(Legislative Intent)
This Act is specially enacted to foster the sound operations and development of securities investment trust and consulting business, promote the integrated administration of the asset management services market, and protect investment; matters not provided for in this Act shall be governed by the Securities and Exchange Act.

(Competent Authority)
The term "Competent Authority" as used in this Act means the Financial Supervisory Commission.

(Securities Investment Trust Enterprises and Types of Business)
The term "securities investment trust" as used in this Act means offering securities investment trust funds and issuing beneficial interest certificates to unspecified persons, or privately placing securities investment trust funds and delivering beneficial interest certificates to specified persons, and investing in or trading securities, securities-related products, or other items approved by the Competent Authority.
The term "securities investment trust enterprise" as used in this Act means an institution that operates securities investment trust business with the permission of the Competent Authority.
The types of business operated by securities investment trust enterprises are as follows:
1. securities investment trust business.
2. full fiduciary discretionary investment business.
3. other relevant business permitted by the Competent Authority.
A securities investment trust enterprise shall report the types of business it will operate to the Competent Authority and apply for its approval.

(Securities Investment Consulting Enterprises and Types of Business)
The term "securities investment consulting" as used in this Act means providing analysis, opinions, or recommendations on matters relating to investment in or trading of securities, securities-related products, or other items approved by the Competent Authority, in return for compensation obtained directly or indirectly from a principal or third party.
The term "securities investment consulting enterprise" as used in this Act means an institution that operates securities investment consulting business with the permission of the Competent Authority.
The types of business operated by securities investment consulting enterprises are as follows:
1. securities investment consulting business.
2. full fiduciary discretionary investment business.
3. other relevant business permitted by the Competent Authority.
A securities investment consulting enterprise shall report the types of business it will operate to the Competent Authority and apply for its approval.

(Definitions)
Following are definitions of other terms as used in this Act:
1. "Securities investment trust contract" means a trust contract signed between a securities investment trust enterprise as the settlor and a fund custodian institution as the trustee, for purposes of regulating the mutual rights and obligations between the securities investment trust enterprise, the fund custodian institution, and the beneficiary(ies).
2. "Fund custodian institution" means a trust company or a bank concurrently operating trust business that serves, on the basis of a trust relationship, as the trustee under a securities investment trust contract, and handles the custody, disposition, and collections and payments of a securities investment trust fund according to the instructions of the securities investment trust enterprise, and conducts business related to fund custody under this Act and the securities investment trust contract.
3. "Beneficiary" means a person designated in the securities investment trust contract as entitled to benefit from the securities investment trust fund.
4. "Securities investment trust fund" means the trust property under the securities investment trust contract, including the purchase price obtained from the public offering or private placement of beneficial interest certificates, and any proceeds accruing thereupon and assets purchased therewith.
5. "Beneficial interest certificates" means securities issued or delivered for purposes of public offering or private placement of a securities investment trust fund, and serving to represent the rights enjoyed by the beneficiaries in the fund.
6. "Offshore fund" means a fund established outside of the territory of the Republic of China and having the nature of a securities investment trust fund.
7. "Securities investment consulting contract" means an investment consulting mandate contract signed with respect to a mandate given to a securities investment consulting enterprise by a customer to provide analysis, opinions, or recommendations regarding matters relating to investment or trading in securities, securities-related products, or other items approved by the Competent Authority.
8. "Securities" means securities under Article 6 of the Securities and Exchange Act.
9. "Securities-related products" means securities-related futures, options, or other financial products that have been approved by the Competent Authority for trading.
10. "Full fiduciary discretionary investment business" [abbreviated below as "discretionary investment business"] means the business, with respect to fiduciary investment assets that a customer delivers by a mandate or transfers under a trust, of conducting value analysis and making investment judgments regarding securities, securities-related products, or other items approved by the Competent Authority, and executing investments or trades for the customer based on such investment judgments.
11. "Full fiduciary custodian institution" means a trust company or a bank concurrently operating trust business that, in accordance with this Act and the contract(s) applying to the full fiduciary mandate, maintains custody of the fiduciary investment assets and handles related full fiduciary custody business.
12. "Fiduciary investment assets" means assets that a customer delivers by a mandate or transfers under a trust for purposes of full fiduciary discretionary investment [hereinafter abbreviated as "discretionary investment"], and any proceeds accruing thereupon and assets purchased therewith.

(Restrictions on Concurrent Operations)
Securities investment trust, securities investment consulting, and discretionary investment business may not be operated except in accordance with this Act.
A trust enterprise that offers and issues a mutual trust fund for the purpose of investing in securities, and meets certain conditions, shall apply to concurrently operate securities investment trust business as provided in this Act.
The "certain conditions" referred to in the preceding paragraph shall be prescribed by the Competent Authority in consultation with the competent authority for the Trust Enterprise Act.

(Exemption from the Act Within Periods and Scopes as Approved to Facilitate Innovation in Financial Technologies and Promote the Financial Regulatory Sandbox)
To facilitate the development of financial inclusion and financial technologies, applicants, not limited to securities investment trust enterprises and securities investment consulting enterprises, may apply to conduct innovative experimentation in securities investment trust, securities investment consulting, and discretionary investment business pursuant to the Financial Technology Development and Innovative Experimentation Act.
An innovative experiment under the preceding paragraph may be exempted from application of the provisions of this Act within the period and scope approved by the Competent Authority.
The Competent Authority shall take into reference the results of implementation of the innovative experimentation under paragraph 1, and review the appropriateness of this Act and relevant financial laws and regulations in light thereof.

(Duty of Care)
Securities investment trust enterprises, securities investment consulting enterprises, fund custodian institutions, full fiduciary custodian institutions, and their directors, supervisors, managers, and employees, shall conduct business in good faith and with the duties of due care, diligence, and fidelity as good administrators, in accordance with this Act and with regulations and contracts authorized and issued or entered into under this Act.
Enterprises, institutions, and personnel referred to in the preceding paragraph shall keep confidential the personal data, transaction data, and other related information of beneficiaries and customers, except where otherwise provided by another act or regulation or the Competent Authority.
Anyone who violates a provision of the preceding two paragraphs shall be liable for compensation for resultant damage incurred by a beneficiary or contractual counterparty of the securities investment trust fund.

(Duty of Good Faith and Liability for Damages)
The following are prohibited in the operation of securities investment trust business, securities investment consulting business, discretionary investment business, fund custody business, full fiduciary custody business, and other business under this Act:
1. misrepresentation.
2. fraud.
3. any other act sufficient to mislead other persons.
A financial report or any other related business document reported or publicly announced by a securities investment trust enterprise, securities investment consulting enterprise, fund custodian institution, or full fiduciary custodian institution may not contain any misrepresentation or concealment.
Anyone who violates a provision of the preceding two paragraphs shall be liable for injury consequently sustained by a beneficiary or contractual counterparty of the securities investment trust fund.

(Limit on and Right of Claim for Damages)
For injury caused intentionally by a person who is liable for damages for a violation of this Act, a court may, at the request of the victim, according to the circumstances of the case, impose at its discretion punitive damages of not more than three times the amount of the injury; for injury caused by gross negligence, it may impose at its discretion punitive damages of not more than twice the amount of the injury.
Rights to claim damages as prescribed in this Act shall be extinguished if not exercised within two years from the time the claimant learns of the cause entitling the claimant to claim damages, or within five years from the date of occurrence of such cause for damages.