Mainland China, Taiwan ink 3 financial MOUs

Nov. 17, 2009 (China Knowledge) - Mainland China and Taiwan yesterday signed three long-awaited memorandums of understanding that mainly cover cross-strait financial supervision, the official Xinhua News Agency reported.

Pursuant to the MOUs, which will come into effect in two months, banking regulators of mainland China and Taiwan will cooperate to exchange and share information, set up institutions and deal with emergencies to ensure the stable development of the banking sectors on both sides of the Taiwan Strait.

Mainland financial institutions can apply to set up branches in Taiwan and vice versa after the MOUs take effect.

In addition, the mainland offices of seven Taiwanese banks will be allowed to be upgraded to branches, while commercial banks, securities firms, fund houses and insurers from the mainland will be permitted to invest in Taiwan's stock and bond markets under the Qualified Domestic Institutional Investor scheme.

The guidelines for Taiwanese and mainland financial firms investing in each other will be discussed. A free-trade pact or economic cooperation framework agreement is expected to be signed early next year.