Taiwan - Opinions And Views in Practice / Legal News Update January 2019.
Legal News & Analysis - Asia Pacific - Taiwan - Regulatory & Compliance - Tax
4 February, 2019
The Constitutional Court of the Judicial Yuan issued J.Y. Interpretation No. 771 on December 14, 2018. In the Interpretation, the Constitutional Court states that an authentic successor does not lose his/her legally acquired right of inheritence despite that the statute of limitations on the restitution of the right of inheritance has already run. In the event that the estate property is illegally possessed by others, the successor is entitled to recover the property pursuant to the relevant provisions of the Civil Code, provided, however, that the statute of limitations set forth in Article 125 of the Civil Code shall still be applicable. (Dennis Chen)
The MOEA promulgated the regulations on declaration and management of corporate information
According to the “Regulation on Declaration and Management of Corporate Information Pursuant to Article 22-1 of the Company Act” (the “Declaration Regulations”), promulgated by the MOEA on October 31, 2018, non-government-owned entities, publicly traded companies and the companies designated by the authorities shall declare annually such information as required in Article 22-1 of the Company Act on the “Platform for Declaration of Information by Company’s Responsible Person and Major Shareholders” maintained by Taiwan Depository and Clearing Corporation. The companies formed before the Declaration Regulatios coming to effect shall declare the required information during the period beginning November 1, 2018 to January 31, 2019. The companies form after the Declaration Regulations becoming effective shall declare the required information within 15 days after corporate formation. Starting 2020, companies shall declare during the month of March every year the rquired information for the preceding year unless they have already made an amended declaration of information between January 1 and March 31 of that year. (Albert Liao)
The MOEA promulgated the “Guidelines on Implementation of Online Application for Company Registration and Electronic Service”
The newly amended Company Act provides that the documents to be served by the competent authority upon a company pursuant to laws and the applications to be filed by a company with the authority may be made electronically. Accordingly, the MOEA promulgated the “Guidelines on Implementation of Online Application for Company Registration and Electronic Service” on November 1, 2018. Prior to making an electronic application, a company shall enter the necessary information on the designated platform, and submit the information after affixing an electronic signature.
The time an electronic application is submitted shall be the timestamp recorded by the information system. After receiving an application, the authority shall acknowledge the receipt thereof to the company by appropriate means. Upon consent of the company or its representative, the authority may advise the company to download the official document on the information system to complete the electronic service. The time a document is served shall be the time such document is downloaded by the company or its representative. If the company does not download the document within 5 days, the authority shall make the service in paper-form instead. (Albert Liao)
The Labor Standards Act and the Act for Protecting Worker of Occupational Accidents have been amended to protect the equal rights of persons with disabilities against discrimination—The President has published on November 21, 2018 the amendments to the Labor Standards Act and the Act for Protecting Workers of Occupational Accidents. Important amendments include:
(1) removing the words such as “mentally insane or physically crippled” that have been perceived to be discriminative and derogatory to persons with disabilities, and replacing them with “mentally/physically disabled”; and
(2) replacing the words such as “crippled” with “disabled” or “inconvenient,” to implement the priciples of equality and non-discrimination as stated in the Convention on the Rights of Persons with Disabilities. (Max Lee)
The FSC promulgated the amendments to the Regulations Governing the Acquisition and Disposal of Assets by Public Companies.
The FSC promulgated the amendments to the Regulations Governing the Acquisition and Disposal of Assets by Public Companies on November 26, 2018. The gist of the amendment is as follows:
(1) Expending the definition of Right-of-use Asset in accordance with the International Financial Reporting Standard 16 (“IFRS 16”).
(2) Relaxing the regulations with respect to the acquisition or transfer of business-use equipment between a public company and its wholly own (directly or indirectly) subsidiaries, namely, such transactions no longer need to be approved by the board of directors, and are exempt from the evaluation of the reasonableness of the transaction costs. (3) Relaxing the public announcement information reporting requirements of the trading of subscription or redemption of securities investment funds or futures trust funds by investment professionals. (4) Relaxing the publication requirement on acquisition or disposal of real property for construction use by a public company in the construction business where the company’s paid-in capital exceeds NT$ 10 billion and the trading counterparty is not a related party, unless the transaction amount is nonless than NT$ 1 billion. (5) Exempting public companies from the need to establish related procedures if the board of directors has resolved not to engage in transactions of derivative financial products. (6) The Amendments shall be implemented on January 1, 2019. (Andy Lee)
The FSC amended the Regulations Governing Foreign Investments by Insurance Companies
For implementing Paragraph 3, Article 146-4 of the recently revised Insurance Act, restricting Insurance Enterprises’ investment amount of foreign currency denominated listed or over-the-counter certificates of domestic stocks or bonds (the “International Bond Bonds”), expanding the ways of use of Insurance Enterprises funding (“Funding”), and improving flexibility and efficiency of use of Funding, the FSC amended the Regulations Governing Foreign Investments by Insurance Companies (the “Regulation”) on November 21, 2018. There are totally 9 revised provisions in the amendment. The major aspects of the amendment include: Expanding the scope of Insurance Enterprises’ investment, including Bonds issued by or guaranteed by Foreign local government affiliates, and setting the limit line of investment; and including the investment amount of the International Bond Bonds in foreign investment quota, which shall not exceed 145% of the approved foreign investment quota (the “Limit Line”).
Upon the effectiveness of the amended Regulation, the insurance company is forbidden to increase investment portion of the International Bond Bonds when the foreign investment quota has already exceeded the Limit Line. (Steven Yen)
The FSC amended the Regulations Governing Investments in Insurance-related Businesses by Insurance Companies
Since the Regulations Governing the Application by Insurance Companies for Investments in Insurance-related Businesses (the “Regulation”) covers not only the application for investments in the Insurance-related Businesses by insurance companies but also the management aspects after the investment, the FSC on December 3, 2018 renamed the Regulation to “Regulations Governing Investments in Insurance-related Businesses by Insurance Companies” and amended the regulations in several aspects.
Given the need for the insurance enterprises applying for investments in the Insurance-related Businesses to enhance the soundness of their finnancial business, the FSC amended the qualifications for the insurance enterprises which may invest in the Insurance-related Businesses as well as the required application forms.
For enhancing the risk management and business management mechanisms for the insurance enterprises to invest in Insurance-related Business, the FSC added certain handling procedure concerning investing in the Insurance-related Businesses by insurance enterprises.
To ensure that the insurance enterprises abide by the Prudential Supervision Principle when investing in the Insurance-related Business, and to help the authorities to collect the financial, business and operational information of the Insurance-related Business being invested, the FSC added new rules concerning post-investment management to be complied by the insurance enterprises which invest in Insurance-related. (Steven Yen)
For further information, please contact:
C. Y. Huang, Partner, Tsar & Tsai Law Firm