MEMORANDUM OF UNDERSTANDING 

BETWEEN 

THE AMERICAN INSTITUTE IN TAIWAN AND 

THE TAIPEI ECONOMIC AND CULTURAL REPRESENTATIVE OFFICE IN THE 

UNITED ST ATES 

CONCERNING COOPERATION AND THE EXCHANGE OF INFORMATION 

RELATED TO THE SUPERVISION OF CROSS-BORDER CLEARING 

ORGANIZATIONS 

In view of the growing globalization of the world's financial markets and the increase in crossborder operations and activities of regulated entities, the American Institute in Taiwan ("AIT") 

and the Taipei Economic and Cultural Representative Office in the United States ("TECRO") 

( each a "Participant" and, together, the "Participants") entered into this Memorandum of 

Understanding ("MOU") regarding cooperation and the exchange of information in the 

supervision and oversight of clearing organizations that operate on a cross-border basis in both 

the United States and Taiwan. AIT's designated representative is the Commodity Futures 

Trading Commission ("CFTC"), and TECRO's designated representative is the Financial 

Supervisory Commission ("FSC"). The Participants, through their designated representatives, 

express their willingness to cooperate with each other in the interest of fulfilling the respective 

regulatory mandates of their designated representatives. 

SECTION ONE: DEFINITIONS 

For purposes of this MOU: 

1. "Authority" means: 

a. In the United States, the CFTC as the designated representative of AIT; and 

b. In Taiwan, the FSC as the designated representative of TECRO. 

2. "Requesting Participant" means the Participant making a request, through its 

designated representative, under this MOU. 

3. "Requested Participant" means the Participant to which a request is made, through its 

designated representative, under this MOU. 

4. "Laws and Regulations" means: 

a. For AIT and its designated representative, the Commodity Exchange Act 

("CEA"), Dodd-Frank Wall Street Reform and Consumer Protection Act, CFTC 

regulations, and other applicable legal or regulatory requirements of the territory 

represented by AIT; and 

b. For TECRO and its designated representative, the Futures Trading Act, Standards 

Governing the Establishment of Futures Clearing Houses, Regulations Governing 

Futures Clearing Houses, and other applicable legal or regulatory requirements of 

the territory represented by TECRO. 
5. "Person" means a natural person, unincorporated association, partnership, trust, 

investment company, or corporation, and may be a Clearing Member, Clearing 

Participant, or Covered Clearing Organization. 

6. "Covered Clearing Organization" means a central counterparty organized in the 

territory represented by either AIT or TECRO that satisfies both of the following 

criteria: 

a. A derivatives clearing organization that is, or that has applied to be, registered by 

the CFTC as such or that has been granted, or that has applied for, an exemption 

from registration or other relief under the CEA; and 

b. A clearing organization that is, or that has applied to be, authorized by the FSC as 

such or that has been granted, or that has applied for, recognition under the Laws 

and Regulations of the territory represented by TECRO. 

7. "Clearing Member" means a member of a Covered Clearing Organization that also 

serves as an intermediary through which market participants access the Covered 

Clearing Organization's services. 

8. "Clearing Participant" means a participant of a Covered Clearing Organization that 

does not serve as an intermediary, but trades and clears only for its own account as 

principal. 

9. "Books and Records" means documents, electronic media, and books and records 

within the possession, custody, or control of, and other information about, a Covered 

Clearing Organization. 

10. "Emergency Situation" means the occurrence of an event that could materially impair 

the financial or operational condition of a Covered Clearing Organization. 

11. "On-Site Visit" means any regulatory visit by a Participant, through its designated 

representative, to the premises of a Covered Clearing Organization as described in 

Section Five of this MOU for the purposes of ongoing supervision and oversight, 

including the inspection of Books and Records. 

12. "Local Participant" means the Participant that represents the territory in which a 

Covered Clearing Organization that is the subject of an On-Site Visit is physically 

located. 

13. "Visiting Participant" means the Participant, through its designated representative, 

conducting an On-Site Visit. 

