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Article 22
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In conducting margin purchase and short sale business, a securities firm shall not use securities for any purpose other than those listed below and shall deposit the securities in the central depository:
- As a source of securities for conducting short sale business.
- As collateral for refinancing of funds or securities by securities finance enterprises.
- As a source of securities to lend in conducting securities lending and borrowing business.
- As collateral for borrowing securities through the TWSE securities lending system.
- To lend to a securities firm or securities finance enterprise conducting securities borrowing and lending business as a source of securities for conducting securities borrowing and lending business or securities margin purchase and short sale business.
- To lend through the TWSE securities borrowing and lending system.
- To participate in competitive auction lending transactions or negotiated lending transactions conducted by a securities finance enterprise.
A securities firm using securities referred to in the preceding paragraph shall be responsible for delivering securities of the same type upon settlement of margin purchases and short sales.
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