Article 1.
The Regulations are enacted in accordance with Paragraph 1 of Article 48 of the National Pension Act (hereinafter referred to as “the Act”).
Article 2.
The National Pension Insurance Fund (hereinafter referred to as“ the Fund”) refers to the special find defined in Paragraph 1(2) of Article 4 of the Budget Act, classified into the subordinate unity budget. The Ministry of the Interior shall be the competent authority in charge of the Fund.
Article 3.
Income/expenditure, management and utilization of the Fund will be carried out by the Bureau of Labor Insurance (hereinafter referred to as “the Bureau”) as commissioned by the Ministry of the Interior. Upon approval of the Ministry of the Interior, the Bureau may delegate the utilization of the Fund to financial organizations.
Supervision of the Fund will be carried out by the National Pension Supervisory Commission, Ministry of the Interior (hereinafter referred to as “the Supervisory Commission”).
Article 4.
The Fund sources are from:
1. Lump sum appropriation from the central government when incorporating;
2. Income from the insurance premium;
3. Share assumed by the central competent authority according to the laws and the responsibility reserve from the central government;
4. Income from interest and fines;
5. Revenue from the interest and utilization of the Fund;
6. Other incomes.
Article 5.
The Fund shall serve the following purposes:
1. Old age pension payment, maternity payment, mentally/physically disability pension payment, death payment and surviving family pension payment.
2. The re-examination expenses defined in Paragraph 1 of Article 37, and Article 38 of the Act.
3. The related expenses to be assumed pursuant to laws as defined in Paragraph 4 of Article 30, Paragraph 4 of Article 34, Paragraph 4 of Article 42, and Article 46 of the Act.
4. Management expenses required for utilization of investment.
5. Other statutory expenses.
Article 6.
Utilization of the Fund may extend to:
1. Deposits in domestic/foreign financial organizations;
2. Investment in domestic/foreign bonds/securities;
3. Investment in domestic/foreign the equity securities traded or underwritten in stock exchange markets or over-the-counter markets (hereinafter referred to as the “equity securities”);
4. Investment in trust fund beneficiary certificates issued or managed by domestic fund management organizations (hereinafter referred to as the “domestic fund”);
5. Investment in beneficiary certificates, fund shares or investment units issued or managed by foreign fund management organizations (hereinafter referred to as the “offshore fund”);
6. Investment in domestic/foreign asset securitization products;
7. Investment in financial derivatives referred to in subparagraphs 1-3 and the preceding subparagraph, and other financial derivatives;
8. Engagement in lending and trading marketable securities;
9. Loans to governments at various levels for undertaking economic construction or investment expenditures with compensation or repayable by budgeting on a year-by-year basis;
10. Other items beneficial to the return of the Fund examined by the Supervisory Commission and reported to and approved by the Ministry of the Interior.
Where the investment referred to in the subparagraph 7 of the preceding paragraph is carried out by the Bureau independently, it shall be limited to hedging trades.
Where the items referred to in Paragraph 1 involve the territories of Mainland China, Hong Kong or Macao, compliance with the relevant laws and regulations defined by the competent authority in charge of finance or other relevant authorities shall be required.
Article 7.
When investing domestically, the Fund shall follow the following investment restrictions:
1. Total cost for purchase of any single equity securities shall be no more than 5% of the total value utilized from the Fund at the time of investment; the same shall apply to the total cost of any single debt security, single domestic fund or single asset securitization product.
2. Accumulated total amount for the investment in any single debt security shall be no more than 10% of the net value of the issuing company at the time of investment; accumulated total amount for the investment in financial debts shall be no more than 20% of the net value of the issuing financial organization at the time of investment;
3. Investment in domestic asset securitization products issued by any single entrusted organization or specific-purpose company shall be no more than 10% of the total issued amount;
4. Total amount for the investment in any single equity security shall be no more than 10% of the total issued amount of the securities.
