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Title:

Taiwan Stock Exchange Corporation Rules Governing Trading of Beneficial Certificates  CH

Amended Date: 2024.02.23 (Articles 12 amended,English version coming soon)
Current English version amended on 2022.07.20 
Categories: Securities Exchange Market > Trading > Beneficial Certificates
   Chapter 2 Market Trading
Article 5    When the original market on which the offshore ETF beneficial certificates circulate is closed, the beneficial certificates will continue to be traded on the TWSE central market.
    When the original market on which the foreign securities of the component securities of the underlying index of a securities investment trust ETF with foreign component securities circulate is closed, the beneficial certificates and underlying ETF beneficial certificates will continue to be traded on the TWSE central market.
     For a leveraged or inverse securities investment trust ETF of which the component securities of the underlying index contain one or more foreign securities, when the overseas market on which those securities circulate or the exchange market of the investment object is closed, the beneficial certificates and underlying ETF beneficial certificates will continue to be traded on the TWSE central market.
     When the original market of the foreign futures contracts of the component securities of the underlying index of a futures ETF is closed, the beneficial certificates will continue to be traded on the TWSE central market.
Article 6    The minimum lot size for trading beneficial certificates shall be represented by one trading unit or its integer multiples, where one trading unit equals 1,000 beneficial units. The trading unit of offshore ETF beneficial certificates may be determined by offshore fund entities. The trading unit of underlying ETF beneficial certificates may be determined by SITEs.
     Fractions of a trading unit are governed mutatis mutandis by the TWSE Regulations Governing Odd-Lot Trading of Listed Shares.
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Article 7    Quote information consists of the bid and offer price per beneficial unit. The currency that such prices are quoted in is the currency in which the SITE, offshore fund entity, futures trust enterprise or trustee institution applies to the TWSE for listing.
    The minimum tick size of ETF beneficial certificates and real estate investment trust beneficial securities is one cent, or NT$0.01, for beneficial units quoted less than NT$50, and five cents, or NT$0.05, for beneficial units quoted at more than or equal to NT$50.
    Provisions regarding minimum tick sizes for beneficial certificates other than those specified in the preceding paragraph are subject mutatis mutandis to the minimum tick size rules for listed stock prices.
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Article 8    The relevant daily price fluctuation limit provisions for listed stocks shall apply mutatis mutandis to beneficial certificates after they are listed, provided no price fluctuation limits are imposed on the following beneficial certificates:
  1. securities investment trust ETF beneficial certificates with foreign component securities, and the underlying EFT beneficial certificates.
  2. futures ETF beneficial certificates that track a foreign futures index.
  3. offshore ETF beneficial certificates.
     For a leveraged or inverse securities investment trust ETF of which the component securities of the underlying index are all domestic securities, the relevant daily price fluctuation limit for the beneficial certificates and their underlying EFT beneficial certificates shall be 10 percent multiplied by the multiple of the fund. No price fluctuation limits are imposed on the beneficial certificates and their underlying EFT beneficial certificates where the component securities of the underlying index contain one or more foreign securities.
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Article 9     The calculation basis for the price fluctuation limits on beneficial certificates except offshore ETF beneficial certificates for the first day of listing are determined on the business day before listing in accordance with the following rules:
  1. For a securities investment trust fund offered by a securities investment trust enterprise, the net asset value per unit of beneficial interest on the most recent business day, obtainable by calculation pursuant to Article 72 of the Regulations Governing Securities Investment Trust Funds.
  2. For a futures trust fund offered by a futures trust enterprise, the net asset value per unit of beneficial interest on the most recent business day, obtainable by calculation pursuant to Article 76 of the Regulations Governing Futures Trust Funds.
  3. For a real estate investment trust fund established by a trustee institution, the net asset value per unit of beneficial interest calculated according to the provisions of the real estate investment trust contract.
  4. For an underlying ETF beneficial certificate, the ratio of its trading units to the trading units of the beneficial certificates mentioned in Article 2, paragraph 1, subparagraph 2, item 1 and the net asset value per unit of beneficial interest on the most recent business day as converted at the exchange rate.
