Financial Supervisory Commission (FSC) Chairman Sean Chen (陳冲) said yesterday that the government’s hopes for a memorandum of understanding (MOU) on cross-strait financial supervision should not be unrealistic because practical issues would need to be addressed after the signing.
The MOU will be signed at the third round of talks between the Straits Exchange Foundation (SEF) and its Chinese counterpart, the Association for Relations Across the Taiwan Strait (ARATS), in Nanjing, China, on Sunday.
In a report to the legislature’s Finance Committee, Chen said cross-strait financial supervision would involve matters of sovereignty and mutual recognition, the Broadcasting Corporation of China (BCC) reported.
However, problems would only arise with financial institutions operating across the Strait after the MOU is signed, Chen said.
Asked whether China would recognize staff sent by the FSC to carry out supervisory tasks, Chen said the matter would have to be handled delicately.
Staff could avoid going to China by, for example, examining financial reports in Taiwan, he said.
The government does not necessarily need to conduct on-site supervision, Chen said, as long as it can be sure that the situation is under control.
Some legislators had also suggested that the government request the help of academic institutions in carrying out supervision, he said.
“Everything we do will be based on how we deal with other countries, such as how the nation deals with the US,” Chen said.
Three agreements and one joint statement are expected to be signed at the third meeting between SEF Chairman Chiang Pin-kung (江丙坤) and ARATS Chairman Chen Yunlin (陳雲林). The MOU on financial cooperation is one of the agreements.
“The MOU is just a ticket. It only provides the general principles. Signing the MOU does not mean that financial institutions from Taiwan and China are allowed to set up branches on both sides,” Chen was quoted as saying.
Chen said the MOU would not touch on the issue of China’s currency.
“There are only four problems [to be included]: Both sides need to be willing to exchange information, keep information confidential, truly understand each other and cooperate on information ... There should be no technical problems,” Chen said.