萬國法律事務所

The Financial Supervisory Commission (FSC) is considering an amendment of the rule that prohibits commercial banks in Taiwan from investing in Chinese securities. According to Article 74-1 of Taiwan’s Banking Act, the FSC has the authority to prescribe the type of securities and to impose limits on investments. Currently, FSC rules prohibit commercial banks in Taiwan from investing in securities issued by companies in China or those issued by the Chinese government. However, the FSC is now reviewing whether this ban should be lifted. If the FSC decides to make the amendment, the amount of the investments in Chinese securities will be combined with other investments in securities made by a bank to calculate whether the bank has complied with the limit on the amount that a bank can invest in securities.

Additionally, China’s laws and regulations have strict conditions as to what constitutes a “Qualified Foreign Institutional Investor (QFII),” and currently none of the commercial banks in Taiwan meet these conditions. Thus, along with amending its rules to permit investment in Chinese securities, in order to enable such investment, FSC may negotiate with the Chinese government for a relaxation of its conditions for being deemed a QFII.