14. "Recipient Entity" means, if the Requesting Participant is AIT, the U.S. Department 

of the Treasury or the U.S. Board of Governors of the Federal Reserve System. 

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SECTION TWO: GENERAL PROVISIONS

15. This MOU is a statement of intent for the Participants, through their designated 

representatives, to consult, cooperate, and exchange information in connection with 

the supervision and oversight of Covered Clearing Organizations. 

16. This MOU should be interpreted and implemented in a manner that is permitted by, 

and consistent with, the laws and requirements applicable to each Authority. With 

respect to cooperation pursuant to this MOU, no secrecy or blocking laws or 

regulations should prevent a Participant, through its designated representative, from 

providing assistance to the other Participant, through its designated representative. 

The Participants, through their designated representatives, anticipate that cooperation 

under this MOU primarily is intended to be achieved through ongoing informal 

consultations, supplemented as needed by more formal cooperation. This MOU is 

intended to support both informal consultations and formal cooperation, as well as to 

facilitate the written exchange of non-public information in accordance with 

applicable laws. 

17. This MOU does not create any legally binding obligations, give rise to any rights, or 

modify or supersede domestic laws or regulations. This MOU does not confer upon 

any Person the right or ability directly or indirectly to obtain, suppress, or exclude any 

information or to challenge the execution of a request for assistance under this MOU. 

18. This MOU is not intended to limit or condition the discretion of an Authority in any 

way in the discharge of its regulatory responsibilities or to prejudice the individual 

responsibilities or autonomy of any Authority. This MOU is not intended to limit an 

Authority to taking solely those measures described herein in fulfillment of its 

supervisory functions or preclude Authorities from sharing information or documents 

with respect to Persons that are not Covered Clearing Organizations, Clearing 

Members, or Clearing Participants but may be subject to regulatory requirements in 

the territory represented by AIT or TECRO. In particular, this MOU does not affect 

any right of any Authority to communicate with, conduct an On-Site Visit of, or 

obtain information or documents from any Person subject to its jurisdiction that is 

physically located in the jurisdiction of another Authority. 

19. This MOU is intended to complement, but is not intended to alter, the terms and 

conditions of existing arrangements, including the following: 

a. The International Organization of Securities Commissions Multilateral 

Memorandum of Understanding Concerning Consultation and Cooperation and 

the Exchange of Information (revised May 2012) ("IOSCO MMOU") to which 

the CFTC and FSC are signatories, which covers primarily information sharing in 

the context of enforcement matters; and 

b. The Memorandum of Understanding between the American Institute in Taiwan 

and the Coordination Council for North American Affairs on the Exchange of 

Information Concerning Commodity Futures and Options Matters (January 11, 

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1993), with TECRO as successor in interest for the Coordination Council for 

North American Affairs. 

20. To facilitate cooperation under this MOU, the Participants hereby designate contact 

persons for the Authorities as set forth in Appendix A, which may be updated from 

time to time by the relevant Participant, through its designated representative, 

transmitting revised contact information in writing to the other Participant, through its 

designated representative. 

SECTION THREE: SCOPE OF SUPERVISORY CONSULTATION, COOPERATION, 

AND EXCHANGE OF INFORMATION 

General 

21. The Participants, through their designated representatives, recognize the importance 

of close communication concerning their supervision of Covered Clearing 

Organizations and intend to consult regularly, as appropriate, regarding: 

a. General supervisory issues, including regulatory, oversight, or other related 

developments; 

b. Issues relevant to the operations, activities, and regulation of Covered Clearing 

Organizations; and 

c. Any other areas of mutual supervisory interest. 

22. The Participants, through their designated representatives, recognize in particular the 

importance of close cooperation in the event that a Covered Clearing Organization 

experiences, or is threatened by, a potential financial crisis or other Emergency 

Situation. 

23. The Participants, through their designated representatives, expect cooperation to be 

most useful in, but not limited to, the following circumstances where issues of common 

regulatory concern may arise: 

a. The initial application for registration or authorization, or exemption therefrom, 

by a Covered Clearing Organization that is authorized or registered in the other 

jurisdiction; 

b. The ongoing supervision and oversight of a Covered Clearing Organization with 

respect to compliance with applicable Laws and Regulations, exemptive or other 

relief, or international standards; and 

c. Regulatory or supervisory actions or approvals taken in relation to a Covered 

Clearing Organization that may impact the operations of the entity in the 

jurisdiction of the other Authority. 

