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Article 1
These Regulations are enacted pursuant to the front
section of Paragraph 4, Article 7, Paragraph 3 of
Article 8, Paragraph 3 of Article 9 and Paragraph 3 of
Article 10 of the Money Laundering Control Act
(referred to as the “Act” hereunder).
Article 2
Terms used in these Regulations are defined as follows
:
1. The term “agricultural financial institution”
shall mean credit departments of farmers’
associations, credit departments of fishermen’s
associations (collectively referred to as “credit
departments” hereunder) and Agricultural Bank of
Taiwan.
2. The term “a certain amount” shall mean NT$500,000
(including the foreign currency equivalent thereof)
.
3. The term “cash transaction” shall mean cash
receipt or payment in a single transaction
(including all transactions recorded on cash
deposit or withdrawal vouchers for accounting
purpose), or the transaction of currency exchange.
4. The term “customer” shall mean the customers of
agricultural financial institutions.
5. The term “beneficial owner” shall mean a natural
person who ultimately owns or controls a customer
and/or the natural person on whose behalf a
transaction is being conducted, including those
persons who exercise ultimate effective control
over a legal person or arrangement.
6. The term “risk-based approach” (RBA) shall mean
agricultural financial institutions should
identify, assess and understand the money
laundering and terrorist financing (ML/TF) risks to
which they are exposed and take anti-money
laundering and countering terrorist financing
(AML/CFT) measures commensurate to those risks in
order to mitigate them. Based on the RBA,
agricultural financial institutions should adopt
enhanced control measures for higher risk
situations, and adopt relatively simplified control
measures for lower risk situations to allocate
resources efficiently, and use the most appropriate
and effective approach to mitigate the identified
ML/TF risks.
Article 3
An agricultural financial institution shall comply
with the following provisions in undertaking customer
due diligence (CDD) measures:
1. An agricultural financial institution shall not
accept anonymous accounts or accounts in fictitious
names for establishing or maintaining business
relationship.
2. An agricultural financial institution shall
undertake CDD measures when:
A. establishing business relations with any customer;
B. carrying out occasional transactions with respect
to:
(1) a cash transaction above a certain amount or
multiple apparently related cash transactions
that is above a certain amount when combined;
or
(2) a cross-border wire transfer involving
NTD30,000 or more (including the foreign
currency equivalent thereof);
C. there is a suspicion of money laundering or
terrorist financing; or
D. The agricultural financial institution has doubts
about the veracity or adequacy of previously
obtained customer identification data.
3. The CDD measures to be taken by an agricultural
financial institution are as follows:
A. Identifying and verifying the customer’s identity
using reliable, independent source documents, data
or information, and in addition, retaining copies
of the customer’s identity documents or record the
relevant information thereon.
B. Verifying that any person purporting to act on
behalf of the customer is so authorized,
identifying and verifying the identity of that
person using reliable, independent source
documents, data or information where the customer
opens an account or conducts a transaction through
an agent, and in addition, retaining copies of the
person’s identity documents or record the relevant
information thereon.
C. Taking reasonable measures to identify and verify
the identity of the beneficial owner of a customer,
including using reliable source data or information
.
D. Enquiring information on the purpose and intended
nature of the business relationship when
undertaking CDD measures, and obtaining relevant
information in view of the circumstances.
4. When the customer is a legal person, an
organization or a trustee, an agricultural
financial institution shall understand the business
nature of the customer or trust (including
trust-like legal arrangements) and obtain at least
the following information on the customer or the
trust to identify and verify the identity of the
customer:
A. Name, legal form and proof of existence of customer
or trust.
B. The charter or similar power document that
regulates and binds the customer or the trust,
except for any of the following circumstances:
(1) Customers/entities listed under Item C of
Subparagraph 6 hereof and insurance products
listed under Item D of Subparagraph 6 hereof
are free of the situation described in the
proviso of Subparagraph 3, Article 6 herein.
(2) The customer who is an organization
acknowledges that it does not have a charter or
similar power document.
C. The names of those persons having a senior
management position in the customer.
