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Article 12
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The responsible persons and associated persons of a securities firm shall be registered by their firm with the stock exchange, Securities Association, or over-the-counter stock exchange before performing their duties, and may not perform their duties without such registration.
A securities firm that employs any person to engage in business other than the business under the subparagraphs of Article 2, paragraph 2, when that person has been dismissed from his or her position within the past 3 years by an order of the FSC pursuant to the Act, shall file with the stock exchange for registration of that person before their employment may effect.
Under any of the following circumstances, the stock exchange, Securities Association, or over-the-counter stock exchange shall refuse to grant a registration, and shall void a registration that has already been made:
- 1. A responsible person of a securities firm conforms to any circumstance in Article 30 of the Company Act or Article 53 of the Act.
- 2. An associated person of a securities firm conforms to any circumstance in paragraph 1 of Article 54 of the Act or fails to meet the qualifications in Articles 5 and 6.
By the 15th day of each month, the stock exchange, Securities Association or over-the-counter stock exchange shall report the status for the previous month of the registrations under the preceding three paragraphs for recordation by the FSC.
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Article 13
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In the event of any change of responsible person or associated person, the securities firm shall file a registration with the stock exchange, Securities Association, or over-the-counter stock exchange within 5 days after the change, as specified below. The securities firm shall not be released from liability for the actions of such persons before completion of the registration.
- For the purpose of an amendment registration due to job transfer or promotion of a responsible person or associated person of a securities firm.
- For the purpose of canceling a registration in the event of the death, resignation, layoff, dismissal, severance, or retirement of a responsible person or associated person of a securities firm, or a circumstance set out in Article 17.
- For the purpose of voiding a registration when the dismissal of a responsible person or associated person is ordered by the FSC in accordance with the Act, or the registration of said person conforms to any circumstance under paragraph 3 of the preceding article.
Registration of any change in a responsible person or associated person of the overseas branch of a securities firm shall be performed within 10 days after the change.
By the 15th day of each month, the stock exchange, Securities Association or over-the counter stock exchange shall compile the particulars of changes to registrations as referred to in the preceding paragraph for the previous month and report them to the FSC for recordation.
A securities firm shall file with the stock exchange, Securities Association, or over-the-counter stock exchange for approval and recordation before any change of an internal auditing associated person of the securities firm described in paragraph 1 may take effect.
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Article 18
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Responsible persons and associated persons of a securities firm shall conduct business in accordance with the principles of honesty and good faith.
Except where otherwise provided by law or regulation, responsible persons and associated persons of a securities firm may not engage in the following conduct:
- Engaging in the trading of exchange-listed or OTC-listed stocks with information learned on the job for the purpose of obtaining speculative profit.
- Disclosing information regarding a customer order or other secrets learned as a result of the job, other than in response to inquiries made in accordance with laws or regulations.
- Accepting a customer's trading order with discretionary authority over the type, quantity, price, or purchase or sale of the securities.
- Trading securities with a guarantee to the customer of earning profits or with a promise of sharing profits.
- Trading securities under an agreement with the customer to jointly assume the losses or profits of the transaction.
- Accepting orders from customers to buy or sell securities and concurrently buying or selling the same securities for his or her own account on the opposite side of the trade.
- Subscribing or trading securities in the name of the customer or by using the customer's account.
- Subscribing or trading securities for the customer in the names of other persons or relatives.
- Borrowing or lending of money or securities to or from a customer, or acting as an intermediary for the borrowing or lending of money or securities to or from a customer.
- Fraud, deception, or other misleading behavior when engaging in underwriting, proprietary trading, or brokerage trading of securities.
- Safekeeping securities, cash, chops, or deposit books of customers, or misappropriating any of those things.
- Trading securities for a customer that has not entered into a brokerage contract;
- Trading securities other than in accordance with the particulars and instructions of the order placed by the customer.
- Providing a customer or unspecified persons with information indicating that the price of certain securities will rise or fall in order to solicit the trading of securities;
- Recommending trades in specific stocks to unspecified persons, except as necessary for purposes of securities underwriting.
- Accepting customer settlement by means of offsetting a purchase or sale of securities with a sale or purchase of securities of the same type through the same or a different account. However, this restriction shall not apply to settlement by mutually offsetting margin purchases and short sales in margin trading, nor shall it apply to accepting customer settlement by means of mutually offsetting an equal quantity of cash purchases and spot sales of the same security that have been executed through the same account on the same business day, when done in accordance with laws and regulations.
- Opening an account, or subscribing, trading, or settling securities as agent on behalf of another person, provided that this restriction does not apply if the responsible person or associated person is the statutory representative of the principal.
- Processing the opening of an account, or the subscription, trading, or settlement of securities, for a director, supervisor, or employee of the company on behalf of another person.
- Processing the opening of an account for a person other than the principal for whom the account is being opened. However, this rule does not apply if the FSC has provided otherwise.
- Processing an application for subscription, trading, or settlement of securities from a person who is not the customer or not an agent with a power of attorney from the customer.
- Accepting a trading order despite being aware that the customer is using undisclosed information of a public company that will have a material impact on the stock price of the company or being aware that the customer intends to manipulate the market.
- Any agreement between persons engaging in securities underwriting business and an issuing company or its relevant personnel for purposes of obtaining improper profit.
- Soliciting, acting as an intermediary for, or promoting unapproved securities or derivative products thereof.
- Other conduct in violation of securities laws or regulations or conduct prohibited by the rules prescribed by the FSC.
Persons referred to in the preceding paragraph also may not engage in any conduct prohibited by securities laws and regulations when conducting their duties.
The provisions of the two preceding paragraphs shall apply mutatis mutandis to other employees of a securities firm.
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