Securities enterprises that have obtained the qualification to engage in proprietary trading of domestic bonds may also engage in proprietary trading of foreign currency denominated international bonds without making an application.

Securities enterprises that have obtained the qualification to underwrite domestic bonds may also offer financial planning, evaluation and consulting services relating to foreign currency denominated international bonds in accordance with the following rules without making an application:
1.The securities enterprise may not engage in underwriting on a firm commitment basis or a standby commitment basis;
2.The securities enterprise may not be involved in receipt/payment between the issuer and the investors.
3.The securities enterprise may not report the commencement of underwriting foreign currency denominated international bonds business by offering financial planning, evaluation and consulting services relating to foreign currency denominated international bonds.

A securities enterprise that intends to engage in the underwriting of foreign currency denominated international bonds shall apply to the Bank for approval by submitting documents provided in Article 7 herein and documents evidencing its qualifications as specified below:
1.Having the qualification to underwrite domestic securities.
2.Meeting one of the criteria below:
(1)Having a long-term credit rating of BBB (or equivalent) or higher for the latest year from a credit rating agency approved or recognized by the FSC or an internationally known credit rating agency; or
(2)For a branch of a foreign securities firm in Taiwan, its head office has practical experience in underwriting foreign securities.
3. The regulatory capital adequacy ratio shall meet one of the following requirements:
(1)For domestic securities firms, the regulatory capital adequacy ratio in the six months before the date of application shall be at least 200%; for banks and bills finance companies engaging concurrently in securities business, the regulatory capital adequacy ratio shall reach the statutory ratio;
(2)For branches of foreign securities firms in Taiwan, their head office shall meet the criteria provided in the preceding item or Paragraph 3, Article 59 of the “Regulations Governing Securities Firms”.
4. Free of any of the following sanctions:
(1)Any sanction imposed by the FSC during the preceding one year acting pursuant to any of Subparagraphs 2 ~ 4, Article 66 of the “Securities and Exchange Act”; and
(2)Any sanction during the preceding one year whereby the TPEx, acting pursuant to its operating rules or bylaws, has suspended or restricted the firm's trading privileges.
5. No accumulated loss as shown in its latest CPA audited or certified financial statements.

When a securities enterprise engages in the underwriting of a foreign currency denominated international bond, receipt/payment between the enterprise and the investors/issuer shall always be made in the denominated currency of the international bond.

A securities enterprise that has obtained the qualification to engage in proprietary trading of domestic bonds may also engage in proprietary trading of foreign securities without making an application. However if such trading is neither an investment of proprietary funds nor done to meet hedging purposes, the securities enterprise shall apply to the Bank for approval by submitting documents provided in Article 7 herein and photocopies of the latest CPA audited or certified financial statements, procedures for handling receipt/payment, process description and other documents required by the Bank.

When a securities enterprise engages in business mentioned in the preceding article, related receipt/payment shall always be made in the denominated currency of the security.

The business scope of call (put) warrant issued by securities enterprises involving foreign exchange (hereinafter referred to as “offshore or foreign currency warrant business”) includes the following:
1.For domestic call (put) warrants involving foreign securities or indices of foreign securities markets, the scope of the underlying shall conform to relevant regulations stipulated by the FSC.
2.For offshore call (put) warrants involving domestic securities or indices, the scope of the underlying shall be limited to domestic stocks or baskets of stocks, domestic exchange traded securities investment trust funds, offshore ETFs, and Taiwan depositary receipts.

A securities enterprise that intends to engage in offshore or foreign currency warrant business shall apply to the Bank for approval by submitting documents provided in Article 7 herein, and in addition, documents specified below:
1.Qualification certificates issued by the FSC and the competent authority in the place where the offshore warrants will trade; and
2.Business plan (including product profiles, operational guidelines and risk management).

