A Taiwan-area securities firm that meets the conditions of each of the following subparagraphs may apply to the competent authority for permission for equity investment by the securities firm itself or a third-region subsidiary in a securities company, securities investment fund management company, or futures company in the Mainland Area:
1. The net worth of the firm stated in the financial report for the most recent period, audited and attested or reviewed by a CPA, is greater than NT$7 billion along with a net worth per share no lower than par value.
2. The firm during the preceding 3 months has received no disposition pursuant to Article 66, subparagraph 1 of the Securities and Exchange Act, Article 103, subparagraph 1 of the Securities Investment Trust and Consulting Act, Article 100, subparagraph 1 of the Futures Trading Act, or three or more orders for corrective action or improvement within a specified deadline as prescribed in Article 44 of the Trust Enterprise Act.
3. The firm has received no disposition in the preceding half year pursuant to Article 66, subparagraph 2 of the Securities and Exchange Act, Article 103, subparagraphs 2 and 3 of the Securities Investment Trust and Consulting Act, Article 100, subparagraph 2 of the Futures Trading Act, or Article 44, subparagraph 1 of the Trust Enterprise Act.
4. The firm has received no disposition in the preceding year pursuant to Article 66, subparagraph 3 of the Securities and Exchange Act, Article 103, subparagraph 4 of the Securities Investment Trust and Consulting Act, Article 100, subparagraph 3 of the Futures Trading Act, or Article 44, subparagraph 2 of the Trust Enterprise Act.
5. The firm has received no disposition in the preceding 2 years pursuant to Article 66, subparagraph 4 of the Securities and Exchange Act, Article 103, subparagraph 5 of the Securities Investment Trust and Consulting Act, Article 100, subparagraph 4 of the Futures Trading Act, or Article 44, subparagraph 3 of the Trust Enterprise Act.
6. The firm has received no disposition within the preceding year pursuant to the articles of incorporation of the Taiwan Stock Exchange, the Taipei Exchange, the Taiwan Futures Exchange , or a futures clearing house requiring it to suspend or restrict trading activities.
7. The firm had a regulatory capital adequacy ratio above 200 percent for the preceding 3 months. However, this requirement does not apply if special-case approval has been obtained due to special needs.
A Taiwan-area securities firm that does not meet the conditions of subparagraphs 2 through 6 of the preceding paragraph but that has made concrete improvement in the circumstances of its non-compliance and has received approval from the competent authority is not subject to the restrictions of those subparagraphs.

A Taiwan-area SITE that meets the conditions of each of the following subparagraphs may apply to the competent authority for permission for equity investment by the SITE itself or a third-region subsidiary in a Mainland-area securities investment fund management company:
1. The SITE has a net worth per share no lower than par value as stated in the financial report for the most recent period, audited and attested or reviewed by a CPA.
2. The SITE has during the preceding 3 months received no disposition pursuant to Article 103, subparagraph 1 of the Securities Investment Trust and Consulting Act, Article 100, subparagraph 1 of the Futures Trading Act, or three or more orders for corrective action or improvement within a specified deadline as prescribed in Article 44 of the Trust Enterprise Act.
3. The SITE has received no disposition during the preceding half year pursuant to Article 103, subparagraphs 2 or 3 of the Securities Investment Trust and Consulting Act, Article 100, subparagraph 2 of the Futures Trading Act, or Article 44, subparagraph 1 of the Trust Enterprise Act.
4. The SITE has received no disposition during the preceding year pursuant to Article 103, subparagraph 4 of the Securities Investment Trust and Consulting Act, Article 100, subparagraph 3 of the Futures Trading Act, or Article 44, subparagraph 2 of the Trust Enterprise Act.
5. The SITE has received no disposition during the preceding 2 years pursuant to Article 103, subparagraph 5 of the Securities Investment Trust and Consulting Act, Article 100, subparagraph 4 of the Futures Trading Act, or Article 44, subparagraph 3 of the Trust Enterprise Act.
A Taiwan Area SITE that does not meet the conditions of subparagraphs 1 through 4 of the preceding paragraph but that has made concrete improvement in the circumstances of its non-compliance and has received approval from the competent authority is not subject to the provisions of those subparagraphs.

