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Article 3
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Securities brokers accepting consignments for securities trades must first execute a consignment contract with the principal, and shall not effect securities trades on behalf of those who have not yet executed such a contract.
Securities brokers shall abide by the following provisions when executing a contract with a principal:
1. Where the principal is a natural person, with the exception of the following circumstances, that person shall bring their National Identity Card, personally place their seal on the consignment contract, open an account, and place a photocopy of their National Identity Card on file.
(1) Where the principal has limited or no disposing capacity, the principal's statutory agent or guardian shall bring his/her own and the principal's National Identity Card, open an account, personally place their seal on the consignment contract, and place a photocopy of their own and the principal's National Identity Card on file. Where the principal has not yet obtained a National Identity Card, a household registration or household membership list may be used; the guardian shall also supply proof of guardianship.
(2) Where the principal is a person working overseas for a juristic person, the principal may engage an agent to open an account by personally bringing their own and the principal's National Identity Cards, a power of attorney notarized by an ROC overseas representative office or other authorized institution, and documents provided by the juristic person evidencing the fact of employment overseas.
(3) When the principal has specified a trading volume of NT$1 million or less per day and has not yet opened a margin trading account, the broker may accept an account-opening application from the principal through the Internet, by letter, or by another method; however, the principal's personal signature and stamp are still required on the account contract, and the signature and seal-stamp must be verified by the broker before the contract will be legally effective. The broker may determine what type of credit check shall be performed in connection with opening this type of account; however, a new credit check must be carried out at the time of any subsequent adjustment to the then-current limit on trading volume, in accordance with relevant regulations.
2. When the principal is a juristic person, procedures shall be carried out by an authorized person holding copies of evidentiary documents, including a copy of the juristic person's registration, a copy of the tax authority notice for issuance of a uniform invoice number and establishment of a withholding entity, a legally valid power of attorney and a copy of the authorized person's National Identity Card.
When the principal, the principal's statutory agent or other authorized person executes a consignment contract, a sample signature card or seal impression card for the principal, the principal's statutory agent or other authorized person shall be kept on file, and an identical signature or seal shall be used when trading, subscribing to, or authorizing another as agent to trade or subscribe to securities, or to complete settlements and related procedures.
The consignment contract shall specify the name, sex, age, address, birthplace, profession, and National Identity Card number of the principal (or principal's agent, if any). For juristic persons, the contract shall specify the name, address, and government uniform invoice number of the juristic person; in addition, the articles of incorporation, operating rules, and relevant public announcements of the Taiwan Stock Exchange Corporation, as well as the regulations of the ROC Securities Dealers Association, shall be recognized as a part of the contract.
The broker shall engage in securities trading on behalf of the principal only after the principal opens a centralized securities depository account and a deposit account at the principal's designated financial institution.
The provisions of the preceding paragraph regarding opening a deposit account are not applicable to the following: foreign nationals or overseas Chinese outside ROC territory; securities investment trust funds; insurance companies; foreigners or overseas Chinese converting holdings of convertible corporate bonds into stocks or overseas depository receipts into their underlying securities through their accounts at a custodian institution (custodian bank); depository account owners at the depository institutions issuing overseas depository receipts through their custodian banks; and collective investment trust fund accounts managed by trust enterprises with depository participant status.
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