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Issuance of the interpretive order regarding Article 3 of the Regulations Governing Insurance Enterprises Extending Loans to and Engaging in Other Transactions with Same Person, Same Interested Party or Same Affiliate
The Financial Supervisory Commission (FSC) issued an interpretive order regarding “Article 3 of the Regulations Governing Insurance Enterprises Extending Loans to and Engaging in Other Transactions with the Same Person, Same Interested Party or Same Affiliate” (Ref. No.: Jin-Guan-Bao-Cai-Zi-10602505691) dated December 29, 2017. The method of calculation of the aggregate amount of transactions under “other transactions” entered into by insurers with the same person, same interested party or same affiliate is set out below:
1. If the transaction belongs to property transactions (for example, securities, real property and other assets transactions), the aggregate amount of the holding arising from the purchase shall be calculated in the manner stipulated in the “Relevant Rules for Insurers in the Use of Funds” in an interpretive order issued by the FSC dated 27 August 2009; in case of the sale of the holding, the amount recorded in the account at the time of such sale shall be deducted from such aggregate amount.
2. If the transaction belongs to profit/loss transactions (for example, receive or pay for rents and fees), all of the payments to or receipts from the same person, same interested party or same affiliate in respect of rents or fees during the year shall be accounted for in the aggregate amount of translations with the counterparty. Such aggregate amount will be zeroed at the beginning of the next year.