Article 1
These Regulations are prescribed pursuant to Article 32 of the Central
Bank of China Act.
Article 2
The administration and supervision of the negotiable instruments clearing
business by the Central Bank of China ( hereinafter referred to as the
"Bank" ) shall be conducted in accordance with the provisions of these
regulations; matters not provided for herein shall be conducted in
accordance with the provisions of other relevant laws and regulations.
Article 3
"Negotiable instruments clearing business," as used in these regulations,
refers to the conduct of exchange and clearing of negotiable instruments and other relevant business between financial enterprises.
Institutions that engage in the clearing of negotiable instruments shall be called clearinghouses.
The term "Clearinghouses" as referred to in these Regulations shall include those clearinghouses already established prior to the prescription
and promulgation of these regulations.
Article 4
Clearinghouses in each local area shall each individually set up Executive
Committees under the direction and supervision of the Bank for deliberation on the following:
1. The negotiable instruments clearing business;
2. Applications by financial enterprises to participate in clearing and applications by financial enterprises (
hereinafter referred to as "clearing entity" ) to withdraw from clearing;
3. Negotiable instrument clearing bonds and processing fees;
4. Clearing times for negotiable instruments and dishonored negotiable instruments;
5. Handling of regulatory violations in the clearing of negotiable instruments;
6. Preliminary and final accounting matters;
7. Matters relating to the merger of clearinghouses and other organizational changes; and
8. Disposal of assets.
Article 5
The Executive Committee shall be composed of the following members:
1. Banks and credit cooperatives participating in clearing operations,
regardless of whether they have branch offices, may recommend one
representative to the Executive Committee.
2. From among farmers' or fishermen's associations that have been
approved to conduct checking deposit business, the Taiwan
Cooperative Bank shall each year select three associations from a
given district on a rotating basis to each appoint one representative to
the Executive Committee.
Appointments of committee members in accordance with the provisions
of the preceding paragraph shall be reported by the clearinghouse to the
Bank for approval and record.
The chairman of the Executive Committee
shall be appointed by the Bank and be
subordinate to the Bank in the handling of
all clearinghouse operations and Executive Committee resolutions.
Article 6
The Executive Committee shall convene one or two meetings monthly,
which shall be chaired by the committee chairman. The chairman shall
designate another committee member to serve as acting chairman in the
event of absence. The chairman may convene a special session of the
committee as needed or at the request of two or more committee members.
Article 7
Resolutions of the Executive Committee shall require a quorum of more
than one-half of members and be passed by vote of a simple majority of those members present. When voting is deadlocked, the chairman shall
cast the deciding vote.
Article 8
Minutes of the Executive Committee meetings shall be recorded and
reported to the Bank in timely fashion for approval or record before being
sent to each clearinghouse for recordation.
Article 9
Clearinghouses shall have one executive director, appointed by the Bank. Where the executive director is appointed by a correspondent bank, the appointment shall be reported to the Bank for approval and record. Where
new employees are engaged due to operational necessity, such engagements shall be made within the limits of the authorized workforce.
Appointments to director, deputy director and specialist posts shall be reported to the Bank for record. Where a branch office of a correspondent bank makes such appointments, they shall be reported to the headquarters
of the correspondent bank for record.
Article 10
Operating expenses of clearinghouses shall be borne jointly by each
clearing entity. In addition to revenue support approved by the Bank, half
of the amount of any shortfalls shall be equally borne by all the local
clearing entities. The remaining half [of any shortfall] shall be distributed
among clearinghouses in proportion to the total number of paid-in
negotiable instruments [transactions]. The clearinghouse shall settle
distribution of expense payments once each fiscal year and notify each
clearing entity of the amounts to be paid. If a transfer of funds is required
as a result of operating expense payments, such funds may be borrowed
from the Bank or its correspondent bank.
Article 11
The fiscal year for clearinghouses shall begin on 1 January and end on 31
December.
1. Budget:
Two months prior to the beginning of the fiscal year, the budget for the following fiscal year shall be drafted and reported to the Bank for
recordation.
2. Final accounting:
Two months prior to the end of the fiscal year, the year-end business report and final accounting statement shall be compiled and reported
to the Bank for record.
Article 12
A clearinghouse already established prior to the prescription and
promulgation of these regulations shall, within the time period specified
by the Bank, amend its registration to conform to the definition of a single
foundation, and upon that basis shall reorganize as a single clearinghouse.