    With respect to the beneficial certificates referred to in the preceding paragraph, the auction reference price at market opening on the first day of listing shall be the price arrived at by processing the calculation basis set under the same paragraph, pursuant to Article 7, paragraphs 2 and 3 herein.
    With respect to offshore ETF beneficial certificates, the auction reference price at market opening on the first day of listing shall be the price arrived at by processing the latest net asset value per unit of the offshore fund, during TWSE business hours on the day before listing as published by the representing master agent of the offshore fund pursuant to Article 14 of the Regulations Governing Offshore Funds, pursuant to Article 7, paragraph 2 herein.
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Article 10    Any beneficial certificate trade of which settlement is conducted after the date of suspension of changes to entries in the register of beneficial owners for the determination of the record date of distribution by the SITE pursuant to Article 77 of the Regulations Governing Securities Investment Trust Funds or by the futures trust enterprise pursuant to Article 78 of the Regulations Governing Futures Trust Funds shall be an ex-dividend transaction.
    On the commencement date of ex-dividend trading, the price fluctuation limits for those trades shall be calculated based on the previous day's closing price minus the dollar amount of distributed gains. When there is no previous day's closing price, the closing price shall be replaced with the price determined by the principles laid down in Article 58-3, paragraph 4, subparagraph 2 of the TWSE Operating Rules.
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Article 10-1    In the event of split or reverse split of ETF beneficial certificates, daily fluctuations on a trading day after listing of split or reverse-split beneficial certificates shall be calculated on the basis of the closing price of the beneficial certificates on the last trading day prior to the split or reverse split divided by the ratio of number of beneficiary units after the split or reverse split to the number of original beneficiary unit.
    In the absence of closing price on last trading day for the split or reverse-split beneficial certificates in the preceding paragraph, the price determined according to the guidelines under Article 58-3, paragraph 4, subparagraph 2 of the TWSE Operating Rules shall be used instead.
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Article 10-2    A trade of REIT beneficial securities of which settlement is conducted after the date of suspension of changes to entries in the register of beneficial owners for the determination of the record date for the distribution of gains or additional public offering of REIT beneficial securities by the trustee in accordance with the REIT contract, shall be an ex-dividend or ex-rights transaction.
    On the commencement date of ex-dividend trading, the price fluctuation limits for those trades shall be calculated based on the previous day's closing price minus the amount of distributed gains.
    On the commencement date of ex-rights trading, the price fluctuation limits for those trades shall be calculated by one of the following approaches:
  1. Where the issuing price of each beneficial unit of the REIT beneficial securities in the trustee’s additional public offering is lower than the closing price of the day preceding the commencement date of the ex-rights trading period, for the calculation of the price fluctuation on the commencement date of ex-rights trading, the amount of increase shall be calculated based on the previous day's closing price, and the amount of decrease shall be calculated based on the previous day's closing price minus the value of rights in the REIT beneficial securities in the additional public offering.
  2. Where the issuing price of each beneficial unit of the REIT beneficial securities in the trustee’s additional public offering is higher than the closing price of the day preceding the commencement date of the ex-rights trading period, for the calculation of the price fluctuation on the commencement date of ex-rights trading, the amount of increase shall be calculated based on the previous day's closing price minus the value of rights in the REIT beneficial securities in the additional public offering, and the amount of decrease shall be calculated based on the previous day's closing price. The value of rights in the preceding paragraph is calculated by the TWSE.
    When there is no closing price on the day preceding the commencement date of ex-dividend or ex-rights trading, the closing price shall be replaced with the price determined by the principles stipulated in Article 58-3, Paragraph 4, Subparagraph 2 of the TWSE Operating Rules,
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Article 11    A SITE that issues ETF beneficial interest certificates, a futures trust enterprise , or an offshore fund institution shall designate a liquidity provider to provide liquidity when the certificate is traded on the centralized market of the TWSE. The relevant operational guidelines shall be adopted separately by the TWSE.
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