Taiwan and China yesterday failed to agree on further regulatory easing for life insurance companies to expand in each others market with a Chinese delegate saying existing rules are liberal enough.
“Taiwanese insurance companies already enjoy favorable terms when doing business in China,” China Insurance Regulatory Commission (CIRC) international affairs director Jiang Bo (姜波) said after insurance regulators from both sides of the Taiwan Strait yesterday held their first meeting in Taipei.
Jiang was referring to the 50 percent stake limit Taiwanese life insurers may have in a joint ventures in China with Chinese partners.
Life Insurance Association of the Republic of China chairman Hsu Shu-po (許舒博) has urged China to allow Taiwanese insurers to own a 51 percent stake or introduce more than one partner, so that they may have majority control in the joint venture and avoid boardroom disputes.
Some Chinese firms can own up to a 20 percent share in insurance firms, Jiang said, adding that current requirements fall in line with the Economic Cooperation Framework Agreement inked by the two sides in 2010.
Taiwanese insurers with operations in China may apply to offer retirement insurance to be launched in the pilot zone of Shanghai, Jiang said, without elaboration.
China also welcomed qualified Taiwanese insurers to tap the Chinese market through joint ventures and investment, and it would help existing insurers to facilitate capital increase plans, Jiang said.
In return, Taiwan would relax regulations so qualified Chinese life insurers can soon establish representative offices and take stakes in local peers, Insurance Bureau director-general Joanne Tseng (曾玉瓊) said.
The two sides also agreed to meet once a year for discussions on market access and governance issues.
Foreign life insurers, including local firms, which want to access the Chinese market, must have capital of US$5 billion, have been operating for 30 years and have set up a representative office in China for two years before filing applications to upgrade.
Taiwanese insurers have pressed for easier access, such as lowering the capital requirement to US$3 billion and the experience hurdle to 20 years. In addition, they requested a shorter period before upgrading their representative offices to branches after their establishment.