Industrial Group Act

Link to law: http://law.moj.gov.tw/ENG/LawClass/LawAll.aspx?PCode=D0050103

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Chapter Ⅰ General Principles

Article 1

The purpose of Industrial group is to coordinate the relationship among industries, enhance joint benefits, promote industrial improvement and enhance economic development.

Article 2

An industrial Group is a body corporate.

Article 3

The classification system of Industrial group is as follows:
A. Industrial Board of Trade
1. Provincial (or municipal) Industrial Board of Trade.
2. Industrial Board of Trade of special zones.
3. National Industrial Board of Trade.
4. League of nationwide Industrial Boards of Trade.
B. Industrial Association:
1. County or City Industrial Association
2. Provincial or Municipal Industrial Association
3. National Federation of Industries
The organizations of Provincial or Municipal Industrial boards of trade are subject to not being in Special Zones.
Provincial or Municipal Industrial Groups, County or City Industrial Groups should each take the district name to which it belong before the group’s name; while Industrial Groups in Special Zones should each take the Special Zone’ name before the name of the industrial group; national Industrial Groups should each take the Republic of China before the name of the group; specific Industrial Boards of trade or leagues of industrial boards of trade should take the names of specific industries before the organizations’ names.

Article 4

The tasks of Industrial Groups are as follows:
A. The investigation, statistics, research, improvement and development of both domestic and overseas industries.
B. The investigation of raw material source and assistance in preparation, etc.
C. The investigation and statistics of transportation and sales of members’ products, propaganda of members’ products.
D. The liaison, propaganda of technical cooperation.
E. The maintenance of members’ legal rights.
F. The investigation of members’ business situation.
G. The exhibition and display of members’ products.
H. The collection of basic data, dynamic investigation and registration of members and member representatives.
I. The application, alteration, changes of members’ business licenses and membership qualification certificates and some other services.
J. The investigation and settlement of conflicts between trades and the coordination and settlement of labor and capital conflicts.
K. The research and promotion of production force, skill training of industry practitioners and organizing of seminars and symposiums.
L. The organizing of members’ commonweal projects.
M. Providing entrusted services to units, groups and members.
N. Coordinative propelling, investigation and proposal of governmental economic policies and industrial decrees.
O. Participation into social activities.
P. Other obligatory tasks or services stipulated in other relevant decrees.

Article 5

The competent authorities of County or City Industrial Associations are county governments or city governments; The competent authorities of Industrial Boards of trade or Industrial Associations in municipalities directly under central government are the relevant municipality government; the competent authorities of provincial Industrial Boards of Trade or Industrial Associations, Industrial Boards of Trade in special zones, national Industrial Boards of Trade, league of nationwide specific Boards of Trade and National Federation of Industries is Ministry of the Interior.
Businesses of the above-mentioned Industrial Groups are subject to guidance and supervision of the relevant purpose enterprise competent authorities.

Article 6

The locale of each Industrial Group should be in the locus of the competent authorities and that of industrial groups in special zones should be decided by the relevant competent authorities; A Industrial Group may establish offices with approval of the competent authorities.

Chapter Ⅱ Industrial Boards of Trade

Section One: Establishment

Article 7

An industrial board of trade should be established in a district with at least five licensed factories of the same trade, but the establishment of national industrial board of trade is not subject to the number of licensed factories.

Article 8

(Criteria of dividing different trades and the division of organizing districts of industrial boards trade in special zones.)
Criteria of dividing different trades of industrial groups are determined and revised by Ministry of Economic Affairs and Ministry of the Interior; the division of organizing districts of industrial boards of trade in special zones is determined and adjusted by Ministry of the Interior and Ministry of Economic Affairs together.

Article 9

Only one industrial board of trade of the same trade is permissible in a district.

Article 10

As for group or industry with two different trades, Ministry of the Interior and Ministry of Economic Affairs jointly determine which industrial board of trade it should join, those conforming to Article 7 after joining an industrial board of trade should also join another industrial board of trade at the same time.
Those out of special zones have to get approval of both Ministry of the Interior and Ministry of Economic Affairs to join the industrial boards of trade in an adjoining special zones.

