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Article NO. Content

Title:

Directions for the Conduct of Wealth Management Business by Securities Firms  CH

Amended Date: 2015.01.21 
5     A securities firm applying to conduct the business under point 2, paragraph 1, subparagraph 1 shall meet the following conditions and qualifications, and shall obtain approval from the FSC:
  1. Regulatory capital adequacy ratio: its regulatory capital adequacy ratio reported for the half-year prior to the application date exceeds 150 percent.
  2. Financial position meets any of the following conditions:
    1. Its CPA audited or reviewed financial report for the most recent period shows no accumulated deficit, and its financial position meets the provisions of Articles 13, 14, 16, 18, 18-1 and 19 of the Regulations Governing Securities Firms.
    2. The holding company that directly or indirectly holds 100 percent of the shares of the securities firm provides an unconditional and irrevocable guaranty securing the liabilities of the securities firm.
  3. Legal compliance
    1. Has not, within the past three months, been sanctioned under Article 66, subparagraph 1 of the Securities and Exchange Act or under Article 100, paragraph 1, subparagraph 1 of the Futures Trading Act.
    2. Has not, within the past six months, been sanctioned under Article 66, subparagraph 2 of the Securities and Exchange Act or under Article 100, paragraph 1, subparagraph 2 of the Futures Trading Act.
    3. Has not, within the past one year, had a sanction imposed by the FSC to suspend its business.
    4. Has not, within the past two years, had a sanction imposed by the FSC to void any part of its business permit.
    5. Has not, within the past one year, had a sanction of suspended or restricted trading imposed on it by the Taiwan Stock Exchange Corporation (TWSE), Taipei Exchange (TPEx), or Taiwan Futures Exchange (TAIFEX), under the operating rules or bylaws thereof.
  4. Has established a legal compliance unit and a person in charge thereof pursuant to the Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in Securities and Futures Markets (hereinafter "Regulations Governing Internal Control").
    After a securities firm has been approved by the FSC to conduct the aforementioned business, if its regulatory capital adequacy ratio is non-compliant with the requirement of the preceding paragraph for two consecutive months, the securities firm shall suspend the aforementioned business. It may resume such business only after the regulatory capital adequacy ratio has met the requirement for three consecutive months and approval has been filed for and granted by the FSC.
    A securities firm that fails to meet the compliance requirements in subparagraph (3) of paragraph 1 may be exempted from restriction under that subparagraph if has already corrected the infraction and provide specific documentary proof thereof.
    An ROC branch of a foreign securities firm applying to conduct business under paragraph 1 shall comply with paragraph 1, subparagraphs 3 and 4, and the regulatory capital adequacy ratio, financial position, and the long-term credit rating of its head office shall comply respectively with subparagraphs 1 and 2 of paragraph 1, and Attachment 2.