萬國法律事務所

Taiwan’s Financial Supervisory Commission recently proposed an amendment of the Regulations Governing Banking Activity and the Establishment and the Investment by Financial Institutions between the Taiwan Area and the Mainland Area (Regulations). The amendment cancels the current restriction that stipulates that a Taiwan bank can only choose two investment methods out of three (establishment of a branch office, establishment of a subsidiary, or holding Chinese bank shares) if a Taiwan bank wishes to invest in China.

The amended Regulations are expected to take effective after Taiwan’s Executive Yuan reviews and approves of the same. Upon execution of the amended Regulations, financial enterprises that have a strong desire to invest in China, such as Chinatrust Financial Holding Company and Cathay Financial Holdings, will have more choices with respect to investment vehicles in China. In addition to the above, other restrictions, such as the limitation on loan amounts of a Taiwan bank’s China branch office, might also be relaxed.