Translations of Taiwan securities laws and regulations updated
Taiwan’s official portal for securities-related laws and regulations was recently updated with changes to nine of its English translations by Winkler Partners.
The Winkler Partners Translation Department has produced the English translations of securities laws and regulations for the portal since 2002. The portal is updated twice a month with new and revised content.
Currently, the site contains 1,453 securities laws and regulations, 587 of which have been translated into English. The site also contains 6,562 administrative letters of interpretation and 1,851 court judgments.
- Taiwan Stock Exchange Corporation Procedures for Press Conferences Concerning Material Information of Listed Companies
- Taiwan Stock Exchange Corporation Standards for Determining Whether a TWSE Listed Company Shall Publish Complete Financial Forecasts
- Corporate Governance Best-Practice Principles for TWSE/GTSM Listed Companies
- Taiwan Stock Exchange Corporation Principles for Handling Information Disclosure on the Key Financials Section of the Market Observation Post System (MOPS)
- Taiwan Stock Exchange Corporation Procedures for Applications by TWSE Listed Companies for the Delisting of Securities
- Standards for Determining Unsuitability for GTSM Listing under Article 10, Paragraph 1 of the GreTai Securities Market Rules Governing the Review of Securities for Trading on the GTSM
- Taiwan Futures Exchange Corporation Trading Rules for Taiwan Stock Exchange Capitalization Weighted Stock Index Options Contracts
- Taiwan Futures Exchange Corporation Trading Rules for Mini-TAIEX Futures Contracts
- Taiwan Futures Exchange Corporation Trading Rules for Taiwan Stock Exchange Banking and Insurance Sector Index Futures Contracts
- Taiwan Futures Exchange Corporation Trading Rules for Stock Option Contracts
- Taiwan Futures Exchange Corporation Trading Rules for Taiwan Stock Exchange Stock Index (TAIEX) Futures Contracts
- Taiwan Futures Exchange Corporation Trading Rules for Taiwan Stock Exchange Electronic Sector Index Futures Contracts
- Taiwan Futures Exchange Corporation Trading Rules for FTSE/TWSE Taiwan 50 Index Futures Contracts
- Taiwan Futures Exchange Corporation Trading Rules for Taiwan Stock Exchange Finance Sector Index Option Contracts
- Taiwan Futures Exchange Corporation Trading Rules for Taiwan Stock Exchange Electronics Sector Index Option Contracts
- Taiwan Futures Exchange Corporation Trading Rules for GreTai Securities Market Stock Index Futures Contract
- Taiwan Futures Exchange Corporation Trading Rules for GreTai Securities Market Stock Index Options Contract
- Taiwan Futures Exchange Corporation Trading Rules for Taiwan Stock Exchange NonFinance NonElectronics Sub-Index Futures Contracts
- Taiwan Futures Exchange Corporation Trading Rules for Taiwan Stock Exchange NonFinance NonElectronics Sub-Index Options Contracts
- Taiwan Futures Exchange Corporation Trading Rules for Single Stock Futures Contracts
- Taiwan Futures Exchange Corporation Trading Rules for the Gold Options Contract
- Taiwan Futures Exchange Corporation Trading Rules for NT Dollar Denominated Gold Futures Contracts
Wrongful termination and age discrimination in a Taiwanese employment dispute
The Japan Airlines subsidiary in Taiwan dismissed eighteen of its Taiwanese flight attendants with severance as its parent company was undergoing financial difficulties in 2010. The employees filed a complaint with the Taipei City Council for Labor Affairs.
The Council found that when comparing across equivalent ranks of responsibility, those employees which were dismissed were all on average older than those who kept their jobs. Specifically, the Council determined that the dismissals were in violation of the Employment Service Act’s Article 5 prohibition against age discrimination, which prohibits employers from “discriminating against any job applicant or employee on the basis of… age.” The Taiwan subsidiary was fined 600,000NTD (approximately 20,000USD) and lost its appeal of the fine in Taiwan’s Administrative Court.
Two of the employees went on to file a civil action against the airline in Taipei District Court, arguing that in light of their wrongful dismissal, they still had an ongoing employment relationship with the airline. The District Court judge determined that while Japan Airlines did indeed base its decisions for dismissal based on the employees’ cost to the company, the higher salaries of the more senior employees meant that in the end the oldest employees were forced out. While this conduct was not directly discriminatory, the judge noted that Article 5 prohibits age discrimination without making a distinction between whether it is direct or indirect. The dismissals were found to be indirectly discriminatory decisions in violation of Taiwan’s employment law.
