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Article NO. Content

Title:

Operating Rules for Securities Firms Handling Margin Purchases and Short Sales of Securities  CH

Amended Date: 2019.02.12 
Categories: Securities Exchange Market > Margin Transaction
Article 37     A customer shall meet the following qualifications to be able to submit a margin account opening application:
  1. The customer is a citizen of the Republic of China who is 20 years of age or older and who is not incapacitated, or a juristic person incorporated and registered under the law of the Republic of China.
  2. The customer has opened a consignment trading account for at least three months.
  3. The customer has settled 10 or more transactions of consignment trading during the most recent year with an accumulated transaction value of 50% of the amount limit for margin purchase applied for. This also applies to a consignment trading account opened for less than one year.
  4. The sum of the customer's income received and various other properties during the most recent year is at 30% of the amount limit for margin purchase applied for, except where the amount limit for margin purchase applied for is less than NT$500,000.
    Where a customer applying for opening of a margin account has one of the following circumstances, the amount limit for margin purchase approved for a margin account that has been opened shall be taken into account in the calculation of the amount limit for margin purchase applied for described in subparagraphs 3 and 4 of the preceding paragraph:
  1. The customer has opened more than five margin accounts.
  2. The customer has opened more than two margin accounts and the amount limit for margin purchase applied for plus the amount limit for margin purchase approved for margin accounts that have been approved has exceeded NT$300 million.
    When a customer is applying for a margin account, calculation of the amount limit for margin purchase applied for in according with paragraph 1, subparagraph 4 needs to include such amount limits for its other loan business with the same securities firm.
    If the customer applies for changes to amount limit during the term of a margin purchase and short sale contract or proceeds to renew the contract upon expiry of the term, the requirements under subparagraph 4 of paragraph 1, paragraph 2 and the preceding paragraph shall be complied with.
    Where necessary, the securities firm may raise the percentage set forth in paragraph 1, subparagraphs 3 and 4.
    In case of application for changes to amount limit or renewal of contract upon expiry, the securities firm may accept the request by way of communication or electronic means that would verify the identification of the applicant and its expression of intent.