| Article 35 |
Where a securities broker accepts a customer's order to purchase or sell shares or bonds, or where a securities dealer purchases or sells securities or bonds for its own account rather than directly negotiate price with a customer over the counter, such broker or dealer shall enter the volume, price or yield in the trading system of the GTSM for matching price or matching bond yield; provided that the number of shares entered for any single trade shall be less than 500 trading units [500,000 shares].
The trading methods of the automated trade matching system and the fixed income securities trading system shall consist of trading before commencement of trading time and trading after commencement of trading time, which shall be executed as follows:
1.The trading quotes made before commencement of trading time shall be executed as follows:
A.The purchase quotes higher than the trade price and the sales quotes lower than the trade price shall all be completely traded.
B.Quotes at the same price as the trade price shall be completely traded.
C.Where two or more parties offer the quotes referred to in the preceding two items, the quote closest to the basis price of the opening of trading of that day shall be adopted. However, if parties whose quotes are the same as the trade price cannot all be satisfied, the priority order of the trading quotes of each party shall be decided by random computer selection.
2.After the trading quotes made before the commencement of the trading time are traded in accordance with the procedures referred to in the preceding subparagraph, the portion not traded shall still be valid and consolidated into the trading quotes made after the commencement of the trading time based on random computer selection for trading in the following methods:
A.The highest reported purchase quote and lowest reported sale quote are compared trade by trade in accordance with the order in which they were made. When the highest reported purchase quote is not less than the lowest reported sales quote, the trade price shall be one of the two quotes which was entered earlier.
B.After the trading procedures referred to in the preceding item, if the volume of shares quoted by one of the parties is not fully traded, the then-current highest reported purchase quote and the lowest reported sales quote shall be compared. When the highest reported purchase quote is not less than the lowest reported sales quote, the trade price shall be one of the two reported quotes which was entered earlier.
C.The procedures enumerated in the preceding item shall be repeated until the then-current highest reported purchase quote is less than the lowest reported sales quote, or until the volume of shares reported by such party is fully traded.
However, in the event that the price of the trading quote made before the commencement of trading time is the same as the price of the trading quote made after the commencement of trading time, the trading quote made before the commencement of trading time shall have the trading priority.
In the execution of trades made after the commencement of trading hours under the preceding paragraph, the price of trades matched upon accumulation of all trading orders over a period of time prior to market closing shall be taken as the closing price. Where unexecuted, the last traded price during trading hours on the current day shall be taken as the closing price.
If, during the one minute prior to market close for a security under the automated trade matching system, any given execution price as test-calculated fluctuates beyond 3.5 percent from the previous execution price as test-calculated (if there is no execution price as test-calculated, the calculation shall be based on the most recent trade price; if there is no most recent trade price, the calculation shall be based on the auction reference price at market opening), the matching at market close for that security is postponed. Entries, cancellations, and changes of trading orders for that security will continue to be accepted from 1:31 p.m. to 1:33 p.m., and matching and execution will then proceed sequentially at 1:33 p.m. However, this restriction shall not apply to managed stock, to securities for which extended matching intervals have been implemented under rules or regulations of the GTSM, securities for which the opening auction reference price at market opening is lower than NT$1, call (put) warrants, or company warrants.
The standard for the "period of time" referred to in paragraph 3 shall be prescribed by the GTSM and publicly announced for implementation after approval and recordation by the competent authority; the same shall apply to amendments thereto.
The rules for trading on the Electronic Bond Trading System referred to in paragraph 1 above shall be separately prescribed by the GTSM.
The GTSM shall disclose, on a real-time basis during trading hours, execution prices and volumes, and the order prices and volumes of the highest unexecuted buy orders and lowest unexecuted sell orders; provided, for other trading orders, the GTSM may make appropriate disclosures of prices and volumes depending on market needs.
When a securities firm enters quotes through the automated trade matching system, whether for customers' accounts or for its own account, if the total quoted amount of purchases in a single day exceeds two times its net worth, or the total quoted amount of sales four times its net worth, the GTSM may suspend its further entries of purchase or sale orders; for a securities firm using the fixed income securities trading system, if the total quoted amount of purchases or sales for customers' accounts or for its own account entered in a single day (including the amount of orders placed in New Taiwan dollars and the amount of orders placed in foreign currencies as converted into New Taiwan dollars at the spot exchange rate) exceeds one time its net worth, the GTSM may suspend its further entries of purchase or sale orders.
Where a securities firm's net worth is less than, but more than half of, its paid-in capital, or its regulatory capital adequacy ratio falls within the range set forth in Article 65 of the Regulations Governing Securities Firms, the multiple for purchases in the preceding paragraph may be adjusted lower to one-and-a-half times its net worth, and the multiple for sales to three times its net worth; for those whose regulatory capital adequacy ratio meets the criteria set forth in Article 66 of the Regulations Governing Securities Firms, the GTSM may further adjust the multiple of the preceding paragraph lower, depending on the severity of the circumstances; for those whose net value is less than one-half of its paid-in capital, the multiple for purchases of the preceding paragraph may be adjusted lower to one time its net worth, and the multiple for sales to two times its net worth; for those whose net worth is lower than one-half of its paid-in capital for 3 consecutive months, the multiple for purchases of the preceding paragraph may be adjusted lower to a half time its net worth, and the multiple for sales to one time its net worth. However, when a securities firm's statements filed on a monthly basis indicate that the reason for such adjustments has diminished, its multiple may gradually be adjusted commensurate with the degree of such diminution; where the ratio of a securities firm's net worth to paid-in capital is raised due to a capital reduction, the corresponding multiples for purchases and sales must be maintained for 3 consecutive months before they may be adjusted pursuant to the above provisions.
Where a securities firm has a substandard rating under the Regulations Governing Early Warning of Overall Operational Risk of Securities Firms, or any of the events specified in Article 7 of the Rules for Audit, Follow-up, and Assistance of Securities Firms, or, subsequent to assistance, correction cannot be made, the GTSM may lower the ratio referred to in paragraph 8. Where correction has been made, the original ratio may be restored. |