1.    FSC amends the Regulations Governing Establishment of Internal Control Systems by Public Companies and the Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in Securities and Futures Markets
In view of the growing international concern for environmental, social and governance (ESG) and other sustainable development issues, and in line with Taiwan's measures to promote enhanced disclosure of sustainability information in annual reports and the compilation of sustainability reports by Taiwan Stock Exchange (TWSE)-listed and Taipei Exchange (TPEx)-listed companies, the Financial Supervisory Commission (FSC) on 22 April 2024 issued amendments to certain articles of the Regulations Governing Establishment of Internal Control Systems by Public Companies and to Articles 8, 14, and 39 of the Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in Securities and Futures Markets. The amendments expressly require TWSE-listed and TPEx-listed companies as well as service enterprises in securities and futures markets to incorporate the management of sustainability information into their internal control systems and to designate it a mandatory audit item. The amendments will come into force from 1 January 2025.
2.    In response to the continued growth of ETFs, the FSC has collaborated with relevant parties to strengthen ETF oversight measures, with the aim of protecting investor rights
To address the impact of ETF growth on the capital market, the FSC, along with TWSE, TPEx, and the Securities Investment Trust & Consulting Association (SITCA), has strengthened ETF supervision measures for advertising and marketing activities, as well as market risk management for ETFs, with the aim of protecting investor rights. These measures include: with regard to marketing activities, reviewing marketing documents during the offering period and regulating the cooperation with internet celebrities; with regard to issuance, adding risk reminder to ETFs with high-yield-related names and conducting an assessment of the concentration of individual stocks within ETF portfolios; and with regard to trading, the FSC overseeing the TWSE and TPEx to regularly assess ETF portfolios and establish a transaction database.
3.    FSC amends the Incentive Policy for Onshore Funds to encourage the balanced development of products and strategies by SITEs
To encourage securities investment trust enterprises (SITEs) to enhance their asset management talent and technologies, expand the scale of assets under management, and move towards internationalization, the FSC on 30 April 2024 issued amendments to the Incentive Policy for Onshore Funds. Considering that the development of actively managed funds is more conducive to the enhancement of the investment and research capabilities of asset management professionals in Taiwan, and that recent years have seen a surge in the development and size of passively managed funds, the amendments are aimed at encouraging SITEs to pursue the balanced development of products and strategies and actively upgrade their investment and research capabilities. To this end, the amendments adjust relevant performance evaluation indicators to make actively managed funds the basis for measuring performance and exclude passively managed funds from those calculations.