| Chapter 4 Standards of Practice for Collective Trust Fund Business |
Section 6 Termination of Collective Trust Fund and Modification of Collective Trust Fund Agreement |
| Article 39 |
When it is necessary to modify a collective trust fund agreement for reasons other than regulatory change, a trust enterprise shall obtain the consent of a majority of the trust supervisors or the adoption of a resolution at a beneficiaries' meeting, and submit the minutes of the trust supervisors meeting or beneficiaries' meeting, a comparison table of the agreement clauses before and after the change, and the reasons for change in a letter to the Trust Association, which shall forward them in a report to the competent authority for approval.
After the circumstance described in the preceding paragraph has been approved by the competent authority, the trust enterprise shall immediately make public announcement in a manner prescribed in Article 39 of the Act for a certain time period for the beneficiaries to decide whether to continue to participate in or withdraw from the collective trust fund. |
| Article 40 |
The reasons for terminating a collective trust fund shall be as stipulated in the agreement, except as otherwise specified by laws or regulations. However the competent authority may order the termination of a collective trust fund if it deems the termination of the fund is advisable in the public interest or the interests of the beneficiaries.
Notice of the termination of a collective trust fund for reasons other than expiration shall be sent to the Trust Association, which shall forward it in a report to the competent authority for approval. After approval, the trust enterprise shall make public announcement in a manner prescribed in Article 39 of the Act within 2 business days from the date of service of the approval letter.
Where a collective trust fund is terminated due to expiration as mentioned in the preceding paragraph, the trust enterprise shall report it to the competent authority for recordation within 2 business days after the expiration date. |
| Article 41 |
When a collective trust fund is terminated, the trust enterprise shall complete liquidation of the collective trust fund within 3 months from the approval by or recordation with the competent authority. The trust assets after liquidation shall be distributed to respective beneficiaries based on the proportion of beneficiary rights.
A trust enterprise shall report the liquidation and distribution methods in the preceding paragraph to the competent authority and publicly announce it, and notify the beneficiaries; within 2 months after the date upon which the liquidation procedures are concluded, the trust enterprise shall notify the competent authority by letter of the results thereof for recordation, and notify the beneficiaries.
With regard to the circumstances in the preceding two paragraphs, the trust enterprise shall first obtain the approval of the trust supervisors before reporting to the competent authority by letter for approval or recordation. |