The Financial Supervisory Commission (FSC) and the central bank are discussing whether to allow local companies to open offshore banking unit (OBU) accounts in domestic banks, FSC Chairman Wellington Koo (顧立雄) said on Monday.
Only overseas individuals, companies and non-financial institutions may open OBU accounts, which accept foreign-currency deposits, and allow clients to transfer and manage foreign funds, according to the Offshore Banking Act (國際金融業務條例).
Domestic companies or individuals may open OBU accounts at local banks only if they plan to apply for loans denominated in foreign currencies, Koo told a meeting of the legislature’s Finance Committee.
The act does not need to be amended to allow domestic companies to open OBU accounts, he said.
“Article 4 of the act states that OBUs can provide loans in foreign currencies to individuals or companies in the nation,” he added.
OBUs have not provided loans denominated in foreign currencies to domestic firms and individuals because regulators have not encouraged them to do so, Koo said.
OBUs, which have been left outside the jurisdiction of domestic banking operations to facilitate overseas investments and international trade, are attractive to companies, as they are not subject to interest income tax, corporate value-added tax or sales tax.
“Many Taiwanese companies set up branches or paper companies overseas to open accounts at OBUs. Why do we waste their time when we can allow them to open accounts directly?” Koo said.
The move is expected to help domestic companies manage their foreign funds more conveniently and boost local banks’ wealth management business, he said.
However, Chinese Nationalist Party (KMT) Legislator William Tseng (曾銘宗) said that the central bank is not likely to agree with the proposal, as it prioritizes stabilizing the foreign-exchange rate.
“Central bank Governor Yang Chin-long (楊金龍) has told the Finance Committee that he is open-minded about how OBUs set their interest rates on foreign loans, but is more conservative about fluctuations in the exchange rates,” Tseng said.
Koo said the commission has made some progress in its talks with the central bank and would continue to discuss the issue of OBU account taxes with the Ministry of Finance.
Central bank Deputy Governor Yen Tzung-ta (嚴宗大) told the meeting that the central bank would cooperate with the FSC to boost lenders’ wealth management business under the premise of maintaining stability in the financial system.
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
Taiwan is open to joining a global liquefied natural gas (LNG) program if one is created, but on the condition that countries provide delivery even in a scenario where there is a conflict with China, an energy department official said yesterday. While Taiwan’s priority is to have enough LNG at home, the nation is open to exploring potential strategic reserves in other countries such as Japan or South Korea, Energy Administration Deputy Director-General Chen Chung-hsien (陳崇憲) said. While the LNG market does not have a global reserve for emergencies like that of oil, the concept has been raised a few times —
RSS