| Title： |
Directions for Establishment of Margin Accounts With Securities Firms for Margin and Stock Loans(2003.04.15) |
| Date： |
|
|
Article 1
|
These Directions are adopted under Article 11 of the Regulations Governing Margin and Stock Loans by Securities Firms.
|
|
Article 2
|
A principal applying to open a margin account and enter into a margin contract shall meet the following conditions, except in cases where renewing an existing contract at its expiration:
1. Be an ROC national of at least 20 years of age and with disposing capacity, or a juristic person organized and registered under the laws of the ROC.
2. Have opened a trading account for at least three full months.
3. Have had at least 10 trade orders executed during the most recent year, of an aggregate amount equal to at least 50 percent of the margin credit line applied for; this also applies where a period of less than one year has elapsed since the principal opened the trading account.
4. Have aggregate income and assets in the most recent year equal to at least 30 percent of the margin credit line applied for, unless the margin credit line applied for does not exceed NT$500,000.
When a principal applies to establish five or more margin accounts, the calculation of margin credit line under subparagraph 3 or 4 of the preceding paragraph shall include the margin credit lines approved for previously established margin accounts, and, where the property certificate is a certificate of deposit with a financial institution under Article 3, paragraph 1, subparagraph 2, the calculation shall be made based upon the average balance for the most recent month.
A principal renewing a margin contract during its term or at its expiration shall meet the requirements set out in paragraph 1, subparagraph 4.
A put warrants issuer may apply to establish a margin account without being subject to the requirements set out in paragraph 1, subparagraphs 2, 3, and 4, and paragraph 2.
A securities firm may raise the percentage under paragraph 1, subparagraph 3 or 4, as it deems necessary after assessment.
|
|
Article 3
|
The property certificate under paragraph 1, subparagraph 4, of the preceding Article shall be limited to the following voucher or document of the principal or his or her spouse, parent, or adult child:
1. photocopy of certificate of real property ownership or tax return.
2. certificate of deposit with a financial institution for the most recent month.
3. certificate of holdings in securities.
Where the principal is not the owner of the property shown on the provided property certificate, the property owner shall be the joint and several guarantor.
|
|
Article 4
|
Where a principal to which a securities firm extends margin and stock loans has entered into a margin contract with a securities finance enterprise via the securities firm and such contract is not yet terminated, if the principal enters into a separate margin contract with the securities firm within six months from the date on which the firm commenced operating margin and stock loan business, the restrictions imposed by Article 2 in relation to conditions for account opening do not apply.
The same shall apply to a principal of a securities firm that is extinguished as a result of a merger/consolidation or transfer of the whole of its business or property where the principal enters into a new margin contract with the surviving securities firm within six months from the day following the record date for the merger/consolidation or from the last business day of the transferor securities firm.
|
|
Article 5
|
These Directions, and any amendments hereto, are formulated by the Taiwan Stock Exchange Corporation together with the GreTai Securities Market and shall be publicly announced and implemented after ratification by the competent authority.
|