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Taiwan Stock Exchange Corporation Securities Borrowing and Lending Rules(2022.06.28) |
| Date： |
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Article 14
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The subject securities in securities borrowing and lending transactions means any securities eligible for margin purchase and short sale transactions; any securities eligible to be underlying securities in the issuance of call (put) warrants; domestic component securities of securities investment exchange-traded trust funds (EFTs); and any underlying securities on which any of the following derivative instruments have been issued where such securities are listed on the TWSE or GreTai Securities Market (GTSM):
- Single-stock options or single-stock futures.
- Domestic and overseas convertible or exchangeable corporate bonds.
- Overseas depositary receipts.
If any of the circumstances described in the financial information indicators listed in the Key Financials and Transaction Information Section of the Market Observation Post System, as shown in Appendix 4, applies to any of the above subject securities in securities borrowing and lending transactions, the borrowing and lending transactions of the securities concerned will be suspended from the following business day unless the trading method trading method is altered or trading is suspended, in which case the date of implementation as announced will prevail. The TWSE will announce an adjustment to the appendix in the event of a revision to indicators in the above section.
Objects of securities borrowing and lending that conform to the first paragraph do not include stocks listed on the Taiwan Innovation Board, stocks primary listed on the Taiwan Innovation Board and ETF beneficial certificates traded in foreign currency.
The subject securities as set forth in the first paragraph shall be those as announced by the TWSE and subject to any further adjustment by the TWSE having regard to the market situation.
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Article 47
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The securities lending fee for a fixed-price or competitive bid transaction shall be calculated, on a daily marked-to-market and on a transaction-by-transaction basis, as the sum of the products obtained by multiplying the outstanding balance of subject securities on loan on a given day by the closing price of the subject securities on that day and further by the lending rate fixed upon execution of the loan transaction. The total securities lending fees shall be collected/paid through the securities firm upon return of securities in satisfaction of the loan by the borrower.
The borrowing period shall begin on the date the subject securities are borrowed and end on the day preceding the date they are returned. If on the return date an act of God or accident occurs prompting the TWSE or TPEx to announce closure of the securities market, the next business day shall be treated as the return date. The preceding paragraph shall apply mutatis mutandis when calculating securities lending fees for holidays.
Where in the fixed-price or competitive bid transaction the lender agrees to renew the loan, the securities lending fee shall continue to accrue until, and be collected/paid upon, return of securities in satisfaction of the loan.
If the borrower in a fixed-price or competitive bid transaction makes any early, partial return during the life of the loan, it shall on the next business day settle all lending fees and expenses that have incurred on the securities borrowing transaction. If the borrower in a negotiated transaction makes any early, partial return during the life of the loan, it shall on the next business day settle all processing fees and loan service fees in relation to the securities returned.
The calculation and payment of the securities lending fee on a negotiated transaction shall be negotiated and agreed upon between the borrower and the lender themselves, notwithstanding the provisions of Article 31, paragraph 5.
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