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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 transaction (including domestic remittance) above a
certain amount or multiple apparently related
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 adopt appropriate risk management mechanisms 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 unusual
situations, an agricultural financial institution shall
promptly complete review to determine whether suspicious
money laundering or terrorist financing activities are
involved and save related records in accordance with
Subparagraphs 4 and 6 of Article 9 herein.
2. If a transaction is deemed suspected of money laundering or
terrorist financing upon review, an agricultural financial
institution shall, regardless of the amount of transaction
and regardless whether the transaction is completed or not,
promptly file a STR with the Investigation Bureau in a format
prescribed by the Bureau in no later than two business days
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.
The amended articles of these Regulations shall enter into force
on the date of promulgation. |