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Title Taiwan Depository & Clearing Corporation Directions for the Handling by Bills Dealers of Account Opening and the Deposit, Settlement, and Withdrawal of Short-Term Bills CH
Date 2018.12.28 ( Amended )

Article Content

I. General Principles
Article 1     These Directions are adopted pursuant to Article 14 of the Taiwan Depository & Clearing Corporation Operating Rules for Short-Term Bills.
Article 2     The competent authority under the Act Governing Bills Finance Business is the competent authority for these Directions.
II. Opening and Management of Book-Entry Accounts
Article 3     To conduct short-term bills central depository, book-entry, and related operations, a bills dealer shall use a deposit account opened by itself or by a designated bank ("agent clearing bank") with the Central Bank's Department of Banking or with a foreign currency clearing bank to handle payments and receipts, and shall submit the following documents to the Taiwan Depository & Clearing Corporation (TDCC) in an official letter to apply to open a book-entry account:
  1. Participant agreement.
  2. Agreement for the opening by the bills dealer of a short-term bills book-entry account.
  3. Application form for opening/closure/changes of a book-entry account.
  4. Specimen seal card of the bills dealer / transaction merchant.
  5. Photocopy of the company registration certificate or other document evidencing registration as a juristic person.
  6. List of the participant's contact persons.
  7. Other documents required by the TDCC.
    The head office and branches of the bills dealer of the preceding paragraph may open separate book-entry accounts, or the head office may open a single unified account.
    When opening a deposit account with a foreign currency clearing bank, the bills dealer or its agent clearing bank shall open the account as a jointly established interbank fund transfer guarantee special account, and shall agree to engage the Financial Information Service Co., Ltd. (FISC) to act as its agent in using the account to carry out fund payment and receipt on its behalf for foreign currency denominated short-term bills.
Article 4     If a bills dealer loses its participant status or goes into liquidation or dissolution, it shall fill out an application form for opening/closure/changes of a book-entry account and submit it to the TDCC to apply to close the book-entry account.
    After the TDCC accepts the application of the preceding paragraph, the book-entry account may only be used to handle redemptions, and once all the short-term bills positions in the account have been redeemed, the account shall be closed.
Article 5     When a bills dealer is ordered by the competent authority to suspend business operations, unless otherwise provided by the competent authority, the TDCC shall suspend the bills dealer’s book-entry account.
Article 6     When a bills dealer applies to the TDCC to change the basic identification data for its book-entry account, either of the following methods may be used:
  1. Notify the TDCC through the Bills Clearing and Settlement System (BCSS).
  2. Fill out an application form for opening/closure/changes of a book-entry account and submit it to the TDCC.
Article 7     By the close of daily business hours at the TDCC, a bills dealer shall reconcile its records with account statements provided by the TDCC.
    If the bills dealer has any doubt about the account statements of the preceding paragraph, it shall work together with the settlement service division of TDCC to determine the reason, and shall promptly correct any error.
III. Deposit of Short-Term Bills in Physical Form
Article 8     The hours for a bills dealer's handling of the deposit procedure for short-term bills in physical form shall be from 9 a.m. to 4:30 p.m. on each business day.
    The TDCC may, as necessary for business purposes, extend the time periods set out in the preceding paragraph, and bills dealers shall make accommodations in accordance with TDCC notification.
Article 9     When a bills dealer uses a manual method to deposit short-term bills in physical form, the following procedure shall be observed:
  1. To deposit short-term bills in physical form that are underwritten or acquired in an initial purchase, the bills dealer shall assign a certificate code, and the number of par values for short-term bills with the same certificate code shall not exceed three. If there are two or more buyers for bills underwritten on a best-efforts basis, for each buyer a different certificate code shall be assigned to the short-term bills to be deposited; if any short-term bills to be deposited have been previously held by a special tax-exempt entity or entities, for each different dollar amount of tax exemption(s) of the previous owner(s) a different certificate code shall be assigned to those short-term bills to be deposited.
  2. The bills dealer shall take the short-term bills in physical form that it intends to deposit and enclose them—together with either (a) an electronic record prepared in accordance with the Format Specifications for Electronic Records of Deposited Bills, or (b) a Statement of Bills Deposited With a Physical Securities Deposit Bank that it has filled out—in an envelope of appropriate size, which it shall send to a physical securities deposit bank. The bills dealer's company seal retained by the TDCC shall be stamped across the edge of the closed envelope flap.
  3. Receipt by the bills dealer of the bills dealer's copy of the Statement of Bills Deposited With a Physical Securities Deposit Bank from the physical securities deposit bank constitutes completion of the procedure for deposit of the physical bills.
    After the bills dealer completes the procedure of the preceding paragraph, if it receives a notice from the physical securities deposit bank that there is a doubt about the physical bills it has deposited, and if the deposited bills are confirmed defective, the bills dealer shall fill out a Short-Term Bills Withdrawal Statement to withdraw the physical bills from the physical securities deposit bank with which they had been deposited.
