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Article NO. Content


Taiwan Stock Exchange Corporation Operation Directions Governing Liquidity Providers of Exchange Traded Notes  CH

Amended Date: 2018.12.24 
Categories: Securities Exchange Market > Trading > Other Securities
5     If a liquidity provider engaged by an issuer fails to meet any of the following requirements, the TWSE may deny approval for its operation of liquidity provision business for ETNs, however, the restriction may not apply to any non-conformance to requirements of subparagraphs 2 to 6 if the non-conformance has been substantially improved and recognized by the competent authority:
  1. Its most recent financial report audited and attested by certified public accountant showing book value per share not less than par value, and financial status meeting the requirements under the Regulations Governing Securities Firms;
  2. Having not received any warning issued by the competent authority pursuant to subparagraph 1 of Article 66 of the Securities and Exchange Act in the last 3 months;
  3. Having not been subject to any disposition of the competent authority ordering the securities firm to remove from office any of its directors, supervisors, or managerial officers or to replace any of its responsible persons or other relevant personnel in the last 6 months.
  4. Having not been subject to any sanction imposed by the competent authority involving suspension of business activities in the last 1 year.
  5. Having not been subject to any sanction imposed by the competent authority involving revocation of any part of its business permission in the last 2 year.
  6. Having not been subject to any measures taken by the TWSE, the Taipei Exchange (TPEx) or the Taiwan Futures Exchange Corporation pursuant to the bylaws or rules thereof involving suspension of or restriction on its trading activities in the last 1 year.
  7. Other requirements prescribed by the competent authority.
    If the TWSE denies approval for a liquidity provider engaged by an issuer to operate the business of providing liquidity for ETNs because the liquidity provider does not meet the requirements of subparagraphs 1 to 7 of the preceding paragraph, or because the circumstance under paragraph 3 of Article 3 occurs, the TWSE may issue an letter prescribing a time limit for the issuer to take over by itself or engage another liquidity provider to provide liquidity in the centralized securities exchange market. If the issuer fails to take corrective measures within the time limit, the TWSE may impose a breach penalty in an amount of NT$30,000 to NT$100,000 on the issuer and the penalty may be imposed in succession until the breach is corrected.