Directions for Domestic Security Firms Approved to Conduct Foreign Exchange Business While Assisting Customers to Declare Foreign Exchange Receipts and Disbursements or Transactions — CBC — TW

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Title：

Directions for Domestic Security Firm Approved to Conduct Foreign Exchange Business while Assisting Customers to Declare Foreign Exchange Receipts and Disbursements or Transactions

Inactive Regulations

Amended Date： March 27, 2017（effective from March 29, 2017）

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(Compliance with the Regulations for Declaration)

Domestic securities firms approved to conduct foreign exchange business (hereinafter referred to as “DSFs”) shall assist customers to make truthful declarations pursuant to the Regulations Governing the Declaration of Foreign Exchange Receipts and Disbursements or Transactions (hereinafter referred to as “the Regulations for Declaration”) when customers settle foreign exchange against New Taiwan dollar (NTD).

(Documents to be verified for foreign exchange spot transactions and the submission of declaration documents)

When carrying out spot transactions for customers, DSFs shall follow the Regulations Governing Foreign Exchange Business of Securities Enterprises (hereinafter referred to as “the Governing Regulations”) with regard to the business scope, amount and restrictions. The DSF shall first verify the securities transaction documents related to the spot transactions, and shall note that:

(1) When handling foreign exchange settlements associated with the businesses listed in the attachment for the same company, the DSF shall verify the veracity of the relevant documents listed in the attachment before processing the settlement. The declarant shall be the company’s head office, and the DSF needs not enquire the settlement amount nor count it toward the DSF’s or the customer’s aggregate settlement amount of the current year. If the verified document, such as the consent letter issued by the competent authority, clearly states the settlement amount for the transaction, the DSF shall make sure that the aggregate settlement amount does not exceed the amount approved by the competent authority.

(2) When handling foreign exchange settlements associated with businesses not listed in the attachment, the declarant shall be the head office of the securities firm or the customer depending on ownership or destination of the foreign exchange receipt, disbursement or transaction, and unless it is otherwise provided in the Regulations for Declaration and this Directions for DSF, the DSF should enquire the settlement amount online and count it toward the securities firm’s head office’s or the customer’s aggregate settlement amount of the current year.

(3) The DSF shall annotate the settlement date and amount on the relevant supporting documents and affix its signature/seal thereon, and then retain a photocopy of these documents along with the top copy of the Declaration Statement of Foreign Exchange Receipts and Disbursements or Transactions (hereinafter referred to as “Declaration Statement”) for future reference without submitting them to the Department of Foreign Exchange. The submission of other declaration information shall be carried out in accordance with relevant provisions of the Governing Regulations.

(Enquiry of aggregate settlement amount of the current year)

DSFs that handle the declaration of foreign exchange settlement against NTD in accordance with Subparagraph 3, paragraph 1, Article 4 of the Regulations for Declaration shall enquire online and count the settlement amount toward the declarant’s aggregate settlement amount of the current year, and shall note that:

(1) A DSF should prevent the declarants from using a third party’s name to make the declaration.

(2) For the declaration of a non-resident’s foreign exchange settlement, a DSF is not required to enquire online the declarant’s aggregate settlement amount of the current year.

(3) For the declaration of an settlement of sale from an inward remittance, which has originally been settled by the same declarant via the same DSF by using the “Annual Aggregate Settlement Amount as provided in Subparagraph 3, paragraph 1, Article 4 of the Regulations for Declaration” (hereinafter referred to as “Annul Aggregate Settlement Amount”), the DSF may handle the declaration without enquiring online or counting the settlement amount in the declarant’s Aggregate Settlement Amount of the current year. In addition, the DSF shall annotate the settlement of sale amount and the date on the declarant's original Foreign Exchange Sale Memo, affix its signature/seal thereon and retain a photocopy for future reference.

(4) The enquiry record of the settlement amount shall be printed out on the DSF's receipt slip of the Declaration Statement to facilitate on-site examination by the Central Bank of the Republic of China (Taiwan) (hereinafter referred to as “the Bank”) and other financial auditing authorities.

(Attention to the breakup of settlement amount)

DSFs engaging in foreign exchange settlements against NTD in accordance with Subparagraph 4, paragraph 1, Article 4, of the Regulations for Declaration shall be aware that the settlement amount for a single transaction is limited to a maximum of US$ 100,000. Such DSFs shall prevent declarants from breaking up a large settlement into smaller ones to circumvent the provision of Article 6 of the Regulations for Declaration which requires prior approvals from the Bank.

(Settlements by persons holding other types of identification documents)

For officials of diplomatic missions in the Republic of China (R.O.C.) and their family members holding Identification Cards issued by the Ministry of Foreign Affairs, and persons holding R.O.C. passports issued by the Ministry of Foreign Affairs but do not have Citizen’s ID Cards, the permitted amount of foreign exchange settlement against NTD shall be the same as that for non-residents.