Article 10     When a bills dealer uses a computerized method to deposit short-term bills in physical form, the following procedure shall be observed:
  1. The bills dealer shall send a deposit instruction to the BCSS.
  2. After the BCSS completes the registration of the short-term bills deposited under that certificate number, it will notify the bills dealer that the bills deposit procedure has been completed. If the BCSS receives notice from the physical securities deposit bank that acceptance of the bills has failed, it will notify the bills dealer that the bills deposit procedure has failed. After the bills dealer contacts the physical securities deposit bank to check on the reason and address the problem, it shall re-send a deposit instruction.
IV. Book-entry Transfers for Short-Term Bills Settlement
Article 11     The hours for a bills dealer to input settlement instructions shall be from 9 a.m. to 4:30 p.m. on each business day.
    If the bills dealer is a securities firm that concurrently operates a bills financing business, it shall engage an agent clearing bank to carry out fund payment and receipt on its behalf for short-term bills denominated in New Taiwan Dollars. Agent clearing banks shall return "funds deducted" confirmations on business days from 9 a.m. to 4:30 p.m.
    A bills dealer that does not participate in the Financial Information Service Company's Foreign Exchange Clearing System shall engage an agent clearing bank to carry out fund payment and receipt on its behalf for short-term bills denominated in a foreign currency. The preceding paragraph shall apply mutatis mutandis to the hours during which the agent clearing bank returns "funds deducted" confirmations.
    The TDCC may, as necessary for business purposes, extend the time periods set out in the preceding three paragraphs, and bills dealers shall make accommodations in accordance with TDCC notification.
Article 12     A bills dealer shall handle the procedures for settlement of repo and reverse repo transactions in accordance with the following procedural principles:
  1. When the bills dealer uses the short-term bills purchased in a reverse repo transaction to conduct a repo transaction, the execution date of the second leg of the repo transaction shall be earlier than or the same as the execution date of the second leg of the reverse repo transaction.
  2. The execution date of the second leg of a repo or reverse repo transaction shall be earlier than the stated maturity date of the short-term bills.
  3. For the duration of a repo-style transaction between the bills dealer and a special tax-exempt entity, neither the bills dealer nor the special tax-exempt entity is allowed to use the short-term bills to carry out a repo-style transaction.
  4. When the bills dealer and a special tax-exempt entity carry out a repo-style transaction, they shall do so with short-term bills in the proprietary positions of their account books.
  5. The bills dealer may prohibit its counterparty, for the duration of a repo transaction, from using the short-term bills to carry out a repo-style transaction.
Article 13     When a bills dealer and a special tax-exempt investor handle settlement of an outright short-term bills transaction, they shall calculate the dollar amount of the investor's tax exemption and input it into the BCSS.
    Principles for input of the tax exemption of the preceding paragraph are as follows:
  1. When the bills dealer sells short-term bills to the special tax-exempt entity, it shall input the dollar amount of the tax exemption from the settlement date of the outright purchase to the stated maturity date.
  2. When the bills dealer buys short-term bills from the special tax-exempt entity, it shall input the dollar amount of the tax exemption for the period during which the short-term bills were held by the special tax-exempt entity.
    When a bills dealer and a special tax-exempt entity handle settlement of an outright short-term bills transaction, the BCSS will reassign a new subcode to the short-term bills certificate code.
Article 14     When a bills dealer and a tax-exempt investor handle settlement of an outright short-term bills transaction, it shall calculate the dollar amount of the investor's tax exemption and input it to the BCSS.
    The method for input of the tax exemption of the preceding paragraph is as follows:
  1. When the bills dealer sells short-term bills to the tax-exempt entity, it shall input the dollar amount of the tax exemption from the settlement date of the outright purchase to the stated maturity date.
  2. When the bills dealer buys short-term bills outright from the tax-exempt entity, it shall input "zero" for the dollar amount of the tax exemption.
    When a bills dealer and a tax-exempt entity handle settlement of an outright short-term bills transaction, the BCSS will reassign a new subcode to the short-term bills certificate code.
Article 15     When fund settlement is not completed prior to the close of a business day, with the result that a bills dealer receives a "settlement incomplete" message from the BCSS, that settlement shall be invalid.
    If, during the period for settlement operations set out in Article 11, the settlement of the second leg of a bills dealer's repo-style transaction has not been input or the settlement is invalidated, the BCSS will proceed directly to initiate settlement of the second leg of the repo-style transaction. If it is still not possible to complete settlement, the BCSS will handle the matter in accordance with the following procedure and conduct follow-up book adjustment operations:
  1. If settlement cannot be completed because the seller is unable to pay the funds to settle the second leg of the repo, the BCSS will transfer the short-term bills for settlement of the second leg into the buyer's proprietary position.