A Taiwan-area FCM that meets the conditions of each of the following subparagraphs may apply to the competent authority for permission for the FCM itself or a third-region subsidiary to make equity investment in a Mainland-area futures company:
1. The FCM has a net worth per share no lower than par value as stated in the CPA audited and attested or CPA reviewed financial report for the most recent period.
2. The FCM has received no disposition during the preceding 3 months pursuant to Article 66, subparagraph 1 of the Securities and Exchange Act, Article 103, subparagraph 1 of the Securities Investment Trust and Consulting Act, or Article 100, subparagraph 1 of the Futures Trading Act.
3. The FCM has received no disposition during the preceding half year pursuant to Article 66, subparagraph 2 of the Securities and Exchange Act, Article 103, subparagraphs 2 and 3 of the Securities Investment Trust and Consulting Act, or Article 100, subparagraph 2 of the Futures Trading Act.
4. The FCM has received no disposition during the preceding year pursuant to Article 66, subparagraph 3 of the Securities and Exchange Act, Article 103, subparagraph 4 of the Securities Investment Trust and Consulting Act, or Article 100, subparagraph 3 of the Futures Trading Act.
5. The FCM has received no disposition during the preceding 2 years pursuant to Article 66, subparagraph 4 of the Securities and Exchange Act, Article 103, subparagraph 5 of the Securities Investment Trust and Consulting Act, or Article 100, subparagraph 4 of the Futures Trading Act.
6. The FCM has received no disposition during the preceding year pursuant to the bylaws of the Taiwan Stock Exchange, the Taipei Exchange, the Taiwan Futures Exchange, or a futures clearing house requiring it to suspend or restrict its trading activities.
7. The FCM had average adjusted net capital for the preceding 3 months of not less than 40 percent of the total amount of margin deposits required for futures traders' open positions.
A Taiwan-region FCM that does not meet the conditions of subparagraphs 2 through 6 of the preceding paragraph but that has made concrete improvement in the circumstances of its non-compliance and has received approval from the competent authority will not be subject to the provisions of those subparagraphs.

A Taiwan-area securities firm applying for permission for equity investment pursuant to Article 16 shall submit the following documents, except as otherwise provided by the competent authority:
1. An application form.
2. An investment proposal setting out the following matters:
A. The investment plan: to include the strategic purpose of the investment, expected benefits, funding sources, a utilization plan, operating plan, and capital recovery plan.
B. Business management principles: to include the location of the company, its capitalization, the lines of business and business items it engages in, and a business management strategy.
C. The investee company's shareholder structure, organizational structure, division of duties, and personnel staffing.
D. A financial assessment of the investee company for the upcoming 3 years.
E. Risk assessment: Assessment of operating risks and a concrete risk management plan.
3. Minutes of the relevant directors meeting.
4. A financial report for the most recent period, audited and attested or reviewed by a CPA.
5. A list of domestic and foreign investee enterprises as of the date of application.
6. Equity investment agreement documents: To include documentary evidence of the ability to obtain investee company financial and operational information and to carry out the strategic objectives of investment.
7. Other data or documents to be submitted pursuant to regulations of the competent authority.

A Taiwan-area securities firm or a third-region subsidiary may only submit an application in the Mainland Area for equity investment after receiving permission from the competent authority pursuant to Article 16. When there is a change in the planned investment amount or shareholding ratio, it shall submit the relevant information and report to the competent authority for permission.
The Taiwan-area securities firm, after receiving permission from the Mainland Area's competent authority for securities and futures, shall immediately notify the competent authority, and shall submit the following information to the competent authority for recordation:
1. The letter of approval from the competent securities and futures authority of the Mainland Area.
2. The amount of investment, the subject investee company, and its shareholder structure.
When a Taiwan-area securities firm or a third-region subsidiary makes a transfer of its equity holdings in a Mainland-area securities or futures institution, the Taiwan-area securities firm shall submit the relevant information to the competent authority for recordation prior to the transfer.

When a Taiwan-area securities firm or a third-region subsidiary increases the amount of its equity investment in a Mainland-area securities or futures institution, the Taiwan-area securities firm shall submit required documentation and apply to the competent authority for permission in accordance with Article 19.

When any of the following circumstances apply to a Mainland-area securities or futures institution in which a Taiwan-area securities firm or third-regions subsidiary has made equity investment, the Taiwan-area securities firm shall report the reasons to the competent authority along with relevant documentation:
1. A change in principal areas of business or operating policies.
2. A change in the original shareholding ratio of the Taiwan-area securities firm or its third-region subsidiary.
3. Any material re-investment.
4. Dissolution or suspension of operations.
5. A change in the institution's name.
6. A merger with, or assignment of all or a major part of assets or business to or from, another financial institution.
7. A reorganization, liquidation, or bankruptcy.
8. The occurrence or foreseeable occurrence of material losses.
9. An instance of material violation of the law or the voidance or revocation of the business permission by the Mainland Area's competent authority for securities and futures.
10. Other matters of a material nature.
The circumstances under subparagraphs 1 to 7 of the preceding paragraph shall be reported to the competent authority in advance. The circumstances under subparagraphs 8 to 10 shall be reported within 3 business days from the day on which the Taiwan-area securities firm becomes aware of the circumstance or on which the circumstance occurs.

When a Taiwan-area securities firm or third-region subsidiary has made equity investment after receiving permission from the competent authority, it shall undertake the following matters except when otherwise provided by the competent authority:
1. Submission to the competent authority, within 15 days after the end of each quarter, of an operations report on the Mainland-area securities or futures institution (to include status of operations, revenues and expenditures, and a benefit assessment).
2. Submission, along with the monthly accounting summary, of a report on the operational status of the Mainland-area securities or futures institution.
3. Reporting of basic company information on the Mainland-area securities or futures institution through the competent authority's designated information-reporting system.
4. Other information or documentation to be submitted pursuant to the regulations of the competent authority.

The provisions of Articles 19 through the preceding article apply mutatis mutandis to SITEs and FCMs.