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Taiwan: Law to Prevent Terrorism Financing Enacted

(Nov. 30, 2016) On July 27, 2016, Taiwan’s Terrorism Financing Prevention Law was published in the official gazette; it took effect on the same day. (Zi kong fangzhi fa [Law on the Prevention and Control of Financing Terrorism] (Terrorism Financing Prevention Law), ZONGTONG FU GONGBAO [GAZETTE OF THE OFFICE OF THE PRESIDENT], No. 7257 (July 27, 2016).) The stated purpose of the Act is to prevent and restrain funding activities of terrorist movements, organizations, and elements; support national security; protect basic human rights; and strengthen international cooperation to prevent terrorist financing. (Id. art. 1.) The Ministry of Justice is the authority in charge of administering the Law. (Id. art. 2.)

The Law provides that the Executive Yuan (Cabinet) will be the authority in charge of policy deliberations related to Taiwan’s prevention of terrorism financing, review of relevant legislation, and planning review and work oversight. (Id. art. 3 ¶ 1.) The Ministry of Justice is also to establish a Terrorism Financing Prevention Review Board (Review Board), with the Minister of Justice as the convener and also an ex-officio member, to discuss whether individuals, legal persons, or groups should be included on the sanctions list or de-listed and related measures; the other members will be the deputy heads of the National Security Agency, the Ministry of Interior, the Ministry of Foreign Affairs, the Ministry of National Defense, the Ministry of Economic Affairs, the Central Bank,  the Financial Supervisory Commission, and other agencies specified by the Executive Yuan. (Id. art. 3 ¶ 2.) The Ministry of Justice will determine the composition, operations, and other matters related to the Review Board. (Id. art. 3 ¶ 3.)

The Ministry of Justice, ex officio or based on a report submitted to it by the Ministry’s Investigation Bureau, after a determination has been made by the Review Board, may put an individual, a legal person, or a group on the sanctions list and make a public announcement to that effect under one of the following circumstances: 1) if acts or plans are carried out to intimidate the public or coerce the government, foreign governments, institutions, or international organizations by causing death or injury of unspecified persons, in connection with certain criminal offenses (set forth in article 8, paragraph 1, of the Law); or 2) if it is necessary to do so based on the requirements of international treaties or agreements on the prevention of terrorism financing or for the implementation of international cooperation or the relevant United Nations resolutions. (Id. art. 4 ¶ 1.) The sanctions list will not be limited to the said individuals, legal persons, or groups within the territory of Taiwan. (Id. art. 4 ¶ 2.)

If any individual, legal person, or group has been designated in a United Nations Security Council terrorism financing-related resolution or anti-proliferation of weapons of mass destruction-related resolution, the Ministry of Justice will immediately designate that individual, legal person, or group as being on the sanctions list and publicly announce it, and no de-listing may occur without adhering to the U.N. Security Council procedures for de-listing. (Id. art. 5.)

The Law further provides that the Ministry of Justice, after the Review Board has deliberated the matter, may take such actions as removing a designated individual, legal person, or group from the sanctions list or undertaking restrictive measures against those entities. (Id. art. 6.) The entities on the sanctions list will be prohibited from engaging in certain activities, e.g., making withdrawals, remittances, transfers, payments, or conveyances of their financial accounts, currency, or other payment instruments or transferring, altering, disposing, utilizing, or  taking other measures sufficient for changing the amount, quality, value, and location of any property or  asset interests. (Id. art. 7 ¶ 1.) The Law also imposes a reporting obligation on certain institutions, in conformity with the Money Laundering and Prevention Control Law, if they, for example, are aware that they own or manage the property or property interests of sanctioned individuals, legal persons or groups or know the location of the property or asset interests of such sanctioned entities. (Id. art. 7 ¶ 2; Money Laundering Control Act (promulgated Oct. 23, 1996, as amended Apr. 13, 2016), art. 5 ¶¶ 1 & 2, LAWS & REGULATIONS  DATABASE OF THE REPUBLIC OF CHINA (toggle for Chinese text).)

The new Law imposes penalties for the financing of terrorist activities, terrorists, or terrorist organizations and specifies that such crimes are to be deemed as the “serious crimes” referred to under the Money Laundering Prevention and Control Law (Terrorism Financing Prevention Law, arts. 8-10; Money Laundering Control Act, art. 3.) If a representative, agent, employee, or other staff member of a legal person has committed any of the offenses stipulated under the Terrorism Financing Prevention Law in the course of carrying out business operations, not only will the offender be punished, but the legal person will also be fined. (Terrorism Financing Prevention Law, art. 11 ¶ 1; Terrorism Financing Prevention Law, Global Legal Information Network, Legislative Yuan, R.O.C. website (English summary of the Law) (last visited Nov. 25, 2016).)

Those who confess to an offense specified in the Law within six months of having committed it will be exempted from punishment; if they confess after six months have gone by, they will be given a reduced punishment or be exempted from punishment; and if they confess during the investigation of the case or the trial, their punishment will also be somewhat reduced. (Terrorism Financing Prevention Law, art. 11 ¶ 2.) The Law further specifies that the offenses set forth in the law will also apply to nationals of Taiwan who commit the crimes outside the territory of Taiwan. (Id. art. 11 ¶ 3.)