No vengeful selling among foreign investors: FSC chair
By Ted Chen, The China Post
August 1, 2014, 12:45 am TWN
TAIPEI, Taiwan -- Financial Supervisory Commission (FSC) Chairman Tseng Ming-chung (曾銘宗) yesterday rejected rumors that the 131.17-point tumble at the conclusion of yesterday's session was part of reprisals by foreign institutional investors over the regulator's plans to impose controls on reports published by their analysts.
The TAIEX yesterday fell by 131.17 points, to close at 9,315.85 points, as foreign institutional investors sold off more than NT$10 billion worth of holdings.
The FSC earlier announced plans to impose tighter control on research reports published by analysts at foreign institutional investors. Following the enactment of the new policy, foreign institutional investors will be required to enforce stringent access control of their research reports, and asked to refrain from distributing their publications among local media outlets.
Specifically, research reports involving individual companies, revenues and profitability forecasts, and target share prices will no longer be allowed to be distributed among local media outlets.
Offending foreign financial institutions will be required to submit an explanation entry to the Market Observation Post System (公開觀測站) website if their research reports are quoted by the media in the future.
The FSC stated that the new policy is designed to uphold the intellectual property rights of foreign institutional investors.
The market however, is rife with speculations that the regulator is aiming to impose the same stringent guidelines regulating domestic institutional investors, and that the FSC is growing uneasy amid opposing opinions published by foreign institutional investors as the TAIEX climbs to long-awaited heights.
New Policy Not an Inquisition: Tseng
At a press conference yesterday, Tseng rejected rumors that yesterday's tumble in the market were the result of foreign institutional investors' reprisal as absurd.
Foreign institutional investors are rational organizations, said Tseng while denying the allegations. In addition, Tseng stated that the use of words such as inquisition and prosecution in the headlines of news articles was rather heavy-handed and regrettable.