To encourage the use of insurance enterprises' funds to invest in public utilities and social welfare enterprises, the FSC amended Articles 8 and 9 of the Regulations Governing Use of Insurance Enterprise's funds in Special Projects, Public Utilities and Social Welfare Enterprises, per the letter Ref. No. Jin-Guan-Bao-Cai-Zi No. 10502500341 dated 3 February 2016. The main points are as follows:
1. Simplify the application documents:
When an insurance enterprise invests in public utilities and
social welfare enterprises, if the insurance enterprise furnishes
the assessment opinion issued by a qualified CPA on the suitability
of the investment based on financial assessment and the legal
opinion issued by a qualified attorney on the legality of such
investment, it need not provide the investment plan and purpose of
such investment; the insurance enterprise need not provide the
financial report if the invested object has been established for
less than a year.
2. To encourage the use of insurance enterprises' funds to invest in projects under the Act for Promotion of Private Participation in Infrastructure Projects and increase the flexibility of fund allocation of insurance enterprises, the following insurance enterprises may make the investment subject to the after-the-fact review of the competent authority:
(1) The total amount that the insurance enterprise invested in one and the same investment project shall be less than NT$1 billion and less than 10% of the owner's equity of the insurance enterprise. In addition, the RBC ratio of the insurance enterprise shall not be less than 200% and such case shall be submitted together with the relevant documents for prior approval of the board of directors.
(2) The total amount that the insurance enterprise invested in one and the same investment project shall be less than NT$5 billion and less than 10% of the owner's equity of the insurance enterprise. Further, the financial condition, corporate governance and the internal auditing of the insurance enterprise shall comply with the relevant laws and regulations.
(3) When the investment conforms to the financial standard stipulated by the Insurance Associations as reported to the competent authority, including the guarantee, risk allocation and the dispute resolution requested by the competent authority of such investment, the total amount that the insurance enterprise invests in one and the same investment project shall be less than NT$5 billion and less than 10% of the owner's equity of the insurance enterprise. Further, the RBC ratio of the insurance enterprise shall not be less than 200% and such case shall be submitted together with the relevant documents for prior approval of the board of directors.
3. Define the aforementioned "total amount" which means the total sum of the premium, plus construction cost and the rent which shall be paid by the insurance enterprise in accordance with the investment agreement.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
