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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 60     If any of the following circumstances applies to any securities deposited or other merchandise by a customer to offset against its margin requirements, the securities firm shall deduct the value of such securities or other merchandise when calculating the collateral maintenance ratio under Article 53, and shall promptly notify the customer to replace such securities within three business days from receipt of the notice with cash of equivalent value or other securities eligible for use as additional collateral in offsetting against margin requirements:
  1. there is any defect in the rights or any other legal dispute.
  2. the provisions of Article 57 are not complied with.
    If any of the following circumstances applies to any securities deposited or other merchandise by a customer to offset against its margin requirements, upon notice by the securities firm, a customer shall replace the securities with equivalent cash or other securities or merchandise eligible for margin requirements within the following period:
  1. TWSE or TPEx listed securities, book-entry central government bearer bonds, local government bonds, corporate bonds, financial bonds, gold that is registered for trading over the counter: Upon the approval and public announcement by TWSE or TPEx of the termination of listing on the TWSE or TPEx, a securities firm shall give notice to a customer requesting it to make replacement 10 business days prior to the termination of listing. However, the aforesaid does not apply if (1) the proviso of Article 35-2 applies to the listed securities and (2) an open-end type fund beneficiary certificate for trading over the counter.
  2. Book-entry central government bearer bonds, local government bonds, corporate bonds, financial bonds: 10 business days prior to the date of partial redemption payment.
  3. For merger of an open-end type securities investment trust fund beneficiary certificate and futures trust fund beneficiary certificate: 10 business days prior to the termination of the trust contract or the expiration date of the extension period. However, if the surviving open-end type securities investment trust fund after merger is qualified under Article 57 requirements, the aforesaid is not applicable.
    In the event of suspension or halting of trading of any securities deposited by a customer to offset against its margin requirements, no replacement is required.