萬國法律事務所

The Financial Supervisory Commission, Executive Yuan (FSC), has issued a circular to prohibit a legal person from acting simultaneously as a director and a supervisor of its subsidiary.

A person may not act as a director and a supervisor of the same company. Formerly, when a legal person is a shareholder of a public company, a representative / proxy designated by such legal person may not be selected or serve concurrently as the director and the supervisor of the company in question. The new circular imposes a more restrictive standard to prohibit the representative / proxy of the legal person as well as the representative of the affiliate of said legal person to be selected or to serve concurrently as the director and the supervisor of the company in question. This policy aims to enhance corporate governance in Taiwan.

It is reported that more than 100 Taiwanese listed companies, in particular in the financial and IT sectors, will be affected by this new regulation. However, in order to limit its impact, the FSC announced that this new policy will not be applicable to the directors and supervisors in the current term of office.