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Event-Triggered Notification 

24. As appropriate in the particular circumstances, each Participant, through its 

designated representative, intends to inform the other Participant, through its 

designated representative, promptly, and where practicable in advance, of: 

a. Pending regulatory changes by the relevant Authority that may have a significant 

impact on the regulation, operations, activities, or reputation of a Covered 

Clearing Organization, including those that may significantly affect the rules or 

procedures of a Covered Clearing Organization; 

b. Any material event of which the relevant Authority is aware that could adversely 

impact the financial or operational resilience of a Covered Clearing Organization 

including such events as a default or potential default of a Clearing Member or 

Clearing Participant; market or settlement bank difficulties that might adversely 

impact the Covered Clearing Organization; failure by a Covered Clearing 

Organization to satisfy any of its requirements for continued registration, 

authorization, exemption, or other relief where that failure could have a material 

adverse effect in the other jurisdiction; or any known adverse material change in 

the ownership, operating environment, operations, financial resources, 

management, or systems and controls of a Covered Clearing Organization; 

c. The status of efforts of which the relevant Authority is aware to address any 

material event that could adversely impact the financial or operational condition 

of a Covered Clearing Organization, Clearing Member, or Clearing Participant; 

and 

d. Enforcement actions or sanctions or significant regulatory actions by the relevant 

Authority, including the revocation, suspension, or modification of authorization, 

registration, exemption, or other relief concerning a Covered Clearing 

Organization. 

25. The determination of what constitutes "significant impact", "significantly affect", 

"material event", "adversely impact", "difficulties", "material adverse effect", 

"adverse material change", or "significant regulatory actions" for purposes of 

Paragraph 24 should be left to the reasonable discretion of the relevant Participant, 

through its designated representative, that determines to notify the other Participant, 

through its designated representative. 

Request-Based Information Sharing 

26. To the extent appropriate to supplement informal consultations, upon written request, 

the Requested Participant, through its designated representative, intends to provide 

the Requesting Participant, through its designated representative, the fullest possible 

cooperation consistent with this MOU in providing assistance in connection with an 

Authority's functions relating to a Covered Clearing Organization, including 

assistance in obtaining and interpreting information that is not otherwise available to 

the other Authority and that is relevant to ensuring compliance by the Covered 

Clearing Organization with Laws and Regulations, exemptive or other relief, or 

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applicable international standards. Such requests should be made consistent with 

Section Four of this MOU, and the Participants, through their designated 

representatives, anticipate that such requests would be made in a manner that is 

consistent with the goal of minimizing administrative burdens. 

27. The information covered by Paragraph 26 includes: 

a. Information relevant to the financial and operational condition of a Covered 

Clearing Organization including, for example, financial resources, risk 

management, and internal control procedures; 

b. Relevant regulatory information and filings that a Covered Clearing Organization 

is required to submit to an Authority including, for example, interim and annual 

financial statements and event-specific notices; and 

c. Regulatory reports prepared by an Authority including, for example, examination 

reports, findings, or information contained in such reports, regarding a Covered 

Clearing Organization. 

Periodic Meetings 

28. The Participants, through their designated representatives, intend to hold periodic 

working-level meetings, as appropriate, to update each other and discuss the 

Authorities' respective functions and regulatory oversight programs and to identify 

and discuss issues of common interest relating to the supervision of Covered Clearing 

Organizations, including: contingency planning and crisis management, systemic risk 

concerns, default procedures, the adequacy of existing cooperative arrangements, and 

the possible improvement of cooperation and coordination. Such meetings may be 

conducted by conference call or on a face-to-face basis, as appropriate. 

