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Article 4
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If any of the following conditions exist with respect to stock or Taiwan depositary receipts eligible for margin purchase and short sale, a securities exchange or OTC market may publicly announce suspension of margin purchase and short sale transactions in such stock, or adjust the margin purchase leverage limit or short sale margin requirement within the scope prescribed by the competent authority and report same to the competent authority for recordation:<br/>1. The trading method for the stock or Taiwan depositary receipts has been changed to require full delivery (in the case of those listed on either an exchange or OTC market), or to require pre-paid settlement (in the case of those listed on an OTC market).<br/>2. Trading has been suspended (in the case of exchange-listed stock and Taiwan depositary receipts, and OTC-listed stock).<br/>3. Delisting has taken place (in the case of exchange-listed stock and Taiwan depositary receipts, and OTC-listed stock).<br/>4. A stock listed on the exchange or OTC market has a par value of NT$10 per share and the net worth per share is below par value, or has no par value or a par value other than NT$10 per share and the issuer has an accumulated deficit.<br/>5. In either the CPA-audited and certified consolidated financial report for the most recent fiscal year or the CPA-reviewed half-year consolidated financial report (either report shall have been prepared in compliance with the laws and regulations of the issuer's home country), the issuer of foreign securities evidenced by Taiwan depositary receipts has posted an accumulated deficit.<br/>6. Taiwan depositary receipts number less than 60 million exchange-listed units following a redemption.<br/>7. There has been a major default on the exchange-listed stock or Taiwan depositary receipts, or OTC-listed stock, and the balance of margin purchases or short sales meets or exceeds a prescribed ratio.<br/>8. The stock price is too volatile.<br/>9. Equity ownership is overly concentrated.<br/>10. Trading volume is excessively abnormal.<br/>11. There is another situation that makes it unadvisable to continue margin purchase and short sale transactions.<br/>Where margin purchase and short sale transactions are suspended or the margin purchase leverage limit or short sale margin requirement is adjusted in accordance with the provisions of the preceding paragraph, if the reason for suspension or adjustment no longer exists, the stock exchange or OTC market shall publicly announce reinstatement and report same to the competent authority for recordation.<br/>The specific standards and procedures required in the preceding two paragraphs shall be prescribed separately by securities exchanges and OTC markets and reported to the competent authority for approval.
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