Chapter 3 Securities Investment Trust Enterprises and Securities Investment Consulting Enterprises |
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11. Securities investment trust enterprises and securities investment consulting enterprises that apply to set up business trial operations in the Zone must meet the following criteria:
(1) When applying for external asset management consulting business trial items, they must comply with Article 6 of the "Regulations Governing the Conduct of Discretionary Investment Business by Securities Investment Trust Enterprises and Securities Investment Consulting Enterprises", and obtain permission from the FSC to provide discretionary investment services. They must also fill out applications for issuance of a new business license in accordance with Article 7 of the same Regulations.
(2) When securities investment trust enterprises and securities investment consulting enterprises apply for the business trial items for multi-channel sales of offshore funds that do not have the nature of a securities investment trust fund, they must meet the qualifications for the master agent specified in the "Regulations Governing Offshore Funds".
(3) Signed a letter of intent on cooperation with the local government of the Zone and obtained a certificate issued by the local government to set up operations in the Zone. |
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12. Customers of business trial items offered by securities investment trust enterprises and securities investment consulting enterprises in a Zone must meet the criteria for high-asset customers specified in the Jin-Guan-Zheng-Tou No. 1130384919 order dated October 25, 2024. |
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13. Securities investment trust enterprises (including securities investment trust enterprises that operate securities investment consulting businesses) may apply for business trial items for the following external asset management consulting services:
(1) For securities, offshore funds (including hedge funds), private equity funds, and other assets (e.g., real estate investments, gold, and minerals) that have not been approved or effectively registered by the FSC, the following services are provided:
i. Accept a customer's appointment to provide investment consulting services.
ii. Accept a customer's appointment to provide securities investment analyses and recommendations, and to execute transactions on the customer's behalf.
iii. Accept a customer's appointment to provide securities investment consulting services with the use of decision-making power.
iv. Accept a customer's appointment to provide securities investment consulting services with the use of decision-making power, and to execute transactions on the customer's behalf.
(2) Provide taxation, risk management, and insurance advisory services. |
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14. Securities investment trust enterprises and securities investment consulting enterprises may apply for a business trial for multi-channel sales of offshore funds that do not have the nature of a securities investment trust fund by signing a mandate contract with a bank or securities firm located in the Zone for the operating unit of the bank or securities firm in the Zone to sell offshore funds that do not have the nature of a securities investment trust fund to high-asset customers. |
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15. Securities investment trust enterprises and securities investment consulting enterprises that apply to set up business trial items in the preceding two points shall submit the following documents, and the provisions in Point 4 of the "Operation Directions of Financial Institutions Applying for Business Trial" do not apply:
(1) The minutes containing board resolutions.
(2) The copy of a letter of intent on cooperation signed with the local government of the Zone and a certificate from the local government for setting up operations in the Zone.
(3) A business plan, which shall include the following information for each of the Zone business trial items:
i. The allocation of personnel, organization, and division of duties between the head office and the Zone operating unit.
ii. The itemized description of the scope of services, operation principles, and evaluation of the expected benefits of the business items in the application for the Zone business trial items.
iii. The management mechanisms and operation guidelines of the Zone operating unit (including the control of the head office or Zone operating unit over the business trial items, customer eligibility criteria, and the management mechanisms and internal control system of the head office for the Zone operating unit).
iv. Protection of customers' rights and interests and dispute handling mechanisms.
v. Mechanisms for handling Zone business trial items after the expiration of the trial period.
vi. Mechanisms and enhancement measures for anti-money laundering and countering the financing of terrorism.
(4) Internal control system for related business trials.
(5) Legal compliance statement.
(6) The head office and the Zone operating unit shall have the capacity and allocation of international asset management service professionals, including the plan to employ domestic and overseas asset management professionals, and propose plan for attending professional asset management training courses organized by the institutions recognized by the competent authority in the next three years.
(7) The required detailed information for each of the Zone business trial items is specified in Appendix 1. |
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16. Securities investment consulting enterprises (including securities investment trust enterprises of securities investment consulting enterprises) may not keep custody of customers' assets when they carry out business trial items in Point 13. In addition, they must enter into an external asset management consulting agreement with the principal, which sets out the rights and obligations between it and the principal arising from the mandate. |
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17. Securities investment trust enterprises and securities investment consulting enterprises applying for Zone business trial items shall comply with Article 3 of the "Regulations Governing Internal Audit and Internal Control System of Anti-Money Laundering and Countering Terrorism Financing of Securities and Futures Business and Other Financial Institutions Designated by the Financial Supervisory Commission". When launching new products or services or engaging in new business practices, they shall assess the money laundering or terrorism financing risks that may arise in relation thereto, and establish relevant risk management measures to mitigate those identified risks. They must also reference the related regulations established by the Securities Investment Trust & Consulting Association of the Republic of China, and establish anti-money laundering and counter terrorism financing mechanisms. |