A securities enterprise that intends to accept orders to trade foreign securities for the first time shall apply to the Bank for approval by submitting documents provided in Article 7 herein, and in addition, a business plan (including operational principles and business practice, procedures of receipt/payment handling and operating process).
When a securities enterprise already approved by the Bank to accept orders to trade foreign securities with receipt/payment of settlement and fees in foreign currency intends to engage in receipt/payment in NTD, the securities enterprise shall apply to the Bank for approval with the following documents：
1. A photocopy of the Bank’s letter of approval for the securities enterprise to accept orders to trade foreign securities with receipt/payment of settlement and fees in foreign currency;
2. A photocopy of letter of approval from the FSC;
3. A statement supporting that the applicant’s computer system is able to meet the requirements set out in Article 28 herein regarding receipt/payment in different currencies; and
4. A description of the controls for receipt/payment of settlement and fees in different currencies. When A DSF that accepts orders to trade foreign securities with receipt/payment settled in foreign currency intends to keep the customer’s settlement funds in a segregated foreign currency account opened with the authorized bank (hereinafter referred to as "customer’s foreign currency account"), the DSF shall first apply to the Taiwan Stock Exchange (hereinafter referred to as “TWSE”) for approval and then report to the Bank for record by submitting a description of operations (including the operating process of receipt/payment handling and the foreign exchange settlement against NTD in the customer’s foreign currency account) one week before the date of commencement. The DSF shall forthwith inform the Bank when the customer’s foreign currency account is suspended or reinstated.

A securities enterprise that accepts orders to trade foreign securities shall comply with the following rules with regard to receipt/payment of settlement and fees with customers:
1. When a customer designates the settlement to be made in a foreign currency, the related receipt/payment shall be made in the foreign currency; and
2. When a customer designates the settlement to be made in NTD, the related receipt/payment shall be made in NTD.
A DSF that keeps the customer’s settlement funds in the customer’s foreign currency account shall comply with the following rules regarding the scope of the customer’s foreign currency account, transfer or payment of funds, and declaration of the foreign exchange settlement against NTD：
1. Funds retained in the customer’s foreign currency account are limited to the settlement amount, fees and related distributable dividends and interest after executing the order to sell/buy foreign securities.
2. Funds deposited in the customer’s foreign currency account shall only be transfered through the following means：
(1) To be paid for the settlement amount in foreign currency in connection with the securities business with the DSF.
(2) To be transferred, in accordance with the customer's instructions, to the customer's personal subaccount of the DSF’s other custodial account set up according to the FSC’s relevant regulations, or to the customer's personal bank deposit account agreed upon in advance between the DSF and the customer.
3. A DSF handling the foreign exchange settlement against NTD or the conversion between foreign currencies shall comply with the provisions of Article 53 herein and assist the customer to declare the settlement in the name of the customer.

A securities enterprise that intends to trade foreign bonds as an agent shall apply to the Bank for approval by submitting documents provided in Article 7 herein, and in addition, a business plan (including business profile, operating process and risk management).

When a securities enterprise trades foreign bonds as an agent, payment shall be remitted by the buyer directly into an account designated by the foreign financial institution. The receipt/payment for investment, redemption, and settlement, fees charged by the foreign financial institution and other fees shall be made in foreign currency.

When a securities enterprise intends to act as a participating dealer for an offshore exchange traded fund (hereinafter referred to as “ETF”) to process (on a brokerage basis) or engage in (on a proprietary basis) purchase or redemption of an offshore ETF in Taiwan (hereinafter referred to as “offshore ETF participating dealer business), the securities enterprise shall apply to the Bank for approval or report to the Bank for record by submitting the following documents before commencing the business:
1.When acting as a participating dealer of an offshore ETF for the first time, the securities enterprise shall apply to the Bank for approval by submitting documents provided in Article 7 herein, and in addition, documents evidencing approval from or completing effective registration with the FSC for the ETF and a business plan (including business profile, operating process, receipt/payment procedure, and hedging arrangements).
2.When the securities enterprise subsequently intends to act as a participating dealer for another offshore ETF, it only needs to report to the Bank for record before commencement by submitting documents evidencing approval from or completing effective registration with the FSC for that ETF.

When a securities enterprise engages in Offshore ETF Participating Dealer Business, receipt/payment between the participating dealer and investors shall always be made in the denominated currency of that offshore ETF as listed on the centralized securities exchange market.

A securities enterprise that intends to act as a participating dealer for a domestically issued foreign currency denominated ETF to process (on a brokerage basis) or engage in (on a proprietary basis) purchase or redemption of foreign currency denominated ETFs shall apply to the Bank for approval or report to the Bank for record by submitting the following documents before commencement：
1. When acting as a participating dealer for a domestically issued foreign currency denominated ETF for the first time, the securities enterprise shall apply to the Bank for approval by submitting documents provided in Article 7 herein, and in addition, the following documents：
(1) Qualification approval letter from TWSE;
(2) Participation contract of the foreign currency denominated ETF; and
(3) A business plan (including the business profile, foreign exchange settlement matters involved in the planning for the foreign currency funds, and hedging arrangements).
2. When the securities enterprise subsequently intends to act as a participating dealer for another domestically issued foreign currency denominated ETF, it shall report to the Bank for record before commencement by submitting the documents provided in Items (1) and (2) of the preceding paragraph.

