Group 1 - The core viewpoint of the news is the modification of regulations by the Financial Regulatory Bureau to align financial institutions' governance with company law, specifically regarding the roles of supervisory boards and audit committees [1][2] - The decision allows financial institutions to choose between maintaining a supervisory board or having an audit committee perform its functions, which is expected to enhance corporate governance and internal oversight efficiency [1] - The modifications specifically pertain to trust companies, while similar regulations for commercial banks and insurance companies were addressed in a previous notification issued in December [1] Group 2 - The revised regulations require that all related party transactions involving directors, supervisors, and senior management must be approved by the board of directors or shareholders' meeting, in line with the latest company law requirements [2] - For routine financial products or services provided by financial institutions, if the transaction amounts do not reach the threshold for significant related party transactions, the approval process can be simplified [2] - The decision clarifies that certain transactions involving directors and senior management can continue to be exempt from individual review if they meet specific criteria, such as not constituting significant related party transactions [3] Group 3 - Financial institutions are advised to manage relationships that may lead to conflicts of interest, especially when directors or senior management hold positions in other entities [4] - Institutions opting to have an audit committee instead of a supervisory board must follow proper governance procedures, including amending their articles of association and selecting personnel accordingly [4] - The implementation of new approval requirements for related party transactions necessitates that financial institutions revise internal policies and optimize business processes to strengthen related party transaction management [4]

Core Viewpoint - The Financial Regulatory Administration has issued a decision to amend certain regulations to align with the new Company Law, which will take effect on July 1, 2024, focusing on the management of supervisory boards and related party transactions in financial institutions [2][4]. Group 1: Regulatory Changes - The amendments include provisions allowing financial institutions to establish an audit committee composed of directors to exercise the functions of a supervisory board, thereby eliminating the need for a supervisory board [3][4]. - The new regulations require that related party transactions involving directors, supervisors, and senior management must be approved by the board of directors or the shareholders' meeting, enhancing the management of such transactions [5][6]. Group 2: Specific Provisions - The amendments to the "Banking and Insurance Institutions Related Party Transaction Management Measures" specify that transactions not reaching the threshold for significant related party transactions can be approved through a unified resolution by the board or shareholders, simplifying the approval process [5][6]. - The decision clarifies that transactions involving daily financial products or services, such as general deposits and insurance purchases, can be resolved collectively by the board or shareholders if they do not meet the significant transaction criteria [6][7]. Group 3: Implementation and Compliance - Financial institutions are encouraged to revise internal systems, optimize business processes, and upgrade systems to comply with the new requirements, thereby strengthening related party transaction management and preventing risks of interest transfer [1][5]. - Institutions have the flexibility to choose whether to retain a supervisory board or delegate its responsibilities to the audit committee, allowing for optimization of corporate governance structures [4][5].