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Article NO. Content

Title:

Operating Rules for Securities Firms Handling Non-Restricted Purpose Loan  CH

Amended Date: 2017.11.27
Article 3     A securities firm that conducts non-restricted purpose loan shall adopt an effective internal control system.
    The internal control system of the preceding paragraph shall adopt "know your customer" assessment and credit investigation procedures, and operating procedures, division of powers and duties, financing limit controls, and account management, loan counterparty, financing conditions for the conduct of non-restricted purpose loans, as well as related risk management mechanisms.
    When a securities firm conducts non-restricted purpose loan, the prospective borrowers shall be decided by the securities firm according to its own internal control system and conduct credit investigation procedures according to the preceding paragraph; as for the stipulations between the parties, a securities firm shall set the applicable financing conditions in accordance with the internal control system of the Paragraph 1 and such conditions shall be stated clearly in the non-restricted purpose loan contract.
    For the stipulations between a securities firm and its client, securities firm shall make in accordance with the internal control system set forth in the preceding paragraph and stated clearly in the non-restricted purpose loan contract.