FSS: "Yuanta Securities Unilaterally Launched US IPO Proxy Service... Improvement Discussions Underway"

[Asia Economy Reporter Lee Jung-yoon] The Financial Supervisory Service (FSS) announced on the 26th that it is currently discussing improvements to address issues related to Yuanta Securities' temporary suspension of its U.S. initial public offering (IPO) subscription agency service, and plans to ensure the service is resumed promptly.

Yuanta Securities decided to temporarily suspend the U.S. IPO subscription agency service, which it launched the previous day as the first in the securities industry. This service allows investors to participate directly in U.S. IPO subscriptions through a local brokerage firm partnered with Yuanta Securities upon application.

According to the FSS, Yuanta Securities only discussed the general structure of the product related to the service launch in June last year, but unilaterally started the service without additional consultations on specific investment procedures and investor guidance documents before the service launch on the 18th of this month.

During market monitoring, the FSS confirmed the service launch and identified certain expressions that could cause investor misunderstandings, advising Yuanta Securities on the need for improvements. Some misleading expressions included implying that disclosure documents submitted to the U.S. Securities and Exchange Commission (SEC) are the same as disclosure documents under the Capital Markets Act, and notices that could mislead investors into believing that investment prospectuses under the Capital Markets Act could be viewed, despite only English disclosure documents from the U.S. being accessible.

An FSS official explained, "The claim that Yuanta Securities was instructed to block the service despite continuous consultations with the FSS over two years is not true."

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