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Article 3
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To ensure security of settlement for securities trades, when TWSE analysis discovers any of the following circumstances in intraday trading at a securities firm involving the securities listed in the preceding article, it will, promptly after market closing, issue written notice to the internal auditing or operations department of the aforesaid securities firm, with a copy to the general manager of its head office; in the case of the Taiwan branch office of a foreign securities firm, it will bring the matter to the attention of the branch office manager:
- Where the difference between an investors' purchase/sale orders for the given security at the given securities firm exceeds NT$300 million and also exceeds one time the net worth of the given securities firm, and where the volume it purchased (or sold) on consignment accounts for 20 percent or more of the total monetary volume of consigned purchases (or sales) of the given security.
- Where the difference between orders accepted by a securities firm for purchase/sale of the given security exceeds NT$500 million and also exceeds 1.5 times the net worth of the given securities firm, and where the volume it accepted in consignments for purchases (or sales) accounts for 40 percent or more of the total monetary volume of all consignments for purchases (or sales) of the given security.
- Where the difference between an investor's confirmed purchases/sales of the given security through the given securities firm exceeds NT$100 million and also exceeds 0.3 times the net worth of the given securities firm, and where the volume of its confirmed purchases (or sales) accounts for 10 percent or more of the total monetary volume of all confirmed trades in the given security.
- Where the difference between confirmed purchases/sales of the given security by a securities firm exceeds NT$200 million and also exceeds one time the net worth of the given securities firm, and where the volume of the confirmed purchases (or sales) thereby accounts for 20 percent or more of the total monetary volume of confirmed trades in the given security.
When the circumstances under subparagraphs 1 or 2 of the preceding paragraph apply to a securities firm, the TWSE may inform the persons referred to in paragraph 1 by telephone within the period when the trading order is consigned or the trade is made. During a period of trading without price limits of an initial listing of common stock, the provisions of paragraphs 1 and 2 regarding notice to the securities firm shall apply mutatis mutandis under any of the circumstances listed below:
- Where any of the following circumstances applies to the price of an investor's purchase/sale orders for the given security with the given securities firm, and the cumulative volume of those orders reaches 1,000 trading units (or the cumulative value of the orders reaches NT$50 million) or more:
- Before market opening, a buy order is placed at a price higher than that day's opening reference price by 25 percent or more, or a sell order is placed at a price lower than that day's opening reference price by 25 percent or more.
- After market opening, a buy order is placed at a price higher than the posted price for orders currently being transacted by 25 percent or more, or a sell order is placed at a price lower than the posted price for orders currently being transacted by 25 percent or more.
- Where any of the following circumstances applies to the prices of orders accepted by a securities firm for purchase/sale of the given security, and the cumulative volume of those orders reaches 5,000 trading units or more or the cumulative value of those orders reaches either NT$200 million or 0.5 times or more of the given securities firm's net worth:
- Prior to market opening, a buy order is placed at a price higher than that day's opening reference price by 25 percent or more, or a sell order is placed at a price lower than that day's opening reference price by 25 percent or more.
- After market opening, a buy order is placed at a price higher than the posted price for orders currently being transacted by 25 percent or more, or a sell order is placed at a price lower than the posted price for orders currently being transacted by 25 percent or more.
If trading of any securities listed in the preceding article under an omnibus trading account of a securities firm reaches a level referred to in paragraph 1 or paragraph 3, the TWSE may bring the matter to the attention of the management of the securities firm, to ensure the security of settlement for securities trades. When the trading volume of a security is below 1,000 units, the provisions of Article 2, paragraph 4 shall apply mutatis mutandis to the numerical standards for the unit of the trading (or order) volume.
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Article 6
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When any of the following circumstances applies to the trading of securities, the TWSE will immediately announce that the security will be subject to disposition measures:
- The TWSE has announced trading information for a particular security pursuant to Article 4, paragraph 1, subparagraph 1 for a period of 3 consecutive business days
- The TWSE has announced trading information for a particular security pursuant to Article 4, paragraph 1, subparagraphs 1 to 10 for a period of 5 consecutive business days, or for any 6 business days with the most recent 10-day period, or for any 12 business days within the most recent 30-day period.
