Section I Domestic Branch Offices |
| Article 19 | A securities firm established under these Standards may apply for the establishment of a branch office or a simple branch office upon the completion of 1 year of operation. Such restriction does not apply, however, to the establishment of a branch office or a simple branch office as a result of merger or transfer. |
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| Article 20 | A securities firm applying for the establishment of a branch office or a simple branch office shall meet all of the following requirements:
1. The applicant's most recent CPA audited and attested financial report indicates that the net worth per share exceeds its par value and its financial condition complies with the standards under Article 49 of the Act. However, the requirement of net worth per share exceeding par value shall not apply to a securities firm that establishes additional branch offices or simple branch offices owing to merger, or acquisition of other securities firms.
2. The applicant has not been sanctioned by the FSC with a warning under Article 66, subparagraph 1 of the Act within the most recent 3 months.
3. The applicant has not been sanctioned by the FSC with an order under Article 66, subparagraph 2 of the Act to dismiss any of its directors, supervisors, or managerial officers or with replacement of its responsible person or other related personnel under Article 100, paragraph 1, subparagraph 2 of the Futures Trading Act within the most recent half year.
4. The applicant has not been sanctioned by the FSC with suspension of operations within the most recent year.
5. The applicant has not been sanctioned by the FSC with voidance of permission for any part of its business within the most recent 2 years.
6. The applicant has not been sanctioned with suspension or restriction of trading by the TWSE, TPEx, or TAIFEX pursuant to its rules or bylaws within the most recent 1 year.
7. The regulatory capital adequacy ratio of the securities firm is not lower than 150 percent.
If a securities firm does not meet a requirement set forth in any of subparagraphs 2 to 6 of the preceding paragraph, but has shown concrete improvement in the circumstances, and the FSC has recognized the improvement, the securities firm may be exempted from the relevant requirement.
For securities firms that establish additional branch offices or simple branch offices owing to merger or acquisition of the entire business, assets, or facilities of other securities firms under the approval of the FSC, the requirements of subparagraphs 2, 3, and 7 of paragraph 1 shall not apply. |
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| Article 20-1 | A securities firm applying for conversion of a branch office into a simple branch office shall meet the requirements of subparagraphs 6 and 7 of paragraph 1 of the preceding article.
If a securities firm does not meet the requirement set forth in subparagraph 6 of paragraph 1 of the preceding paragraph, but has shown concrete improvement in the circumstances, and the FSC has recognized the improvement, the securities firm may be exempted from the relevant requirement. |
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| Article 21 | For each branch office or simple branch office that a securities firm establishes, the minimum paid-in capital of the firm shall increase by NT$30 million. However, for conversion of a securities firm branch office into a simple branch office, no increase in minimum paid-in capital is required. |
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| Article 22 | The standards of the business site and facilities required under Article 6 shall apply mutatis mutandis to branch offices or simple branch offices of securities firms.
Prior to filing an application with the FSC for permission for a branch office of a securities firm to operate brokerage business on the centralized exchange market, consent for computer linkage shall be obtained from the stock exchange centralized exchange market and the securities central depository enterprise.
Prior to filing an application with the FSC for permission for a branch office of a securities firm to operate brokerage business on the over-the-counter market, consent for computer linkage for its securities trading information shall be obtained from the TPEx. |
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| Article 23 | To establish a branch office, a securities firm shall submit all of the following documentation in an application to the FSC:
1. The application for establishment of a branch office (Annex 8).
2. Articles of incorporation or document equivalent to articles of incorporation.
3. Business plan: specify the principles of business operation of the branch office; internal organization and division of labor; personnel recruitment; overview of the site and facilities; and financial forecasts for the next 3 years.
4. Meeting minutes of the board of directors (or board of governors).
5. Internal control system required under Article 11 (including that of the branch office).
6. Documentation affirming the availability of the computer linkage as required under Article 22, paragraph 2 or 3.
7. Other documents as required by the FSC. |
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| Article 23-1 | To establish a simple branch office, a securities firm shall submit all of the following documentation in an application to the FSC for permission:
1. The application for establishment of a simple branch office (Annex 8-1).
2. Articles of incorporation or document equivalent to articles of incorporation.
3. Business plan: specify the principles of business operation of the simple branch office; internal organization and division of labor; personnel recruitment; overview of the site and facilities; and financial forecast for the next 3 years.
