| Article 37 |
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| Article 38 |
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| Article 39 |
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| Article 40 |
A futures trust enterprise that utilizes a futures trust fund offered to unspecified persons for the trades prescribed under Article 38, paragraph 1, subparagraph 2 shall ensure that it has obtained a fair or reasonable price for the trade and shall notify the fund custodian. The total risk exposure associated with the trade may not exceed ten percent of the net asset value of the given fund, except with the approval of the competent authority.
The standard for measurement of the total risk exposure of the preceding paragraph shall be based on the maximum possible losses associated with the trades, excluding foreign currency futures trades conducted as a hedge against future exchange rate risks at the time of settlement.
When a futures trust enterprise utilizes a futures trust fund offered to unspecified persons for selling futures options and option contracts in relation to the trades of paragraph 1, the options shall be adequately covered. The related self-regulatory rules shall be adopted by the Futures Association.
When a futures trust enterprise utilizes a futures trust fund offered to unspecified persons for the trades of paragraph 1, the trading counterparty shall be a financial institution with a credit rating at a specified or higher level issued by a rating agency approved or recognized by the competent authority. |
| Article 41 |
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| Article 42 |
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| Article 43 |
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| Article 44 |
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| Article 45 |
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| Article 46 |
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| Article 47 |
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| Article 48 |
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| Article 49 |
A futures trust enterprise offering a futures trust fund to unspecified persons shall utilize the futures trust fund assets in accordance with these Regulations and the provisions of the futures trust deed, and shall observe the following conditions unless the competent authority provides otherwise:
1. The futures trust enterprise may not invest in non-listed or non-OTC-listed stocks, privately-placed securities, or the beneficial certificates of a futures trust fund offered to persons meeting certain eligibility requirements.
2. The aggregate amount of all trades under Article 38, paragraph 1, subparagraph 1 and 2 may not be lower than a certain percentage of the net asset value of the futures trust fund prescribed by the competent authority.
3. The futures trust enterprise may not make loans or provide security. This restriction shall not apply to futures trust enterprises in compliance with Article 25 of the Regulations Governing Futures Trust Enterprises.
4. The futures trust enterprise may not engage in securities margin transactions.
5. The futures trust enterprise may not engage in trading of futures and securities between the various futures trust funds under the common management of the futures trust enterprise.
6. The futures trust enterprise may not invest in its own issued securities.
7. The futures trust enterprise may not invest in securities issued by an interested company.
8. The futures trust enterprise may not use a futures trust fund to purchase the beneficial certificates of that same fund. This restriction shall not apply in the case of requests by beneficial owners for redemption of beneficial certificates, or when beneficial certificates are redeemed due to the discontinuance of all or some part of the fund.
9. The total amount invested by any fund in the stocks, corporate bonds, or financial bonds of any single listed or OTC-listed company may not exceed ten percent of the net asset value of the fund.
10. The total amount invested by any futures trust fund in the shares of any single listed or OTC-listed company may not exceed ten percent of the total issued and outstanding shares of that company; the total amount invested by all funds under the common management of a futures trust enterprise in the shares of any single listed or OTC-listed company may not exceed ten percent of the total issued and outstanding shares of that company.
11. The total amount invested by any futures trust fund in an underwriting of shares of any single listed or OTC-listed company may not exceed one percent of the total shares underwritten; the total amount invested in any single underwriting by all futures trust funds under the common management of a futures trust enterprise may not exceed three percent of the total of underwritten shares being.
12. The total amount invested by any futures trust fund in the beneficial certificates of a securities investment trust fund may not exceed 10 percent of the futures trust fund's net asset value; the total investment by all of the futures trust funds under the common management of a futures trust enterprise in the beneficial units of any single futures trust fund or securities investment trust fund may not exceed ten percent of the number of beneficial units already issued by the invested fund.
13. The total amount invested by any futures trust fund in the unsecured corporate bonds of any single company may not exceed ten percent of the unsecured corporate bonds issued by that company.
14. The securities held by a futures trust fund may not be loaned to another person. This restriction shall not apply to loans meeting the conditions of Article 53.