  2. If settlement cannot be completed because the buyer is unable to deliver the short-term bills to settle the second leg of the repo, the BCSS will not make any book-entry transfer.
Article 16     When a bills dealer withdraws short-term bills in physical form, in the case of an incomplete underwriting or initial purchase of bills, it shall send a "withdraw bills" instruction to the BCSS prior to 3 p.m. on the date of the BCSS's deadline for extending the custody of registration information for the short-term bills, and shall fill out a Short-Term Bills Withdrawal Statement to withdraw the bills from the physical securities deposit bank with which they had been deposited.
    A bills dealer that fails to carry out the procedure of the preceding paragraph, after receiving a "withdraw bills" notice from the BCSS at 4 p.m. on that same afternoon, shall fill out a Short-Term Bills Withdrawal Statement and withdraw the bills from the physical securities deposit bank with which they had been deposited.
    The term "deadline" in paragraph 1 means the second business day after the underwriting date or initial purchase date as specified in the deposit instruction for the short-term bills in physical form.
Article 17     When a bills dealer conducts firm commitment underwriting or initial purchase of short-term bills, it shall send a settlement instruction to the BCSS for the firm commitment underwriting or initial purchase, and handle the book-entry procedure for the firm commitment underwriting or initial purchase of the short-term bills.
    If the short-term bills acquired by a bills dealer in an initial purchase under the preceding paragraph were previously held by a special tax-exempt entity, the bills dealer shall input the dollar amount of the tax exemption from before the entry of the bills into the BCSS.
Article 18     When a bills dealer underwrites short-term bills on a best-efforts basis, the settlement method shall be as follows:
  1. The bills dealer shall send a settlement instruction to the BCSS for the best-efforts underwriting.
  2. If the bills dealer receives a "settlement unconfirmed" message forwarded by the BCSS from an investor, an investor custodian bank, or the buyer's bills dealer, it shall determine the reason and address the problem.
  3. When the BCSS receives a "settlement confirmed" message from an investor, an investor custodian bank, or the buyer's bills dealer, unless the same bank serves as both the investor custodian bank (or the buyer's bills dealer) and the physical securities deposit bank, the BCSS will notify either the Central Bank's Department of Banking or the FISC to handle payment and receipt—between accounts of the physical securities deposit bank and either the investor custodian bank or the buyer's bills dealer (or its agent clearing bank)—of the funds payable by the buyer.
  4. After the BCSS completes the transfer of the bills dealer's best-efforts underwriting fee and the book-entry transfer for the best-efforts underwriting, it will notify the bills dealer of settlement completion and notify the physical securities deposit bank to remit the funds receivable by the issuer to the funds account at the bank that is designated in the settlement instruction to handle fund receipt and payment.
Article 19     When a bills dealer purchases short-term bills underwritten by another bills dealer on a best efforts basis, the settlement method shall be as follows:
  1. When the bills dealer receives a notice of best-efforts underwritten sale from the BCSS, it shall handle settlement confirmation in accordance with the content of the notice.
  2. If the bills dealer has any doubt about the content of the notice of best-efforts underwritten sale, it shall return a "settlement unconfirmed" message, and the BCSS will in turn notify the best-efforts underwriting bills dealer to handle the matter.
  3. After the bills dealer completes settlement confirmation, it shall return a "settlement confirmed" message.
  4. Unless the same bank serves as both the bills dealer and the physical securities deposit bank, when the BCSS receives a "settlement confirmed" message it will notify either the Central Bank's Department of Banking or the FISC to handle fund payment and receipt between accounts of the physical securities deposit bank and the bills dealer (or the agent clearing bank).
  5. After the BCSS completes the book-entry procedure for the best-efforts underwriting, it will notify the bills dealer of settlement completion.
Article 20     The settlement of a short-term bills trade between a bills dealer and an investor or an investor custodian bank shall be as follows:
  1. The bills dealer shall send to the BCSS a settlement instruction for an outright transaction, a repo-style transaction, or the second leg of a repo-style transaction.
  2. If the bills dealer receives a "settlement unconfirmed" message forwarded by the BCSS from the investor or the investor custodian bank, it shall determine the reason and address the problem.
  3. Unless the same bank serves as both the bills dealer (or the agent clearing bank) and the investor custodian bank, when the BCSS receives a "settlement confirmed" message from the investor or the investor custodian bank it will notify either the Central Bank's Department of Banking or the FISC to handle fund payment and receipt between deposit accounts at the bills dealer (or the agent clearing bank) and the investor custodian bank.
  4. After the BCSS completes the book-entry operation for an outright transaction, a repo-style transaction, or the second leg of a repo-style transaction, it will notify the bills dealer of settlement completion.
Article 21     The settlement procedure for bills dealers handling trades of short-term bills between investors is as follows:
  1. The bills dealer shall send to the BCSS a settlement instruction for a brokered transaction.
  2. If the bills dealer receives a "settlement unconfirmed" message forwarded by the BCSS from an investor, it shall determine the reason and address the problem.
