Emerging Markets Rates and Currencies Handbook

24 Citi | Emerging Markets Currencies Handbook 2021 Deal Management Rollover : FX Swap: Yes. It is required to reset the FX rate at market price with supporting documents. FX forward: No. It cannot be extended. However, in practice, CBC allows forward rollover at market price for one-time only and customer needs to provide a written evidence to meet CBC’s requirement. Unwinding : No. Deals cannot be cancelled or early unwound via entering into an offsetting trade. Early Take Up (ETU) : Yes, with supporting evidence to prove necessity of such early take-up. The original deal rate would be adjusted based on ETU swap points. Documentation Requirements Product specific For Resident accounts Spot • Equal/Exceeding TWD 500k: Central Bank Declaration Form. • Equal/Exceeding USD 1mm equivalent: Central Bank Declaration Form and Supporting documents. • For Capital Flows/Foreign Direct Investment: Regardless of notional, must provide supporting documents as below: a. Standard Central Bank Declaration Form. b. Supporting documents (such as Government Approval, Intercompany Loan Agreement, Statement of Earning Distribution, and/or Statement of Dividend Calculation, etc.). Forward • Regardless of notional, supporting documents are required when entering into transaction and at expiry. • Central Bank Declaration Form is also required at expiry if notional exceeds TWD 500k. Swap • No supporting document is required when initiating the transaction; however, per local practice, supporting documents will be required for intercompany loan or special purposed transaction. • For example, in the case of intercompany loan, supporting documents such as loan agreement are required. Option (Only Plain Vanilla one is allowed) • Per local practice, regardless of notional, supporting documents are required when entering into transaction and at expiry. For Non-Residential accounts Supporting documents are required for all FX conversions: • Power of Attorney (Power of Attorney translated into Chinese). • Central Bank Declaration Form. If the conversion exceeds USD100,000: Prior approval from the Central Bank is required. For further information, please refer to: Regulations Governing the Declaration of Foreign Exchange Receipts and Disbursements or Transactions https://law.moj.gov.tw/ENG/LawClass/LawAll. aspx?pcode=G0450009 Regulations Governing Foreign Exchange Business of Banking Enterprises https://law.moj.gov.tw/ENG/LawClass/LawAll. aspx?pcode=G0450011 Additional Comments All TWD contracts must be based on genuine needs. Balance sheet hedging is allowed but hedge tenor must match the maturity of the underlying. Hedging of receivables/payables, inter-company loans supported by underlying documents is permitted. The CBC requires settlement of all TWD FX deals (i.e. neither non-settlement nor cancellation is allowed per central bank regulation). Citi Taiwan 15FL, No 1, Songzhi Road Xinyi District Taipei City, 11047, Taiwan FX Sales Contact: +8862 8726 9858 Taiwan Note: Citigroup Inc. and any of its affiliates do not provide accounting, tax, or legal advice. Please seek advice from a relevant licensed advisor. Source: Relevant legislation, publicly available sources.