SECTION FOUR: EXECUTION OF REQUESTS FOR INFORMATION 

29. To the extent possible, a request for information under Section Three should be made 

in writing (which may be transmitted electronically), and addressed to the relevant 

contact person identified in Appendix A. A request generally should specify the 

following: 

a. The information sought by the Requesting Participant, through its designated 

representative; 

b. A general description of the matter that is the subject of the request; 

c. The purpose for which the information is sought; and 

d. The desired time period for reply and, where appropriate, the urgency thereof. 

Information responsive to the request, as well as any subsequent communication, may 

be transmitted electronically from a Requested Participant, through its designated 

representative, to a Requesting Participant, through its designated representative. 

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Any electronic transmission should use means that are appropriately secure in light of 

the confidentiality of the information being transmitted. 

30. In an Emergency Situation, the Participants, through their designated representatives, 

intend to notify each other as soon as possible of the Emergency Situation and 

communicate information as appropriate in the particular circumstances, taking into 

account all relevant factors, including the status of efforts to address the Emergency 

Situation. During an Emergency Situation, requests for information may be made in 

any form, including orally, provided such communication is confirmed in writing as 

promptly as possible following such notification. 

SECTION FIVE: ON-SITE VISITS 

31. A Participant, through its designated representative, may need to conduct On-Site 

Visits to a Covered Clearing Organization physically located in the jurisdiction of the 

other Participant in order for an Authority to fulfill its supervision and oversight 

responsibilities pursuant to, and to ensure compliance with, Laws and Regulations. 

The Participants, through their designated representatives, intend to consult and work 

collaboratively in conducting an On-Site Visit. 

32. An On-Site Visit by a Participant, through its designated representative, should be 

conducted through the following procedure: 

a. The Visiting Participant, through its designated representative, intends to provide 

advance notice to the Local Participant, through its designated representative, of 

its intent to conduct an On-Site Visit and the intended timeframe for, and the 

purpose and scope of, the On-Site Visit. Other than in exceptional circumstances, 

the Visiting Participant, through its designated representative, is expected to 

notify the Local Participant, through its designated representative, prior to 

notifying the Covered Clearing Organization. 

b. The Local Participant, through its designated representative, intends to share any 

relevant reports, or information contained therein, related to examinations it may 

have undertaken of the Covered Clearing Organization. 

c. The Participants, through their designated representatives, intend to assist each 

other regarding On-Site Visits, including providing information that the Visiting 

Participant, through its designated representative, may request and that is 

available prior to the On-Site Visit; cooperating and consulting in reviewing, 

interpreting, and analyzing the contents of public and non-public Books and 

Records; and obtaining information from directors and senior management of a 

Covered Clearing Organization. 

d. The Participants, through their designated representatives, intend to consult, and 

the Local Participant, through its designated representative, may in its discretion 

accompany or assist the Visiting Participant, through its designated 

representative, during the On-Site Visit, or the Participants, through their 

designated representatives, may conduct joint On-Site Visits where appropriate. 

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SECTION SIX: PERMISSIBLE USES OF INFORMATION 

33. The Requesting Participant, through its designated representative, is expected to use 

non-public information obtained under this MOU solely for the supervision and 

oversight of Covered Clearing Organizations pursuant to Laws and Regulations and 

to ensure compliance with such Laws and Regulations, exemptive or other relief 

granted by the relevant Authority, or applicable international standards. Neither 

Participant intends to use any non-public information related to or obtained under this 

MOU for any purpose without obtaining the written approval of the other Participant, 

through its designated representative, for the intended use. 

34. The Participants, through their designated representatives, recognize that, while this 

MOU is not intended to enable the Participants, through their designated 

representatives, to gather information for enforcement purposes, the Participants, 

through their designated representatives, subsequently may want to use non-public 

information obtained under this MOU for enforcement purposes. In cases where a 

Participant, through its designated representative, seeks to use non-public information 

obtained under this MOU for enforcement purposes, including in conducting 

investigations or taking enforcement action, the Participant, through its designated 

representative, is expected to treat the non-public information consistent with the use 

and confidentiality provisions of the IOSCO MMOU and, provided both of the 

Authorities are signatories, the IOSCO Enhanced Multilateral Memorandum of 

Understanding Concerning Consultation and Cooperation and the Exchange of 

Information. 