  3. Unless the same bank serves as the investor custodian bank for both the purchasing and selling parties to the transaction, when the BCSS receives "settlement confirmed" messages from the buyer and seller it will notify either the Central Bank's Department of Banking or the FISC to handle fund payment and receipt between the investor custodian bank deposit accounts of the purchasing and selling parties.
  4. After the BCSS completes the book-entry operations for the brokered transaction, it will notify the bills dealer of settlement completion.
Article 22     The settlement procedure for trades of short-term bills between bills dealers is as follows:
  1. The buying and selling bills dealers shall each send to the BCSS a settlement instruction for an outright transaction, a repo-style transaction, or the second leg of a repo-style transaction.
  2. After the BCSS receives the settlement instructions from both the buying and selling bills dealers, it will match the two bills dealers' settlement instructions.
  3. When the bills dealer receives a "matching failed" message from the BCSS, it shall determine the reason and address the problem.
  4. After the BCSS completes the matching procedure, except in the case of internal fund payment and receipt by the same bank, the BCSS will immediately notify the Central Bank's Department of Banking or the FISC to carry out fund payment and receipt between the deposit accounts of the buying and selling bills dealers (or of the bills dealer and the agent clearing bank).
  5. After the BCSS completes the book-entry operation for an outright transaction, a repo-style transaction, or the second leg of a repo-style transaction, it will notify the buying and selling bills dealers of settlement completion.
Article 23     When the bills dealer handles the settlement of transactions between itself and an investor or an investor custodian bank under Article 20, or it handles settlement when that investor engages the bills dealer to conduct firm commitment underwriting or initial purchase of short-term bills issued or held by the investor, if batch net settlement (BNS) is employed, the following procedure shall be observed:
  1. The bills dealer shall separately input BNS settlement instructions to the BCSS for the transaction, firm commitment underwriting or initial purchase according to the situation. The aforementioned settlement instructions shall specify the BNS settlement code and the total number of transactions.
  2. If the bills dealer receives a "settlement unconfirmed" message forwarded by the BCSS from the investor or the investor custodian bank, it shall determine the reason and address the problem.
  3. Unless the same bank serves as both the bills dealer (or the agent clearing bank) and the investor custodian bank, or unless the net amount of funds due is zero, when the BCSS receives a "settlement confirmed" message from the investor or the investor custodian bank it will notify either the Central Bank's Department of Banking or the FISC to handle payment and receipt of net funds due between accounts of the bills dealer (or the agent clearing bank) and the investor custodian bank.
  4. After the BCSS completes the book-entry operations for BNS settlement, it will notify the bills dealer of settlement completion.
Article 24     When a bills dealer handles settlement of a trade between itself and another bills dealer under Article 22, if BNS settlement is employed, the following procedure shall be observed:
  1. The buying and selling bills dealers shall each send to the BCSS a batch settlement instruction. The aforementioned settlement instructions shall specify the BNS settlement code and the total number of transactions.
  2. After the BCSS receives the batches of settlement instructions from both the buying and selling bills dealers, it will match each pair of corresponding settlement instructions.
  3. When the bills dealer receives a "matching failed" message from the BCSS, it shall determine the reason and address the problem.
  4. After the BCSS completes the matching procedure, except in the case of internal fund payment and receipt by the same bank, or if the net amount of funds due is zero, the BCSS will immediately notify the Central Bank's Department of Banking or the FISC to carry out payment and receipt of net funds due between the accounts of the buying and selling bills dealers (or of the bills dealer and the agent clearing bank).
  5. After the BCSS completes the book-entry operations for BNS settlement, it will notify the buying and selling bills dealers of settlement completion.
Article 25     When a bills dealer handles termination of a repo-style transaction in progress between itself and either an investor or an investor custodian bank, the following procedure shall be observed:
  1. The bills dealer shall send a "terminating repo-style transaction in progress" instruction to the BCSS.
  2. If the bills dealer receives an "unconfirmed" message forwarded by the BCSS from the investor or the investor custodian bank, it shall determine the reason and address the problem.
  3. When the BCSS receives a "procedure confirmed" message from the investor or the investor custodian bank, after completing the procedure for termination of the repo-style transaction in progress, it will notify the bills dealer that the procedure has been completed.
  4. Follow-up performance and settlement after the termination of a repo-style transaction between the bills dealer and the investor shall be handled by the mutatis mutandis application of the provisions of Articles 20 and 23.
Article 26     When a bills dealer handles termination of a repo-style transaction in progress between itself and another bills dealer, the following procedure shall be observed:
  1. The two bills dealers shall each send a "terminating repo-style transaction in progress" instruction to the BCSS.
  2. After the BCSS receives the instructions from both bills dealers, it will match the two parties' instructions.
  3. When the bills dealer receives a "matching failed" message from the BCSS, it shall determine the reason and address the problem.
