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The Financial Supervisory Commission published the amendment to the Regulations Governing Foreign Investment by Insurance Enterprises (Regulations) on 29 December 2009. Listed below are the major amendments to the Regulations:
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In order to advance the flexibility of capital use by insurance enterprises, the Regulations provide that insurance enterprises may invest in commercial promissory notes, corporate bonds, convertible bonds and convertible bonds with stock options which are endorsed by qualified companies, and the criteria for calculating limits for the relevant investment. (Articles 6 and 7)
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Considering that certain countries do not require the par value per share of common stocks to be NTD10, the basis for calculating investment limit of corporate bonds is revised from the "paid-in capital" to the "sum of capital and premium". (Article 6)
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The Chinese translation of Exchange Traded Fund is amended from "交易所買賣基金" to "指數股票型基金" in order to resolve the confusion of inconsistent Chinese translations under different regulations. (Article 8)
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In accordance with the current practice and development of risk control, the Regulations provide relevant content and scope of risk control for foreign investment conducted by insurance enterprises and the relevant qualifications for the application of insurance enterprises to increase their foreign investment limits up to 35% of their capital. (Article 15)
