Important Measure June 2021
2021-08-10
1. Amendments to the Incentive Policy for Onshore Funds to Provide Incentive for Securities Investment Trust Enterprises to Participate in the Policy
To encourage participation by small and medium-sized securities investment trust enterprises ("SITEs") and to increase the competitiveness of Taiwan's asset management sector, the Financial Supervisory Commission (FSC), on June 11, 2021, amended the Incentive Policy for Onshore Funds. The amendment allows SITEs whose average size of assets under management in the last fiscal year ranked in the bottom three-quarters (small and medium-sized SITEs), if they meet the relaxed requirements for the evaluation indicators, to enjoy preferential measures offered under the Policy. These include being allowed to apply for issuance of securities investment trust funds that are not subject to the regulatory limits on the types, scope, and percentage of their securities investment, and being allowed to apply for issuance of ETF feeder funds that may invest in the ETFs already managed by the SITE and without limiting such investment to the ETFs with domestic component securities. These amendments will facilitate small and medium-sized SITES' development of innovative niche funds and will promote the diversification of fund products to satisfy investor demand.
2. Implementing the Stock Market Making Mechanisms
In order to invigorate the stock market trading volume and boost the tradability of high-quality low-liquidity stocks, the FSC has overseen the launch of the Stock Market Making Mechanisms by the Taiwan Stock Exchange (TWSE) and the Taipei Exchange (TPEx) for TWSE/TPEx listed stocks. The Stock Market Making Mechanisms formally came online on June 30, 2021. To meet practical operational needs of market makers, the FSC issued three orders on June 4, 2021, exempting market makers from certain restrictions, including exemption from the intraday limit on the sale of borrowed securities which is currently set at 30% of the average daily trading volume of any individual security for the past 30 business days, and exemption from the restriction that borrowed securities may not be sold at a price lower than the closing price of the preceding business day.
3. The FSC Issued Order Regarding the Checkinglists of the Financial Reports and the Index of Financial Reports
In resoponse to the recent amendment to the Regulations Governing the Preparation of Financial Reports by Securities Issuers, the primary exchange listed foreign companies (KY companies) shall announce audited instead of review second quarter financial reports starting from 2021, and to promote listed companies to publish unaudited self-assessed annual information under the “Corporate Governance 3.0- Sustainable Development Roadmap”, on 2 June 2021 the FSC published ordinance regarding checkinglist of the annual and quarterly financial reports, and rescinded Order No. Financial-Supervisory- Securities-Auditing-1080302723 issued on 14 February 2019.
To encourage participation by small and medium-sized securities investment trust enterprises ("SITEs") and to increase the competitiveness of Taiwan's asset management sector, the Financial Supervisory Commission (FSC), on June 11, 2021, amended the Incentive Policy for Onshore Funds. The amendment allows SITEs whose average size of assets under management in the last fiscal year ranked in the bottom three-quarters (small and medium-sized SITEs), if they meet the relaxed requirements for the evaluation indicators, to enjoy preferential measures offered under the Policy. These include being allowed to apply for issuance of securities investment trust funds that are not subject to the regulatory limits on the types, scope, and percentage of their securities investment, and being allowed to apply for issuance of ETF feeder funds that may invest in the ETFs already managed by the SITE and without limiting such investment to the ETFs with domestic component securities. These amendments will facilitate small and medium-sized SITES' development of innovative niche funds and will promote the diversification of fund products to satisfy investor demand.
2. Implementing the Stock Market Making Mechanisms
In order to invigorate the stock market trading volume and boost the tradability of high-quality low-liquidity stocks, the FSC has overseen the launch of the Stock Market Making Mechanisms by the Taiwan Stock Exchange (TWSE) and the Taipei Exchange (TPEx) for TWSE/TPEx listed stocks. The Stock Market Making Mechanisms formally came online on June 30, 2021. To meet practical operational needs of market makers, the FSC issued three orders on June 4, 2021, exempting market makers from certain restrictions, including exemption from the intraday limit on the sale of borrowed securities which is currently set at 30% of the average daily trading volume of any individual security for the past 30 business days, and exemption from the restriction that borrowed securities may not be sold at a price lower than the closing price of the preceding business day.
3. The FSC Issued Order Regarding the Checkinglists of the Financial Reports and the Index of Financial Reports
In resoponse to the recent amendment to the Regulations Governing the Preparation of Financial Reports by Securities Issuers, the primary exchange listed foreign companies (KY companies) shall announce audited instead of review second quarter financial reports starting from 2021, and to promote listed companies to publish unaudited self-assessed annual information under the “Corporate Governance 3.0- Sustainable Development Roadmap”, on 2 June 2021 the FSC published ordinance regarding checkinglist of the annual and quarterly financial reports, and rescinded Order No. Financial-Supervisory- Securities-Auditing-1080302723 issued on 14 February 2019.
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2021-08-10