TAIWAN Law and Practice Contributed by: Robin Chang, Sarah Wu and Eddie Hsiung, Lee & Li
dations are appropriate for the risk tolerance of the corresponding customers. The Robo-Adviser Rules also put in place certain rules for the implementation of “rebalancing transac - tions” by robo-advisers as indicated in 2.2 Regulatory Regime . Given the above, so long as the above-mentioned rules are followed, there should be no issue relating to best execution from the perspective of the Robo- Adviser Rules. 4. Online Lenders 4.1 Differences in the Business or Regulation of Fiat Currency Loans Provided to Different Entities A local licensed bank may engage in lending business. However, conducting lending activities as a compa - ny’s registered business item is still not permitted in Taiwan currently, although lending does not fall within the type of business that may only be carried out by a local licensed bank. Under Taiwan law, a bank’s lending to small busi - nesses or individuals may be subject to stricter rules from the perspective of financial consumer protection. 4.2 Underwriting Processes As indicated in 4.1 Differences in the Business or Regulation of Fiat Currency Loans Provided to Dif- ferent Entities , if a fintech company is not a licensed bank, then it may not register lending as one of its registered business items. In the case of peer-to-peer lending, as indicated in 2.2 Regulatory Regime , pursuant to the P2P Guidelines, a peer-to-peer lending platform operator would need to have in place and implement relevant risk control mechanisms such as establishing criteria for review - ing loan applications and limits on loan amounts. 4.3 Sources of Funds for Fiat Currency Loans For bank loans, the funds are acquired through con - ventional means, similar to other traditional lending practices.
In peer-to-peer lending, the funds originate from lend - ers who are connected through the platform. 4.4 Syndication of Fiat Currency Loans As far as we know, there have been no instances of syndicated loans being arranged entirely online in Tai - wan. However, please note that according to the news in January 2024, the FSC has approved a digital-only bank’s trial application to participate in a syndicated loan. 5. Payment Processors 5.1 Payment Processors’ Use of Payment Rails Please see 2.2 Regulatory Regime regarding e-pay - ment businesses. 5.2 Regulation of Cross-Border Payments and Remittances Traditionally, only licensed banks may handle cross- border remittances, and payments through cheques and credit cards are also handled by banks. However, the E-Payment Act now allows Taiwan e-payment operators to offer cross-border payment services in collaboration with non-Taiwan e-payment providers. Also, as mentioned in 2.2 Regulatory Regime regarding e-payment businesses, the revised E-Payment Act allows licensed non-e-payment insti - tutions to apply to render cross-border small-amount remittance services exclusively for foreign workers in Taiwan. 6. Marketplaces, Exchanges and Trading Platforms 6.1 Permissible Trading Platforms In Taiwan, the main stock exchanges are the Taiwan Stock Exchange and the Taipei Exchange. The Taiwan Futures Exchange is specifically for trading exchange- traded futures and options. These exchanges are established and regulated under Taiwan’s securities and futures regulations, and they typically offer online trading services.
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