Draft Amendments of the Banking Act and the Financial Consumer Protection Act
Taiwan’s Financial Supervisory Commission (FSC) has completed draft amendments of the Banking Act. The draft amendment contains a substantial relaxation of the ceiling calculation method for reinvestment of the banks, allows banks to issue "interim notes", and incorporates the legal basis for derivatives to strengthen supervision.
The FSC is also expected to submit a draft amendment of the Financial Consumer Protection Act to the Executive Yuan very soon. Pursuant to the current Financial Consumer Protection Act, the highest fine that may be imposed is NTD 10 million and consumer disputes are handled on a case-by-case basis by an ombudsman body. In order to more severely punish financial institutions which violate relevant laws, the draft amendment of the Financial Consumer Protection Act increases the fine to the total amount of profit from sales of the product related to the violation. Additionally, there will be other administrative punishments, including warnings, suspensions of product sales, forced cessations of all or parts of the business, and revocation of the director, supervisor, and manager positions. Finally, the draft amendment adds a collective dispute resolution mechanism.
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