Taipei: Taiwan's Financial Supervisory Commission (FSC) announced on Tuesday that publicly-traded companies will soon be allowed to distribute cash dividends in foreign currencies, potentially starting as early as next year. This initiative aims to create a more investor-friendly environment within the country.

According to Focus Taiwan, the FSC highlighted that foreign investors currently hold up to 46.93 percent of Taiwan's total stock market value. By allowing dividends in foreign currencies, the measure seeks to reduce currency exchange costs for both investors and securities custodians. Huang Chung-hao, deputy head of the FSC's Securities and Futures Bureau, explained during a regular press conference that this step is intended to align Taiwan's regulations with international practices.

The announcement follows a significant development where Taiwan's stock market recently surpassed the United Kingdom to become the world's seventh-largest by total market capitalization. The FSC noted that if system adjustments proceed smoothly, companies listed on the Taiwan Stock Exchange (TWSE), the Taipei Exchange (TPEx), and the emerging stock market will be able to distribute cash dividends in foreign currencies upon request starting next year.

The new arrangement will specifically apply to foreign shareholders, as stated by the FSC.