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Article 4
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Brokers must receive a request by a principal or principal's agent in person or by means of letter, telegraph, telephone, IC card, or the Internet before they may fill out and print the letter of consignment stipulated prescribed under Article 87 of the Securities and Exchange Law in order to execute a trade.
When a principal or principal's agent requests securities trades through letter, telegraph or telephone, the securities broker's officer managing the trade shall fill out the letter of consignment in either written or electronic form, print the consignment order, and sign and stamp it the letter of consignment. When the principal requests trades by means of IC card, the Internet or other means of electronic interchange, the securities firm may be exempt from the requirement to produce and fill out the le
tter of consignment; however, it shall promptly print a record of requests for trades in the order received, and for requests for trades made by means of IC card, the Internet or other means of electronic interchange, or where letters of consignment were filled out in electronic form and not printed out one by one, which after market closing shall be signed by the officer processing the trade and the department manager, or the employee receiving the trading order, shall add their signatures to the record o
f requests for trades. The record of requests for trades shall include the principal's name and account number, the time of consignment, the type, number, and face value of the securities, the consigned price, the period of validity, the name or code number of the trader, and the method of request. Requests made in person shall be signed and stamped by the principal or the principal's agent.
When the principal makes a trading request over the Internet, the record of requests referred to in the preceding paragraph shall also include the principal's Internet address (IP) and digital signature. When the request is made by phone, the broker shall make use of the telecommunications provider's caller ID service to record the caller's telephone number. When the immediate record of requests is printed, the items listed above may be omitted. An agent must first obtain a power of attorney from the pri
ncipal before trading on his behalf or signing trading documents.
The securities broker shall not be liable for errors that occur when the principal or his agent makes a trading request by telephone when such errors are not attributable to the fault of the broker. For securities brokers making use of IC cards, the Internet, or other electronic forms of interchange, electronic signatures issued by a certification authority shall be used to differentiate and verify documents transmitted during consignment, order confirmation, and transaction confirmation.
Where records of requests for trades made by means of IC card, the Internet or other means of electronic interchange are saved in accordance with the following provisions, the broker may be exempt from the requirement to print out a record of requests for trades:
1. Use of a digital data storage medium that allows neither modification nor deletion, with complete records produced on the date of transaction.
2. Establishment of a comprehensive directory and procedures for management.
3. Personnel solely responsible for management of the storage medium, and the capability to convert electronic data files to printed format at any time.
Letters of consignment which are filled out electronically and not printed one by one shall be stored in an electronic form that be altered or deleted.
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