TAIWAN Law and Practice Contributed by: James Huang, Eddie Hsiung and Maggie Huang, Lee and Li, Attorneys-at-Law
Chapter V: Implement Transparency and Explainability Financial institutions should ensure the “trans - parency” of AI system operations. For example, financial institutions may proactively disclose information through reports, technical docu - ments or website postings to inform stake - holders about their AI system practices. As to “explainability”, financial institutions should be able to clearly explain the logic of the AI systems operation. Chapter VI: Promote Sustainable Development Financial institutions should align their devel - opment strategies and implementation with sustainable development principles, such as reducing redundant hardware set-ups and sav - ing energy when using AI systems. Appropriate education and training for employees should also be provided to help them adapt to new work environments. The AI Guidelines should serve as a reference for financial institutions in the introduction, use and management of AI. According to the FSC, the AI Guidelines are administrative guidance in nature. If no such self-regulations are established by relevant industry associations in the financial industry, financial institutions are advised to fol - low the AI Guidelines for AI-related matters.
able to communicate the overall policy and the individual/specific AI system-related information that the consumers may need to know. Chapter II: Emphasise Fairness and Human- Centric Values When using AI systems, financial institutions should assess fairness, avoid bias and prevent discrimination. For instance, if a financial insti - tution uses generative AI developed by a third party while not being able to control the training process or to ensure fairness in data or results, the financial institution should still have its per - sonnel manage and control the risks associated with the output information objectively and pro - fessionally. Chapter III: Protect Privacy and Customer Rights Financial institutions should protect customer privacy, avoid risk of data leakage and follow the principle of data minimisation to avoid collecting excessive or unnecessary sensitive information. Further, they should ensure that customers are able to choose whether to use AI services. Chapter IV: Ensure System Robustness and Security Financial institutions should ensure system robustness and security, establishing and imple - menting cybersecurity measures. When using AI systems developed or operated by third parties for financial services, appropriate risk manage - ment and supervision of such third-party ven - dors are necessary.
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