When engaging in a single foreign exchange transaction against NTD for an amount less than NT$ 500,000 or the equivalent thereof, the customer is not required to complete a Declaration Statement and the settlement amount will not be counted toward the aggregate settlement amount of the current year.

DSFs shall, however, be aware of and prevent customers from breaking up a large settlement into smaller ones to circumvent the required declaration and enquiries regarding the aggregate settlement amount of the current year.

(Entry of declarant’s ID number)

DSFs shall assist a declarant to truthfully fill out the "declarant's ID number" on the Declaration Statement in accordance with the following provisions:

(1) Companies, limited partnerships and firms: Indicate the Uniform Business No. provided by the competent authorities for its establishment and registration.

(2) Associations: Indicate the uniform tax withholding number assigned by the tax authorities. For an association without a uniform number, indicate the name of the competent authorities approving its registration and its registration certificate number.

(3) Individuals:

A. An individual with a Citizen's ID Card: Write down the Citizen’s ID No. and date of birth.

B. Holder of a relevant Taiwan Area Resident Certificate or Alien Resident Certificate with a validity of one year and above: Indicate the uniform identification number, the date of issuance, date of expiry (enter 999/12/31 for the date of expiry for Alien Permanent Resident Certificate), and date of birth as specified on the certificate.

C. Minors: For a natural person under 20 years of age bearing a Citizen’s ID Card or a relevant Taiwan Area Resident Certificate or Alien Resident Certificate with a validity of one year and above, the “declarant's ID number” on the Declaration Statement shall be provided under the field “Individual” in accordance with the provisions of the preceding two items, and the legal representative of the minor shall also sign on the Declaration Statement under the field “Signature of the declarant and its responsible person.”

(4) Non-residents:

A. Natural persons (including minors):

i. Holder of a relevant Taiwan Area Resident Certificate or Alien Resident Certificate with a validity of less than one year, and for a citizen of Mainland China and a resident of Hong Kong or Macao holding a Taiwan Entry and Exit Permit or a relevant entry document but not having resident status: Indicate the nationality as shown on the certificate or permit, the uniform identification number (or the permit number if there is no uniform identification number), and date of birth in the Declaration Statement.

ii. Foreign passport holder or official of diplomatic missions in the Republic of China and his/her family member holding an identification card issued by the Ministry of Foreign Affairs, and a person holding a R.O.C. passport but not having a Citizen’s ID Card: Indicate the nationality, passport (certificate) number and date of birth in the Declaration Statement.

B. Legal entities:

i.Non-resident legal entity: Shall authorize its representative or agent in the R.O.C. to act as the declarant. In the Declaration Statement, the said representative or agent shall write down his/her ID No. or certificate number and clearly specify the representation or agency relationship.

ii. Foreign financial institution: Shall authorize a local financial institution to act as the declarant. In the Declaration Statement, the said local financial institution shall write down its identification number of the establishment permit issued by the competent authority and clearly specify the representation or agency relationship.

(Verification of declarant’s identity)

Before processing the declaration of foreign exchange settlement, a DSF shall first verify that a declarant's registration certificate number indicated by a declarant according to the provisions of the preceding point (point 7) is the same as the corresponding number on the declarant's identification document or primary registration data. The DSF shall also verify the entrustment or authorization document for settlement declaration, and confirm that the foreign exchange involved in the receipts, disbursements, or transactions actually belongs to or is needed by the declarant himself/herself before processing the declaration. A DSF shall also notice that:

(1) If the declarant is a company, limited partnership or firm, the DSF shall visit the website of Commerce Industrial Services Portal of the Ministry of Economic Affairs and go to “Enquiry of company registration”, “Enquiry of limited partnership registration” or “Enquiry of business registration” to enquire and verify the registration information of the company, limited partnership, or firm.

(2) If the declarant is a non-resident under 20 years of age, the DSF may verify the required documents in accordance with its internal operation procedure and applicable provisions of the Civil Code on a case-by-case basis.

(Declarant’s signature on the Declaration Statement)

Information written down in a Declaration Statement concerns the rights and obligations of a declarant. In case a Declaration Statement is filled out for a declarant by a third person, the declarant shall affix his/her seal or signature on the Declaration Statement after verifying the accuracy of all the declared items to specify explicitly his/her responsibility.

(Assistance in truthful declaration)

10.

DSFs shall assist declarants to fill out the Declaration Statement carefully and truthfully. In the event that the nature of the settlement and the amount to be settled violate the common sense or are inconsistent with the status or occupation of the declarant, the DSF shall assist the declarant to make a truthful declaration before processing the settlement.