35. Before using non-public information obtained under this MOU for any purpose other 

than those addressed in Paragraphs 33 or 34, the Requesting Participant, through its 

designated representative, is expected to first consult with and obtain the written 

approval of the Requested Participant, through its designated representative, for such 

use. If approval is not given by the Requested Participant, through its designated 

representative, the Participants, through their designated representatives, intend to 

consult to discuss the reasons for withholding approval of such use and the 

circumstances, if any, under which the Requesting Participant, through its designated 

representative, might use such information. 

36. If a Participant, either on its own or through its designated representative, ("Receiving 

Participant") receives, from an actor that is not a Participant or an Authority ("Third 

Party"), non-public information originally provided by the other Participant's 

designated representative ("Disclosing Authority") that is related to the supervision 

and oversight of a Covered Clearing Organization and that the Receiving Participant 

is aware was obtained by the Third Party from the Disclosing Authority on a 

confidential basis, the Receiving Participant is expected to use and treat the 

information consistent with the provisions of this MOU. 

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3 7. This Section does not apply to the use by a Participant, through its designated 

representative, of information obtained directly from a Covered Clearing 

Organization, whether during an On-Site Visit or otherwise. However, where nonpublic information is provided to the Requesting Participant, through its designated 

representative, pursuant to an information-sharing request pursuant to Section Four, 

the provisions in this MOU apply to the use of the information by that Requesting 

Participant, through its designated representative. 

SECTION SEVEN: CONFIDENTIALITY OF INFORMATION AND ONWARD 

SHARING 

38. Except as provided in Paragraphs 39-41, the Participants, both on their own and 

through their designated representatives, are expected to keep confidential, to the 

extent permitted by law, non-public information related to or obtained under this 

MOU, requests made under this MOU, the contents of such requests, and any other 

matters arising under this MOU. 

39. As required or otherwise permitted by law, it may become necessary for a Requesting 

Participant's designated representative to share non-public information obtained 

under this MOU with a Recipient Entity in its jurisdiction. In these circumstances 

and to the extent permitted by law: 

a. The Requesting Participant, through its designated representative, intends to 

notify the Requested Participant, through its designated representative; and 

b. Prior to the Requesting Participant, through its designated representative, sharing 

the non-public information with the Recipient Entity, the Requesting Participant, 

through its designated representative, is expected to provide adequate assurances 

to the Requested Participant, through its designated representative, concerning the 

Recipient Entity's use and confidential treatment of the information, including, as 

necessary, assurances that: 

1. The Recipient Entity has confirmed that it requires the information for a 

purpose within the scope of its jurisdiction; and 

11. The information would not be shared by the Recipient Entity with third 

parties without getting the prior written approval of the Requested 

Participant, through its designated representative. 

40. Except as provided in Paragraph 39, the Requesting Participant, through its 

designated representative, is expected to obtain the prior written approval of the 

Requested Participant, through its designated representative, before disclosing nonpublic information received under this MOU to any actor that is not a Participant or 

an Authority. The Requested Participant, through its designated representative, 

should take into account the level of urgency of the request and respond in a timely 

manner. During an Emergency Situation, the Requested Participant, through its 

designated representative, may provide such approval in any form, including orally, 

provided such communication is confirmed in writing as promptly as possible 

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following such notification. If approval is not given by the Requested Participant, 

through its designated representative, the Participants, through their designated 

representatives, intend to consult to discuss the reasons for withholding approval of 

such disclosure and the circumstances, if any, under which the intended disclosure by 

the Requesting Participant, through its designated representative, might be approved. 

41. To the extent possible, the Requesting Participant, through its designated 

representative, intends to notify the Requested Participant, through its designated 

representative, of any legally enforceable demand for non-public information 

furnished under this MOU. When complying with the demand, the Requesting 

Participant, through its designated representative, intends to assert all appropriate 

legal exemptions or privileges with respect to such information as may be available. 