5. Total amount for the investment in any single domestic fund shall be no more than 10% of the units of beneficiary certificates issued by the fund, or no more than 20% of the total issued amount of the securities where the single domestic fund refers to an exchange traded fund (ETF).
The issuing companies, guarantee organizations or entrusted organizations referred to in subparagraph 2 and subparagraph 3 of the preceding paragraph shall have no less than the specific ratings awarded by internationally recognized credit rating institutions or approved by the competent authority in charge of finance.
Article 8.
When investing overseas, the Fund shall follow the following investment restrictions:
1. Total cost for purchase of any single equity security shall be no more than 5% of the total value utilized from the Fund at the time of investment; the same shall apply to the total cost of any single debt security, single offshore fund or single asset securitization product;
2. Amount for the investment in any single offshore equity security and single debit security shall be no more than 10% of the commissioned amount;
3. The issuer of offshore debt securities and offshore asset securitization products or bonds shall have no less than the specific ratings awarded by internationally recognized credit rating institutions or approved by the competent authority in charge of finance;
4. In addition to the local bank’s domestic and overseas branches, the deposits denominated in foreign currency may also be deposited in any foreign banks which have no less than the specific ratings awarded by internationally recognized credit rating institutions or approved by the competent authority in charge of finance;
5. The deposits denominated in foreign currency deposited in the same bank shall be no more than 3% of the total amount utilized from the Fund, unless the deposits refer to the funds deposited in the custodian bank to be reserved for commissioned investment.
The specific ratings referred to in Paragraph 2 of the preceding Article, and subparagraph 3 and subparagraph 4 of the preceding paragraph shall be defined by the Bureau.
Article 9.
The ratios of foreign investments by the Fund referred to in subparagraphs 1-3, subparagraphs 5-7, and subparagraph 10 of Paragraph 1 of Article 6 herein shall be no more than 45% of the total amount utilized from the Fund.
Article 10.
Investment in financial derivatives by the Fund shall be processed in accordance with the following rules:
1. Except for principal-guaranteed-typed products, investment shall in principle not increase the financial leverage of the Fund;
2. To accommodate the needs for the exchange hedge between New Taiwan Dollars and foreign currencies in relation to foreign investment, the Fund may invest in foreign exchange financial derivatives within the amount limits and product scopes under relevant regulations stipulated by the Central Bank;
3. Engagement in financial derivatives shall be processed through the financial organizations approved by the competent authorities in charge of finance, securities and futures in the countries concerned.
Measures concerning trading limit, stop-loss limit, trading counterpart and risk management of investment in financial derivatives by the Fund shall be drafted by the Bureau and examined by the Supervisory Committee, and then submitted to the Ministry of the Interior for approval.
Article 11.
The Bureau shall draft the plan for income/expenditure, management and utilization of the Fund prior to commencement of the year, and submit the same to the Supervisory Commission for examination and then to the Ministry of the Interior for approval.
Article 12.
The Bureau shall submit the report about income/expenditure, management and utilization of the Fund and the accumulated amount thereof to the Supervisory Committee for examination on a monthly basis and then to the Ministry of the Interior for review and record. The Ministry of the Interior shall also announce the same on a yearly basis.
Article 13.
The accounting of the Fund shall be processed independently. Preparation of the accounting report, annual budget and final accounts shall be carried out by the Bureau.
The preparation of the annual budget and final accounts shall be submitted to the Supervisory Commission for examination and then to the Ministry of the Interior for approval.
Preparation and execution of the budget and preparation of final accounts related to the Fund shall be carried out in accordance with the Budget Act, Accounting Act, Financial Statement Act, Audit Act and relevant laws.
Article 14.
In order to process matters concerning the accounting of the Fund, an accounting system shall be established.
Article 15.
The Fund shall be settled upon termination, and the balance thereof, if any, shall be allocated to the national treasury.
Article 16.
The Regulations shall be enforced as of October 1, 2008.
The amendments hereto shall be enforced as of July 1, 2011.