Sat, Nov 14, 2009 page3

• Equality key to inking MOU: FSC head

  FINANCE The opposition has set five principles for signing cross-strait agreements, including protecting national and public interests and establishing risk mechanisms

  • By Flora Wang and Loa Iok-sin / STAFF REPORTERS
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  Financial Supervisory Commission (FSC) Chairman Sean Chen (陳冲) yesterday said he would ensure that Taiwan enjoys equal footing if it signs a memorandum of understanding (MOU) on financial supervision with China.

  Chen made the remarks to the press after briefing Legislative Speaker Wang Jin-pyng (王金平) and representatives of the three caucuses behind closed-doors on the government’s plan to sign a cross-strait MOU.

  Chen said the commission would seek other “alternatives” if the two sides failed to reach a consensus on the official titles to be used by the signatories of the MOU. He did not elaborate.

  The commission has not set a timetable for signing of the memorandum, he said, adding that the MOU would be signed when “everything is ripe.”

  Chen said on Thursday that Taipei and Beijing were still in talks over the titles to be used, after Chinese authorities rejected the FSC’s request that Chen’s full title be included in the document.

  REGULATORY SYSTEMS

  The MOU would outline financial regulatory systems to pave the way for the two sides to discuss and approve reciprocal operations in the banking, insurance and securities sectors. The legislature’s Finance Committee passed a resolution on Thursday banning Chinese banks from entering Taiwan before the two sides of the Taiwan Strait have signed an economic cooperation framework agreement (ECFA). The resolution stipulates that the commission should not approve applications by Chinese banks to set up offices in this country until after the proposed ECFA has been signed and currency conversion and settlement have been allowed under the ECFA’s “early harvest” list of agreements.

  Protesting against the FSC’s decision to brief the legislature behind closed doors, Democratic Progressive Party (DPP) caucus secretary-general Yeh Yi-jin (葉宜津) yesterday withdrew from the briefing.

  Meanwhile, Wang promised to have the executive branch report to the legislative committees next week, adding that the legislature had arranged for the FSC to brief the Finance Committee on Monday to show the commission’s respect for the DPP.

  At a separate setting yesterday, the DPP urged the government to uphold national, public and financial interests when it signs the proposed MOU.

  “In order to protect national interests and the country’s development, we urge the government to keep in mind five guidelines when they negotiate and sign the cross-strait MOU on financial cooperation,” DPP Spokesman Tsai Chi-chang (蔡其昌) told a news conference at party headquarters.

  “The five principles are: equal footing in name, equal footing in contents [of the agreement], protection of information, [setting up an] anti-fraud and risk management mechanism and legislative supervision,” Tsai said.

  He added that equal footing in name meant Taiwan should not be downgraded into a part of the People’s Republic of China in the MOU, and equal footing in contents of the agreement meant that services and operations permitted to Chinese banks operating in Taiwan must also be granted to branches of Taiwanese banks operating in China.

  INITIATIVE

  “Protection of information is also important, because Chinese banks would gain access to individual credit information when they set up offices in Taiwan,” he said. “The government should therefore take the initiative in protecting the privacy of Taiwanese account holders so that their personal information would not be used inappropriately by Chinese banks.”

  Given the uncertainties in the Chinese market and political instability, Tsai urged the government to include the establishment of anti-fraud and risk management mechanisms in the wording of the MOU to protect the interests of Taiwanese banks and the public.

  “Most importantly, any cross-strait agreement must be transparent and subject to legislative supervision, since any cross-strait agreement — be it an MOU or an ECFA — would mainly benefit big corporations and could turn a majority of the public into potential victims,” Tsai said.

  “The government must be very transparent in handling information, place everything under legislative supervision, make complete risk assessments and ensure that we are fully prepared and has the public’s consent before it signs the agreement,” he said.
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