  4. After the BCSS completes the procedure for termination of the repo-style transaction in progress, it will notify both bills dealers that the procedure has been completed.
  5. Follow-up performance and settlement after the termination of a repo-style transaction in progress between the bills dealer and another bills dealer shall be handled by the mutatis mutandis application of the provisions of Articles 22 and 24.
Article 27     When a bills dealer buys short-term bills issued by itself, it shall fax an Application by Bills Dealer for Early Retirement of Commercial Paper Issued by Itself to the TDCC by 4 p.m. on the settlement date to handle retirement of bills in the bills dealer account book, and within 5 business days after the settlement date shall go to the physical securities deposit bank to complete the tax payment procedure. If tax payment is not completed by the deadline, the TDCC shall refer the matter to the tax authorities for handling in an official letter.
    The bills dealer shall send the original of the application of the preceding paragraph to the TDCC to be filed for future reference. If the purchased short-term bills are in physical form, the bills dealer may also fill out a Short-Term Bills Withdrawal Statement and submit it to the physical securities deposit bank to withdraw the bills.
Article 28     When a bills dealer handles the procedure for account transfers between its head office and a branch thereof, the following procedure shall be observed:
  1. The outward transfer and inward transfer units shall each send an "account transfer settlement" instruction to the BCSS.
  2. After the BCSS receives the settlement instructions from both parties, it will match the settlement instructions.
  3. When the bills dealer receives a "matching failed" message from the BCSS, it shall determine the reason and address the problem.
  4. After the BCSS completes the book-entry procedure for the account transfer, it will notify the outward transfer and inward transfer units of settlement completion.
    The procedure of the preceding paragraph shall be handled only by a bills dealer whose head office and branch have each established book-entry accounts.
Article 29     A bills dealer may act at its own discretion to send a settlement instruction to the BCSS to handle the setting and lifting of settlement restrictions on its proprietary holdings of short-term bills.
Article 30     To create a pledge on an investor's short-term bills in favor of a bills dealer, the following procedure shall be observed:
  1. The bills dealer shall send a "create pledge" instruction to the BCSS based on the Application to Create Pledge Between Investor and Bills Dealer on Short-Term Bills filled out by the investor, and shall go to the investor custodian bank to handle the pledge creation procedure.
  2. If the bills dealer receives a "settlement unconfirmed" message forwarded by the BCSS from the investor custodian bank, it shall determine the reason and address the problem.
  3. After the BCSS receives a "settlement confirmed" message from the investor custodian bank and completes the book-entry transfer procedure for the creation of a pledge, it will notify the bills dealer of settlement completion.
Article 31     To create a pledge on a bills dealer's short-term bills in favor of another bills dealer, the following procedure shall be observed:
  1. Both bill dealers shall send a "create pledge" instruction to the BCSS based on an Application for Creation of Pledge Between Bills Dealers on Short-Term Bills filled out by themselves.
  2. After the TDCC receives notice of pledge from both bills dealers, it will match the settlement instructions.
  3. If the bills dealers receive a "matching failed" message from the BCSS, they shall determine the reason and address the problem.
  4. After the BCSS completes the book-entry transfer procedure for the creation of pledge, it will notify both bills dealers of settlement completion.
Article 32     When an investor will purchase short-term bills from a bills dealer and create a pledge thereon in favor of the bills dealer, the following procedure shall be observed:
  1. The bills dealer shall send a "carrying out investor's purchase of short-term bills and creation of pledge thereon" instruction to the BCSS based on the Application to Create Pledge Between Investor and Bills Dealer on Short-Term Bills filled out by the investor, and shall go to the investor custodian bank to handle the pledge creation procedure.
  2. If the bills dealer receives a "settlement unconfirmed" message forwarded by the BCSS from the investor custodian bank, it shall determine the reason and address the problem.
  3. Unless the same bank serves as both the bills dealer (or the agent clearing bank) and the investor custodian bank, when the BCSS receives a "settlement confirmed" message from the investor custodian bank it will notify either the Central Bank's Department of Banking or the FISC to handle fund payment and receipt between accounts of the bills dealer (or the agent clearing bank) and the investor custodian bank.
  4. After the BCSS completes the book-entry operations for an investor's purchase of short-term bills from a bills dealer and creates a pledge in favor of the bills dealer, it will notify the bills dealer of settlement completion.
Article 33     When an investor or a bills dealer will cancel a pledge created on short-term bills in favor of a bills dealer, the following procedure shall be observed:
  1. The pledgee bills dealer shall fill out either a Notice of Cancellation of a Pledge of Short-Term Bills Between an Investor and a Bills Dealer or a Notice of Cancellation of a Pledge of Short-Term Bills Between Bills Dealers, submit it to the pledgor, and send a "cancel pledge" instruction to the BCSS.