Article 13
In applying under the provisions of the preceding Article for
incorporation of a foundation, the entire group of persons who have stated a willingness to serve as director must apply to the Bank for approval of
incorporation, submitting three copies of each of the following documents:
1. Application for approval of incorporation as a foundation;
2. Articles of incorporation (original document);
3. Inventory of donated properties, and documentation thereof;
4. Statements by contributors that they agree to transfer ownership of donated properties to the foundation once the registration of the
foundation has been approved;
5. Minutes of contributor meetings;
6. A list of directors and supervisors, and photocopies of their national identity certificates;
7. Statements of agreement from persons who have agreed to serve as director or supervisor;
8. A specimen impression of the foundation's seal, and either specimen seal impressions or specimen signatures of the directors;
9. Minutes of the board of directors' founding meeting;
10. A document explaining the foundation's operations plan; and
11. Other documents designated by the Bank.
Article 14
The articles of incorporation shall set forth the following particulars:
1. The foundation's name and purpose, and the location of its main office and any branch offices;
2. The type and monetary value of donated properties, and methods of safekeeping and utilization thereof;
3. Operations and methods of management thereof;
4. The number and term length of directors and supervisors, and the method of their appointment;
5. The organizational structure, and the duties of the board of directors and the supervisors;
6. Ownership of any property remaining after the foundation is dissolved or the competent authority voids its approval of incorporation; and
7. The duration (if limited) of the foundation.
Article 15
After approval has been granted for incorporation of a foundation,
registration papers shall be filed with the court of jurisdiction within 30 days of receipt of the approval document, and a photocopy of the
registration certificate shall be reported to the Bank for record within 30 days of receipt of notice that registration has been completed.
When any item subject to the incorporation approval process is amended, application for approval of the amendment shall be submitted, together
with related documents, to the Bank within 30 days of occurrence of the
amendment. The provisions of the preceding paragraph shall apply mutatis mutandis to procedures for recording the registration amendment
with the court of jurisdiction and with the Bank.
Article 16
At a foundation that has completed incorporation registration, the board
of directors shall meet at least once every three months, and minutes of each meeting shall be reported to the Bank for record within one month
of the finish of the meeting.
Resolutions of the board of directors must be approved by a majority vote at a meeting attended by more than one-half of the directors. Where the
articles of incorporation have more stringent provisions, said provisions
shall apply.
Article 17
At a foundation that has completed incorporation registration, the
positions of chairman of the board and president shall in principle be fulltime
positions, but this principle may be waived under special
circumstances where the Bank has granted its approval.
Article 18
A foundation that has completed incorporation registration may establish
an advisory committee. The committee shall be composed of representatives
appointed or recommended by the financial institutions participating in the
foundation's clearing operations, and shall be responsible for advising the
foundation in matters related to its clearing operations.
Article 19
At a foundation that has completed incorporation registration, the
remuneration or compensation of directors, supervisors, and employees at each level may be set with reference to standards for government-run
financial institutions; such remuneration (compensation) shall be reported to the Bank for approval or record.
Article 20
In managing the foundation's properties and operations, an incorporated
foundation and its directors and supervisors shall strictly abide by the
intent of, and management procedures set forth in, applicable laws and
regulations and in the articles of incorporation.
Article 21
Where any of the circumstances listed below applies to a clearinghouse
that was organized after the foundation completing its incorporation registration, the Bank may serve notice and require corrective action
within a limited period; in the event correction is not made within the specified time period, the Bank may void its approval of incorporation
and notify the court where the foundation filed its registration papers:
1. The board of directors adopts an illegal or improper resolution;
2. The foundation fails to carry out operations in accordance with its operations plan, or engages in operations outside the permitted scope;
3. The foundation fails to obtain legal documentation of its income and/ or expenditures, or fails to maintain full accounting records;
4. The foundation makes misrepresentations in reports related to its operations, financial matters, or other matters of material significance;
or
5. Other violations of the provisions of laws or regulations.
Article 22
The provisions of Articles 4 to 10 shall not apply to the clearinghouse
organized after first completing its registration of foundation's
establishment.
Article 23
All financial enterprises approved to conduct checking deposit business
may apply to the clearinghouse to participate in clearing [business] as a
clearing entity. Branches of clearing entities shall without exception
participate in their local clearinghouse [operations], provided that
negotiable instruments received by credit cooperatives, farmers' associations or
fishermen's associations shall, as specified by the Bank, be cleared through the
Taiwan Cooperative Bank of Taiwan or other clearing entities.
Where a financial enterprise has not applied in accordance with the
preceding Paragraph to participate in clearing [business], a clearing entity
may be engaged as its agent for the clearing of negotiable instruments.
The engaged [clearing] financial enterprise shall first make a report to the
clearinghouse for transmission to the Bank for prior approval.
Article 24
A clearing entity engaged as an agent for the clearing of negotiable
instruments shall assume on behalf of the represented entity all liability
with respect to clearing.