For a securities enterprise to act as a liquidity provider for a domestically issued foreign currency denominated ETF, the provisions of the preceding article shall apply mutatis mutandis to the procedure and documentation required for applying for the business. Notwithstanding the foregoing, the documents provided in Item (2), Subparagraph 1 of the preceding article shall be substituted with the liquidity contract on the domestically issued foreign currency denominated ETF.

Securities enterprises that have obtained the qualification to engage in proprietary trading of securities or to accept orders to trade securities on the centralized securities exchange market may also engage in proprietary or broker trading of foreign currency denominated ETFs without making an application.
When engaging in the business mentioned in the preceding paragraph, a securities enterprise shall comply with the following rules:
1.Receipt/payment between the securities enterprise and investors regarding the purchase and sale of a foreign currency denominated ETF shall be made in the denominated currency of that ETF.
2.A foreign currency denominated ETF may not be an underlying product in margin purchase and short sales, securities borrowing and lending, borrowing or lending money in connection with securities business, or borrowing or lending money without specific purposes by securities firms, and other relevant businesses.
3.NTD denominated ETF positions acquired through margin purchase or borrowing may not be converted into foreign currency denominated ETFs.
4.When the trading order of an investor to buy a foreign currency denominated ETF fails to be executed and if the securities broker has collected payments from the investor in advance, the securities broker shall return the advance payments no later than the next business day following the trading day.
5.When an investor’s amount receivable is greater than the amount payable on the same settlement day, the securities enterprise may sign an intra-day overdraft contract with the settlement bank to facilitate timely settlement with the investor.
6.In the case of out-trade, an investor default on a sale, or an overseas Chinese or foreign investor requesting a delay in settlement, the securities enterprise may apply to TWSE for borrowing securities to cover the settlement.

A securities enterprise that intends to act as the master agent of an offshore fund institution in the offering and sale of its funds in Taiwan (hereinafter referred to as the “offshore fund master agency business”) shall apply to the Bank for approval by submitting documents provided in Article 7 herein, and in addition, the following documents:
1.A photocopy of document evidencing the approval from or effective registration with the FSC for offering and sale of offshore funds in Taiwan;
2.Business plan (including business profile, operating process and receipt/payment procedure); and
3.List of sub-distributors and a statement supporting the qualifications of those sub-distributors.
When a securities enterprise acts as the master agent of an offshore ETF that is listed in NTD, the securities enterprise shall apply to the Bank for approval on a case-by-case basis.

When a securities enterprise acting as a master agent for an offshore fund institution sells the funds or mandates its sub-distributors to handle the offering and sale of the offshore funds, the related receipt/payment shall be handled according to the following rules:
1.When the investor pays and receives funds directly to and from an offshore account designated by the offshore fund institution, the related receipt/payment for purchase and redemption between the investor and the offshore fund institution shall be made in foreign currency.
2.When the investor purchases the offshore fund through the account opened by the master agent at a domestic bank in the name of the offshore fund institution, or a bank account designated by the centralized securities depository enterprise, or a non-discretionary money trust managed by a trust enterprise, or accepting orders to trade foreign securities by a securities enterprise, the following applies:
(1)When the purchase is paid in NTD, relevant receipt/payment shall be made in NTD.
(2)When the purchase is paid in foreign currency, relevant receipt/payment shall be made in foreign currency.
(3)Upon receiving purchase payments and redemption proceeds that involve exchange settlement against NTD, the securities enterprise shall carry out exchange settlement promptly and remit the payments out to the offshore fund institution or remit the proceeds into the account designated by the investor.
3.When an investor purchases an offshore fund with foreign currency, and then switches into another offshore fund with a different currency, the investor may be paid with the fund with denominated currency at the time of redemption.

When a master agent files a report with the FSC in events referred to in Article 12 of the “Regulations Governing Offshore Funds”, it shall notify the Bank.

When a securities enterprise intends to act as the local mandated agent of an offshore fund institution and conduct private placement to specified counterparties (hereinafter referred to as “offshore fund private placement business”), the securities enterprise shall apply to the Bank for approval by submitting documents provided in Article 7 herein, and in addition, the following documents:
1.A statement to comply with the provisions in Article 52 of the “Regulations Governing Offshore Funds”. Such statement is not required if the counterparties are entities provided in Subparagraph 1, Paragraph 1, Article 52 of the Regulations.
2.Business plan (including business profile, primary information of the offshore fund, operating process and receipt/payment procedure).

