| Article 1 |
These Rules are adopted pursuant to Article 43-1 of the Operating Rules of the Taiwan Futures Exchange Corporation (TAIFEX).
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| Article 2 |
Futures commission merchants (FCMs) that engage in applying for listing and trading Flexible Contracts shall observe the Operation Rules in addition to the Futures Trading Act and applicable acts and regulations. Matters on which the Operating Rules are silent shall be handled in accordance with the applicable bylaws and rules, public announcements, and circulars of the TAIFEX.
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| Article 3 |
When FCMs receive an order from a trader who is for the first time applying for listing of Flexible Contracts or to engage in trading of Flexible Contracts, it shall provide a Key Points Checklist for a Trader Participating in the Taiwan Futures Exchange Flexible Contract Trading to the trader to carefully read and sign, and the trader shall meet the following qualifications:
- Has had a total of 10 or more futures or options trades executed within the past year.
- According to credit check operations, is qualified to be given a trading limit exceeding NT$500,000.
The requirements of subparagraphs 1 and 2 of the preceding paragraph do not apply to a trader who is a qualified institutional investor or a natural person or juristic person with a prescribed level of financial capacity or professional expertise as referred to in the proviso to paragraph 1 of Article 4 of the Financial Consumer Protection Act.
The application operations under paragraph 1 may be done in writing or electronically. The Checklist template will be separately prescribed by the TAIFEX.
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| Article 4 |
An application for listing of Flexible Contracts may, by an FCM for its own account or for an order by a trader, be submitted to the TAIFEX from 8:30 a.m. to 3:30 p.m. on a TAIFEX business day. Once the TAIFEX has reviewed the application and found that it meets the following requirements, the contract may be listed for trading on the following business day:
- For an application for listing of Flexible Contracts, the contract terms including expiration dates must comply with the relevant provisions of the Trading Rules of the Flexible Contracts.
- A contract for which listing is applied under the preceding subparagraph may not be identical to any flexible contract that is already listed on the application date. However, this restriction does not apply if the already listed flexible contract will be delisted on the following business day.
- If on the same business day applications are made for Flexible Contracts with the same contract term, the chronological order in which the FCMs enter the applications into the TAIFEX system determines the priority, and the first to enter its application is the applicant FCM for that contract.
The TAIFEX may make adjustments with respect to the application times for listing under the preceding paragraph in the event that application operations are affected by a system malfunction, disruption, or other factors.
If the TAIFEX believes there is a likelihood that the listing of a flexible contract would impact the futures market, it may refuse the listing.
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| Article 5 |
An FCM may accept a trader's order applying for the listing of a flexible contract in writing, by telephone, fax, or electronically such as via the Internet, private line, or closed private network.
An FCM applying for listing of a flexible contract for their own accounts or for an order by a trader shall keep the relevant application records, and the preservation period shall be as provided in the Table of Mandatory Preservation Periods for Accounts, Statements, Vouchers, and Certificates of Futures Commission Merchants and Clearing Members. Recordings of telephone applications shall be preserved for at least 1 year.
If application records under the preceding paragraph are preserved by means of media, the following requirements shall be met:
- They are stored on electronic media that cannot be edited or erased, and the preparation of the records is completed on the day of the trade's execution.
- The records are fully indexed and management procedures are in place.
- A specific person(s) is responsible for records management, and it is possible at any time to convert the electronically stored data to hardcopy format.
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| Article 6 |
The trading method for Flexible Contracts on the TAIFEX market, except in block trading done by price negotiation, will be in continuous trading and matched automatically by computer.
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| Article 7 |
The validity of buy and sell orders for Flexible Contracts shall be limited to the session during which the orders are entered, and orders shall be entered during the trading hours set in the trading rules of the respective contracts. The FCM, in the chronological sequence in which the orders are placed by the principals, may enter the FCM code number, clearing member code number, order form serial number, account number of the principal, futures contract ticker symbol, price, quantity, type of transaction (sale/purchase), and whether a new position is being established or old position offset. Upon acceptance by the computer of the TAIFEX, the order confirmation or execution report shall be given to the participating FCM. The information to be included on the buy/sell order-entry confirmation or execution report forms may be adjusted by the TAIFEX depending on actual needs.
The serial numbers of order forms shall be sequentially assigned in the order that the orders are received from principals by the FCM. The serial numbers of orders for proprietary trading by FCMs shall be sequentially numbered in the order that the orders are entered.
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| Article 8 |
Orders for Flexible Contracts matched in continuous trading are limited to single orders for the same contracts and further are limited to limit orders. Additionally, limit orders may be specified as an immediate-or-cancel ("IOC") order or a fill-or-kill order ("FOK").
Orders for Flexible Contracts negotiated in block trading are divided into single orders for the same contracts, and combination orders for simultaneous trading of different flexible contracts.
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| Article 9 |
If the open position in any Flexible Contracts has been zero every day continuously for a certain period of time, it will be delisted from the next business day. However, the TAIFEX may adjust this depending on market conditions.
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| Article 10 |
For Flexible Contracts, the information on executed trades and information on buy and sell quotes matched in continuous trading shall be independently disclosed in real-time on the TAIFEX website.
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| Article 11 |
An FCM handling the application and trading business shall pay the application fees and surcharges of Flexible Contracts to the TAIFEX.
The fee standards for the application fees and surcharges of Flexible Contracts under the preceding paragraph will be prescribed by the TAIFEX and submitted to the Competent Authority for approval.
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| Article 12 |
These Operation Rules, and any amendments hereto, will take force upon promulgation following approval by the Competent Authority.
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