Article 25
Types of negotiable instruments covered under these regulations are as
follows:
1. Bank drafts (including banker's credit);
2. Cashier's checks (including cashier's checks with a bank as paying
agent);
3. Checks (including national (public) treasury checks); and
4. Other payment vouchers approved by the Bank for exchange.
Article 26
A clearing entity shall open a deposit account at the Bank or a
correspondent bank of the Bank. Payable or receivable clearing balances
and dishonored check balances shall be paid or collected through the
aforementioned account.
Where there is a necessity for a clearing entity that has not opened a
deposit account with the Bank to pay or collect payable or receivable
clearing balances and dishonored check balances through the Bank,
application may be made to transact the payments or collections through
another clearing entity's deposit account with the Bank.
Article 27
Where the balances in a clearing entity's deposit account are insufficient
to pay a given day's clearing balances or dishonored check balances, the
shortfall shall be supplemented within the time period set forth in
regulations.
When a clearing entity violates the provisions of the preceding
Paragraph, the Bank or its correspondent bank shall notify the local
clearinghouse, which shall in turn notify each relevant clearing entity to
return all payable and receivable negotiable instruments to the clearing
entity in question for resettlement.
Where a clearing entity must conduct resettlement in accordance with the
provisions of the preceding Paragraph, the clearinghouse shall
immediately report to the Bank for approval to temporarily suspend the
[clearing entity's] clearing [operations]. Where circumstances warrant,
the clearinghouse may submit a request to the Bank to be forwarded to
the Ministry of Finance, which will order the clearing entity to cease
operations and undergo liquidation.
Article 28
Clearinghouses shall draft a "Negotiable Instrument Clearing Business
Participation Agreement" which shall clearly state the following items:
1. The qualifications required for application to be a clearing entity;
2. Criteria for determining the amount of clearing bond a clearing entity
must post, reserve restrictions and conditions for its return;
3. [Provisions permitting] clearing entities to accept clearing
consignments from other financial institutions that are
non-participants in the clearing business;
4. Negotiable instruments collected by a clearing entity from another
clearing entity shall be presented to the local clearinghouse to carry out
clearing; the same shall apply for dishonored checks;
5. Branches of clearing entities shall, without exception, participate in
local negotiable instruments clearing and the [parent] clearing entity
shall submit for clearing all negotiable instruments from other clearing
entities accepted by its branches and assume full liability associated
with their clearing;
6. Clearing entities shall open deposit accounts with the Bank or [one of]
its correspondent bank [s];
settlement of all payable and receivable clearing balances and dishonored check balances shall be conducted in
accordance with the Directions for the Central Bank of China to
Govern Electronic Interbank Fund Transfers and Settlements and other
relevant regulations; and
7. Other protocols to be observed by clearing entities.
Article 29
Clearinghouses shall draft criteria for all processing fees collected for the
provision of services.
Article 30
Clearinghouses shall draft procedures for handling negotiable
instruments clearing, systems for accounting and auditing, and other
necessary operating protocols.
Article 31
Clearinghouses shall adopt protocols with financial enterprises that
conduct checking account operations to govern the handling of
dishonored checks and other related matters.
Article 32
Clearinghouses shall draft Operational Directions of Attention regarding
provision of information collected during the course of business for
public inquiry with regard to the credit histories of checking account
holders. Where changes occur [in the checking account credit history
information] they shall be duly noted and where the checking account
credit history is substandard, the following information shall be noted and
reported within a specified period of time to each financial enterprise:
1. The name and identification card number of the account holder of
personal accounts;
2. The account holder's name and responsible person's name and identification
card number for accounts held by non-juristic-person companies or groups;
and
3. The account holder's name, profit-making enterprise uniform
invoice number and tax code number for accounts held by juristic persons.
Article 33
The rules, regulations and accounting and auditing systems drafted by
clearinghouses in accordance with the provisions of the preceding five
Articles shall be submitted to the Bank for approval and record; the same
shall apply to all amendments thereto.
Article 34
Clearinghouses shall strengthen internal constraints and closely supervise
the conduct of personnel with respect to the handling of the record of
dishonored checks due to insufficient funds and other credit history
information.
Article 35
The provisions of Paragraph 3, Article 27 shall apply mutatis mutandis
with regard to serious violations of these regulations or [other] negotiable
instruments clearing rules and regulations by clearing entities.
Article 36
The Bank may at any time notify clearinghouses or require by regulation
that they submit scheduled or unscheduled operational, financial or other
relevant reports and may assign an officer to examine such reports.
Article 37
These regulations shall become effective from the date of promulgation.
﹝Remarks：These Regulations are made in Chinese which shall prevail
in case of any discrepancy between the English translation
and the Chinese original.﹞ |