Article 11

The establishment and organizing of industrial boards of trade should be reported to relevant competent authorities for approval and should be under guidance and supervision of the competent authorities; and the rules, scroll of members and member representatives, resumes of staff should be reported to relevant authorities for files
The rules of industrial boards of trade, scroll of members and member representatives, resumes of staff should be handed over to the purpose enterprise competent authorities of the same level for future reference.

Article 12

The rules of industrial boards of trade should contain the following items:
A. Name
B. Purpose
C. Ruling area
D. Locale of meeting of industrial board of trade
E. Tasks
F. Organizing
G. Membership qualification and procedures of joining in and withdrawing from industrial board of trade.
H. The rights and obligations of members
I. Number of member representatives and criteria of electing member representatives.
J. The number, authorities, office term, election and dismission of directors and supervisors.
K. Details about holding meetings.
L. Funds and accountant.
M. Enactment and amendment of rules.

Section Two: Membership

Article 13

All licensed publicly-operated and nongovernmental-run factories must join in the relevant industrial boards of trade within one month after establishment(exclusive of war industry of national defense); multi-occupation enterprises should join all the relevant industrial boards of trade respectively.
All member enterprises or factories of industrial boards of trade have to send their member representatives to attend meetings convened by industrial boards of trade.

Article 14

Factories are not allowed to withdraw from industrial boards of trade unless they stop business, move out of the districts of industrial boards of trade or suffer punishment of permanent shutout.

Article 15

The rules of boards of trade should state clearly the number of representatives of each member factory according to the levels of annual membership dues (the number of representatives of each member factory ranges from one to seven).

Article 16

Member representatives should be at least at the age of 20 years and they must be the principals, managers or current staff of the member factories.

Article 17

Any of the following mentioned personnel is not eligible for member representative:
A. Those who commit crimes and are in execution of verdict.
B. Those who are deprived of public rights and have not regained public rights yet.
C. Those who have been placed under custodianship and such custodianship has not yet been withdrawn.
D. Those who announce bankruptcy.
If member representatives have any of the above-mentioned situations, their representative qualification will become invalid automatically, already appointed member representatives who lose their representative qualification will be replaced by newly appointed representatives.

Article 18

Member representatives have the rights to vote, elect, be elected and the right of recall, each representative has only one ballot.

Article 19

In case that member representatives cannot attend meetings in person, they have to entrust other member representatives to deputize theirs rights and duties. Each member representative can only deputize one absent representative, and the number of member representatives deputizing another absent representative should not exceed half of the representatives present.

Section Three: Staff of industrial boards of trade

Article 20

Directors and supervisors of industrial boards of trade are elected in general meetings by member representatives among them, and then councils, boards of supervisors should be established, specific regulations as follows:
1. A Provincial (municipal) industrial board of trade should have no more than 21 directors.
2. An industrial board of trade in special zone should not have more than 27 directors.
3. A national industrial board of trade should have no more than 33 directors.
4. The number of supervisors of an industrial board of trade should not exceed one third of the number of directors.
5 Backup directors and supervisors of industrial board of trade should be elected, and the number of backup directors and backup supervisors should not exceed one third of the number of directors and supervisors respectively.
When there are more than three directors or supervisors in an industrial board of trade, standing directors or standing supervisors should be elected, the number of standing directors and standing supervisors should not exceed one third of the number of directors and supervisors respectively; a head of directors should be elected from the standing directors(the head of directors should be elected from directors if there is no standing directors).

Article 21

Councils and boards of directors should carry out their authorities and duties respectively in compliance with decisions and rules adopted in general meetings.

Article 22

The head of directors must be resident in ROC and he must be of R.O.C. nationality.
At least two thirds of Directors, supervisors, standing directors and standing supervisors must be of R.O.C nationality with residences in P.R.C respectively.

Article 23

The office term of directors and supervisors is 3 years; the number of those serving two terms uninterruptedly should not exceed half of the total number in office. The maximum serving terms of heads of directors is 6 years.

Article 24

Directors and supervisors are unpaid positions.

Article 25

In case of any of the following situations, directors and supervisors should be dismissed or relieved immediately; the vacancies are to be filled by backup directors and supervisors respectively:
A. disqualification of member representatives
B. reasonable resignation approved by councils or boards of supervisors
C. dismission and recall of positions in accordance with the Act.
D. The factories or enterprises member representatives delegate withdraw from industrial boards of trade.