D. The address of the registered office of the
customer, and the address of its principal place of
business.
5. When the customer is a legal person, an
agricultural financial institution shall understand
whether the customer is able to issue bearer shares
and adopt appropriate measures for customers who
have issued bearer shares to ensure its beneficial
owners are kept up-to-date.
6. When the customer is a legal person, an
organization or a trustee, an agricultural
financial institution shall, in accordance with
Item C of Subparagraph 3 hereof, understand the
ownership or control structure of the customer or
the trust, and obtain the following information to
identify the beneficial owners of the customer and
take reasonable measures to verify the identity of
such persons:
A. For legal persons or organizations:
(1) The identity of the natural persons who
ultimately have a controlling ownership
interest in a legal person. A controlling
ownership interest refers to owning more than
25 percent of a legal person’s shares or
capital; an agricultural financial institution
may request the shareholder list or other
documents from the customer to assist in the
identification.
(2) To the extent where no natural person exerting
control through ownership interests is
identified or that there is doubt as to whether
the person(s) with the controlling ownership
interest are the beneficial owner(s) under (1)
above, an agricultural financial institution
should identify the identity of the natural
persons (if any) exercising control of the
customer through other means.
(3) Where no natural person is identified under (1)
or (2) above, an agricultural financial
institution shall identify the identity of the
relevant natural person who holds the position
of senior managing official.
B. For trustees: the identity of the settlor(s), the
trustee(s), the trust supervisor, the
beneficiaries, and any other person exercising
ultimate effective control over the trust, or the
identity of persons in equivalent or similar
positions.
C. Except for situations provided for in the proviso
of Subparagraph 3 of Article 6 herein or where the
customer has issued bearer shares, an agricultural
financial institution is not subject to the
requirements of identifying and verifying the
identity of beneficial owner set out under Item C
of Subparagraph 3 hereof, provided the customer or
a person having a controlling ownership interest in
the customer is
(1) a R.O.C government entity;
(2) an enterprise owned by the R.O.C government;
(3) a foreign government entity;
(4) a public company and its subsidiaries;
(5) an entity listed on a stock exchange outside of
R.O.C. that is subject to regulatory disclosure
requirements of its principal shareholders, and
the subsidiaries of such entity;
(6) a financial institution supervised by the
R.O.C. government, and an investment vehicles
managed by such institution;
(7) a financial institution incorporated or
established outside R.O.C. that is subject to
and supervised for compliance with AML/CFT
requirements consistent with standards set by
the Financial Action Task Force on Money
Laundering (FATF), and an investment vehicle
managed by such institution; or
(8) a fund administered by a R.O.C. government
entity; or
(9) an employee stock ownership trust or an
employee savings trust.
D. Except for situations provided for in the proviso
of Subparagraph 3 of Article 6 herein, an
agricultural financial institution is not subject
to the requirements of identifying and verifying
the identity of beneficial owner set out under
Item C of Subparagraph 3 hereof when the customer
purchases property insurance, accident insurance,
health insurance or an insurance product that does
not require policy value reserve.
7. An agricultural financial institution should not
establish a business relationship or carry out
occasional transactions with a customer before
completing the CDD process. However, an
agricultural financial institution may first obtain
information on the identity of the customer and any
beneficial owner and complete the verification
following the establishment of business
relationship, provided that:
A. money laundering and terrorist financing risks are
effectively managed, including adopting risk
management procedures with respect to the
conditions under which a customer may utilize the
business relationship to complete a transaction
prior to verification;
B. it would be essential not to interrupt the normal
conduct of business with the customer; and
C. verification of the identities of customer and
beneficial owner will be completed as soon as
reasonably practicable following the establishment
of business relationship. The agricultural
financial institution shall terminate the business
relationship if verification cannot be completed as
soon as reasonably practicable and inform the
customer in advance.
8. Where an agricultural financial institution is
unable to complete the required CDD process on a
customer, it should consider reporting suspicious
transactions in relation to the customer.