(Seal of the declarant)

11.

In case a declarant uses a seal for a specific purpose on his/her Declaration Statement, the specific purpose of the seal shall be the one for making settlements only or relevant to the settlements.

(Alteration of the Declaration Statement)

12.

The amount stated in a Declaration Statement shall not be altered. If any other fact stated in the Declaration Statement is altered, the declarant shall affix his/her seal or signature next to the alteration.

(Completion of Declaration Statement and examination of nature of transaction)

13.

DSFs shall check whether all the fields on the Declaration Statements are properly filled out. The nature of settlement shall be documented accurately and not be replaced with a remittance classification code. When there is more than one nature or currency of settlement, such natures, currencies and settlement amounts shall be separately indicated. The nature of settlement shall be declared according to the following provisions:

(1) The nature of foreign exchange receipt or transaction: Companies, limited partnerships, firms, associations and individuals shall indicate the sources of their foreign exchange revenue; non-residents shall indicate the use of NTD proceeds from sale of foreign exchange.

(2) The nature of foreign exchange disbursement or transaction: Companies, limited partnerships, firms, associations and individuals shall indicate the use of their foreign exchange proceeds; non-residents shall indicate the sources of NTD revenue for purchasing foreign exchange.

(Agreement on declaration over the Internet)

14.

When a DSF accepts a declarant's application for making declarations of foreign exchange settlements through the Internet in accordance with Article 10 of the Regulations for Declaration, the related terms and conditions of the agreement between the DSF and the declarant shall include matters prescribed in Article 11 of the Regulations for Declaration.

(Design of online control programs)

15.

DSFs shall design online control programs according to declaration procedures which are applicable for making declarations in person at the DSF, and shall provide online declaration instructions, the Regulations for Declaration and relevant provisions on the website, and assist declarants in making declarations through the Internet.

(Enquiry of online declaration)

16.

When a declarant makes a foreign exchange settlement declaration through the Internet pursuant to Subparagraph 3, paragraph 1, Article 4 of the Regulations for Declaration, the DSF shall use an online real-time enquiry system and count the settlement amount toward the declarant’s aggregate settlement amount of the current year to make sure the declared amount does not exceeded the Annual aggregate settlement amount before processing the declaration. The DSF shall also show the enquiry records on the declaration medium retained by itself.

(Verification of online declaration documents)

17.

When processing a declarant’s declaration of foreign exchange settlement against NTD through the Internet, DSFs shall first verify the veracity of relevant securities transaction documents provided and annotate the settlement date and amount, Foreign Exchange Memo number and affix its signature or seal on the relevant documents for future examination.

(No alteration of online declaration information)

18.

DSFs may not alter any of the declarant's declaration information retained in electronic format.

(Correction of declaration content)

19.

To correct the content of the Declaration Statement, a declarant shall submit the application along with the following documents to the Bank through the DSF which handled the original declaration:

(1) Correction of declaration of foreign exchange settlements against NTD:

A. A declarant unintentionally making an untruthful declaration: Submit an opinion letter issued by a lawyer, an accountant or a DSF indicating that the untruthful declaration was unintentional, relevant supporting documents, the original Declaration Statement and the Foreign Exchange Purchase (Sale) Memo (those who declared through the Internet shall submit the Declaration Statement and the Foreign Exchange Purchase (Sale) Memo printed by the DSF), and the corrected Declaration Statement and the Foreign Exchange Purchase (Sale) Memo. The content of the opinion letter shall include the declarant's name, the settlement date and amount, the content of the original declaration, the corrected declaration, and the reason for making the mistake on the original declaration.

B. A declarant intentionally making an untruthful declaration, and having already been penalized pursuant to Paragraph 1, Article 20 of the Foreign Exchange Regulation Act: Submit the receipt of the fine paid, the corrected Declaration Statement, the Foreign Exchange Purchase (Sale) Memo and the relevant supporting documents.

(2) Correction of other transaction certificates: Submit the original certificate drawn by the DSF (those who declared through the Internet shall submit the certificate printed by the DSF), the corrected certificate drawn by the DSF, and the documents supporting the content-correction application.

(3) Correction of Foreign Exchange Purchase (Sale) Memo with the amount less than NT$500,000: Submit the original Foreign Exchange Purchase (Sale) Memo drawn by the DSF (those who declared through the Internet shall submit the memo printed by the DSF), the corrected Foreign Exchange Purchase (Sale) Memo, and the documents supporting the content-correction application. The DSF shall make photocopies of relevant supporting documents and information for the correction of declaration content mentioned in the preceding paragraph, and shall retain the photocopies along with the original declaration information for future reference.