Where measures under paragraph 1 have been announced for a particular security for the first time within the most recent 30 business days, the TWSE will simultaneously adopt the following measures within 10 business days of the next business day after the condition occurs:
- Conducting trade matching for the securities with manually controlled trade matching terminals (matching approximately every 5 minutes, or for securities placed under altered trading methods, every 10 minutes; for securities under altered trading methods for which periodic call auction is also used, approximately every 45 minutes).
- Notifying securities brokers that when an investor's daily volume of trading orders for the security during the given period consists of a single trade of 10 trading units or multiple trades with an aggregate total of 30 trading units or more, they shall collect from the investor the full amount of the buy-side price or sell-side securities for trades already consigned that day; for margin trading, they shall collect in full the margin for the purchase or the short sale. For further trading orders in excess of the aforementioned amounts on the same day, the buy-side price or sell-side securities shall also be collected in full, and for margin trading, the margins shall also be collected in full. This, however, shall not apply to liquidation of margin trades or orders to trade the security through a default account.
When the measures under paragraph 1 have been announced two or more times (inclusive) for a particular security within the most recent 30 business days, the TWSE will simultaneously adopt the following measures within 10 business days of the next business day after the occurrence:
- Conducting trade matching for the securities with manually controlled trade matching terminals (matching approximately every 20 minutes; for securities under altered trading methods, approximately every 25 minutes; for securities under altered trading methods for which periodic call auction is also used, approximately every 60 minutes).
- Notifying securities brokers that for an investor's daily volume of trading orders for the security during the given period, they shall collect from the investor in full the buy-side price or sell-side securities for trades already consigned that day; for margin trading, they shall collect in full the margin for the purchase or the short sale. This, however, shall not apply to liquidation of margin trades or orders to trade the security through a default account.
When measures are announced for a particular security pursuant to paragraph 2 or 3 herein and reasons for announcement include circumstances under Article 4, paragraph 1, subparagraph 8, or during the period of disposition the TWSE further announces trading information pursuant to the aforementioned subparagraph 8 and analysis shows irregularities, or when the TWSE deems that there is a securities trading irregularity with the likelihood of a significant impact on the security of settlements in the market, or under other circumstances when it is necessary to maintain order in the markets or the security of settlements, then after reporting to the Surveillance Operations Oversight Committee for a resolution, it may adopt the following disposition measures:
- The measures under paragraphs 2 and 3, provided that these may be adjusted when necessary, as follows:
- The time at which trade matching of the security is done using manually controlled trade matching terminals.
- Whether, when the investor places the order for the security involved in the irregular trading, there is advance collection of all or a specific proportion of the buy-side price, sell-side securities, margin for margin purchase, or margin for short sale.
- The effective period of the measures.
- Amounts of reported daily sales or purchases of the given security may not exceed NT$60 million by the head office of any securities firm or NT$10 million by a branch office of any securities firm; when necessary, the amounts of reported daily sales or purchases of the given security at the head offices and branch offices of securities firms may be adjusted based on the current trading in that security, its market value, or the capitalization of the issuing company. Provided, this shall not apply to liquidation of margin trades or orders to trade the security through a default account.
- Notifying all securities firms to make an additional submission to the Clearing and Settlement Fund when trading the security involved in irregular trading.
- Temporarily suspending margin purchases and short sales of the given security, provided that this shall not apply for already concluded trades.
- Suspending trading of the given security for a specific period after reporting to and receiving approval from the competent authority.
- Other measures.
Measures for disposition under subparagraph 2 of the preceding paragraph may also be adopted pursuant to a resolution of the special management committee of the Joint Responsibility System Clearing and Settlement Fund, which may prescribe the amounts of reported daily purchases or sales of the given security by securities firms and the period of disposition.
When disposition measures are adopted with respect to trading in a given security by resolution of the Surveillance Operations Oversight Committee or the special management committee of the Joint Responsibility System Clearing and Settlement Fund, the number of days on which trading information is announced prior to implementation of the measures or during the effective period of the disposition need not be included in the basis of calculation under paragraph 1.
If during a period of any measure under paragraphs 2 to 4 an order is placed for trading of the given securities under an omnibus trading account of a securities broker, the provisions for that measure shall apply, and the securities firm shall collect all or a specific proportion of the buy-side price or sell-side securities from any representative (mandatary) for any principal thereunder that reaches the threshold. When the trading volume of a security is below 1,000 units, the provisions of Article 2, paragraph 4 shall apply mutatis mutandis to the numerical standards for the unit of the trading (or order) volume.
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