| Title： |
Regulations Governing Internal Personnel Opening Accounts at Securities Firms for Consigned Securities Trading(2004.07.13) |
| Date： |
|
|
1
|
These Regulations are specially adopted to govern the opening of accounts for consigned securities trading by internal personnel at securities firms.
|
|
2
|
"Internal personnel," as used in these Regulations, refers to the following:
(1) Directors, supervisors, and employees of securities firms, provided that for juristic-person directors or supervisors, only the juristic person itself or its representative may be designated as a director or supervisor; where the securities firm is concurrently operated by a financial institution, "employees" refers to those persons employed in the securities department.
(2) Spouses and minor children of the personnel referred to in the preceding subparagraph.
The internal personnel referred to in the preceding paragraph shall be limited to opening accounts for consigned securities trading at their own securities firms, and may not open such accounts under another’s name. The consignment order forms used in trading shall first be reviewed by the securities firm, and the securities firm shall prescribe the level at which consignment order forms will be reviewed when the duties of the internal personnel referred to in the preceding paragraph involve undisclosed information or a conflict of interest with the securities firm or other investors requiring recusal. .
Internal personnel of securities firms which have dealing or underwriting departments but no brokerage business shall open accounts only at other securities firms designated by the securities firm by which they are employed, and shall be subject to these Regulations.
|
|
3
|
A securities firm shall differentiate the accounts opened by internal personnel and other principals, and information on accounts opened shall be compiled and submitted to the Taiwan Stock Exchange Corporation each month. If the employee handling a trade learns that the trade was consigned by an internal employee under another person's name, the employee handling the trade shall refuse to accept the consignment and shall notify the manager in charge of consignment trading. When one of the internal personnel at a securities firm loses his or her internal personnel qualification or status, their account shall be cancelled or converted to a principal's ordinary consignment order account.
|
|
4
|
Internal personnel at a securities firm with knowledge that the underwriting division is selling stock obtained through firm commitment underwriting or with knowledge of the trading division's intent to trade a particular type of stock may not request trades in the same type of stock prior to the sale or the trade by the respective division.
|
|
5
|
Internal personnel at securities firms may not engage in margin trading, provided that spouses as referred to under Article 2, paragraph 1, subparagraph 2 but which are not spouses of either directors or supervisors or juristic-person director's or supervisor's representatives, shall not be subject to this restriction.
When quotas are allocated for margin purchases and shorts sales of securities, spouses of internal personnel at securities firms who are engaging in margin trading as referred to in the preceding paragraph may only settle their margin purchase or short sale transaction for the given security and may not consign any further order for a margin purchase or short sale for the given security.
|
|
6
|
Internal auditing at a securities firm shall include a weekly audit of the consigned trades entered by internal personnel and the subject of the trades, in order to avoid affecting the rights and interests of other investors and the securities firm.
|
|
7
|
Internal auditing at a securities firm shall include a monthly audit of the evidentiary documents relating to consigned trades by internal personnel.
Securities firms shall place evidentiary documents relating to trades by internal personnel in custody separately from those of other principals in order to make them available for auditing by the competent authorities.
|
|
8
|
Matters not provided for in these Regulations shall be governed by other relevant laws and regulations.
|
|
9
|
These Regulations shall take force upon approval by the competent authority.
|