When a local mandated agent of a privately placed offshore fund purchases fund shares from the offshore fund institution, it shall do so in the name of the counterparty, and the receipt/payment for settlement and fees shall be made in the denominated currency of that fund.
When the agent reports to the institution designated by the FSC within five (5) days from the date that the price of the privately placed offshore funds has been paid in full, it shall notify the Bank.

A securities enterprise concurrently conducting trust business that engages in wealth management business by means of non-discretionary or semi-discretionary individually managed money trust involving foreign exchange (hereinafter referred to as “wealth management business involving non-discretionary or non-discretionary individually managed money trust”) shall apply to the Bank for approval by submitting documents provided in Article 7 herein and a business plan (including business description, business counterparties, trust framework, receipt/payment principles and declaration of foreign exchange settlement).
When a securities enterprise that has been approved by the Bank to engage in wealth management business involving non-discretionary or semi-discretionary individually managed money trust subsequently increases or decreases the number of branches handling the business, the securities enterprise shall report to the Bank for record within seven (7) days after obtaining approval from the competent authority.

When a securities enterprise engages in business under the preceding article, related receipt/ payment shall be handled according to the following rules:
1.Foreign currency non-discretionary or semi-discretionary money trust: Receipt/payment of the trust funds between a securities enterprise and the trustor or the beneficiary shall only be handled in foreign currency and not paid in NTD.
2.NTD non-discretionary or semi-discretionary money trust with investments in products involving foreign exchange:
(1) Receipt/payment of trust funds between a securities enterprise and the trustor or the beneficiary shall only be handled in NTD. Proceeds from the sale of foreign currency denominated products invested by the trust shall be exchanged into NTD immediately and deposited into the NTD trust asset deposit account – trustor sub-account. Foreign currency deposits shall be used exclusively for settlement purpose only.
(2) When the purchase or sale of foreign currency denominated products through the same trust account involves exchange settlement against NTD, the securities enterprise shall carry out gross settlement through an authorized bank or by itself if it is a DSF without offsetting or settling on a net basis. However, for accounts receivable or payable arising from the purchase or sale of underlying assets on the same date or sale first and then buyback before the settlement of the sale through the same trust account of the trustor, the securities enterprise may, according to the trustor's instruction, combine and net off all the received (paid) money in the same foreign currency and then exchange the net received (paid) amount into NTD.

Before establishing a foreign currency denominated collective investment trust account for the first time, a securities enterprise concurrently conducting trust business that engages in foreign currency denominated collective investment trust account business shall apply to the Bank for approval by submitting documents provided in Article 7 herein, and in addition, the following documents:
1.A FSC approval letter, but exempted for the collective investment trust accounts that accept funds from professional investors only, provided it is stated so in the application letter and reported to the FSC for record in accordance with the “Regulations Governing Management and Utilization of Collective Investment Trust Funds”;
2.A management and utilization plan for the foreign currency denominated collective investment trust account;
3.The risk level of the collective investment trust account and the risk tolerance level of investors who could bear the risk of the account, but exempted for the collective investment trust accounts that accept funds from professional investors only, provided it is stated so in the application letter; and
4.Terms and conditions of the collective investment trust account agreement.
A securities enterprise establishing a NTD denominated collective investment trust account that involves foreign exchange settlement against NTD shall apply to the Bank for permission to carry out foreign exchange settlement by submitting documents provided in Subparagraphs 1 and 4 of the preceding paragraph, a declaration statement and an account asset schedule.

Securities enterprises shall observe the following rules when handling receipt/payment associated with business under the preceding article:
1.Foreign currency denominated collective investment trust account: Receipt/payment of trust funds between a securities enterprise and the trustor or the beneficiary shall only be handled in foreign currency instead of NTD.
2.NTD denominated collective investment trust account with investments in products involving foreign exchange: Receipt/payment of trust funds between a securities enterprise and the trustor or the beneficiary shall be handled in NTD only.

When a securities enterprise concurrently conducting trust business that engages in wealth management business by means of non-discretionary or semi-discretionary individually managed money trust, the qualifications of the trustor shall meet the criteria set out in Subparagraph 1 of Point 9 and Subparagraph 1 of Point 10 of the “Operating Directions”.
There shall be no transfer of funds between the NTD and foreign currency denominated non-discretionary or semi-discretionary money trust accounts of the same trustor or different trustors.
When a securities enterprise concurrently conducting trust business with investments in products involving foreign exchange, such products must be denominated in foreign currency and shall not involve or be linked to NTD exchange rate or NTD interest rate index.