Taiwan Depository & Clearing Corporation (TDCC)
Brief Introduction
This Memorandum of Understanding between Central Securities Depository of Iran (CSDI) and Taiwan Depository & Clearing Corporation (TDCC) was signed by the CSDI Chief Executive Officer, Dr. Mohammad Reza Mohseni and the TDCC's CEO Sherman Lin on 5 December 2016 on the sidelines of the 20th ACG Summit in Tehran.
Objectives
- Increase efficiency of asset custodianship and settlement systems
- Exchange of information and making the other party aware of changes in infrastructure and legal business environment.
- Expansion of cross-border activities and defining the process of cross-border listing, registry
- Facilitate cross-training and create a conducive situation for business growth
An Introduction to Taiwan Depository & Clearing Corporation (TDCC)
Taiwan Depository & Clearing Corporation (TDCC) is the descendant CSD service provider in Taiwan formed as a result of the merger of two organizations (TSCD & DIDC).
Original TSCD (Taiwan Securities Central Depository Co., Ltd.) was established in October 1989 in accordance with the Securities and Exchange Act. Major operations of TSCD included:
1) Providing book-entry of securities transactions;
2) Clearing and settlement of securities traded on TSEC and GTSM exchange;
3) Clearing and settlement for both cash and securities among Emerging Stocks;
4) Computer process handling for the clearing of futures market;
5) Registration of securities issuing in dematerialized form;
6) Computer process of book-entry for participants. Entrusted by Securities and Futures Bureau, Financial Supervisory Commission (FSC), TSCD also conducts the auditing of shareholders affairs for issuing companies.
In order to promote dematerialization and a central clearing-settlement system for short-term bills, DIDC (Debt Instruments Depository and Clearing Co., Ltd. Taiwan) started the preparatory operation since April 2004. It has introduced not only a central depository service but also a Delivery Versus Payment (DVP) mechanism by linking the Inter-bank Fund Transfer System of the Central Bank of China. The Debt Instruments Depository and Clearing System was set up to improve the efficiency and security of bills back-office operation and furthermore to develop a safe and sound money market.
With the growth of cross-industry operations in Taiwan’s financial sector, there has been a steady increase in the volume of securities, bond and bill transactions handled by both securities firms and bill dealers. In July 2005, in order to ensure a higher level of convenience for market participants, avoid duplication of investment and keep up with the trend towards back-office integration among the world’s leading stock markets, FSC decided that DIDC should be merged into TSCD. It was anticipated that the integration of settlement, clearing and central depository platforms would help to reduce investment costs, improve operational performance, expand service scope and stimulate market development through the creation of synergy. Therefore it is now renamed as “TDCC” after the action of merger completed in March 2006.
In addition, in coordination with the competent authority’s promotion of its strategy for creating a "Corporate Governance Roadmap", TDCC has been developing the electronic voting system for general meetings. In order to satisfy the need for integrating market platforms, TDCC completed a merger with Taiwan Integrated Shareholder Service Company (TISSC) on March 24, 2014. TISSC’s Shareholders Meeting Electronic Voting Platform, after the merger, was replaced by TDCC's Stockvote platform as the single contact point in the market. Integration of the two platforms will not only save on operating costs for issuing companies, but also make foreign and domestic investors to exercise their shareholders’ rights more efficiently.
In line with the government's policy of internationalization and liberalization of the securities market, TDCC will continue to extend service areas of the securities markets, to protect investors' rights and to reduce the risks for securities firms, and with the aim of making Taiwan's stock market significantly efficient.
Joint Projects
- CSDI Attends 19th General Assembly of Asia-Pacific Central Securities Depository Group (ACG) Hosted by TDCC
The 19th ACG Annual Meeting was held in Taiwan in November 2015. On the sidelines of the event, the AFSF was officially formed and its establishment document was signed by fourteen ACG member companies. The project aims at providing the necessary technical infrastructure for cross-border trading of investment funds in AFSF CSD members.
- 1st Official Visit by Iranian Capital Market Delegation to Taiwan
For the first time, a high-ranking CSDI delegation comprising of the company's CEO, Mohammad Reza Mohseni, the Chairman of the Board Hossein Fahimi and CSDI Board member Vahid Bagheri traveled to Taiwan in March 2017. During the visit which took place at the official invitation of the TDCC, the Iranian delegation paid visits to different sections of the Taiwanese financial market.
Also in the course of the visit, separate meetings were held with the officials from TDCC, Taiwan's market supervisory body and its exchange markets, and joint working groups were planned to set up to hold specialized training courses and get to know with the latest CSD business achievements, especially in the field of electronic services to stakeholders.
- CSDI Chairman of Board Meets Taiwanese counterparts
CSDI and TDCC Delegation held a meeting on the sidelines of the World Forum of CSDs (WFC) meeting held in Hong Kong in December 2017. At this meeting, it was decided that TDCC share the company's experiences in the field of electronic voting with CSDI.
CSDI, an ACG member since 2012, has become the grouping board member since 2016. TDCC is also an ACG board member the fact that paved the way for joint cooperation between the two companies in various areas, especially the exchange of knowledge and experience and the promotion of multilateral cooperation between the member companies. Also, CSDI and TDCC as co-members of the ACG’s "Investor Services" working group started cooperation to expand and advance the services in members of the working group.
· Cooperation on Standardization of Mutual Fund Pre/Post-trade Operations
CSDI and TDCC are working jointly on the project of standardization of pre- and post-trade procedures for settlement operations of mutual funds, as well as on facilitating cross-border transactions related to the financial instruments in thirteen members of Asia Fund Standardization Forum (AFSF).
