June 2017
A securities firm withdrawing from the bond market in mainland China or facing penalties by its competent authority is required to report within five business days upon occurrence of the fact(Taiwan)
2017.4.5
Oli Wong
The Financial Supervisory Commission promulgated, via the Jin-Guan-Zheng-Quan-Zi 1060008569 Directive of April 5, 2017 (hereinafter, the "Directive"), the amendment to Article 4, Paragraph 1, Subparagraph 6 of the Regulations Governing Securities Firms concerning the requirements for relevant reporting by a securities firm on its application to a mainland China competent authority for becoming a QFII and on investment in the interbank bond market in mainland China. The Directive specifically requires that a securities firm withdrawing from the bond market in mainland China or facing penalties by its competent authority is required to issue a letter to the Taiwan Securities Association within five business days upon occurrence of the fact.
The Directive provides that the following matters shall be reported by a securities firm:
1. If the securities firm has applied to become a qualified foreign institutional investor (QFII) in mainland China to invest in securities in stock markets in mainland China and is subject to any of the following matters:
(1) Such securities firm has applied to a mainland China authority to become a qualified institutional investor or to seek investment quota recordation or approval; or
(2) Such securities firm has been recorded with or approved or ejected by a mainland China securities or foreign exchange authority or has voluntarily withdrawn its application; or
(3) The qualification approval granted to the securities firm has been revoked or cancelled by a mainland China securities or foreign exchange authority or the investment quota of the securities firm has been recalled or revoked; or
(4) The securities firm has been penalized by a mainland China securities or foreign exchange authority.
2. If a securities firm has registered with a mainland China authority for investment in the interbank bond market in mainland China, has recorded with a mainland China authority, has changed the amount of its intended investment, has withdrawn from the interbank bond market in mainland China or has been penalized by a mainland China authority.
In addition, the Directive also requires a securities firm to report to the Taiwan Securities Association its position and amount of Renminbi-denominated securities on a monthly basis to safeguard investors' rights and interests.
Oli Wong
The Financial Supervisory Commission promulgated, via the Jin-Guan-Zheng-Quan-Zi 1060008569 Directive of April 5, 2017 (hereinafter, the "Directive"), the amendment to Article 4, Paragraph 1, Subparagraph 6 of the Regulations Governing Securities Firms concerning the requirements for relevant reporting by a securities firm on its application to a mainland China competent authority for becoming a QFII and on investment in the interbank bond market in mainland China. The Directive specifically requires that a securities firm withdrawing from the bond market in mainland China or facing penalties by its competent authority is required to issue a letter to the Taiwan Securities Association within five business days upon occurrence of the fact.
The Directive provides that the following matters shall be reported by a securities firm:
1. If the securities firm has applied to become a qualified foreign institutional investor (QFII) in mainland China to invest in securities in stock markets in mainland China and is subject to any of the following matters:
(1) Such securities firm has applied to a mainland China authority to become a qualified institutional investor or to seek investment quota recordation or approval; or
(2) Such securities firm has been recorded with or approved or ejected by a mainland China securities or foreign exchange authority or has voluntarily withdrawn its application; or
(3) The qualification approval granted to the securities firm has been revoked or cancelled by a mainland China securities or foreign exchange authority or the investment quota of the securities firm has been recalled or revoked; or
(4) The securities firm has been penalized by a mainland China securities or foreign exchange authority.
2. If a securities firm has registered with a mainland China authority for investment in the interbank bond market in mainland China, has recorded with a mainland China authority, has changed the amount of its intended investment, has withdrawn from the interbank bond market in mainland China or has been penalized by a mainland China authority.
In addition, the Directive also requires a securities firm to report to the Taiwan Securities Association its position and amount of Renminbi-denominated securities on a monthly basis to safeguard investors' rights and interests.
