Article Content
Chapter 1 General Provisions
| Article 1 | These Regulations are enacted pursuant to Paragraph 2, Article 28 of the Trust Enterprise Act (the "Act"). |
| Article 2 | The term "management and utilization of collective investment trust funds" as used in these Regulations shall mean a trust enterprise being entrusted with a money trust, and in accordance with the provisions of a trust agreement and with the consent of the trustor, pooling, managing and utilizing the trust monies together with trust monies from other trustors having the same scope or method of operations with the establishment of a collective investment trust account.
The term "collective investment trust account" ("collective trust account") as used in these Regulations shall mean an account set up by a trust enterprise for purposes of collective management and utilization of trust monies having the same scope or method of operations.
The term "beneficiary rights to a collective trust account" as used in these Regulations shall mean the entitlement of a beneficiary to the proceeds of a collective trust account established by a trust enterprise after the trustor entrusts the trust enterprise with his/her funds for collective management and utilization, which are recorded by the trust enterprise by book-entry.
The term "beneficiary"as used in these Regulations shall mean a beneficiary entitled to beneficiary rights in accordance with the ratio of beneficiary rights held in a collective trust account.
The provisions of Paragraph 3 and Paragraph 4, Article 3 of the Regulations Governing Offshore Structured Products shall apply to the terms "professional investor" and "non-professional investor" as used in these Regulations. |
| Article 3 | A trust enterprisethat meets the requirements set out in Article 4 and Subparagraphs 1~3, Article 5 of the Regulations Governing the Scope of Business, Restrictions on Transfer of Beneficiary Rights, Risk Disclosure, Marketing, and Conclusion of Contract by Trust Enterprises may establish a collective trust account; where the collective trust account is denominated in foreign currency, the trust enterprise shall obtain the consent of the Central Bank of the Republic of China (Taiwan) ("Central Bank").
Prior to establishing a collective trust account that accepts funds from non-professional investors, a trust enterprise shall submit the following documentation to the Trust Association of the ROC (the "Trust Association") for review, which, together with the review opinions, will be forwarded by the Trust Association to the competent authority for approval:
1. A management and utilization plan for the collective trust account;
2. Risk level of the collective trust account and risk tolerance categories of investors who will findthe account's risk level acceptable;
3. The terms and conditions of the collective trust account agreement (the "terms and conditions"), and a comparison table showing the differences between the terms and conditions and the template drafted by the Trust Association;
4. The name list and experience of the personnel managing and operating the collective trust account;
5. Where the terms and conditions provide for trust supervisors, the name list, experience and acceptance letter of trust supervisors;
6. Meeting minutes of the board of directors; and
7. Other documents as required by the competent authority.
After its application mentioned in the preceding paragraph has been approved, a trust enterprise shall establish a collective trust account and commence the acceptance of trust monies within 6 months from the date of service of the approval letter. A trust enterprise with legitimate reasons for not being able to do so within the 6-month period may apply to the competent authority for an extension, which may not be longer than 6 months and shall be granted only once.
Where a trust enterprise fails to establish a collective trust account and commence the acceptance of trust monies within the time period set out in the preceding paragraph, the competent authority may void the approval.
When a trust enterprise establishes a collective trust account that accepts funds from professional investors only, the trust enterprise shall submit the documentation specified in Subparagraph 1, Subparagraph 3 (terms and conditions), and Subparagraphs 4 ~ 7 of Paragraph 2 hereof to the competent authority for recordation in 5 business days from the day the trust monies have been deposited into the account.
Unless it is otherwise provided by the competent authority, the participation in and withdrawal from a foreign currency denominated collective trust account and the payment of related fees shall be effected in the foreign currency designated by the trust enterprise, and the trust enterprise may not change the denominated currency at will after designation.
Where any payment relating to a collective trust account involves inward or outward remittance of funds, relevant rules of the Central Bank shall be followed. |
| Article 4 | For collective trust accounts set up by an offshore securities unit (OSU) established pursuant to Article 22-3 of the Offshore Banking Act that accepts funds only from individuals, juristic persons, government agencies or financial institutionsoutside the Republic of China, the provisions of these Regulationsdo not apply to the following matters, provided the head office of the OSU has been approved by or registered with the competent authority to establish collective trust accounts:
1. The types and scope of trust assets under management, utilization and disposal;
2. Qualification requirements for professional investors;
3. The establishment of a collective trust account requiring the review and/or approval of or recordation with the Trust Association or the competent authority; and
4. Undertaking of roadshow, advertising, business solicitation and promotional activities. |