Amendments to the Administrative Rules for Electronic Payment Institutions and Business(Taiwan)

Yi-Shan Cheng

The Financial Supervisory Commission promulgated Articles 2, 7, 9, 12, 24 and 27 as amended and Article 20-1 as added of the Administrative Rules for Electronic Payment Institutions and Business (hereinafter, the “Rules”) via the Jin-Guan-Yin-Piao-10640003250 Directive of August 18, 2017.

First, the Rules amended and added Articles 27 and 20-1 to allow electronic payment institutions to provide integrated transmission services for payment and collection information to collection users and to set relevant regulatory requirements, including: (1) an agreement should be executed between a collection user and other institutions to stipulate the rights, obligations and liabilities between the parties with respect to matters relating to the integrated transmission of collection and payment information by collection user; (2) with respect to the terminal equipment or applications so provided, appropriate protection and control measures shall be taken to avoid payment and collection information from leakage or alteration; (3) the payment and collection information so obtained and stored shall be limited to the scope of necessity for service provision; and (4) relevant information learned during the execution of business shall not be used for purposes other than business execution except as otherwise stipulated by law or expressly approved under an executed agreement or in writing.

In addition, Article 7 of the Rules as amended provides that with respect to the service charges for payment services provided to physical distribution channels, payment of government fees, taxes, fines or other expenses, payment for utility companies, telecommunications services, public transportation or parking, payment of statutory fees, taxes, fines, or other fees a collection user is retained by a government agency to collect and levy, or the collection of service charges for utility enterprises, telecommunications services or parking as handled by an electronic payment institution, such service charges shall be stipulated in advance according to the secure design stipulated by the Rules; each transaction shall be capped at NT$10,000 with the monthly cumulative transaction amount capped at NT$30,000; and they may be exempt from the requirements for payment instructions and re-confirmation of payment instructions.

In addition, Article 9 as amended of the Rules provides that an electronic payment institution authorized to operate electronic ticket business may, based on a user’s payment instruction, transfer a New Taiwan Dollar payment recorded in an electronic payment account to another registered New Taiwan Dollar electronic ticket held by the user and issued by such institution.

Finally, Article 12 as amended of the Rules allows an electronic payment institution to accept value storage via credit card by users and set relevant administrative and regulatory restrictions, including: (1) the amount of stored value shall be limited to New Taiwan Dollars; (2) the limit of value storage and risk control mechanisms may be agreed with a credit card issuer; (3) the amount of stored value via credit card shall be used for the collection and payment of physical transaction amounts on behalf of other entities, shall not be used for payment transfer or withdrawal between electronic payment accounts and shall be communicated in conspicuous language on a service webpage and whenever a user stores value via credit card; and (4) when automatic value storage services are provided to users via credit card, the limit on each transaction and the automatic value storage per day shall be agreed with the users, and users should be provided with mechanisms for adjusting the limits at all times and for stopping automatic value storage.