Financial Supervisory Commission: Allowing foreign employees to participate in shareholding trusts is expected to be launched in December

In order to help listed companies attract international talents, the Financial Supervisory Commission said today that it will issue an order explaining that foreign employees can invest in the stocks of domestic listed companies they serve or belong to through a "trust mechanism" in the same way as their national employees. It is expected to be implemented in late December this year.

Huang Houming, deputy director of the Securities and Futures Bureau of the Financial Supervisory Commission, said that the Financial Supervisory Commission will issue an explanation in the near future in accordance with the provisions of Article 10, Paragraph 1, of the "Regulations on the Administration of Securities Investment by Overseas Chinese and Foreigners", clarifying that foreign employees of listed (counter), primary listed (counter) companies and their related companies with controlling and subordinate relationships may participate in employee holdings. Equity trusts invest in the stocks of domestic listed over-the-counter companies that the firm serves or belongs to the group, and the trust operator, as the foreign investment registration entity, registers domestic or overseas foreign employee stock ownership trust investment accounts with the Taiwan Stock Exchange Co., Ltd. to solve the regulatory obstacles for foreign employees to participate in employee stock ownership trusts.

Huang Houming said that the current employee stock ownership trust system mainly allows domestic employees to participate. However, with the international development of enterprises, the number of foreign employees hired by listed and over-the-counter companies is increasing. Companies hope to strengthen the recruitment and retention of international talents through the employee stock ownership trust system. Therefore, the Financial Supervisory Committee will amend the relevant regulations to eliminate legal obstacles for foreign employees to participate in the system.

According to the plan of the Financial Supervisory Commission, after foreign employees participate in employee stock ownership trusts, the trust operator will be the foreign investment registration entity and register with the stock exchange for domestic or overseas foreign employee stock ownership trust investment accounts. Relevant regulations will also cover matters such as account opening, stock trading restrictions, trust operators’ internal control systems, and fund remittances.

When will this system be launched? The Financial Supervisory Commission has supervised the stock exchanges and over-the-counter trading centers to cooperate in revising relevant regulations. Subsequent system development and construction will be carried out by relevant units such as the stock exchanges, over-the-counter buying centers and trust operators. It is expected to be officially implemented in the fourth quarter of 2026 and is expected to be on the road in late December.

The Financial Supervisory Commission stated that employees are important assets for the sustainable development of enterprises. Opening up foreign employees to participate in employee stock ownership trusts will allow foreign employees to invest in domestically listed and over-the-counter stocks of the company or group they work for through the trust mechanism in comparison with domestic employees. This will help deepen the long-term relationship between enterprises and multinational talents, implement employee benefits and incentive mechanisms, and promote the long-term development of my country's capital market.