4. Meeting minutes of the board of directors (or board of governors).
5. Internal control system required under Article 11 (including the simple branch office).
6. Other documents as required by the FSC.
For conversion of a branch office into a simple branch office, the provisions of subparagraph 2 and subparagraphs 4 to 6 of the preceding paragraph shall apply, and the securities firm shall submit the following documentation in an application to the FSC for permission:
1. The application for conversion into a simple branch office (Annex 8-2).
2. Conversion business plan: specify the reasons for conversion (including an analysis of the operating condition of the existing branch office(s)), handling of the rights and interests of existing customers or alternative service methods, etc., and the principles of business operation of the simple branch office; internal organization and division of labor; personnel recruitment; overview of the site and facilities; and financial forecasts for the next 3 years.
3. Employee placement plan. |
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| Article 24 | Within 6 months after the permission has been granted for establishment of a branch office, the securities firm shall complete the incorporation registration of the branch office and submit all of the following documentation to the FSC to apply for issuance of the business license of the branch office:
1. The application for establishment of the branch office (Annex 9).
2. Photocopy of the branch office incorporation registration certificate.
3. List of managerial officers and associated persons with certification of their qualifications.
4. Documentation certifying compliance with Article 6.
5. Documentation certifying the deposit of the operation bond.
6. Contract affirming the availability to utilize the computer linkage facilities under Article 22, paragraph 2 or 3.
7. Other documents as required by the FSC.
The permit for the establishment of a branch office shall be voided if the applicant fails to apply for the license within the period prescribed in the preceding paragraph. The period prescribed in the preceding paragraph may be extended, however, if the securities firm applies to the FSC, with good cause, prior to the expiration of the period. Such an extension shall not exceed 6 months and may be granted only once. |
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| Article 24-1 | Within 6 months after the permission has been granted for establishment of a simple branch office or conversion of a branch office into a simple branch office, the securities firm shall complete the incorporation registration of the simple branch office and submit all of the following documentation to the FSC to apply for issuance of the business license of the simple branch office:
1. The application for establishment of the simple branch office (Annex 9-1).
2. Photocopy of the simple branch office incorporation or amendment registration certificate.
3. List of managerial officers and associated persons with certification of their qualifications.
4. Documentation certifying compliance with Article 6.
5. Documentation certifying the deposit of the operation bond.
6. Other documents as required by the FSC.
The permit for a simple branch office shall be voided if the applicant fails to apply for the license within the period prescribed in the preceding paragraph. The period prescribed in the preceding paragraph may be extended, however, if the securities firm applies to the FSC, with good cause, prior to the expiration of the period. Such an extension shall not exceed 6 months and may be granted only once. |
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| Article 24-2 | In each fiscal year, the total number of simplified branch offices that a securities firm applies to establish, counted in combination with branch offices to be converted to simplified branch offices, shall not exceed three. |
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| Article 24-3 | The business items that a simple branch office of a securities firm may handle are limited to the following:
1. Wealth management business.
2. Business solicitation and account opening preparatory operations for securities brokerage business.
3. Other business as approved by the FSC.
A securities firm simple branch office conducting wealth management business shall do so in accordance with the provisions regarding branch offices in the Directions for the Conduct of Wealth Management Business by Securities Firms. |
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| Article 25 | The provisions of Article 19 through 24 shall apply mutatis mutandis to a financial institutions that concurrently operates securities business and applies for concurrent operation of securities business by a branch office. The provisions of Articles 20, Article 23, subparagraphs 1, 2, 4 to 7, and Article 24, paragraph 1, subparagraphs 1 to 3 and 5 to 7 and paragraph 2 of these Standards shall apply mutatis mutandis to a financial institution that only applies to conduct proprietary trade in government bonds at its branch office. The financial institution shall assign a full time associated person to deal with such business. |
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