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Anti-Fraud: Telecom Industry


To block the spread of fraud from its source, the Anti-Fraud Bill mandates that telecom operators must comply with specific obligations within the telecommunications network sector. These obligations include real-name registration, restrictions or suspensions, and entry/exit inspections. Non-compliance will result in fines ranging from approximately NT$100,000 to several million.


What must telecom services platform operators comply with?

Real-name registration for telecom services and database comparison
To align with the upcoming real-name registration for telecom services, the government will designate a database that telecom operators must use to compare user data, in compliance with the Personal Data Protection Act. This real-name registration requires users to apply for telecom services in person or via written authorization. Should users wish to transfer services to others, KYC (Know Your Customer) and registration must be performed again, otherwise telecom services will be restricted or suspended. However, for telecom services used internally by households or enterprises, KYC and registration are not required again.

"Notification and Action" and High-Risk List for Telecom Operators
If a telecom operator receives a notification from judicial or police authorities indicating that a user is suspected of committing fraud through the service, the operator must re-conduct KYC and registration within a specified period. If the user does not cooperate or the data is inconsistent, services should be restricted or suspended. If the notification confirms that the user is indeed engaged in fraudulent activities, services should be immediately restricted or suspended. Other services of the same user must also undergo KYC and registration again. Non-cooperation or inconsistent data will similarly result in restriction or suspension of services. To prevent the misuse of multiple services by fraudulent individuals, users restricted or suspended too many times will be classified as high-risk users, limited to applying for only one set of services or numbers within two years. If an organization (regardless of being a legal entity or not) is found to be applying for multiple services under different names and gets restricted or suspended, the original representative cannot apply for additional services under different organizations.

Restrictions on International Roaming Services and Prepaid Cards
Due to past misuse of international roaming services without real-name registration, this bill requires users to have entry records, and telecom operators must periodically check for exit records to provide international roaming services. Alternatively, users can perform KYC and registration at the counter to apply for international roaming. Although prepaid cards are already registered, there are frequent occurrences of applications using false foreign identities or the misuse of uncompleted prepaid cards by foreign users. Therefore, during the use of prepaid cards by foreign users, telecom agencies must regularly check exit records. If the user exits, prepaid card services must be restricted or suspended.

Telecom Operators’ Immunity for Compliance with Control Measures
Following the legislation of this bill, telecom operators share the burden of preventing fraud crimes. To avoid the dilemma of compliance with law enforcement and confidentiality obligations and to enhance telecom operators' willingness to cooperate, future compliance with anti-fraud measures by telecom operators will exempt them from confidentiality obligations and liabilities for damages to users or third parties. This bill attempts to weaken fraud "channels" through telecom services and considers the conflicts faced by telecom operators in law enforcement compliance, providing a Good Samaritan clause for immunity. This is commendable and suggests increasing preventive measures and technical training for foreign telecom services. Although Article 5 of this bill mentions international cooperation, the form, method, organization, or member composition of such cooperation still requires detailed regulations, and we look forward to future government norms and ideas in this area.




Editor: Doris Lin, Harvey Huang

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