Article 26

Industrial boards of trade employ and dismiss staff of the boards according to relevant rules and carry out routine work under orders of heads of directors; the employment and dismission of staff of industrial boards of trade should be reported by heads of directors to the councils for approval and then submitted to relevant competent authorities for check and reference.

Section Four: Meetings of Industrial boards of trade

Article 27

General meetings are organized and convened by heads of directors, include the following meetings:
A. Regular meetings that meet at lease once a year, the date of meeting is determined by the councils.
B. Temporary meetings convened when councils consider necessary or requested by at lease one fifth of member representatives.
When the meetings could not be convened on time, the competent authorities should appoint one director to convene the meetings.

Article 28

The general meetings should be notified 15 days ahead of the date of meetings; emergent or temporary meetings are not subject to notification of 15 days beforehand if the member representatives are able to attend them on time, all the meetings should be guided and supervised by appointed personnel of competent authorities.

Article 29

The decisions adopted and approved by half of the present representatives in general meetings(the general meeting is valid only when attended by more than half of the member representatives) will take effect, but any of the following decisions will take effect only when two thirds of member representatives attend the meeting and approved by at least two thirds of member representatives present.
A. Amendment of Rules.
B. Punishment of member factories, enterprises and member representatives.
C. Dismission of directors and supervisors.
D. Decision of liquidation and appointment of personnel in charge of liquidation.

Article 30

In case the number of member representatives exceeds 300, preliminary meetings should be convened in sub-districts and a certain number of member representatives in proportion to representative number should be elected from each sub-district to attend general meeting.

Article 31

Council and board of supervisors should hold meetings at least once a season respectively, backup directors and supervisors have to attend these meetings as nonvoting delegates.

Article 32

Decisions adopted in a meeting of council or board of supervisors take effect under the circumstance that at least half of directors or supervisors attend the meeting and half of the directors or supervisors present vote for the decisions; the resignation of directors or supervisors is effective only under the circumstance that half of directors or supervisors attend the meeting and more than two thirds of the directors or supervisors present vote for the resignation.

Section Five: Funds

Article 33

The income of industrial boards of trade is as follows:
A. Admission fee stipulated in rules of industrial boards of trade and paid by members when joining.
B. Annual membership dues stipulated in rules of industrial board of trade and paid monthly in proportion to capital, producing tools, staff number or products quantity of member factories; in case members purchase clubs, add producing equipment or hold exhibitions, an increased membership due should be charged accordingly with approval of competent authorities.
C. Operating fee collected in accordance with decisions made in general meetings.
D. Commision income.
E. Funds and interest of funds.

Article 34

Multi-occupation members that join at lease two industrial boards of trade should pay their membership dues to each industrial board of trade in proportion to the capital, producing tools, staff number or products quantity that belong to the relevant trade for which they join in the industrial board of trade.

Article 35

Members should report their capital situations, producing tools, staff numbers, products quantity and other important data to the industrial board of trade so that their membership dues may be easily and correctly calculated.

Article 36

Each member should at least bear one share of operating fee(no more than 50 shares allowed), when necessary, an increase of membership dues may be charged upon decisions made in general meetings, the total amount of operating fee and the amount of each share are determined at general meetings and reported to competent authorities, and the competent authorities deliver the report to purpose enterprise competent authorities for final approval.

Article 37

The above-mentioned operating fees are not refundable when members withdraw from industrial board of trade.

Article 38

The budget and final accounts of industrial boards of trade should be compiled in annual reports, submitted to the board of supervisors for check, announced at general meeting for approval and finally submitted to competent authorities for future reference.

Article 39

Enterprises run by industrial board of trade should have separate accountants, and the statements of annual financial situations should be submitted to board of supervisors for check, then announced at general meeting and finally submitted to competent authorities for future reference.

Article 40

When industrial board of trade dissolve, personnel in charge of the liquidation work are to be appointed in accordance with decisions made at general meeting; in case no personnel are available, the board of trade or interest-related parties assume the task of applying for local court to decide the appointment of liquidation personnel

Article 41

Liquidation of the industrial board of trade and enterprises run by it should be made separately, personnel in charge of the liquidation work are to be elected in genera meetings.