  2. After the BCSS completes the book-entry operations for the pledge cancellation, it will notify the bills dealer of settlement completion.
Article 34     When a pledge is exercised by a court, the bills dealer shall handle book-entry transfers in accordance with the TDCC's notification.
Article 35     When a bills dealer intends to obtain title to an investor's short-term bills through exercise of a pledge, the following procedure shall be observed:
  1. The bills dealer shall fill out and submit an Application to Exercise Pledge Rights Between Investor and Bills Dealer on Short-Term Bills and send an "exercise pledge" instruction to the BCSS. Unless the subject of the pledge is short-term bills in the investor's reverse repo position, the bills dealer may designate a third party for the exercise of pledge rights.
  2. The bills dealer shall fill out the Application to Exercise Pledge Rights Between Investor and Bills Dealer on Short-Term Bills of the preceding subparagraph, the third copy of the Application to Create Pledge Between Investor and Bills Dealer on Short-Term Bills submitted when the parties created the pledge, and the contract under which the pledgor agrees that the pledgee may obtain the title to the pledged object, and shall then go to the investor custodian bank to handle the procedure for exercise of pledge rights.
  3. If the bills dealer receives a "settlement unconfirmed" message forwarded by the BCSS from the investor custodian bank, it shall determine the reason and address the problem.
  4. After the BCSS receives a "settlement confirmed" message from the investor custodian bank and completes the book-entry transfer procedure for the exercise of pledge rights, it will notify the bills dealer of settlement completion.
Article 36     When a bills dealer intends to obtain title to a pledgor bills dealer's short-term bills through exercise of pledge, the following procedure shall be observed:
  1. The pledgee bills dealer shall fill out and submit an Application for Exercise of Pledge Rights Between Bills Dealers on Short-Term Bills, and send an "exercise pledge" instruction to the BCSS.
  2. The pledgee bills dealer shall fill out and submit the Application for Exercise of Pledge Rights Between Bills Dealers on Short-Term Bills of the preceding subparagraph, the second copy of the Application for Creation of Pledge Between Bills Dealers on Short-Term Bills submitted when the parties created the pledge, and the contract under which the pledgor agrees that the pledgee may obtain title to the pledged object, and shall then go to the TDCC to handle the procedure for the exercise of pledge rights.
  3. After the TDCC has received the pledgee bills dealer's notification of its exercise of pledge rights, and then cross-checked them against the documents of the preceding subparagraph and found no discrepancy, it will handle the book-entry transfer procedure for the exercise of pledge rights and notify both bills dealers of settlement completion. If any uncertainty arises during the cross-checking of the documents, the TDCC shall notify the pledgee bills dealer to handle the matter.
Article 37     When an investor substitutes the subject of a pledge made in favor of a bills dealer, the following procedure shall be observed:
  1. The bills dealer shall send a "substitute the subject of pledge" instruction to the BCSS based on the Application to Substitute Subject of a Pledge Between Investor and Bills Dealer on Short-Term Bills filled out by the investor, and the Application to Create Pledge Between Investor and Bills Dealer on Short-Term Bills (the short-term bills on which the new pledge is established), and shall go to the investor custodian bank to handle the procedure for substituting the subject of the pledge.
  2. If the bills dealer receives a "settlement unconfirmed" message forwarded by the BCSS from the investor custodian bank, it shall determine the reason and address the problem.
  3. After the BCSS receives a "settlement confirmed" message from the investor custodian bank and completes the book-entry transfer procedure for substituting the subject of the pledge, it will notify the bills dealer of settlement completion.
    When the bills dealer handles the procedure for substituting the subject of the pledge under the preceding paragraph, it shall do so prior to the stated maturity date (not including the stated maturity date itself).
Article 38     When a pledgor bills dealer intends to substitute the subject of a pledge, the following procedure shall be observed:
  1. The two bills dealers shall send a "substitute the subject of pledge" instruction to the BCSS based on the Application to Substitute Subject of Pledge Between Bills Dealers on Short-Term Bills and the Application for Creation of Pledge Between Bills Dealers on Short-Term Bills (the short-term bills on which the new pledge is established) filled out by themselves.
  2. After the TDCC receives "settlement for substitution of the subject of a pledge" instructions from both bills dealers, it will match the settlement instructions.
  3. If the bills dealers receive a "matching failed" message from the BCSS, they shall determine the reason and address the problem.
  4. After the BCSS completes the book-entry transfer procedure for substitution of the subject of the pledge, it will notify both bills dealers of settlement completion.
    When the pledgor bills dealer handles the procedure for substituting the subject of the pledge under the preceding paragraph, it shall do so prior to the stated maturity date (not including the stated maturity date itself).