9. If an agricultural financial institution suspects
that a customer or transaction may relate to money
laundering or terrorist financing activities and
reasonably believes that performing the CDD process
will tip-off the customer, it may choose not to
pursue that process and file a suspicious
transactions report instead.
Article 4
If there exists any of the following situations in the
CDD process, an agricultural financial institution
should decline to establish business relationship or
carry out any transaction with the customer:
1. The customer is suspected of opening an anonymous
account or using a fake name, a nominee, a shell
entity, or a shell corporation to open an account;
2. The customer refuses to provide the required
documents for identifying and verifying his/her
identity;
3. Where a customer opens an account through an agent,
it is difficult to check and verify the facts of
agency and identity related information;
4. The customer uses forged or altered identification
documents;
5. The customer only provides photocopies of the
identification documents; the preceding provision
does not apply to for businesses where a photocopy
or image file of the identification document
supplemented with other control measures are
acceptable;
6. Documents provided by the customer are suspicious
or unclear, or the customer refuses to provide
other supporting documents, or the documents
provided cannot be authenticated;
7. The customer procrastinates in providing
identification documents in an unusual manner;
8. The customer is an individual, legal entity or
organization sanctioned under the Terrorism
Financing Prevention Act or a terrorist or
terrorist group identified or investigated by a
foreign government or an international anti-money
laundering organization, except for payments made
under Subparagraphs 2 ~ 4, Paragraph 1, Article 6
of the Terrorism Financing Prevention Act; or
9. Other unusual circumstances exist in the process of
establishing business relationship and the customer
fails to provide reasonable explanations.
Article 5
The CDD measures of an agricultural financial
institution shall include ongoing customer due
diligence and observe the following provisions:
1. An agricultural financial institution shall apply
CDD measures to existing customers on the basis of
materiality and risk, and to conduct due diligence
on such existing relationships at appropriate
times, taking into account whether and when CDD
measures have previously been undertaken and the
adequacy of data obtained. The aforementioned
appropriate times include at least:
A. When the customer opens a new account or enters new
business relationships;
B. When it is time for periodic review of the customer
scheduled on the basis of materiality and risk; and
C. When it becomes known that there is a material
change to customer’s identity and background
information.
2. An agricultural financial institution shall
scrutinize transactions taken place during its
business relationship with a customer to ensure
that the transactions being conducted are
consistent with the institution’s knowledge of the
customer, the customer’s business and risk
profile, including, where necessary, the source of
funds.
3. An agricultural financial institution shall
periodically review the adequacy of customer
identification information obtained in respect of
customers and beneficial owners and ensure that the
information is kept up to date, particularly for
higher risk categories of customers, for whom the
agricultural financial institution should conduct
review at least once every year.
4. An agricultural financial institution is entitled
to rely on the identification and verification
steps that it has already undertaken. Therefore an
agricultural financial institution is allowed not
to repeatedly identify and verify the identity of
each customer every time that a customer conducts a
transaction unless it has doubts about the veracity
or adequacy of that information, discovers that the
customer is involved in a transaction suspicious of
money laundering or terrorist financing, or
discovers that there is a material change in the
way that the customer’s account is operated, which
is not consistent with the customer’s business
profile. In such events, the agricultural financial
institution shall conduct CDD again in accordance
with the provisions of Article 3 herein.
Article 6
An agricultural financial institution shall determine
the extent of applying CDD and ongoing CDD measures
under Subparagraph 3 of Article 3 herein and the
preceding Article using a risk-based approach (RBA)
and observe the following provisions:
1. For higher risk circumstances, an agricultural
financial institution shall apply enhanced CDD or
ongoing CDD measures by adopting additionally at
least the following enhanced measures:
A. Obtaining the approval of senior management before
establishing or entering a new business
relationship;
B. Adopting reasonable measures to understand the
sources of wealth and the source of funds of the
customer; source of funds means the actual source
of funds from where the funds are derived; and
C. Adopting enhanced ongoing monitoring of business
relationship.
2. For customers from high ML/TF risk countries or
regions, an agricultural financial institution
shall conduct enhanced CDD measures consistent with
the risks identified.
