Overview
Taiwan is not a UN Member State but it implements UN sanctions voluntarily through several pieces of legislation, including the Foreign Trade Act, the Money Laundering Control Act, and the Counter-Terrorism Financing Act (“the CFT Act”).
Under Article 4 of the CFT Act, the Terrorism Financing Review Committee (consisting of directors of several government ministries, the National Security Bureau, Central Bank and Financial Supervisory Commission) can also designate people or entities suspected of terrorism financing on its Sanctions List.
Taiwan also uses export controls to restrict trade with certain countries and listed entities (see Export Controls).
Taiwan also imposes restrictions on China under the Act Governing Relations Between Peoples Of The Taiwan Area And The Mainland Area (“the Cross-Strait Act”). For instance, Article 73 prohibits investment in Taiwan by Chinese people and entities without authorisation by competent authorities (Mainland Affairs Council, Executive Yuan).
National Competent Authorities
Anti-Money Laundering Division – money-laundering and counter-terrorism financing
Ministry of Economic Affairs – export controls
International Trade Administration (formerly the Bureau of Foreign Trade), within the Ministry of Economic Affairs – export controls
Mainland Affairs Council – Cross-Strait economic and trade policies
Ministry of Justice Investigation Bureau – money-laundering and counter-terrorism financing
Guidance
International Trade Administration – International Trade FAQs
Directions to Identify Companies Implementing the Internal Compliance Program
Licensing
Under Article 6 of the CFT Act, the Ministry of Justice can provide exemptions to sanctions for the following:
- payments necessary for maintaining the family life of a designated individual or the dependents
- expenses necessary for the management of the property or property interests by a designated individual, legal person or entity
- payments made by a designated individual, legal person or entity to a bona fide third-party creditor, whose right is given before sanctions
The Ministry of Justice can set restrictions on how funds are used under theses exemptions.
Enforcement
Under Article 10 of the CFT Act, a person who directly or indirectly collects or provides any property or property interests for another person in the knowledge that the other person is a designated person/entity can be sentenced to between 6 months and 5 years imprisonment and a fine of up to NT$5m. Under Article 11, where it is a company’s representative/employee that has committed the offence (during the performance of their role), then the company is liable to the same maximum fine. The penalty can be waived if disclosed within 6 months.
Reporting
Banks, trust and investment corporations and credit cooperative associations are required to report to the Ministry of Justice Investigation Bureau:
- when they hold/manage property or property interests of a designated person or entity
- places where property or property interests of a designated person or entity is located
An institution that fails to comply can be fined between NT$200k and NT$1m under Article 12 of the CFT Act.
Export controls
Taiwan is not a member of the four multilateral ‘Export Control Regimes’: Australia Group, Missile Technology Control Regime, Nuclear Suppliers Group, or Wassenaar Arrangement (See, e.g. US Export Controls). However, under the Foreign Trade Act, Taiwan maintains its own control lists which largely align with those regimes.
Article 6 of the Foreign Trade Act permits the Ministry of Foreign Affairs to introduce export or import controls from specific countries/territories in certain circumstances:
- In the event of a natural disaster, incident, or war;
- If national security is endangered or public safety is hindered; or
- In the event of a serious shortage of a specific material or a drastic fluctuation in the price thereof on the domestic or international market;
- A serious imbalance in international payments or a threat thereof;
- As required by international treaties, agreements, United Nations resolutions, or international cooperation; or
- If a foreign country uses measures violating international agreements or the principle of fairness and reciprocity to impede exports and imports to this country.
In April 2022 this power was used to introduce export controls on goods to Russia and Belarus. Goods subject to these restrictions are listed on the High-Tech Commodities List for Exportation to Russia and Belarus. The list has been updated, bringing it in line with EU and US export controls.
Taiwan’s export controls consist of:
- the Export Control List for Dual Use Items and Technology and Common Military List, which lists items subject to export controls that have military or dual-use applications. Exporters must secure licenses from the International Trade Administration before exporting items on this list. Exporters are required to declare the intended end uses and end users of the proposed exports
- the Strategic High‑Tech Commodities Control List (“SHTC Entity List”), which lists entities and individuals (including those sanctioned by the UN and other allied countries like the US and EU). Taiwanese exporters must secure licenses from the International Trade Administration before exporting to those on the SHTC list
- the High-Tech Commodities List for Exportation to Russia and Belarus, which lists items that (in addition to those on the dual-use list) are subject to export controls when destined for Russia or Belarus. Exporters must secure licences from the ITA before exporting goods on this list to Russia or Belarus
Legislation:
Regulations Governing the Export and Import of Strategic High-tech Commodities
Control lists:
Export Control List for Dual Use Items and Technology and Common Military List
Strategic High‑Tech Commodities Control List
High-Tech Commodities List for Exportation to Russia and Belarus
Export licences:
Exporters can apply for several export licences and permits via the Ministry of Economic Affairs. Applications are submitted via the Electronic Licensing System for Import and Export Goods.
Enforcement:
The International Trade Administration is responsible for enforcement. Violations of Taiwanese export controls are governed by chapter 4 of the Foreign Trade Act and are punishable by (inter alia) imprisonment of up to 5 years and/or a fine of up to NT$3m.
The fine for a first offence violation of export controls on Russia and Belarus is set at NT$1m.
De-listing
De-listings under Taiwan’s autonomous sanctions regime are announced on the Ministry of Justice website and the Anti-Money Laundering Division website. There has been 1 delisting to date in November 2019. In accordance with Article 13 of the CFT Act, designated people and entities sanctioned under Taiwan’s autonomous sanctions can apply for administrative remedies to have their listing reviewed. Delisting is then subject to approval by the Terrorism Financing Review Committee.
