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Articles 1 - 5 of 5
Full-Text Articles in Law
Product Due Diligence And The Suitability Of Minibonds: Taking The Benefit Of Hindsight, Christopher Chao-Hung Chen
Product Due Diligence And The Suitability Of Minibonds: Taking The Benefit Of Hindsight, Christopher Chao-Hung Chen
Christopher Chao-hung Chen
This article focuses on some problems arising from applying the product due diligence requirement of the suitability rule to complex financial products. The article draws several conclusions. First, the ‘not unsuitable’ test should be adopted to reduce legal uncertainty. Second, the comparative risk approach is a better choice in assessing the suitability of investment products. However, there must be further elaboration of the classification of product risk. Third, there must be a balance between risk and return to avoid risk mismatches in product design. Fourth, what have been termed minibonds raise the problem of documentation suitability. Though it is difficult …
Regulation Of Speculation In The Financial Market: Focusing On Derivative Instruments, Christopher Chao-Hung Chen
Regulation Of Speculation In The Financial Market: Focusing On Derivative Instruments, Christopher Chao-Hung Chen
Christopher Chao-hung Chen
This article argues that market speculation is a conduct to acquire benefits by undertaking risk. Derivative instruments are powerful tools for market participants to conduct market speculation, which may help hedging, market making and completing investment market. However, pure and excessive speculation might cause net loss of market efficiency and create external costs. Some speculative transactions may imply asymmetric information. Market speculation might also lead to market abuse and even systemic risk. These reasons provide the basis to regulate market speculation by derivatives trading. This paper argues that Taiwan law might build on current regulatory model centring on the type …
Classification Of Clients Of Financial Firms: From Comparative Law Perspective, Christopher Chao-Hung Chen
Classification Of Clients Of Financial Firms: From Comparative Law Perspective, Christopher Chao-Hung Chen
Christopher Chao-hung Chen
The purpose of this article is to examine current regulations under Taiwan law with regard to classification of clients of financial firms in Taiwan from the perspective of comparative law. After comparing with relevant laws in the EU, UK, USA, Hong Kong, and Singapore, this article argues that there are certain points worth further consideration and revision under Taiwan law: first, the level of current regulation in Taiwan and its scope are rather limited compared with foreign laws; secondly, it is necessary to introduce other standards than mere ‘total assets’ in order to determine a ‘large’ enterprise; and thirdly, current …
The Construction Of Suitability Obligation Of Financial Institutions When Selling Structured Products: From Comparative Law Perspective, Christopher Chao-Hung Chen
The Construction Of Suitability Obligation Of Financial Institutions When Selling Structured Products: From Comparative Law Perspective, Christopher Chao-Hung Chen
Christopher Chao-hung Chen
The purpose of this article is to examine the suitability rules regarding structured products under Taiwan law from a comparative law perspective. After the global financial crisis, Taiwan has imposed specific suitability obligations on financial institutions when they promote derivatives and structured products. However, the suitability rule is only placed in administrative regulations and its scope is also limited. In addition, Taiwan law does not distinguish different types of relationships between a financial institution and a client. Furthermore, the biggest challenge to the suitability rule is to define the meaning of ‘suitable’. This article argues that the starting point is …
Contractual Structure Of Structured Notes And Legal Characterisation Of Non-Discretionary Trust, Christopher Chao-Hung Chen
Contractual Structure Of Structured Notes And Legal Characterisation Of Non-Discretionary Trust, Christopher Chao-Hung Chen
Christopher Chao-hung Chen
This article argues that if a structured product is documented as “notes”, it should be deemed as “securities” under the Securities Exchange Act in Taiwan. It should be regulated issuance, purchase or brokerage activities under securities regulations, if a structured note is issued directly in Taiwan or if a domestic investor authorized a securities broker to have it purchased in a foreign country on his behalf,. In addition, even if one invests in structured notes issued by a foreign company via a non-discretionary trust with a commercial bank, this activity should still constitute sales of foreign securities; and thus it …