3. For lower risk circumstances, an agricultural
financial institution may adopt simplified CDD
measures, which shall be commensurate with the
lower risk factors. However simplified CDD measures
are not allowed in any of the following
circumstances:
A. Where the customers are from or in countries or
regions known to have inadequate AML/CFT regimes,
including but not limited to those which designated
by international organizations on AML/CFT as
countries or regions with serious deficiencies in
their AML/CFT regime, and other countries or
regions that do not or insufficiently comply with
the recommendations of international organizations
on AML/CFT as forwarded by the Council of
Agricultural, Executive Yuan (referred to as
“the Council” hereunder); or
B. Where an agricultural financial institution
suspects that money laundering or terrorist
financing is involved.
Article 7
An agricultural financial institution should perform
its own CDD operation. However if it is otherwise
permitted by law or the Council that an agricultural
financial institution may reply on third parties to
perform the identification and verification of the
identities of customers, agents and beneficial owners
or the purpose and intended nature of the business
relationship, the agricultural financial institution
relying on the third party shall still bear the
ultimate responsibility for CDD measures and comply
with the following provisions:
1. An agricultural financial institution relying on a
third party should be able to immediately obtain
the necessary CDD information.
2. An agricultural financial institution should take
adequate steps to satisfy itself that copies of
identification data and other relevant
documentation relating to the CDD requirements will
be made available from the third party upon request
without delay.
3. An agricultural financial institution shall make
sure that the third party it relies on is
regulated, supervised or monitored, and has
appropriate measures in place for compliance with
CDD and record-keeping requirements.
4. An agricultural financial institution shall make
sure that the jurisdiction at where the third party
it relies on is based has AML/CFT regulations in
place that are consistent with the standards set
out by the FATF.
Article 8
Agricultural financial institutions shall observe the
following provisions in checking the names of
customers and trading counterparties:
1. An agricultural financial institution shall
establish policies and procedures for checking the
names of customers and trading counterparties using
a risk-based approach to detect, match and filter
customers, senior managerial officers or beneficial
owners of customers, or trading counterparties that
are individuals, legal entities or organizations
sanctioned under the Terrorism Financing Prevention
Act or terrorists or terrorist groups identified or
investigated by a foreign government or an
international anti-money laundering organization.
2. The policies and procedures for checking the names
of customers and trading counterparties of an
agricultural financial institution shall include at
least matching and filtering logics, implementation
procedures and inspection standards, and shall be
documented.
3. An agricultural financial institution shall
document its name and account checking operations
and maintain the records for a time period in
accordance with Article 11 herein.
Article 9
Agricultural financial institutions shall observe the
following provisions for ongoing monitoring of
accounts or transactions:
1. An agricultural financial institution shall use a
database to consolidate basic information and
transaction information on all customers for
inquiries for AML/CFT purpose so as to strengthen
the institution’s account or transaction
monitoring ability. An agricultural financial
institution shall also establish internal control
procedures for requests and inquiries as to
customer information made by various entities, and
shall exercise care to ensure the confidentiality
of the information.
2. An agricultural financial institution shall
establish policies and procedures for account or
transaction monitoring using a risk-based approach
and utilize information system to assist in the
detection of suspicious ML/FT transactions.
3. An agricultural financial institution shall review
its policies and procedures for account or
transaction monitoring based on AML/CFT
regulations, nature of customers, business size and
complexity, money laundering and terrorist
financing related trends and information obtained
from internal and external sources, and the results
of internal risk assessment, and update those
policies and procedures periodically.
4. The policies and procedures for account or
transaction monitoring of an agricultural financial
institution shall include at least the procedures
for establishing a complete monitoring system, and
carrying out the setting of parameters, threshold
amounts, alerts and monitoring operations, the
procedures for checking the monitored cases and
reporting standards, and shall be documented.
5. A complete monitoring system mentioned in the
preceding Subparagraph shall include the patterns
published by the trade associations in the case of
Agricultural Bank of Taiwan and patterns published
by the Agricultural Bank of Taiwan as well as
additional monitoring patterns in reference to the
money laundering and terrorist financing risk
assessment or daily transaction information of the
agricultural financial institution itself in the
case of credit departments.
