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Provisions Concerning Qualification Requirements and Procedures for Trust Enterprises Applying Under the Trust Enterprise Act, Article 18, Forepart of Paragraph 1, to Concurrently Operate Securities Investment Trust and Consulting Business
1 February 2005
Letter Ref. Jin-Kuan-Yin-(IV)-0944000037
Financial Supervisory Commission, Executive Yuan
Subject: The Financial Supervisory Commission (FSC) hereby sets out provisions concerning qualification requirements and application procedures for trust enterprises applying under the Trust Enterprise Act, Article 18, forepart of paragraph 1, to concurrently operate securities investment trust and consulting business. Please be advised and notify all Trust Association members.
Statement:
1.Under the Standards Governing the Establishment of Securities Investment Trust Enterprises and the Standards Governing the Establishment of Securities Investment Consulting Enterprises, trust enterprises are allowed to apply for "concurrent operation of securities investment trust business," "concurrent operation of securities investment consulting business," "concurrent operation of mandate-type discretionary investment business," and "concurrent operation of trust-type discretionary investment business."
2.The forepart of paragraph 1 of Article 18 of the Trust Enterprise Act provides that "each type of business to be conducted by a trust enterprise shall be separately subject to the approval of the Competent Authority." On this basis, the FSC hereby prescribes the following qualification requirements for trust enterprises applying to the FSC under the Trust Enterprise Act, Article 18, forepart of paragraph 1, for approval to concurrently operate the aforesaid four types of business:
(1) The trust enterprise's credit rating satisfies the requirements of Order Ref. Tai-Tsai-Rong-(IV)-0924000965 (Standards for the Credit Rating That a Trust Enterprise Must Hold in Order to Offer and Issue Collective Trust Funds and to Establish Trust Fund Collective Management and Operation Accounts), issued on 30 October 2003 by the Ministry of Finance.
(2) There has been no serious instance in which the trust enterprise has violated a trust-related act or regulation or the self-regulatory rules of the Trust Association of R.O.C. ("the Association") or failed to take corrective action after receiving a reprimand from the Association.
(3) Where the trust enterprise applies for "concurrent operation of a securities investment trust business" or "concurrent operation of a trust-type discretionary investment business," it shall also obtain a "money trust" business permit.
3.A trust enterprise that meets the above-stated qualification requirements is entitled under the applicable provisions of the Securities Investment Trust and Consulting Act to apply to the FSC for a permit, attaching a declaration stating that it meets the qualification requirements stated above. In order to register, within six months from the date on which it receives the permit from the FSC, the trust enterprise shall assemble the documents required in Article 22 of the Standards Governing the Establishment of Securities Investment Trust Enterprises or Article 19 and Article 22 of the Standards Governing the Establishment of Securities Investment Consulting Enterprises, and shall be in compliance with the requirement that the CPA-audited and attested financial report for the preceding period shall show a net worth per share not lower than par value, and shall have this verified by the general manager and a compliance officer before it may proceed with registration. Where the trust enterprise fails to register within the aforesaid period, the FSC may revoke its permit for the concurrent business operation, provided that where there is a legitimate reason the enterprise may apply to the FSC before the period expires for a three-month extension. No more than one extension will be granted.
4.The Letter Ref. Tai-Tsai-Rong-(IV)-90725253 announced by the MOF on 5 January 2001 and the Letter Ref. Tai-Rong-Jyu-(IV)-0924000563 announced by the Bureau of Monetary Affairs, MOF on 2 July 2003 cease to apply. |