Section Six: League of nationwide industrial boards of trade

Article 42

When three industrial boards of trade of a same trade exist in a province or a municipal or in a certain area, a national league of industrial boards of trade should be established with the approval of the competent authorities.
For special industrial groups, the national league may be established accordingly with the approval of the competent authorities.

Article 43

The funds of national leagues of industrial boards of trade should be borne by their member groups by paying one tenth to two tenth of their annual income of perennial membership dues (specific criteria should be stipulated in rules).

Article 44

Temporary operating fees (if necessary) of national leagues of industrial boards of trade should be approved at general meetings.

Article 45

The member representatives of national leagues of industrial boards of trade should be appointed by the member groups in proportion to the expenses shared by them.

Article 46

Council and board of supervisors of each national league of industrial boards of trade should be established, the directors and supervisors will be elected from among the member representatives present in general meeting, regulations are as follows:
A. No more than 33 directors of each league are allowed.
B. The number of supervisors should not be more than one third of that of directors.
C. Backup directors and supervisors should be elected from among member representatives, the number should not exceed one third of the number of directors and supervisors respectively.
When there are more than 3 directors or supervisors, standing directors and supervisors should be elected, the number of standing directors or supervisors cannot exceed one third of the number of directors or supervisors respectively; a head of directors should be elected from among the standing directors (when no standing directors are available, the head of directors should be elected from among the directors).

Article 47

When it is necessary for a national league of industrial boards of trade to demand its member groups to carry out consolidated actions, the implementation of consolidated actions should be approved at general meeting and submitted to purpose enterprise competent authorities for final approval.

Article 48

In addition to prescriptions in this section of chapter two, relevant prescriptions in other sections of this chapter are also practicable to national league of industrial boards of trade.

Chapter Ⅲ Industrial Associations

Article 49

County or city associations should be organized by at least five licensed factories of the same trade that cannot join a industrial board of trade, when there are only less than 5 factories, they should join in a industrial association of the neighboring county or city.

Article 50

Industrial association of municipalities directly under central government is organized by the following:
A. Licensed factories that cannot join a industrial board of trade.
B. Industrial boards of trade in municipalities directly under central government.

Article 51

Provincial industrial associations are organized by the following:
A. County or city industrial associations
B. Provincial industrial boards of trade.

Article 52

For multi-occupation factory, if one of its industries cannot join in a local industrial board of trade, it should join in a local industrial association to become a member.

Article 53

A factory that has already joined in a industrial board of trade should, if necessary, affiliate a local (municipality or county or city) industrial association.

Article 54

National Federation of Industries should be organized if 50 of any of the following mentioned groups exist.
A. Provincial or municipal industrial associations.
B. All Industrial boards of trade in a certain area without national league of the industrial boards of trade.
C. Nationwide industrial boards of trade.
D. National leagues of industrial boards of trade.

Article 55

Funds of industrial association are from the following sources:
A. Fees collected from group members, paid yearly by these group members as per one tenth to two tenth of their annually collected membership dues (criteria should be stipulated in rules).
B. Fees collected from individual factory members, paid by these individual members as per the lowest membership dues of group members (criteria should be stipulated in rules); in case that an industrial association has only individual factory members, the funds are to be collected as per subparagraph A and subparagraph B of Article 33.

Article 56

The number of representatives of general meeting of industrial association is stipulated as follows:
A. Representatives elected from group members in proportion to the funds the groups pay to industrial association (specific criteria should be stipulated in rules of the industrial association)
B. One representative (manager or principal of the factory) from each individual factory member; the number of directors or supervisors elected from individual factory members should not exceed one third of the number of total directors or supervisors of the industrial association. For industrial association with only individual factory members, the number of representative of general meeting is as per Article 15; the number and appointment of directors and supervisors are as per Article 57.

Article 57

There should be directors and supervisors elected from among representatives of general meetings, a council and a board of supervisors should then be established and the enforcement rules are as follows:
A. A county or a city industrial association should have no more than 15 directors.
B. A provincial or a municipal industrial association should have no more than 27 directors.
C. National Federation of Industries should have no more than 45 directors.
D. The number of supervisors of industrial association of all levels should not exceed one third that of directors.
E. Backup directors and supervisors should be elected and the number of them should not exceed one third of that of directors and supervisors respectively.
If more than 3 directors or 3 supervisors exist in an industrial association, standing directors and standing supervisors should be elected, and the number of standing directors or standing supervisors should not exceed one third of that of directors or supervisors respectively, a head of directors is to be elected from among standing directors, the head of directors should be elected from among directors if no standing directors are available.