6. An agricultural financial institution shall
document its ongoing account or transaction
monitoring operation and maintain the records for a
time period in accordance with Article 11 herein.
Article 10
When conducting CDD, an agricultural financial
institution should use self-established database or
information obtained from external sources to
determine whether a customer or beneficial owner or
senior managerial officer of a customer is a person
who is or has been entrusted with a prominent function
by a R.O.C. government, a foreign government or an
international organization (referred to as politically
exposed persons (PEPs) hereunder) and observe the
following provisions:
1. For a customer or beneficial owner determined to be
a current PEP of a foreign government, an
agricultural financial institution shall treat the
customer directly as a high-risk customer, and
adopt enhanced CDD measures under Subparagraph 1 of
Article 6 herein.
2. For a customer or beneficial owner determined to be
a current PEP of a R.O.C. government or an
international organization, an agricultural
financial institution shall assess risks when .
establishing business relationship with the person
and conduct annual review thereafter. In case of
higher risk business relationship with such
customers, the institution shall adopt enhanced CDD
measures under Subparagraph 1 of Article 6 herein.
3. For a senior managerial officer of a customer
determined to be a current PEP of a R.O.C.
government, a foreign government or an
international organization, an agricultural
financial institution shall determine whether to
apply the enhanced CDD measures under Subparagraph
1 of Article 6 by considering the level of
influence the officer has on the customer.
4. For former PEPs of R.O.C. or foreign governments or
international organizations, an agricultural
financial institution shall the level of influence
that the individual could still exercise by
considering relevant risk factors and determine
whether to apply the provisions of the preceding
three Subparagraphs based on the RBA.
5. The preceding four Subparagraphs apply to family
members and close associates of PEPs. The scope of
family members and close associates mentioned above
will be determined in a manner stipulated in the
latter section of Paragraph 4, Article 7 of the Act
.
Provisions of the preceding Paragraph do not apply
when the beneficial owner or senior managerial officer
of a customer specified under sub-items (1) ~ (3) and
(8) of Item C, Subparagraph 6, Article 3 herein is a
PEP.
Article 11
An agricultural financial institution shall keep
records on all business relations and transactions
with its customers in hard copy or electronical form
and in accordance with the following provisions:
1. An agricultural financial institution shall
maintain all necessary records on transactions,
both domestic and international, for at least five
years or a longer period as otherwise required by
law.
2. An agricultural financial institution shall keep
all the following information for at least five
years or a longer period as otherwise required by
law after the business relationship is ended, or
after the date of the occasional transaction:
A. All records obtained through CDD measures, such as
copies or records of official identification
documents like passports, identity cards, driving
licenses or similar documents.
B. Account files or contract files.
C. Business correspondence, including inquiries to
establish the background and purpose of complex,
unusual large transactions and the results of any
analysis undertaken.
3. Transaction records maintained by an agricultural
financial institution must be sufficient to permit
reconstruction of individual transactions so as to
provide, if necessary, evidence for prosecution of
criminal activity.
4. An agricultural financial institution shall ensure
that information on transaction records and CDD
information will be swiftly made available to the
competent authorities when such requests are made
with appropriate authority.
Article 12
Agricultural financial institutions shall comply with
the following provisions with respect to cash
transactions above a certain amount:
1. Verify the identity of the customer and keep
relevant transaction records.
2. Conduct CDD measures in accordance with the
following provisions:
A. Check the identity (ID) document or passport
provided by the customer and record the customer’s
name, date of birth, address, telephone, account
number, amount of transaction, and ID number.
Notwithstanding the foregoing, in case that the
customer is confirmed to be exactly the
accountholder, it should be clearly noted in the
transaction record rather than undertaking a
repeated ID verification.
B. If the transaction is conducted by an agent, check
the identity of the agent by checking his or her ID
document or passport and record the name, date of
birth, address, and telephone of the agent, account
number, amount of transaction, and ID number.
