For the establishment of Taiwan’s Free Economic Pilot Zone, the Financial Supervisory Commission (“FSC”) recently issued three rulings to loosen the restrictions on Offshore Banking Units (“OBUs”). In respect to the business of derivative financial products, the FSC issued a ruling on December 27, 2013, stating that OBUs shall only engage in non-CNY-denominated business unless otherwise approved by the competent authority, and shall only conduct business with non-Taiwan individuals or juristic persons or qualified Taiwan financial institutions. In addition, when conducting business with non-Taiwan individuals or juristic persons, OBUs are no long obligated to categorize them as “professional clients” or “non-professional clients”, and they may decide the criteria of a qualified client according to their internal control and risk control policies instead. In respect to the business of foreign exchange, the FSC issued a ruling on December 27, 2013, stating that the OBUs which do not fall within the negative listings (for instance, monthly non-performing loan ratios for the past 6 months are not lower than 1%, loan loss coverage ratio of the latest month is 150% or more) may conduct certain non-CNY foreign exchange business with non-Taiwan individuals or juristic persons or qualified Taiwan financial institutions without prior application or report. However, those OBUs not yet approved by the Central Bank shall still comply with relevant laws and regulations when conducting above business with the qualified Taiwan financial institutions. In respect to the trust business, the FSC issued a ruling on January 29, 2014, stating that the OBUs are not obligated to comply with the Trust Enterprise Act, Securities Investment Trust and Consulting Act, and Futures and Exchange Act when conducting non-CNY currency trust business for which their head offices have obtained approval.