The Taiwan Monthly
Trading Policies
Driving Market Accessibility and Transparency
Taiwan’s commitment to fostering a global investor-friendly market continues with the implementation of several market reform measures. These initiatives aim to improve operational efficiency, increase flexibility, and ensure robust information transparency. Here’s an overview of the latest updates designed to enhance the Taiwan capital market for international investors.
1. Facilitating Overnight Overdrafts for Foreign Investors
To address prefunding concerns and improve liquidity, Taiwan’s banks are authorized to provide unsecured overnight overdraft services to foreign investors. Effective September 26, 2024, this reform boosts operational flexibility, simplifies settlement processes, and reduces funding delays.
2. Flexible Prepayment Handling
Foreign investors trading red-flagged stocks can manage advance collections of funds and securities directly through custodians. This improvement, introduced on May 1, 2024, eliminates the need to transfer funds or securities to brokerage settlement accounts, minimizing delays and enhancing settlement efficiency.
3. Multiple Custodian Institutions
The Financial Supervisory Commission (FSC) now allows foreign institutional investors to appoint multiple custodians. Effective February 24, 2025, this measure reduces operational costs, supports diverse asset management strategies, and encourages greater participation in Taiwan’s market.
4. Enhanced Information Disclosure Standards
The Taiwan Stock Exchange (TWSE) has mandated that listed companies provide comprehensive and timely disclosures to enhance information transparency for global investors. Starting in 2024, all material information will be disclosed simultaneously in both Chinese and English, ensuring accessibility for global stakeholders.
These progressive reforms underscore Taiwan’s dedication to creating a more accessible and transparent market for global investors. By simplifying operations and enhancing disclosure standards, Taiwan continues to position itself as a leading destination for international capital.
For further inquiries, please contact Mr. Chen at rickychen@twse.com.tw