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Article 44
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If a circumstance arises under Article 39 or the preceding article that requires a buy-in of securities for return of securities borrowed in a fixed-price or competitive bid transaction, and if due to the constraint of the settlement period the lender is unable to exercise its shareholder's rights in a timely manner, the TWSE may, in addition to placing an order with a securities firm to buy in subject securities, borrow subject securities for return to the lender and effect a further return of securities when the bought securities are credited to the account.
If a circumstance arises under Article 39 or the preceding article that requires a buy-in of securities for return of securities borrowed in a fixed-price or competitive bid transaction, and if due to the trading status of the market generally or the subject securities specifically it is not possible to buy in subject securities within 2 consecutive business days after the date of the circumstance, the TWSE will repay the shortfall by cash in an amount determined by reference to the closing price on the second business day.
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Article 47
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The securities lending fee for a fixed-price or competitive bid transaction shall be calculated, on a daily marked-to-market and on a transaction-by-transaction basis, as the sum of the products obtained by multiplying the outstanding balance of subject securities on loan on a given day by the closing price of the subject securities on that day and further by the lending rate fixed upon execution of the loan transaction. The total securities lending fees shall be collected/paid through the securities firm upon return of securities in satisfaction of the loan by the borrower.
The borrowing period shall begin on the date the subject securities are borrowed and end on the day preceding the date they are returned. If on the return date an act of God or accident occurs prompting the TWSE or TPEx to announce closure of the securities market, the next business day shall be treated as the return date. The preceding paragraph shall apply mutatis mutandis when calculating securities lending fees for holidays.
Where in the fixed-price or competitive bid transaction the lender agrees to renew the loan, the securities lending fee shall continue to accrue until, and be collected/paid upon, return of securities in satisfaction of the loan.
If the borrower in a fixed-price or competitive bid transaction makes any early, partial return during the life of the loan, it shall on the next business day settle all lending fees and expenses that have incurred on the securities borrowing transaction. If the borrower in a negotiated transaction makes any early, partial return during the life of the loan, it shall on the next business day settle all processing fees and loan service fees in relation to the securities returned.
The calculation and payment of the securities lending fee on a negotiated transaction shall be negotiated and agreed upon between the borrower and the lender themselves, notwithstanding the provisions of Article 31, paragraph 5.
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