1.“Virtual Currencies With the Nature of Securities” Categorized as “Securities” Stipulated by Securities and Exchange Act
To cater to market practitioners’ increasingly needs to raise funds by ICOs belong to “Securities”, the FSC issued an order on 3rd July 2019, stipulating that the virtual currencies with the nature of investments, and liquidity shall be categorized as “Securities” defined by Article 6 of the Securities and Exchange Act.
As defined as aforementioned FSC order, “virtual currencies with the nature of securities” means those that use cryptography and distributed ledger technology or other similar technologies to represent value that can be digitally stored, exchanged, or transferred, as well as possessing the characteristics as below:
（1）Funding is contributed by contributors.
（2）The funding is contributed to a common enterprise or project.
（3）The contributors expect to receive profits.
（4）The profits derived primarily from the efforts of the issuer or a third party/third parties.
2.Adoption of a Rule Requiring Termination of a Futures Trust Deed after FSC Approval when the Net Asset Value per Unit of its Exchange-Traded Futures Trust Fund Falls below a Certain Standard
Pursuant to Article 83, paragraph 2, subparagraph 3 of the Regulations Governing Futures Trust Funds, the FSC issued an order on 26 July 2019 stipulating the delisting rules for exchange-traded futures trust funds (“futures ETFs”). This rule requires that a futures ETF shall obtain the FSC’s approval to delist when its average net asset value (NAV) per unit of 3 consecutive business days is less than its issue price, so as to protect investors interests from the failure of price quotation mechanism due to a low NAV per unit.
3.Amendments to the Regulations Governing Futures Trust Funds, Allowing Effective Registration for Futures Trust Funds
To comply with the amendments to the Futures Trading Act promulgated on 16 January 2019, allowing futures trust enterprises to use the system of filing for effective registration for offerings of futures trust funds, the FSC issued an amendment to the Regulations Governing Futures Trust Funds on 1 July 2019. The amendment specifies that the effective registration is used for follow-on offerings of futures trust funds, and also specifies the period for the effective registration, the required documents to submit, and the circumstances where the case will be suspended, voided, revoked, or rejected.
4.To Honor Outperformed Securities Firms in the Area of Treating Customers Fairly in 2019
To encourage financial service enterprises to value and implement the Treating Customers Fairly (TCF) Principles and to help enterprises get a better picture of how they are doing in implementing the Principles, the FSC launched an assessment program on the principles for Financial Service Enterprises to Treat Customers Fairly Principles Assessment Program since 2019. The assessees in the first year included banks, insurance companies, and integrated securities firms. The assessment results were published in June 2019, featuring the top 20% of enterprises for each industry. As to securities firms, the top ones include CTBC Securities, E.SUN Securities, Taiwan Cooperative Securities, Mega Securities, Fubon Securities, and KGI Securities.
To commend the outperformed securities firms, on 16 August 2019, the FSC held the 2019 Securities Firms’ Liaison and Recognition Meeting for the Treating Customers Fairly Principles Assessment Program. FSC Chairman Wellington Koo hosted the meeting and presented awards to the winners. At the meeting, the FSC delivered a presentation on achievements and deficiencies identified during the assessments and provided recommendations as well. The award-winning securities firms were also invited to share their experiences in implementing TCF policies, to enable securities firms to learn from each other and strengthen their practices for protecting financial consumers’ interests.