15. Proxy forms for shareholders' meetings of an issuing company whose shares are purchased by a fund may not be sold or transferred.
16. The total monetary amount of stock transactions by any futures trust fund brokered by any single securities firm may not exceed 30 percent of the total amount of the fund's stock transactions during the given month.
17. The total amount that a futures trust fund may invest in a bills finance company's guaranteed bills may not exceed ten percent of the fund's net asset value nor exceed 500 million New Taiwan Dollars.
18. The total amount invested by any futures trust fund in the bonds of any single international financial institution approved for domestic issuance by the competent authority may not exceed ten percent of the fund's net asset value, nor may it exceed ten percent in the total monetary amount of the international financial institution bonds issued within Taiwan by the given international financial institution.
19. The futures trust enterprise may not engage in any improper trading activity and thereby affect the net asset value of a fund under its management.
20. The futures trust enterprise may not engage in any other acts prohibited by the competent authority.
When a futures trust enterprise utilizes a futures trust fund offered to unspecified persons for investment in an underwriting of stock, the amount of the investment shall be calculated as an aggregate share number or monetary amount inclusive of the shares of exchange-listed and OTC-listed companies of a similar type already held, and the ceiling on investment ratios shall be based on those aggregate figures. Investments in depository receipts shall be calculated as an aggregate share number or monetary amount inclusive of the shares of the issuer of the depository receipts already held, and the ceiling on investment ratios shall be based on those aggregate figures.
"Corporate bonds" as referred to in paragraph 1, subparagraph 9 and 13 shall include common corporate bonds, convertible corporate bonds, exchangeable corporate bonds, and corporate bonds with warrants. |
| Article 50 |
A futures trust enterprise shall maintain the assets of each futures trust fund in the following forms and in the ratios prescribed by the competent authority:
1.Cash.
2.Bank deposits.
3.Short-term bills purchased from bill houses.
4.Repo-style bond transactions.
5.Other types of assets approved by the competent authority.
The banks, trading counterparties, and subject forms of assets of subparagraphs 2 through 5 of the preceding paragraph shall have a credit rating at a specified level or above issued by a credit rating agency approved or recognized by the competent authority.
The total holdings of items under paragraph 1, subparagraphs 2 through 5 by a futures trust funds that is offered domestically, with the exception of a principal protection futures trust fund, may not exceed a percentage to be prescribed by the competent authority. |
| Article 51 |
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| Article 52 |
A futures trust enterprise shall utilize a futures trust fund offered to persons meeting certain eligibility requirements in accordance with the futures trust deed. Except where otherwise provided by the competent authority, the scope of such utilization shall comply with the provisions of Articles 38, 40, and 42, and the futures trust enterprise shall observe the following conditions:
1. Fund assets may not be loaned.
2. The futures trust enterprise may not engage in any futures or securities trading between the futures trust funds under its management.
3. The futures trust enterprise may not invest in its own issued securities.
4. The futures trust enterprise may not invest in securities issued by an interested company.
5. The futures trust enterprise may not use a futures trust fund to purchase the beneficial certificates of that same fund. This restriction shall not apply in the case of requests by beneficial owners for redemption of beneficial certificates, or when beneficial certificates are redeemed due to the discontinuance of all or some part of the fund.
6. The total amount a futures trust fund-of-funds invests in the beneficial certificates of a securities investment trust fund may not exceed ten percent of the net asset value of the futures trust fund.
7. Proxy forms for shareholders' meetings of an issuing company whose shares are purchased by a futures trust fund may not be sold or transferred.
8. The total holdings of items under Article 50, paragraph 1, subparagraph 2 through 4 may not exceed a certain prescribed percentage.
9. The futures trust enterprise may not accept the direction of specified persons to assist others in performing a merger or acquisition, evading income tax, or other actions influencing compliance with the law, observance of good faith, or professional investment management by the futures trust enterprise.
10. The futures trust enterprise may not take other actions prohibited by the competent authority. |
| Article 53 |
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| Article 54 |
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| Article 55 |
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| Article 56 |
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| Article 57 |
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| Article 58 |
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