The civil court judge ruled that because the forced dismissal of the two flight attendants constituted an illegal act of age discrimination, the termination of their employment contracts was invalid. According to the judgment, the flight attendants still had an existing employment relationship with the airline vis a vis Article 71 of the Civil Code, which reads: “A juristic act which is contrary to an imperative or prohibitive provision of law is void, unless nullity is not necessarily implied.” According to the judge, the wrongful termination was a ‘juristic act’ in violation of Article 5, an imperative provision of the Employment Services Act, and therefore legally void. As such, the flight attendants were entitled to resume their work as well as backwages from the date of their termination.
A subsequent appeal by the Taiwan subsidiary of Japan Airlines was dismissed by the Supreme Administrative Court.
Translations of Taiwan securities laws and regulations updated
Taiwan’s official portal for securities-related laws and regulations was recently updated with changes to nine of its English translations by Winkler Partners.
The Winkler Partners Translation Department has produced the English translations of securities laws and regulations for the portal since 2002. The portal is updated twice a month with new and revised content.
Currently, the site contains 1,451 securities laws and regulations, 577 of which have been translated into English. The site also contains 6,514 administrative letters of interpretation and 1,78o court judgments.
1. Enforcement Rules of the Personal Information Protection Act
3. Regulations Governing The Use Of Trading Information
4. GreTai Securities Market Procedures for the Review of Financial Reports of GTSM Listed Companies
Taiwan’s Personal Information Protection Act update
Chen Hui-ling recently contributed an update on the implementation of Taiwan’s Personal Information Privacy Act to the Privacy & Business International Report. The update can be downloaded here.
Peter Dernbach appointed WIPO panelist
Peter Dernbach, head of the firm’s IP practice, has been appointed as a domain name dispute resolution panelist by the World Intellectual Property Organization Arbitration and Mediation Center (http://www.wipo.int/amc/en/domains/panel/panelists.html). The Center is the leading provider of domain name dispute resolution services and received almost 2,900 Uniform Dispute Resolution Policy (UDRP) complaints in 2012. Panelists are appointed on the basis of reputation, impartiality, and expertise and experience in the areas of intellectual property, electronic commerce, and the internet.
Taiwan permits piercing of corporate veil
Taiwan’s Legislative Yuan amended Article 154 of Taiwan’s Company Act at the beginning of 2013. The revision makes it possible for creditors to hold shareholders liable for company obligations beyond the amount of their share ownership under certain ‘serious’ circumstances.
Article 154 now reads:
The liability of shareholders shall be limited to payment in full of the shares they have subscribed except for those described in paragraph 2.
Where a shareholder abuses the corporation’s status as a legal entity in a manner that causes the corporation incur an obligation that is clearly difficult to discharge, and the circumstances are serious in nature, the shareholder shall be liable for fully discharging the obligation.
Taiwan Solidarity Union Legislator Hsu Chun-hsin proposed the amendment in response to the collapse of Kuo Hua Insurance as well as a Taiwan Supreme Court decision that reversed a High Court holding that applied the doctrine. Tai Shang Zi No. 792 (2002). According to Hsu, the Supreme Court overruled the High Court on grounds that there was no express statutory language authorizing corporate veil piercing.
The amendment was also intended to bring Taiwanese law in line with the norms for corporate veil piercing in other jurisdictions such as the United States, the U.K., and Germany. The record of the legislative deliberations also noted that the Japanese Supreme Court adopted the doctrine in 1969 and that Article 20 of China’s Company Act did the same in 2005.
The enacted version appears to be a statement of principle by the Legislature affirming that the courts may apply the doctrine but leaving the courts free to develop the doctrine. During the legislative debate, representatives of the Executive branch and the judiciary expressed the usual concerns routinely raised when Taiwan attempts to graft a common law doctrine onto its civil law system. According to representatives from the Executive Yuan, the elements of the doctrine are not clearly defined and it is uncertain how the courts will apply them.
The amendment to Article 154 took force on 30 January 2013.
