The Cabinet has finalized draft amendments to the Company Act (公司法) in what could be its largest revision in a decade, aiming to remove restrictions on management board and employee remuneration, and bolster enforcement of regulations against money laundering.

To clamp down on money laundering, the draft amendment proposes that the nation’s 688,319 companies be required to declare information regarding beneficiaries, including board directors, supervisors, managers and shareholders who hold a more than 10 percent stake in the company.

Companies that fail to do so would be subject fines of up to NT$5 million (US$166,633) or could have their licenses withdrawn, according to the amendments.

The act as it stands does not regulate beneficiaries who control a large share of companies’ assets. The proposed amendments would allow police, banks, accountants and lawyers to review a company’s data.

Board members would be authorized to review a company’s financial and management status and firms that fail to comply would be subject to a fine of NT$240,000 to NT$2.4 million, the proposals said.

The measures are to help the nation prepare for evaluations by the Asia Pacific Group on Money Laundering in November next year.

Meanwhile, the amendments also ease restrictions on board and shareholder meetings to prevent companies from rejecting meeting requests.

Only a company’s chairperson has the power to call board meetings, but the amendments would authorize board members to call meetings with the consent of more than half of board members.

To facilitate shareholder meetings, the amendments would require companies to provide the list of shareholders to company officials who are authorized to convene shareholder meetings, as in practice, some companies might withhold the list to prevent a shareholder meeting from being called.

The amendments would also allow businesses to issue shares in their subsidiaries or parent company to employees to create flexibility in employee remuneration.

Businesses would also be permitted to distribute dividends twice a year, once more than current regulations accomodate.

“The amendments are the largest revision of the Company Act in 10 years, with 150 out of the act’s 449 articles to be modified,” Cabinet deputy spokeswoman Chang Hsiu-chen (張秀禎) said.

The amendments are designed to remove restrictions, create flexibility, improve corporate governance and facilitate digitization and internationalization, Chang said.

The amendments were first proposed by former premier Lin Chuan (林全) and have been discussed for more than a year. They are considered a major piece of legislation by the Democratic Progressive Party administration to improve company management flexibility and transparency.