These Regulations are adopted pursuant to Article 11, paragraph 4, Article 14, paragraph 1, Article 17, paragraph 3, Article 18, paragraph 1, Article 19, Article 22, paragraph 4, Article 25, paragraph 2, and Article 46 of the Securities Investment Trust and Consulting Act.

Except where the Financial Supervisory Commission (FSC) provides otherwise, a securities investment trust agreement shall stipulate the following matters:
1.The name and address of the securities investment trust enterprise (SITE) and the custodian institution.
2.The name and duration of the securities investment trust fund ("the fund").
3.The rights, obligations, and legal liability of the SITE.
4.The rights, obligations, and legal liability of the fund's custodian institution.
5.The rights, obligations, and legal liability of the beneficiary.
6.The basic governing policies and the scope of utilization of the fund for securities investment and trading in securities-related products.
7.Fund income distribution.
8.Redemption of certificates of beneficial interest.
9.The fees borne by the fund.
10.The management or custodial fees of the SITE and the custodian institution.
11.Calculation of the net asset value of beneficiary units and the fund as a whole.
12.Termination of the securities investment fund agreement.
13.The reasons for convening beneficiaries' meetings; the required quorum; the votes required for passage of a measure; and the means of adopting resolutions.
A trust enterprise that concurrently operates securities investment trust business may itself keep custody of fund assets pursuant to FSC approval; where the trust enterprise also has a trust supervisor, the matters to be stipulated under subparagraph 4 of the preceding paragraph shall also include the rights, obligations, and legal liability of the trust supervisor.
A template for the securities investment trust agreement shall be adopted by the Securities Investment Trust and Consulting Association of the R.O.C. (SITCA) in consultation with the Trust Association of the R.O.C. ("the Trust Association") and submitted to the FSC for approval.

As it deems appropriate due to market conditions, the FSC may place limits on fees for requests by beneficiaries for purchase or redemption of beneficiary interest certificates, management or custodial fees collected by a trust enterprise or custodian institution, and the fees borne by a fund.

In managing a fund to invest or trade, a SITE shall base its decisions on its analysis; it shall keep records of its execution thereof, and shall also submit a review on a monthly basis. Its analysis and decisions shall be founded on reasonable grounds and bases.
The SITE shall include the analysis, decisions, execution, and review referred to in the preceding paragraph in the internal control system, and faithfully implement the system.
The SITE shall keep records of the control activities under the preceding paragraph, and shall preserve them for not less than 5 years.

A SITE shall have the power to direct utilization of fund assets. The SITE shall implement such utilization itself, and except where the FSC provides otherwise, may not authorize a third party for same. A SITE shall have the power to direct the custodian institution of a fund in the custody, disposal, and receipt and payment of fund assets, and may also inspect and inventory fund assets on an irregular basis.
Except where law or regulations otherwise provide, when a SITE uses a fund to invest in market- or OTC-listed securities, it shall authorize a securities broker to undertake the transaction on the centralized securities market or an OTC market on a cash-on-delivery basis.
A SITE using a fund to invest in government bonds, corporate bonds, or financial bonds shall do so on a cash-on-delivery basis.
A SITE investing assets held by a fund shall register the transaction under the name of the custodian institution's dedicated fund account, provided that where the fund holds foreign securities or securities-related products, the transaction may take place in accordance with agreements between the custodian institution and the foreign trustee custodian institution.

The custodian institution of a fund shall utilize fund assets in accordance with the SITE's directions and shall exercise the rights associated with those assets.
The custodian institution of a fund may only undertake the following dispositions of fund assets at the direction of a SITE:
1.Adjusting the fund's investment portfolio as investment strategy requires.
2.Making adjustments to the margin account or paying premiums.
3.Paying the fees borne by the fund as stipulated in the trust agreement.
4.Paying distributable income to beneficiaries of the fund as stipulated in the trust agreement.
5.Paying the redemption price to beneficiaries for redemption of their certificates of beneficial interest.

A SITE using a fund for overseas investment may authorize a company providing it with consulting services for overseas investment or a member of its own group that provides centralized market trading services to place a trading order on its behalf through a foreign securities firm, futures commission merchant, or other trading counterparty.
When SITE authorizes a company providing it with consulting services for overseas investment or a member of its own group that provides centralized market trading services to place a trading order on its behalf through a foreign securities firm, futures commission merchant, or other trading counterparty, it shall adopt risk monitoring and management measures for such transactions as a part of its internal control system, as well as setting out the standards for selection of a company to provide consulting services for overseas investment; those measures and standards shall be submitted to the board of directors for approval.
The term "member of its own group" as used in the preceding paragraph shall mean a holding company to which the SITE belongs which has shareholdings in the SITE in excess of 50 percent; a subsidiary in which the SITE has shareholdings in excess of 50 percent; or a subsidiary belonging to the same holding company in which the holding company has shareholdings in excess of 50 percent.