The Securities and Futures Commission plans this year to establish a market for the trading of "gray" shares, or unlisted equities.
Chu Jaw-chyuan (
Gray market shares have long been bought and sold in Taiwan through underground brokers and dealers. Because there has been a strong demand for the gray shares of high-tech companies, regulators have sought to bring more supervision to the trading of unlisted shares.
The securities commission last year asked the TAISDAQ, Taiwan's over-the-counter market, to conduct feasibility studies.
But before a mechanism to officially trade gray shares can be established, the commission must first clarify the roles of the TAISDAQ and the Taiwan Stock Exchange, securities officials say.
"In recent years, the commission has allowed the [TAISDAQ] to serve as a preparatory market for the Taiwan Stock Exchange," Chu said. "Most companies that applied to list their shares on the TAISDAQ had done so with the eventual goal of listing on the main stock exchange."
Chu said the commission would like to draw clearer lines between the TAISDAQ and the Taiwan Stock Exchange, with the former taking on gray shares.
Meanwhile, companies that want to trade on the main board will apply directly to the Taiwan Stock Exchange, rather than listing on the TAISDAQ first, Chu said.
According to the Taiwan Stock Exchange, roughly 650 companies are expected to trade on the main board this year.
Speaking on a related issue, Chu said that Qualified Foreign Institutional Investors (QFIIs) will continue to be barred from accepting capital from China.
Chu made the remarks after suggestions during a national economic conference this weekend that Taiwan should allow capital from China into Taiwan's market.
"The administration is currently considering deregulating its China investment policy regarding certain domestic manufacturing and service sectors," Chu said.
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