28 December, 2007
Taiwan to Increase Fund Investment Cap for Derivatives to 40%
The Financial Supervisory Commission has announced that it intends to amend Taiwan's Regulations Governing Offshore Funds ("Offshore Regulations") so that the Commission will have the power to set limits on how much an offshore fund registered in Taiwan can invest in derivative products. Previously the investment cap for these products was 15% of the fund's net asset value subject to certain other technical restrictions and restrictions on derivative products based on Chinese or Taiwanese financial instruments. Please see Article 23 of the current Offshore Fund Regulations for further details. The translation is by Winkler Partners.
In the announcement, the Commission notes that its policy objectives include giving the Commission greater flexibility to change the cap in the future and to harmonize the caps for offshore funds and domestic ones.
In its notes to the proposed revision to Article 23, the Commission note that its short term goal is to raise the cap of derivative product investments to 40%. The long term goal is to update Taiwan's fund regulatory regime to comply with European Union's UCITS Ⅲ requirements.
The statutory period of public comment on this amendment expires on 2 January 2008. Please contact Shan Lee at +886-2-2311-2345 ext. 33 for further details.
Winkler Partners has translated and maintained official translations of Taiwan's financial services laws and regulations since 2002. Please contact Paul Cox at +886-2311-2344 ext. 545 for further information.
