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Article 9
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A securities firm operating fund brokerage business shall, in accordance with Article 38-1 of the Regulations Governing Securities Firms, establish a segregated deposit account with a bank for the collection and payment of customer money. The money in that account shall be kept separate and independent from the securities firm's own assets and may not be used for any other purposes.
A securities firm may not utilize the money referred to in the preceding paragraph except for the purpose of making required payments on behalf of its customer.
A securities firm operating fund brokerage business shall sign a trust agreement with the financial institution with which the segregated deposit account is opened, designate the segregated deposit account as the trust account, and engage the financial institution to manage, utilize, and dispose of the funds in the account in accordance with the trust agreement.
A securities firm operating fund brokerage business, if it fails to do as set out in the preceding paragraph, may not accept money from customers.
A securities firm's creditors may not, to satisfy any debt owed by the securities firm with respect to its own property, make any claim or exercise any other right against money obtained by the securities firm for a customer in connection with business.
The trust agreement signed between the securities firm and the financial institution in accordance with paragraph 3 shall stipulate the following:
- The scope of the management and utilization of the trust property shall be limited to investment in funds as defined in Article 2, paragraph 3 herein or other scope of investment/utilization approved by the TPEx or the competent authority.
- When the trustee financial institution makes payments or transfers money in accordance with the instructions of the securities firm, it shall check the trade data of the securities firm's customer.
- The securities firm agrees that the trustee financial institution shall provide data related to the transactions of the dedicated trust account as required by the competent authority or the TPEx to audit the business of the securities firm.
- If the securities firm suspends operations, terminates its operations, reorganizes, is declared bankrupt, dissolves, has its establishment registration or permit canceled, or is otherwise unable to perform matters in connection with the payment of money, the beneficial rights in the trust shall vest in the customer. The trustee financial institution shall then promptly return the trust property to the customer or transfer it to the new trustee financial institution.
- Except as provided in the preceding subparagraph, the beneficial rights in the trust may not be transferred or pledged.
- Other matters as provided by the TPEx or the competent authority.
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Article 13
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A securities firm that operates only fund brokerage business shall, within 3 months after the end of each fiscal year, file with the TPEx and publicly announce its annual financial report audited and attested by CPAs. The auditing and attestation of the aforesaid financial report shall be performed by practicing CPAs of a joint accounting firm approved by the FSC in accordance with the Regulations Governing Approval of Certified Public Accountants to Audit and Attest to the Financial Reports of Public Companies.
The financial reports under the preceding paragraph shall be prepared in accordance with applicable laws and regulations. For matters on which applicable laws and regulations are silent, they shall be prepared in accordance with generally accepted accounting principles.
A securities firm that operates only fund brokerage business shall, by the 7th day of each month, file with the TPEx in the prescribed format its monthly accounting summary and income statement for the preceding month.
The periods for which a securities firm keeps its accounting reports, account books, and accounting documents shall comply with the Business Entity Accounting Act, and additionally shall comply with the Required Periods for Preservation of Accounting Statements and Vouchers by Securities Firms Trading on the TPEx adopted by the Taipei Exchange.
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Article 14
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In the case of a securities firm that operates only fund brokerage business, the total amount of the securities firm's external liabilities may not exceed its net worth.
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Article 15
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In the case of a securities firm that operates only fund brokerage business, its capital may not be loaned to others nor used for other purposes. The utilization of its capital shall be limited to the following:
- Bank deposits.
- Purchase of government bonds or financial bonds.
- Purchase of treasury bills, negotiable certificates of deposit, or commercial paper.
- Other uses approved by the competent authority or the TPEx.
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Article 16
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A securities firm that operates only fund brokerage business may not make any equity investment in any other enterprise and may not be a shareholder of unlimited liability in another company or a partner in a partnership enterprise.
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Article 34
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A securities firm that conducts fund brokerage business is prohibited from itself making price quotations and engaging in trading or exchange of funds.
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Article 39
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If a securities firm is in any of the following circumstances, the TPEx may notify it to make supplementation or correction within a time limit, and in addition may impose a penalty of not more than NT$100,000:
- Violation of Article 5, Article 8, Articles 10 to 12, paragraphs 3 or 4 of Article 13, Article 17, or Articles 22 to 33.
- Failure to provide information to the TPEx, the centralized securities depositary enterprise, or a CPA designated by the TPEx by a deadline set by the TPEx,
- Violation of any other provision of these Rules or other relevant requirements.
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