Article 39     When an investor intends to sell short-term bills originally under pledge to a bills dealer and purchase short-term bills from the bills dealer to substitute the subject of the pledge, the following procedure shall be observed:
  1. The bills dealer shall send a "substitute the subject of pledge" instruction and a "trade transaction" instruction to the BCSS based on the Application to Substitute Subject of a Pledge Between Investor and Bills Dealer on Short-Term Bills filled out by the investor, and the Application to Create Pledge Between Investor and Bills Dealer on Short-Term Bills submitted when the new pledge was created on the short-term bills, and shall go to the investor custodian bank to handle the procedure for substituting the subject of the pledge.
  2. If the bills dealer receives a "settlement unconfirmed" message forwarded by the BCSS from the investor custodian bank, it shall determine the reason and address the problem.
  3. Unless the same bank serves as both the bills dealer (or the agent clearing bank) and the investor custodian bank, or unless the net amount of funds due is zero, when the BCSS receives a "settlement confirmed" message from the investor custodian bank it will notify either the Central Bank's Department of Banking or the FISC to handle payment and receipt of net funds due between deposit accounts at the bills dealer (or the agent clearing bank) and the investor custodian bank.
  4. After the BCSS completes the book-entry operations for the investor's substitution of the subject of the pledge and for the purchase/sell transactions, it will notify the bills dealer of settlement completion.
    When the bills dealer carries out the procedure for substituting the subject of the pledge and for the purchase transaction as set out in the preceding paragraph, it shall do so prior to the stated maturity date (not including the stated maturity date itself).
Article 40     When short-term bills in the investor's reverse repo position are used to create a pledge in favor of a bills dealer, once the repo-style transaction reaches its execution date, the procedure for substituting the subject of the pledge is as follows:
  1. The bills dealer shall send a "substitute the subject of pledge" instruction, and a "new repo-style transaction" instruction, to the BCSS based on the Application to Substitute Subject of a Pledge Between Investor and Bills Dealer on Short-Term Bills filled out by the investor, and the Application to Create Pledge Between Investor and Bills Dealer on Short-Term Bills submitted when the new pledge was created on the short-term bills, and shall go to the investor custodian bank to handle the procedure for substituting the subject of the pledge.
  2. If the bills dealer receives a "settlement unconfirmed" message forwarded by the BCSS from the investor custodian bank, it shall determine the reason and address the problem.
  3. Unless the same bank serves as both the bills dealer (or the agent clearing bank) and the investor custodian bank, or unless the net amount of funds due is zero, then when the BCSS receives a "settlement confirmed" message from the investor custodian bank it will notify either the Central Bank's Department of Banking or the FISC to handle payment and receipt of net funds due between deposit accounts at the bills dealer (or the agent clearing bank) and the investor custodian bank.
  4. After the BCSS completes the book-entry operations for the investor's substitution of the subject of the pledge, and for the new repo-style transaction, it will notify the bills dealer of settlement completion.
Article 41     If, for short-term bills in an investor's reverse repo position that have been pledged in favor of a bills dealer, at the execution date of the second leg of the repo-style transaction, the bills dealer or the investor custodian bank has not completed the settlement procedure by canceling the pledge, exercising pledge rights, or substituting the subject of the pledge by the required deadline, the TDCC will proceed directly to initiate the exchange of the original repo-style position that was pledged for the investor's proprietary position for the pledge.
Article 42     When a bills dealer buys short-term bills from an investor or an investor custodian bank, or it sells short-term bills to another bills dealer for best-efforts underwriting, in the event of cancellation, the following procedure shall be observed:
  1. Before an investor, an investor custodian bank, or another bills dealer confirms settlement, the bills dealer may unilaterally cancel settlement.
  2. When an investor, an investor custodian bank, or another bills dealer has already confirmed settlement but has not yet completed the transfer of funds or securities, the bills dealer shall handle the matter as follows:
    1. The bills dealer shall send a cancellation instruction to the BCSS.
    2. If the bills dealer receives an "unconfirmed" message forwarded by the BCSS from an investor, an investor custodian bank, or another bills dealer, it shall determine the reason and address the problem.
    3. After the BCSS receives a confirmation message from an investor, an investor custodian bank, or another bills dealer and completes the procedure for settlement cancellation, it will notify the bills dealer of completion of settlement cancellation.
Article 43     The settlement for short-term bills sold by a bills dealer to an investor or an investor custodian bank (including those underwritten on a best-efforts basis) may be unilaterally cancelled by the bills dealer at any time before the investor or investor custodian bank has confirmed settlement.
    After the investor or investor custodian bank completes settlement confirmation, the bills dealer may not carry out the settlement cancellation of the preceding paragraph.
Article 44     When a bills dealer, acting upon an investor's instruction, cancels the settlement of a short-term bills trade between investors, the following procedure shall be observed:
  1. Before the seller confirms settlement, the bills dealer may instruct the BCSS to cancel the settlement.
  2. When the seller confirms settlement but the buyer has not yet confirmed settlement, the bills dealer shall send a cancellation instruction to the BCSS. When the BCSS receives the bills dealer's cancellation instruction, it will notify the seller to carry out confirmation of settlement cancellation, and after the seller confirms cancellation of settlement and the TDCC has completed the settlement cancellation procedure, it will issue notifications.
