Important Measure Sep 2023
2023-11-15
Important Measure September 2023
1. Restrictions Eased on the Sub-Delegation of Securities Investment Trust Fund Overseas Investment Business Delegated to Appointed Management Institutions
In response to the operational demands of securities investment trust enterprises (SITEs) and taking as reference the regulations of other jurisdictions internationally, the Financial Supervisory Commission (FSC) on 13 September 2023 issued an order easing restrictions on the sub-delegation of securities investment trust fund overseas investment business delegated to appointed management institutions. With the exception of investment analysis and investment decision-making, which still may not be sub-delegated, an appointed management institution may sub-delegate to a third party any other matters delegated to it, subject to agreement by the SITE and compliance with the laws and regulations of the jurisdiction in which the appointed management institution operates and the requirements of the competent authority of that jurisdiction. The FSC order also sets forth related supporting measures, including matters required to be specified in the authorization contract between the SITE and the appointed management institution, the requirement that the appointed management institution explain its related control measures and provide related data or reports to the SITE, and the requirement that the SITE add related supervision and management procedures to its internal control system.
2. FSC Issues Guiding Directions for the Administration of Virtual Asset Platform or Transaction Service Providers (VASP)
In March 2023, the Executive Yuan designated the Financial Supervisory Commission (FSC) to serve as the competent authority for virtual asset platforms with financial investment or payment properties. In response, the FSC, on 26 September 2023, issued the Guiding Directions for the Administration of Virtual Asset Platform or Transaction Service Providers (VASP) (the "Guiding Directions"). Taking international supervisory trends into reference, the FSC formulated the Guiding Directions based on the provisions of the Money Laundering Control Act and in the spirit of enhancing self-regulation by VASPs. The Guiding Directions enhance the protections that VASPs provide to customers in terms of transparency of transaction information, the methods for custody of customer assets, VASP internal controls and management, and assistance from external experts.
Following the issuance of the Guiding Directions, VASPs will be required to establish an industry association and adopt self-regulatory rules in compliance with the Guiding Directions. These measures will guide VASPs to strengthen their internal controls and further strengthen and enhance protections for the rights and interests of customers.
3. FSC Issues Order Under Article 24, Paragraph 4 of the Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in Securities and Futures Markets
In tandem with the policies set out in the FinTech Development Roadmap 2.0, to promote the digitization of information reporting by financial institutions, the FSC on 20 September 2023 issued an order under Article 24, paragraph 4 of the Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in Securities and Futures Markets. Under the order, securities firms that are not public companies must publicly announce and report their Statement on Internal Control through the Market Observation Post System (MOPS) but are not required to further submit the written materials to the FSC for recordation.
1. Restrictions Eased on the Sub-Delegation of Securities Investment Trust Fund Overseas Investment Business Delegated to Appointed Management Institutions
In response to the operational demands of securities investment trust enterprises (SITEs) and taking as reference the regulations of other jurisdictions internationally, the Financial Supervisory Commission (FSC) on 13 September 2023 issued an order easing restrictions on the sub-delegation of securities investment trust fund overseas investment business delegated to appointed management institutions. With the exception of investment analysis and investment decision-making, which still may not be sub-delegated, an appointed management institution may sub-delegate to a third party any other matters delegated to it, subject to agreement by the SITE and compliance with the laws and regulations of the jurisdiction in which the appointed management institution operates and the requirements of the competent authority of that jurisdiction. The FSC order also sets forth related supporting measures, including matters required to be specified in the authorization contract between the SITE and the appointed management institution, the requirement that the appointed management institution explain its related control measures and provide related data or reports to the SITE, and the requirement that the SITE add related supervision and management procedures to its internal control system.
2. FSC Issues Guiding Directions for the Administration of Virtual Asset Platform or Transaction Service Providers (VASP)
In March 2023, the Executive Yuan designated the Financial Supervisory Commission (FSC) to serve as the competent authority for virtual asset platforms with financial investment or payment properties. In response, the FSC, on 26 September 2023, issued the Guiding Directions for the Administration of Virtual Asset Platform or Transaction Service Providers (VASP) (the "Guiding Directions"). Taking international supervisory trends into reference, the FSC formulated the Guiding Directions based on the provisions of the Money Laundering Control Act and in the spirit of enhancing self-regulation by VASPs. The Guiding Directions enhance the protections that VASPs provide to customers in terms of transparency of transaction information, the methods for custody of customer assets, VASP internal controls and management, and assistance from external experts.
Following the issuance of the Guiding Directions, VASPs will be required to establish an industry association and adopt self-regulatory rules in compliance with the Guiding Directions. These measures will guide VASPs to strengthen their internal controls and further strengthen and enhance protections for the rights and interests of customers.
3. FSC Issues Order Under Article 24, Paragraph 4 of the Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in Securities and Futures Markets
In tandem with the policies set out in the FinTech Development Roadmap 2.0, to promote the digitization of information reporting by financial institutions, the FSC on 20 September 2023 issued an order under Article 24, paragraph 4 of the Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in Securities and Futures Markets. Under the order, securities firms that are not public companies must publicly announce and report their Statement on Internal Control through the Market Observation Post System (MOPS) but are not required to further submit the written materials to the FSC for recordation.
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Update：
2023-11-15