Article 58

In addition to prescriptions stated in chapter 3, the relevant prescriptions in chapter 2 are also applicable to industrial association.

Chapter Ⅳ Supervision

Article 59

If any factory don’t affiliate to the relevant industrial board of trade or the industrial association in due time stipulated in the rules, it should make up membership dues it has escaped since the second month of its establishment when it affiliate to the industrial board or industrial association.
Industrial group holds the responsibility of reporting those factories that don’t join the relevant industrial groups even 6 months after due time to competent authorities to press those factories to affiliate to the relevant industrial group in a limited period.
Those factories that don’t affiliate to the relevant industrial boards of trade or industrial associations should be reported to competent authorities for punishment of compelled shutout after decisions made in meetings of councils
Industrial groups should report those factories that don’t affiliate to the relevant industrial groups in due time in accordance with the Act to competent authorities to press them to join in the relevant industrial groups in a limited period, those that still don’t join in the relevant industrial groups 6 months after due time are to be punished as per prescriptions of Article 63.

Article 60

Those that don’t pay membership fee in accordance with rules are to be punished as per the following procedures:
A. Persuasion for those of 3-month late fee.
B. Warning for those of 6-month late fee and don’t pay membership fee even after persuasion.
C. Outlaw the membership of those of 9-month late fee who have been warned but haven’t paid no response, and the outlawed factories can’t attend any meetings of the industrial groups and can’t enjoy the rights of members.

Article 61

After one year of shutout, if a factory still can’t resume its business, the relevant industrial board of trade or industrial association should report it to competent authorities for check and investigation, and cancel its membership.

Article 62

If directors and supervisors of industrial groups break the rules or commit jobbery when executing their duties, and one tenth of the member representatives put forward the phenomena, and the phenomena of breaking the rules or committing jobbery are testified by two thirds of the representatives present at general meeting where two thirds of the member representatives are in attendance, the rule-breaking and/or jobbery-committing directors and/or supervisors should be punished by competent authorities as per the relevant acts.

Article 63

The reorganization of industrial groups
In any case that an industrial group violates decrees, oversteps the scope its powers or hampers a commonweal affair, the competent authorities should punish it as per the following steps:
A. Warning
B. Nullify its decisions adopted in general meetings..
C. Suspend one or all of its tasks.
D. Depose its directors and supervisors.
E. Command a compulsory shutout for strengthening disciplines.
F. Dissolution of industrial group.
After the dissolution of industrial group, another new industrial group has to be organized immediately.
Authorities of lower level should report the punishment of the above subparagraphs from D to F to upper competent authorities for final approval; the relevant local competent authorities may execute the punishment of the above subparagraphs from A to C.

Article 64

Any industrial group is not allowed to run lucrative business.

Article 65

Any industrial group is not in a position to persuade its members to donate money without decision made at general meeting and approval from competent authorities.

Chapter Ⅴ Supplementary Provisions

Article 66

If national industrial groups cannot convene general meetings normally in the event of fatal national accidents, the absent directors and supervisors are to be filled by member representatives of lower level industrial groups that are able to attend the general meetings with approvals from competent authorities, and relevant prescriptions of Article 23 of the Act apply to the serving term of these new directors and supervisors.

Article 67

Mining industries may organize industrial boards of mining or join in industrial associations in accordance with the Act; the Ministry of the Interior together with the Ministry of Economic Affairs determine the classification of mining industries and the division of organizing districts, and the classification and division are subject to being adjusted when necessary.

Article 68

Industrial groups established before the implementation of the Act shall reshuffle the organizational structure in accordance with the Act after the expiration of serving term of their directors and supervisors.

Article 69

The enforcement rules concerning the implementation of the Act are to be enacted by Ministry of the Interior together with Ministry of Economic Affairs.

Article 70

The act takes effect as of the date of promulgation.
The articles of this law amended on 12nd May of 2009 of the Republic of China take effect on 23rd November of 2009.