| Title： |
Operating Rules for Securities Firms Handling Margin Purchases and Short Sales of Securities(2012.11.02) |
| Date： |
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Article 19
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Upon execution of a margin purchase or short sale, the securities firm shall, by 10 a.m. on the second business day after the trade date, collect from the customer a margin for the margin purchase, based on the balance of the trade price of the margin purchase less the dollar amount of the margin loan, or in the case of a short sale, a margin for the short sale, based on the trade price of the short sale multiplied by a required percentage (any amount less than NT$100 shall be calculated as NT$100).
Notwithstanding the provisions of Article 31, where a TWSE or GTSM listed security is bought on margin and sold short on the same day in an account, if the customer has signed a consent letter with the securities firm, then a net settlement is allowed for offsetting a portion of the settlement obligation under the margin purchase against an equal amount of the settlement obligation under the short sale, in which case the securities firm shall prepare an Application to Settle Margin Purchases with Cash and an Application to Settle Short Sales with Spot Securities on behalf of the customer.
If the customer having signed the consent letter under the preceding paragraph does not wish to have netting settlement thereunder carried out, the customer shall give a written instruction to the securities firm before close of market on the day on which the trades are executed.
No interest may be accrued on the margin purchase and short sale with respect to the portions that are offset by netting under paragraph 1; nevertheless, the handling fee for that portion of the short sale shall still be calculated and collected/paid.
The portions of the trades that are offset by netting under paragraph 1 shall still be calculated respectively into the position limits for margin purchases and short sales for the customer on the given day; however, if the day offset of margin purchases and short sales is within half of the margin position limit, it may be exempted from being calculated into the position limits for margin purchases and short sales as specified above, provided that it shall still be calculated into the position limits for margin purchases and short sales of any single security.
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