RESTRICTIONS LIFTED ON RMB BUSINESS OF HONG KONG BRANCHES OF TAIWANESE BANKS

05/01/2011

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To assist Hong Kong branches of Taiwanese banks in expanding business and increasing the flexibility in using their RMB assets, the Financial Supervisory Commission on 10 March 2011 lifted certain restrictions on RMB business of Hong Kong branches. Major changes are as follows:
l	The scope of RMB business that Hong Kong branches are allowed to engage with any individual or corporate entity of Taiwan or any third jurisdiction will be defined in principle by the range of financial services permitted by Hong Kong financial authority.
l	The scope of RMB business that Hong Kong branches are allowed to engage with any individual and corporate entity of Mainland China is still limited by the "Regulations Governing the Banking Activity and the Establishment and the Investment by Financial Institution Between the Taiwan Area and the Mainland Area," including deposits acceptance, outward/inward remittance, export/import-related foreign exchange, collecting and paying agency, credit extension, accounts receivable purchase, related interbank transactions, and other businesses as approved by the competent authority.
l	A Hong Kong branch is permitted to invest in RMB securities issued by an entity other than the government or any corporate entity of Mainland China.