萬國法律事務所

Regarding the case of Taishin Financial Holding Co., Ltd (“Taishin Holdings”) requests to regain the operation right of Chang Hwa Bank, Taipei District Court Civil Division held on April 27, 2016 that among the six asserted obligations and the defaults claimed by Taishin Holdings against the Ministry of Finance, only the claim confirming the existence of a contractual relationship was recognized by the Court.

Since this was the high-profile case, the presiding judge spent considerable time explaining the content of the judgment, and the Taipei District Court issued a 14-page press release regarding the same.

Although the court found that part of the contractual relationship continues to exist, but for the 24th election of directors, the court held that the Ministry of Finance did not violate the contract, interfering with Taishin Holdings in obtaining more than a majority of seats of directors. Therefore, the reassignment of three directors for Taishin Holdings was unnecessary, and in addition, the claim for compensation was held to be unreasonable.

It is noteworthy that the Court held that the algorithm for the right to operate a dominant position should be calculated subject to all directors rather than limited to only the ordinary directors. The financial market now is concerned with the future impact on the Financial Supervisory Commission (FSC) caused by the Court’s opinion.