Winkler Partners in the World Trademark Review 1000
Winkler Partners has again been recognized as a leading Taiwan trademark firm by the World Trademark Review 1000. In the 2013 issue just released, Winkler Partners is cited as a favorite among companies with transnational interests. Partner Peter J. Dernbach, head of the firm’s intellectual property practice, was praised for his “simply brilliant” work and particular expertise in trademark prosecution and strategy. The World Trademark Review 1000 is the definitive guide exclusively dedicated to identifying the world’s leading trademark legal services providers.
Investment in Taiwan to be simplified
Taiwan’s Executive Yuan recently approved a bill to amend the Statute for Investment by Foreign Nationals. The draft legislation is intended to simplifying the approval process for direct investments in Taiwan by foreign nationals.
Direct investments currently require advance Foreign Investment Approval by the Ministry of Economic Affairs’ Investment Commission after a substantive although usually routine review process that can take up to two months. The new legislation would merely require the investor to report the investment as a general rule.
However, the draft bill would also require foreign nationals without a place of residence or business in Taiwan to retain an accountant or an attorney to report or apply for approval of investments.
The bill will be considered by the Legislative Yuan at its next session, which begins in February.
Translations of Taiwan Securities Laws and Regulations Updated
Taiwan’s official portal for securities-related laws and regulations was recently updated with a new translation by Winkler Partners.
The Winkler Partners Translation Department has produced the English translations of securities laws and regulations for the portal since 2002. The portal is updated twice a month with new and revised content.
Currently, the site contains 1,451 securities laws and regulations, 575 of which have been translated into English. The site also contains 6,462 administrative letters of interpretation and 1,723 court judgments.
Taiwan Legislature enhances criminal penalties for trade secret misappropriation
Taiwan’s Legislature has passed a much-anticipated bill introduced by the Executive Yuan to amend the Trade Secrets Act.
The bill seeks to close loopholes in the definition of trade secret misappropriation and to enhance criminal penalties.
Misappropriation of trade secrets is now punishable with imprisonment of up to five years and fines of between NT$1 to $10 million (c. US$34,000 to US$340,000). However, if the unjust enrichment resulting from the misappropriation of the trade secret exceeds NT$10 million, the amount of the fine may be increased to as much as three times the amount of the unjust enrichment. As before, a victim of trade secret theft can seek restitution of the unjust enrichment in a civil action although the amount was formerly difficult for a civil plaintiff to prove on his own.
Those who misappropriate trade secrets intending to use them overseas face imprisonment of between one and ten years and fines ranging from NT$3 million (c. US$103,000) to NT$50 million (c. US$1.7 million). Again the fines can be enhanced by multiples of the unjust enrichment up to 10x where resulting unjust enrichment exceeds NT$50 million. This range of fines actually exceeds the amount requested by the Executive Yuan and was inserted just before the bill was passed.
Significantly, the amended Trade Secrets Act now provides that the heavy criminal fines for trade secret misappropriation also be imposed on employers whose representatives, agents, or employees misappropriate trade secrets in the course of their duties unless the employer “does its utmost” to prevent the misappropriation of trade secrets. In other words, employers must take precautions that new employees, especially those coming from competitors, do not bring trade secrets with them. If employers passively allow trade secrets to be used, the employer will also be exposed to the heavy new fines.
Some members of the legal and business communities may be disappointed to learn that the proposed Article 14-1 was dropped from the bill due to reportedly universal opposition by legislators from all parties. The proposed Article 14-1 was based on a provision found in several Japanese IP laws that would have given the court discretion to find that the plaintiff’s allegations are true if the defendant makes a general denial without mounting a substantive defense. The provision was intended to make establishing trade secret misappropriation in civil cases somewhat easier given Taiwan’s lack of effective civil discovery procedures.
Despite this disappointment, Taiwan’s Trade Secret Act has been given sharp new teeth that should help deter employees from taking trade secrets with them when they leave with relative impunity as has been the case in the past. If they do, their former employers will be able to avail themselves of the considerable powers of prosecutors to discover evidence that can be used both in criminal prosecutions and later civil litigation.
Another important strategic wrinkle is that the crime of trade secret misappropriation is ‘prosecutable only on complaint’ (gaosu nai lun). In other words, prosecutors can begin an investigation only upon receiving a complaint and the complainant retains the power to withdraw his complaint and end the investigation. This control over the initiation and termination of the investigation gives victims of trade secret misappropriation more flexibility to negotiate settlements with the misappropriator.