42. The Participants, through their designated representatives, intend that any sharing or 

disclosure of non-public information under this MOU, including deliberative and 

consultative materials such as written analysis, opinions, or recommendations relating 

to non-public information that is prepared by or on behalf of a Participant's 

designated representative, would not constitute a waiver of any privilege or 

confidentiality respecting such information. 

SECTION EIGHT: MODIFICATIONS 

43. The Participants, through their designated representatives as appropriate, intend to 

periodically as appropriate review the functioning and effectiveness of this MOU 

with a view, inter alia, to expanding or altering the scope or operation of this MOU 

should that be judged necessary by the Participants through their designated 

representatives as appropriate. This MOU may be modified in writing by the 

Participants, in consultation with their designated representatives. 

SECTION NINE: EFFECTIVENESS OF MOU 

44. This MOU becomes effective on the date of last signature and is expected to continue 

in effect unless and until cooperation ends as set forth in Paragraph 45. 

SECTION TEN: DISCONTINUATION 

45. Cooperation under this MOU is expected to continue until a Participant, in 

consultation with its designated representative, notifies the other Participant of its 

intent to discontinue this MOU. The Participant that seeks to discontinue this MOU, 

in consultation with its designated representative, should provide 45 days' written 

notice to provide sufficient time for the other Participant to forward the notice of 

discontinuation to its designated representative. Upon notice of discontinuation, the 

Participants, through their designated representatives, intend to consult concerning 

the disposition of any pending requests for assistance under this MOU. Unless a 
different understanding is reached through such consultation, cooperation is expected 

to continue with respect to all requests for assistance that were made under this MOU 

before the date of discontinuation of this MOU until all such requests are fulfilled or 

the Requesting Participant, through its designated representative, withdraws such 

request(s). In the event of discontinuation of this MOU, information obtained under 

this MOU is expected to continue to be treated in the manner described under 

Sections Six and Seven. 

This MOU is signed in duplicate in the English language. 

For the American Institute in Taiwan: 

Ingri . Larson 

Managing Director 

Date: 

Place: 

,of ( ~ l----u; ~ ~ 

A,LiT, VA 

11 

For the Taipei Economic and Cultural Representative 

Office in the United States: 

Johnson S. Chiang 

Deputy Representative 

Date: 3 l \ / t'5" / 2 O~ 

Place: ~0-.S~'j~, J)C 
APPENDIX A 

CONTACT PERSONS 

In addition to the following contact information, the Participants, through their designated 

representatives, intend to exchange confidential emergency contact telephone information. 

AIT designates as contact persons:

CFTC 

Clark Hutchison 

Director, Division of Clearing and Risk 

Commodity Futures Trading Commission 

1155 2l51 Street, N.W. 

Washington, DC 20581 

Phone: 1-202-418-6070 

Fax: 1-202-418-5547 

Email: c _hutchison@cftc.gov 

Alternate Contacts: 

Eileen A. Donovan 

Deputy Director, Clearing Policy 

Division of Clearing and Risk 

Commodity Futures Trading Commission 

1155 21st Street, N.W. 

Washington, DC 20581 

Phone: 1-202-418-5096 

Fax: 1-202-418-5547 

Email: edonovan@cftc.gov 

Julie A. Mohr 

Deputy Director, Examinations 

Division of Clearing and Risk 

Commodity Futures Trading Commission 

77 West Jackson Blvd., Suite 800 

Chicago, IL 60604 

Phone: 1-312-596-0568 

Fax: 1-312-596-0713 

Email: jmohr@cftc.gov 

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TECRO designates as contact persons: 

FSC 

85, Sec. 1, Xinshen S. Rd., Da'an District, Taipei City, Taiwan 

Ms. Hsiu-Ling Wang 

Director, Securities and Futures Bureau 

Phone: +866-8773-5100 #7277 

Email: shirley@sfb.gov.tw 

Mr. Chia-Chang Lin 

Section Chief, Securities and Futures Bureau 

Phone: +866-8773-5100 #7115 

Email: erwin@sfb.gov.tw 

Ms. Ming-Shan Chin 

Specialist, Securities and Futures Bureau 

Phone: +866-8773-5100 #7109 

Email: shine91 l@sfb.gov.tw 

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