragraph should fully disclose the following information:
1. The credit limit and cash advance limit of the cardholder;
2. Date from which interest accrues, revolving credit interest rate and period of application;
3. Billing date, payment deadline, amount payable increased in the current period, amount of overpayment and minimum payment;
4. Transaction date, posting date, transaction item, transaction amount, country or area at where a transaction took place, type of currency, the equivalent amount in New Taiwan Dollar or a designated foreign currency and the date of conversion into New Taiwan Dollar or a designated foreign currency with each transaction;
5. Fees schedule and conditions under which fees are charged; the respective amount of fees charged shall be listed separately;
6. For cardholders who have drawn on the revolving credit, previous balance, purchases included in the revolving credit, finance charge and late fees.
7. If the cardholder opts to only pay the minimum payment due for the current amount due, the time needed to pay off the amount and total amount due.
8. If the cardholder opts to pay all or part of the amount due in a fixed number of installment, the amount of principal, finance charge, and fees for each installment, amount outstanding and annual percentage rate on total finance charges.
9. Cumulative finance charges and fees already charged by the card issuer in the year up to the month of statement.
10. Other items as required by the Competent Authority.
Where the transaction details provided by a card issuer on its statement do not conform to the provisions in this article, the card issuer shall make adjustment to its statement in one year from the date the amendment to these Regulations enters into force. |
| Article 45 |
A card issuer shall disclose information relating to credit cards as follows:
1. The revolving credit interest rates shall be posted at the business place of the card issuer;
2. Information relating to the revolving credit interest rates, annual fees, calculation methods for various fees and charges arising from transactions, procedures for handling lost or stolen cards, cardholders' rights, benefits or services provided shall be published in periodicals or on the website of the card issuer; and
3. Other matters as required by the Competent Authority or the Central Bank. |
| Article 46 |
Where a card issuer plans to raise the credit limit of a cardholder, it shall send the principal cardholder a prior notice and obtain the principal cardholder's written consent before raising the credit limit. Where the cardholder has a guarantor, the card issuer shall also send the guarantor a prior notice and obtain the guarantor's written consent. The card issuer shall also notify the guarantor and the principal cardholder after the increase in credit limit has been approved.
When a principal cardholder applies for adjustment of credit limit, a card issuer shall notify the principal cardholder after the adjustment has been approved. If the cardholder has a guarantor, the card issuer shall send the guarantor a prior notice and obtain the guarantor's written consent in case of raising the credit limit of the cardholder. Otherwise, the card issuer only needs to notify the guarantor after the adjustment has been approved.
If the adjustment of credit limit referred to in the preceding two paragraphs also involves change to the credit limit of supplementary cardholder, the card issuer shall also notify the supplementary cardholder of the adjustment.
The methods of obtaining a cardholder's or guarantor's written consent mentioned in Paragraph 1 and Paragraph 2 hereof can also be via digital signature, ATM or automated loan machine. However, the card issuer should step up the verification of the identity of cardholder or guarantor and the agreement entered for issuance of credit card shall specify that the card issuer will be held responsible for the loss of the cardholder resulting from its own failure to perform identity verification. |
| Article 47 |
The clauses of the standard contract of credit card drawn up by a card issuer shall comply with the Mandatory and Prohibitory Provisions for Standard Contract of Credit Card , and the standards adopted for protecting consumers' rights and interests in the standard contract shall not be lower than those provided in the Standard Contract of Credit Card published by the Competent Authority.
The texts for the clauses of the standard contract of credit card of a card issuer shall not be smaller than font size 12. |
| Article 48 |
A card issuer shall calculate interest on the revolving credit of credit card according to the following provisions:
1. A card issuer may not charge compound interest.
2. The date on which interest starts to accrue shall not be earlier than the date the card issuer actually pays the merchant, and the card issuer shall follow the Mandatory and Prohibitory Provisions in a Standard Credit Card Agreement promulgated by the Competent Authority and relevant provisions in the Standard Credit Card Agreement Template.