C. For occasional transactions, verify the identity of
the customer in accordance with Subparagraph 3 of
Article 3 herein.
3. Except for situations specified in Article 13
herein, report the transaction to the Investigation
Bureau, Ministry of Justice (referred to as
“Investigation Bureau” hereunder) in a format
prescribed by the Investigation Bureau via
electronic media in five business days after the
completion of transaction. If an agricultural
financial institution is unable to file a report
via electronic media with a legitimate reason, the
institution may file a written report after
obtaining the consent of the Investigation Bureau.
4. Keep the data reported to the Investigation Bureau
and relevant transaction records in accordance with
Article 11 herein.
Article 13
An agricultural financial institution is not required
to file a report on any of the following cash
transactions above a certain amount with the
Investigation Bureau, provided the financial
institution verifies the identity of the customer and
keeps the transaction records thereof:
1. Deposits into the accounts opened by government
agencies, state-run enterprises, institutions
acting with governmental power (within the scope of
mandate), public and private schools, public
enterprises and government funds established where
relevant regulations or contractual relationships
so provide and their transactions with the
agricultural financial institution.
2. Receivables and payables collected and made by an
agricultural financial institution on behalf of
government treasuries.
3. Transactions and fund arrangements between
financial institutions. Notwithstanding the
foregoing, payables to another financial
institution’s customer paid through an inter-bank
deposit account, such as a customer cashing the
check issued by another financial institution,
shall be handled as required, provided the cash
transaction of the same customer exceeds a certain
amount.
4. Funds paid by a lottery merchant for purchasing
lottery tickets.
5. Payments collected on behalf of a third party
(excluding payments deposited in designated stock
subscription accounts and credit card payments
collected) where the payment notice expressly bears
the name, ID Card number (including the code which
enables tracking of counterparty’s identity), and
type and amount of transaction. Nevertheless, the
duplicate copy of the payment notice shall be kept
as the transaction record.
In case of non-individual accounts such as those
opened by department stores, megastores, supermarket
chains, gas stations, hospitals, transportation
businesses and hotels and restaurants which must
deposit cash amounting to over a certain amount
constantly or routinely in line with business needs,
an agricultural financial institution may, after
verifying the actual business needs, submit the name
list to the Investigation Bureau. Verification and
reporting of transactions on a case-by-case basis may
be waived for such an account unless the Investigation
Bureau responds to the contrary within ten days from
the receipt of the name list. An agricultural
financial institution shall examine the counterparties
to the transactions exempted from reporting on a
case-by-case basis at least once every year, and
report to the Investigation Bureau for recordation if
a counterparty no longer has business dealing as
mentioned in this paragraph with it.
Article 14
Agricultural financial institutions shall file
suspicious transaction reports in accordance with
following provisions:
1. For transactions related to the monitoring patterns
under Subparagraph 5 of Article 9 herein or other
situations that are deemed as suspicious money
laundering activities, an agricultural financial
institution shall file a suspicious transaction
report (STR) with the Investigation Bureau,
regardless of the amount of transaction and
regardless whether the transaction was completed or
not.
2. Within ten (10) business days upon discovery of a
transaction suspected of money laundering or
terrorist financing, an agricultural financial
institution shall promptly file a STR with the
Investigation Bureau in a format prescribed by the
Bureau after the report has been approved by the
responsible chief compliance officer at the
institution.
3. For obviously significant suspected money
laundering transactions of urgent nature, an
agricultural financial institution should file a
report as soon as possible to the Investigation
Bureau by fax or other available means and follow
it up with a written report. The agricultural
financial institution is not required to submit a
follow-up written report, provided the
Investigation Bureau has acknowledged the receipt
of report by sending a reply by fax. In such event,
the agricultural financial institution shall retain
the faxed reply.
4. The formats of STR and faxed reply mentioned in the
preceding two subparagraphs shall be prescribed by
the Investigation Bureau.
5. The data reported to the Investigation Bureau and
relevant transaction records shall be kept in
accordance with Article 11 herein.
Article 15
These Regulations shall enter into force on June 28,
2017. |