Section II Foreign Securities Firms |
| Article 27 | (deleted)
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| Article 28 | A foreign securities firm which intends to establish branch units within the territory of the Republic of China (ROC), shall meet all of the following qualifications:
- The applicant possesses sufficient international securities business experience and financial health in the business type being applied for.
- The applicant has not been sanctioned administratively by its home country's securities regulatory authorities within the most recent 2 years.
The sufficient international securities business experience referred to in subparagraph 1 of the preceding paragraph requires more than 3 years in the securities business and one of the following criteria:
- Verification of sufficient international securities business experience through the governing institution or other organization of the firm's mother nation, or through any other institution recognized by the FSC.
- Obtaining from a country other than the firm's mother nation a membership or trading qualification of the stock exchange.
- A place of business operation located outside of the firm's mother nation or business operations in overseas markets, such that it has received income from the same type of operations applied for.
The financial health referred to in paragraph 1, subparagraph 1 requires the most recent CPA audited and attested financial report to indicate that the net value of per share is not below its par value.
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| Article 29 | A foreign securities firm applying for the establishment of a branch unit within the territory of the ROC should deposit operating capital which shall not be less than the total amount of the paid-in capital needed to be increased for establishment of a branch unit prescribed by Article 21, and the business bond and the settlement/clearance fund needed to be deposited in accordance with Articles 9 and 10 of the Regulations Governing Securities Firms, Article 6 of the Rules for Dealing with Margin Loans and Stock Loans by Securities Firms and the requirements stipulated by other rules and regulations. However, if applying for the establishment of a branch unit thereafter, the firm shall deposit the business bond and the settlement/clearance fund according to Articles 9 and 10 of the Regulations Governing Securities Firms regarding the procedure for establishing branch units.
A foreign securities firm applying for the establishment of a branch unit shall maintain in the ROC assets which shall not be less than the amount of the special reserve appropriated in accordance with Article 14 of the Regulations Governing Securities Firms, and the amount of the liabilities on the balance sheet of the said branch unit.
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| Article 30 | The provisions of Articles 6 and 8 shall apply mutatis mutandis to the establishment of branch units within the territory of the ROC by foreign securities firms.
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| Article 31 | In filing an application with the FSC for the permit to establish branch units, a foreign securities firm shall submit all of the following documentation:
- The application for establishment of branch units (Annex 10).
- A certified copy of its articles of incorporation or equivalent documentation.
- A business plan which specifies: the principles of business operation; the division of internal organization; the employment of personnel; the description of facilities; and its financial projection for the next 3 years.
- The internal control system required by Article 11.
- The securities business license issued by the securities regulatory agency or an equivalent agency of its home country and the documentation certifying the compliance with the requirements stipulated under Article 28.
- A document issued by the competent securities authority of the home country of the foreign securities firm and its parent company approving its establishment of a branch unit within the territory of the ROC.
- Documentary proof that the parent company of the foreign securities firm has approved its establishment of a branch unit within the territory of the ROC and has made a commitment of financial responsibility regarding the branch unit.
- The list of directors, managers, and shareholders who possess more than five percent of its outstanding shares.
- A certified copy of the minutes of the board of directors meeting at which the resolution to establish branch units in the ROC was made.
- The names, nationalities and domiciles of directors and other responsible persons.
- The names, nationalities and domiciles or residence and the power of attorney of designated agents for litigious and non-litigious matters in the ROC.
- Balance sheets and income statements audited and attested by CPAs for the most recent 3 years.
- The power of attorney designating agents for the purpose of applying to the FSC for establishment of branch units.
- The documentation of identification for the agent for litigious and non-litigious matters in the ROC.
- The documentation affirming the availability to the computer linkage as required under Article 8.
- Other documents that the FSC may so require.
All the aforesaid documentation in foreign language shall be accompanied by a Chinese translation.
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| Article 32 | The establishment registration of a foreign securities firm's branch unit shall be completed within 6 months from the date of the permit issued by the FSC and all of the following documentation shall be submitted to the FSC to apply for a securities business operation license of the said branch unit:
- The application (Annex 11).
- A photocopy of the branch unit establishment registration certificate.
- The list of managers and associated persons with certification of their qualifications.
- The documentation certifying the compliance with Article 6.
- The documentation certifying the deposit of business bond.
- The contract affirming the availability to utilize the computer linkage facilities under Article 8.
- Other documents that the FSC may so require.
The permit for the establishment of a foreign securities firm's branch unit shall be revoked if the applicant fails to apply for the license within the duration prescribed in the preceding paragraph. The duration prescribed in the preceding paragraph may be extended, however, should the said foreign securities firm apply to the FSC, with just cause, prior to the expiration of the duration. Such an extension shall not be more than 6 months and may be applied only once.
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| Article 32-1 | In any of the following circumstances, the FSC may reject an application from a foreign securities firm for establishment of a branch unit:
- Any of the circumstances in Article 53 of the Act applies with respect to a managerial officer of the branch unit.
- Any misrepresentation or falsehood is found in any content or information in the application documents.
- The business plan or the internal control system is not concrete enough, or cannot be implemented effectively.
- Other circumstances under which denial of permission is considered necessary to protect the public interest.
If the application documents submitted under this Chapter are incomplete or otherwise contain incomplete information, and the situation is not corrected within a time limit designated by the FSC, the application documents will be returned.
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| Article 33 | A foreign financial institution, with approval from its home government, may apply to the FSC for the establishment of branch units for the operation of securities business.
The provisions of Articles 6, 8, 11 through 15, 19, 20, 29, 31, 32, and 32-1 shall apply mutatis mutandis to foreign financial institutions, other than FCMs, that apply for their branch units established within the territory of the ROC to concurrently operate securities business.
The provisions of Articles 6, 8, 11 to 15, 16-1, 16-2, 19, 20, 29, 31, 32, and 32-1 shall apply mutatis mutandis to foreign FCMs that apply for their branch units established within the territory of the ROC to concurrently operate securities business.
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| Article 33-1 | A foreign securities firm intending to establish a representative office in the ROC shall meet both of the following qualifications:
- The applicant possesses sufficient experience in international securities business.
- The applicant has not been sanctioned suspension of business or more severe penalty administratively by its home country's securities regulatory authorities within the most recent year.
The sufficient experience in international securities business referred to in subparagraph 1 of the preceding paragraph has the same requirements set in Article 28, subparagraph 2.
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| Article 33-2 | In filing an application with the FSC for the approval to establish a representative office within the territory of the ROC, a foreign securities firm shall submit all of the following documentation:
- Application for the establishment of representative offices.
- The securities business license issued by the securities regulatory agency or its equivalent agency of the home country and documents certifying compliance with the qualification requirements stipulated under Article 33-1.
- A certified copy of its articles of incorporation or equivalent documentation.
- A certified copy of the minutes of the board of directors meeting at which the resolution to establish a representative office in the ROC was made.
- Balance sheets audited and attested by CPAs for the most recent 3 years.
- A certified copy of the power of attorney designating the representative.
- A resume of the authorized representative.
- A certified copy of the power of attorney designating the agent for the purpose of applying to the FSC for establishment of representative office.
- Other documents that the FSC may so require.
All the aforesaid documentation in foreign language shall be accompanied by a Chinese translation.
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| Article 33-3 | For a foreign securities firm approved to establish a representative office within the territory of the ROC, its representative office is prohibited from engaging in the securities business stipulated under Article 15 of the Securities and Exchange Act.
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