21 Jan 2019 Taiwan Legal Update: Premier Su Instructs to Simplify KYC Measures for Daily Transaction & Taiwan Reaffirm Inclination to Join CPTPP after its First Commission Meeting
Premier Su Instructs to Simplify KYC Measures for Daily Transaction
Premier Su Tseng-chang, along with the Chairman of Financial Supervisory Committee(FSC), the Director of the Money Laundering Office, and several high-ranking government officials visited Taiwan Cooperative bank on 17th of January to have a better understanding of the bank’s practice on anti-money laundering, anti-fraud, and “Know Your Client” (KYC) policies.During the inspection process, Su made some inquiries about the purpose and practice of the bank acquiring the information during usual transactions such as opening accounts, deposits, and remittances. He stressed the importance of anti-money laundering to maintain social order and protect property safety. However, as Lunar New Year is approaching and the general public’s demand on deposits, withdrawals, and remittances increase, over-emphasis on the inspection would trouble people’s daily transaction. As a result, Su expect the FSC continue to work on the following four measures to simplify the KYC process and make it more convenient for commoners.
- if the bank already has the information and recognize the clients, it is unnecessary to ask the client identify himself with formal document for transaction below NTD$500,000 and without the passbook.
- For depositing via transfer into no update passbook savings account, since the financial institution has the customer’s information, it is not necessary to ask the customer to fill in the information again.
- Those who pay taxes and fees may not obliged to apply the provisions on anti-money laundering.
- Most financial transactions are normal trading activities, and money laundering prevention measures should be convenient and in compliance to the principle of proportionality.
In response to Su’s instruction, the Chairman of FSC, Wellington Koo, said that the Committee would actively promote these measures. He elaborated that the purpose of preventing money laundering is to ensure the smooth operation of all legitimate economic and financial activities and to create the common interests of the people, enterprises, financial institutions, and the government. The implementation of anti-money laundering policy should be based on risk evaluation so that resources can be effectively distributed and maximized. The FSC has asked financial institutions to take note of the updating and periodic review of low-risk clients. The anti-money laundering measures shall be carried out in the least disruptive manner. In the future, under the principle disclosed by the head of Executive Yuan, the relevant policies will be consistently promoted and the common normal trading conditions will be adopted. FQA will be provided for financial institutions to ensure the normal transactions can proceed smoothly under anti-money laundering measures implemented.
Taiwan Reaffirm Inclination to Join CPTPP after its First Commission Meeting
The Japan-led Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which has taken into effect on December 30, 2018, held its first meeting in Tokyo on January 19 and reveal the joining process for new members afterwards.“Amid growing concerns over recent trends toward protectionism, Ministers shared the view that it is of paramount importance to maintain and further strengthen the principles of an effective, open, inclusive and rules-based trading system,” The CPTPP members highlighted the importance of expanding the scope of the trade bloc in the joint ministerial statement to against protectionism after the first meeting. In addition, the Japanese Minister in charge of the Commission, Toshimitsu Moteg, reiterated that the CPTPP welcomes and open to countries or regions that can accept free and fair standards, which make CPTPP’s determination on recruiting new members to form a stronger united front more self-explanatory.
In response to the statement, Taiwan’s Minister without Portfolio, also the Chief Delegator of Office of Trade Negotiation under Executive Yuan, Zhen-zhong Deng, held a press conference, claiming that Taiwan is a free and open economy and will do its utmost to gain the membership.
Participating countries in the CPTPP believe that by further expanding the scale of economic and trade, they will be able to increase their influence. Thus, the procedure has been established for the future application and review of new members as soon as possible, Deng went on explained.
He also pointed out that CPTPP has only one guideline for the economy that intends to join now, that is, being “open and free. It encourages the countries and economic entities that interested in joining the CPTPP to engage in extensive informal discussions with member states. If consensus can be reached among member states, then the next stage is to formally apply for membership.
According to Deng, Taiwan is a free and open economy and has a communication channel with all CPTPP members. The government will carefully seek support and consensus of member states and other countries and do their best to meet its standards and join the trade bloc.
After President Donald Trump pulled the United States out of TPP, on January 2017, the rest of the countries renegotiated the free trade deal and sign the new version of the pact, CPTPP, on March 2018. CPTPP currently has 11 founding countries. It is a huge free economic bloc covering a population of 500 million, with the domestic gross domestic product (GDP) of about 10 trillion US dollars and 13% of global GDP. It regulates the tariff reduction of agricultural and forestry aquatic products, the loosening of regulations on trade and investment, and the strengthening of intellectual property rights.
So far, Japan, Mexico, Singapore, New Zealand, Canada, Australia, Vietnam, and other seven countries are applied to the agreement; Brunei, Chile, Malaysia, Peru, and other four countries are still undergoing domestic procedures and prepare to have the CPTPP agreement come into force.
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