Taiwan Proposes to Obligate Telecommunications, Internet Platform, Payment, Online Games and E-Commerce Service Providers to Prevent Telephone and Online Fraud Crimes by Laws
In response to the rise in telephone and online fraud crimes in recent years, Taiwan’s Executive Yuan (the Cabinet) has proposed new legislation aimed to combat and prevent fraud crimes. The draft legislation (the Draft Anti-Fraud Legislation) proposes various obligations on financial institutions including virtual currencies trading platforms and related service providers, telecommunications carriers, Internet platforms with commercial advertisements, payment service providers, online games service providers and e-commerce service providers for combating and preventing telephone and online fraud. The main proposed obligations for telecommunications, Internet platforms and payment, online games and e-commerce service providers, include:
-Taiwan registered telecommunications service providers are obligated to take reasonable actions to prevent the use of telecommunications services for fraud. KYC procedure taken by a telecommunications service provider shall ask the proposed service subscribers to provide ID documents and verify the said documents and identification of the proposed subscribers via government maintained databases. No service shall be provided until and unless the said verification process is completed.
-No roaming services shall be provided to users of high-risk offshore telecommunications service providers identified by Taiwan’s telecommunications regulator if the user is not located or traveling in Taiwan based on the information provided by the database of the immigration regulators.
-Prepaid card services are not permitted for non-Taiwan citizens who are not located or travelling in Taiwan.
-A telecommunications service provider shall immediately cease or restrict the services for a user who uses the services for fraud, as notified by the regulators to the said telecommunications service provider. No services shall be provided to the same user for a period of 2 years after such cessation or restriction.
-Domestic and offshore Internet (social media, search engine, news, education/knowledge, dating, video or otherwise) platforms that present or push commercials within the territory of Taiwan with a quantity meeting the thresholds set forth by Taiwan’s regulator (“Regulated Internet Platformsâ€) shall not present or push any commercials involving fraud crimes and shall adopt various measures set forth by the Draft Anti-Fraud Legislation for such purposes. The said measures include identifying the ultimate advertisers and conducting annual risk analysis for their platforms being used for fraud crimes.
-Commercials presented or pushed by Regulated Internet platforms will be subject to various disclosure requirements.
-A non-Taiwan Regulated Internet Platform that does not set up a branch office or other business presence in Taiwan (nor does its representative have a Taiwan residency) is required to appoint a local legal representative. The local legal representative shall be either a Taiwan citizen or a Taiwan entity and shall be authorized to receive any notifications from the regulators in terms of enforcements and compliance of the anti-fraud law and assist the platform in complying with the obligations under the anti-fraud law.
-Payment, online games and e-commerce service providers are obligated to prevent fraud crimes. They will be obligated to provide information to the regulators upon request and keep the relevant records as set forth by this new law.
The Draft Anti-Fraud Legislation is now under review and in discussion by Taiwan’s Legislative Yuan (the Congress). While it is not feasible to estimate the timeframe of the said reviewing and discussion process of the Congress, the Taiwan government has considered the introduction of this new legislation as a priority this year.
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English translations of telecommunications and media laws and regulations are available from YANGMING PARTNERS’ Legal Support Department. This publication is intended to highlight selected legal developments and not to be comprehensive nor to provide legal advice. If you have any questions on issues reported here or if you have any issues you would like to see covered in future editions, please contact the editors:
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