FSC warns asset management zone needs legislation first to prevent empty labels

The Chairperson of the Financial Supervisory Commission (FSC), Peng Jin-lung, pointed out during a press conference today that in recent years, various county and city governments have planned to establish "asset management zones" based on their respective industrial structures and regional advantages. They hope to enhance local financial service capacity and international competitiveness by focusing on financial asset management operations. Chairperson Peng expressed appreciation for this, stating that if local governments can adapt to local conditions and leverage their unique features, it will help form a differentiated financial ecosystem and attract external capital and professional talent. However, he also warned that if the business content of these zones is no longer different from existing financial centers or other zones and merely serves as a formal label, it will lose its substantive meaning and could even lead to resource waste and market confusion.

Against this backdrop, the FSC emphasized that the long-term development of asset management zones must first establish a legal foundation. In the past, although some localities established relevant regions through administrative orders or local regulations, the lack of a uniform legal basis made it difficult to establish clear regulations for key issues such as cross-region capital flows, tax incentives, and talent introduction. Chairperson Peng pointed out that without a dedicated law to grant clear legal status to the zones, relevant operators will still face restrictions under current financial regulations when allocating funds, and tax arrangements will struggle to align with international practices, thereby weakening competitiveness in attracting foreign investment.

Regarding barriers to capital movement, the FSC believes that if the zones can clearly regulate the procedures for capital inflow, outflow, and cross-border transfer from a legal perspective, it will help reduce transaction costs and compliance risks. This will not only enhance the operational flexibility of asset management companies locally, but also build greater trust among foreign investors in Taiwan's asset management environment. Regarding taxation, Chairperson Peng mentioned that if the zones can provide reasonable tax incentives or reduction mechanisms in accordance with the law, it will create tax competitive conditions similar to other international financial centers, further fostering capital clustering and economies of scale.

Talent is a key factor in the success of asset management operations. The FSC pointed out that if the zones remain merely at the administrative planning level, it will be difficult to attract financial talent with international vision and professional capabilities. Through dedicated legislation specifying supporting measures for talent introduction and cultivation—such as providing residency convenience, professional certification pathways, and incentive programs—the professional standards of local financial practitioners can be elevated while absorbing high-level overseas talent, thereby forming a virtuous cycle of talent and capital. Chairperson Peng emphasized that the two-way flow of talent and capital is the core of revitalizing the zones and must be planned simultaneously.

Finally, the FSC stated that it will conduct extensive consultations on the draft legislation for the asset management zones in the future, inviting local governments, industry associations, and academic units to participate jointly to ensure that the content of the bill balances industry needs and regulatory principles. Chairperson Peng expressed hope that through legislation granting formal legal status to the zones, breakthroughs can be achieved in capital circulation, tax arrangements, and talent cultivation. This will ensure that the asset management zones in various counties and cities not only possess distinctive names, but also demonstrate differentiation and competitiveness in practical operations, injecting new momentum into Taiwan's financial market.