3. Fees shall not be included in the amount of principal that incurs interest on revolving credit.
4. New purchases may not be included in the current principal that incurs interest on revolving credit.
5. The inclusion of purchases in the principal that incurs interest on revolving credit shall be handled in accordance with the Mandatory and Prohibitory Provisions in a Standard Credit Card Agreement promulgated by the Competent Authority and relevant provisions in the Standard Credit Card Agreement Template.
When a card issuer charges the cardholder late fees as agreed because the cardholder fails to make minimum amount due by the payment due date, the charge method shall comply with the provisions stipulated by the Competent Authority. |
| Article 49 |
A card issuer may not hold the supplementary cardholder liable for principal card charges incurred by the principal cardholder. |
| Article 50 |
If a card issuer collaborates with a contracted merchant in offering a credit card installment payment plan, the card issuer shall observe the following provisions:
1. The payment plan shall stay within the original credit limit of the cardholder.
2. The duration of installment payment plan shall not be longer than two years and six months.
3. The merchant shall, at the time of transaction, inform the cardholder in writing that the installment payment plan is offered by the card issuer, and fees schedule and conditions under which fees are charged. If the transaction is not carried out face-to-face but via the Internet or TV shopping, the merchant may inform the cardholder information provided above by other means, but the merchant is required to save relevant records.
4. The card issuer shall not ask the cardholder to pay for related expenses on grounds of warranting the provision of product or service by the merchant.
If a card issuer offers a credit card installment payment plan without collaborating with the merchant, the card issuer shall observe the following provisions:
1. The card issuer shall comply with the provisions in Subparagraphs 1 and 2 of the preceding paragraph.
2. The card issuer shall inform the cardholder of the information provided in Subparagraph 3 of the preceding paragraph in writing or in a manner as agreed with the cardholder in advance.
Where the credit payment installment payment plan offered by a card issuer does not comply with preceding two paragraphs, the card issuer shall make adjustment within six (6) months from the date the amendment to these Regulations enters into force. |
| Article 51 |
When a credit card business institution collects accounts receivable on its own, it shall handle the collection pursuant to the following provisions:
1. The credit card business institution shall not violate public interests or encroach on the rights of others, and shall execute its rights based on the principle of honesty and integrity.
2. A credit card business institution can collect payment from the cardholder and his/her guarantor only, and shall not bother or demand payment from a third party unrelated to the debt of the cardholder.
3. When a credit card business institution collects debt by phone, it shall identify the name of the institution and install a recording system. The credit card business institution shall retain related information for at least six months for audit or investigation purpose in the case of a dispute.
4. A credit card business institution shall not resort to violence, coercion, intimidation, verbal abuse, harassment, misleading or deceptive representation, or engage in other illicit debt collection practices that invade the privacy of the debtor.
5. When a credit card business institution visits the cardholder or a relevant third party for debt collection purpose, he/she shall identify him-/herself and the name of the financial institution, and show proof documents. |
| Article 52 |
To protect the interests of cardholders, a credit card business institution shall establish a complaint handling procedure and set up a complaint and service hotline. It shall also post the service hotline on the back of the card, and notify the cardholders of such information in writing or by electronic document and post the same on its website.
Unless the filing of information is waived by the Competent Authority, a card issuer shall, before filing the information on late payment by a cardholder that is more than one month overdue, compulsory suspension or closing of card account, receivable on demand, bad debt and other bad credit record of a cardholder with JCIC, notify the cardholder of the reason for filing the bad credit record with JCIC and possible effects on the cardholder in writing or by electronic document as agreed with the cardholder in advance. |
| Article 53 |
Unless otherwise provided by other laws or the Competent Authority, credit card business institutions and merchants shall keep confidential all information on credit card applicants or holders which comes into their possession in the course of processing an application for, or the use of, credit cards by cardholders.
The provisions of the proceeding paragraph shall also apply to information which has come into the possession of a credit card business institution or a merchant due to an official or contractual relationship. |