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Regulations Governing Responsible Persons and Associated Persons of Securities Firms(2006.07.26) |
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Article 2
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The term "responsible person" as used in these Regulations shall be defined in accordance with Article 8 of the Company Law.
The term "associated persons" as used in these Regulations means persons who engage in the following businesses for a securities firm:
1.investment analysis of securities, internal auditing or accounting;
2.the undertaking of the underwriting and trading of securities;
3.the dealing, settlement, clearing of securities, or agency for stock registrar and transfer services;
4.the account opening, credit search, solicitation, receiving consignment, filing, settlement, clearing of the trading of securities or the receipt, payment, and safekeeping of cash and stocks;
5.providing margin purchases or short sales for securities transactions;
6.risk management or operation of derivative financial products;
7. conducting other approved business.
The responsible person and associated persons of the overseas branch of a securities firm shall abide by the local laws and regulations governing securities in the country where they carry out their operations. With the exception of Article 12, Article 13, and Article 18, paragraph 1, these Regulations shall not apply.
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Article 3
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Associated persons of securities firms are classified into the following two categories in accordance with the complexity and responsibility of their duties:
1.Senior agent: the person who engages in the management of a department or is the responsible person of branch of a securities firm, or investment analysis or internal auditing as described in Paragraph 1 of Article 8.
2.Agent: the person who engages in the underwriting, dealing or consigned trading of securities or engaged in internal auditing or accounting.
Only the person who is trained and certified by the internal auditor training program held by an institution accredited by the Financial Supervisory Commission under the Executive Yuan (hereinafter "the Commission") can engage in the internal auditing as provided in Item 2 of the preceding Paragraph.
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Article 8
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Except for securities firms concurrently operated by a financial institution, in which the managers of the internal auditing departments and financial departments may follow separate provisions set out by this Commission, the managers of departments engaged in underwriting, trading on the firm's own accounts, consigned trading, clearing and settlement, internal auditing, stock registrar and transfer services, and financial affairs, as well as the responsible persons of branch units serving as managers of consigned trading and clearing and settlement departments, shall possess the qualifications of a senior agent.
With the exception of the responsible person and the managers of the finance and stock registrar and transfer departments, managers of departments engaged in underwriting, trading on their own accounts, consigned trading, clearing and settlement, and internal auditing at a foreign securities firm's branch unit within the ROC shall possess the qualifications of a senior agent.
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Article 10
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Managers of departments as set forth in Article 8, paragraph 1, and the assistant general managers, deputy assistant general managers, and managers of those departments, or who supervise those departments, and the responsible persons of securities firms' branch units shall possess one of the following qualifications:
1. Graduate of a local or foreign junior college recognized by the Ministry of Education, or an equivalent or higher degree, with three or more years of business work experience in securities, futures, finance, or insurance, with a good performance record.
2. Four years or more of work experience at a securities institution, with a good performance record.
3. Other academic or work qualifications demonstrating possession of professional knowledge of securities and operations and management experience that would enable sound and effective management of securities firm business.
For a branch unit of a foreign securities firm within the ROC, managers of departments that engage in underwriting, trading on its own accounts, consigned trading, clearing and settlement, and internal auditing shall possess the qualifications set forth in the preceding paragraph.
The provisions of paragraph 1 shall be applied mutatis mutandis for positions that are equivalent to assistant general manager, assistant, or manager under other laws or the articles of incorporation of a securities firm.
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Article 11
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For those who, prior to the amendment of these Regulations, were already serving as the general manager of a securities firm or as department manager or responsible person of the branch unit of a securities firm as set forth under Article 8, paragraph 1, may continue to serve in their original position or for the duration of their original term, and will not be subject to the restrictions of the two preceding articles.
Where, following the amendment of these Regulations, a person is promoted or assigned to one of the positions referred to in the preceding paragraph, they shall possess or be in conformance with the qualifications set forth in these Regulations; those who do not meet those qualifications shall be dismissed.
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Article 11-1
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A responsible person of a securities firm may not serve as a responsible person of a bank, financial holding company, trust company, credit cooperative, credit department of a farmers' (fishermen's) association, bills finance company, futures enterprise, insurance enterprise, or another securities enterprise. However, this restriction shall not apply in the following circumstances:
1. Where it is for purposes of an investment relationship between the securities firm and such institutions, and there is no overlapping of the chairmen and/or officers thereof.
2. Where it is for purposes of conducting a merger or consolidation, and this Commission has granted approval, the responsible person may serve as the chairman of such a finance-related enterprise.
3. Where a securities firm is a subsidiary of a financial holding company, the responsible person of the securities firm may serve as the responsible person of such financial holding company or of another of its subsidiaries; provided, that there may not be overlapping of officers between the subsidiaries.
4. Where a securities firm is a juristic-person director or supervisor of a financial holding company, its responsible person, for purposes of serving as a responsible person of that holding company, may concurrently serve as a director or supervisor of a subsidiary of that holding company.
Where for purposes of an investment relationship between a securities firm and a non-financial institution, and there is no overlapping of the chairmen and/or officers thereof, a responsible person of the securities firm may concurrently serve as a director or supervisor of such an investee company.
Any concurrent holding of positions by a responsible person of a securities firm shall be limited to the scope necessary for ensuring the effective execution of the responsible person's duties as such and duties in the concurrently held position, and for maintaining the business operations of the securities firm; it may not involve any conflict of interest or violation of securities regulations or the internal control system, and the rights and interests of shareholders shall be protected.
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Article 11-2
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A responsible person of a securities firm, or a spouse thereof, who serves as a director, supervisor, or officer, or is a shareholder holding 5 percent or more of the total issued shares, of a public company, may not participate in any policy decision-making of the securities firm in the course of any operations relating to that public company.
The calculation of shares held by a person referred to in the preceding paragraph shall include shares held under the names of the person's spouse and minor children, and those held under the names of any other persons.
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