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Article NO. Content


Operational Regulations Governing Securities Firms Recommending Trades in Securities to Customers  CH

Amended Date: 2017.11.22 
Categories: Market Supervision > Regulation of Securities Firms
Article 2     A securities firm shall not recommend any trade in securities to unspecified multiple persons.
    When recommending a trade in securities to a specific customer, a securities firm shall be fully aware of and evaluate the customer's investment knowledge, investment experience, financial status, and degree of investment risk tolerance.
    Before recommending a trade in securities, a securities firm shall first appoint a responsible associated person to explain to the customer the potential risks of trading securities, and then sign a recommendation contract with the customer.
    This Corporation shall separately prescribe the content that must be included in the recommendation contract.
    When recommending trades in securities to professional institutional investors as set forth in paragraph 6, a securities firm shall not be subject to the restrictions in paragraph 3.
    The term "professional institutional investors" as used in the preceding paragraph includes domestic and foreign banks, insurance companies, bills finance companies, securities firms, fund management companies, government investment institutions, government funds, pension funds, mutual funds, unit trusts, securities investment trust companies, securities investment consulting companies, , trust enterprises, futures commission merchants, futures service enterprises and other approved institutions.