August 16, 2004
The recently promulgated Securities Investment Trust and Consulting Act recently and integrates and revises a number of existing regulations to strengthen the internationalization and efficiency of Taiwan’s securities market.
Key points of the Act include:
-- The competent authority is authorized to expand the types of funds that securities investment trust companies may raise in Taiwan, whether publicly or privately-raised.
-- The Act stipulates that the products from securities and investment trust firms may include derivative securities and other items approved by the competent authority. This allows more flexibility for securities investment trust and consulting companies in their operations and management of investment portfolios.
-- A private subscription system has been introduced so that investment firms may respond to special requests from individual investors by purchasing privately issued securities investment trust funds.
-- Sales of overseas funds in Taiwan -- issued by outstanding foreign asset management institutions through public or private subscription or through an agency or consultancy services -- are placed under reasonable controls to protect the interests of domestic investors and to allow domestic and overseas funds to compete on an equal basis.
-- Securities investment trust companies are allowed to operate securities investment consulting companies, and vice versa; the two types of companies are also allowed to operate other enterprises. Securities houses and related enterprises are also permitted to operate securities investment trust and securities investment consulting companies.
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