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Relevant Laws

Title:Operating Rules for Securities Firms Handling Non-Restricted Purpose Loan (2019.09.06)
Article 13     A client shall notify the securities firm if there is a change to the name or ID number, VAT number, juristic person uniform number of the client itself, its agent, or representative, or to the mailing address, recorded on its non-restricted purpose loan contract in writing or by correspondence or electronic means that is sufficient to identify the client as the principal itself and confirm its indication of intent agreed by both parties, which shall be clearly stated in the non-restricted purpose loan contract.
Article 16     The collateral financing calculation standards for a securities firm that operate non-restricted purpose loan business shall be as follows, save in the event of fractions of one trading unit or of one unit of beneficial rights.
  1. The value of TWSE and TPEx traded securities, except for central book-entry bonds, municipal bonds, common corporate bonds and financial bonds, is 60% of the closing price of the business day immediately prior to financing. However, for securities not eligible for margin purchase and short sale, the value shall be calculated as 40% of the closing price of the business day immediately prior to financing.
  2. The value of beneficial certificates of open-end funds traded on the TPEx is 60% of the net asset value of each unit of beneficial rights of the business day immediately prior to financing. The value of physical gold is 60% of the closing average at the closing of the business day immediately prior to financing.
  3. The value of beneficial certificates of open-end securities investment trust funds or futures trust funds is 60% of the net asset value of the business day immediately prior to financing. The value of physical gold is 60% of the closing average of the business day immediately prior to financing.
  4. The value of central book-entry bonds is 80% of the face value.
  5. The value of municipal bonds, common corporate bonds and financial bonds is 60% of the face value.
    A security firm may adopt a stricter standard of the calculation standard of preceding paragraph in accordance with the market status of the collateral market and the client credit risk.
    If there is no closing price of the business day immediately prior to financing prescribed under subparagraph 1 of paragraph 1, the price shall be replaced with the price calculated according to the principles prescribed in Article 58-3, paragraph 2, subparagraph 2 of the Operating Rules of the Taiwan Stock Exchange Corporation or Article 57, paragraph 1 of the Taipei Exchange Rules Governing Securities Trading on the TPEx.
    The financing calculation standard of the collateral set forth in paragraph 1 may be adjusted by TWSE in consultation with TPEx based on the conditions of the collateral.