  3. When the buyer and seller have already confirmed settlement but not yet completed the transfer of funds and securities, the bills dealer shall send a cancellation instruction to the BCSS. When the BCSS receives the bills dealer's cancellation instruction, it will notify both buyer and seller to carry out confirmation of settlement cancellation, and after both parties confirm cancellation of settlement and the TDCC has completed the settlement cancellation procedure, it will issue notifications.
Article 45     When a bills dealer purchases short-term bills underwritten by another bills dealer on a best efforts basis, if, before returning a "settlement confirmed" message, the bills dealer receives the underwriting bills dealer's settlement cancellation notice forwarded by the BCSS, it shall cancel the settlement confirmation notice previously delivered by the BCSS.
    If, after returning the "settlement confirmed" message, the bills dealer receives the best-efforts underwriting bills dealer's settlement cancellation notice forwarded by the BCSS, it shall handle the matter in accordance with the following procedure:
  1. The bills dealer shall verify the content of the cancellation notice.
  2. If the bills dealer has any doubt about the content of the cancellation notice, it shall return an "unconfirmed" message, and the BCSS will in turn notify the best-efforts underwriting bills dealer to handle the matter.
  3. After verifying the content of the cancellation notice, the bills dealer shall return a confirmation message.
  4. After the BCSS receives the bills dealer's confirmation message, it will cancel the settlement procedure and notify the bills dealer of completion of settlement cancellation.
Article 46     When a bills dealer handles cancellation of the settlement of a trade of short-term bills with another bills dealer or of the procedure for account transfer between its head office and a branch thereof, the following procedure shall be observed:
  1. Before the BCSS completes its matching of instructions, the bills dealer may unilaterally cancel settlement.
  2. When the BCSS has completed its matching of instructions but not yet completed the transfer of funds and securities, the bills dealer shall observe the following procedure:
    1. Both bills dealers, or the head office and the branch, shall each send separate cancellation instructions.
    2. After the BCSS receives the cancellation instructions from both parties, it will match the parties' instructions.
    3. When the bills dealer receives a "matching failed" message from the BCSS, it shall determine the reason and address the problem.
    4. After the BCSS completes its matching procedure, it will cancel the settlement and notify both parties of completion of cancellation.
Article 47     When a bills dealer carries out the procedure for termination of a repo-style transaction in progress with another bills dealer, before the BCSS has completed its matching of the instructions, it may unilaterally revoke the procedure for cancellation.
Article 48     When a bills dealer handles cancellation of a BNS settlement procedure under Article 23, the following procedure shall be observed:
  1. If neither the investor nor the investor custodian bank has yet completed settlement confirmation, the bills dealer may unilaterally cancel the BNS settlement.
  2. When the investor or the investor custodian bank has already confirmed settlement but not yet completed the transfer of funds and securities, the bills dealer shall handle the matter in the following manner:
    1. The bills dealer shall send a cancellation instruction to the BCSS.
    2. If the bills dealer receives an "unconfirmed" message forwarded by the BCSS from an investor or an investor custodian bank, it shall determine the reason and address the problem.
    After the BCSS has received a confirmation message from an investor or an investor custodian bank, and completed the settlement cancellation procedure, it will notify the bills dealer of completion of settlement cancellation.
Article 49     When a bills dealer handles cancellation of a BNS settlement procedure under Article 24, the following procedure shall be observed:
  1. Before the BCSS has completed its matching of all the settlement instructions in the batch, the bills dealer may cancel the individual settlements one by one.
  2. When the BCSS has completed its matching procedure but not yet completed the transfer of funds and securities, the bills dealer shall observe the following procedure:
    1. Each bills dealer shall send separate cancellation instructions.
    2. After the BCSS receives the cancellation instructions from both parties, it will match the two parties' instructions.
    3. When the bills dealer receives a "matching failed" message from the BCSS, it shall determine the reason and address the problem.
    4. After the BCSS completes its matching procedure, it will cancel the batch settlement and notify both parties of completion of cancellation.
Article 50     The provisions of Articles 22, 24, 26, 46, 47, and 49 will apply mutatis mutandis to the handling by a bills dealer of the procedure for settlement of short-term bills transactions between the bills dealer itself and the Central Bank or of a trade in foreign currency denominated negotiable certificates of deposit between itself and a foreign depository, book-entry, or clearing institution.
V. Redemption of bills at maturity
Article 51     After the presentment for redemption of short-term bills held by a bills dealer has been processed by the BCSS at the stated maturity date for redemption and the funds have been paid in full, unless the same bank serves as both bills dealer and physical securities deposit bank, the after-tax redemption funds will be deducted and transferred into the deposit account opened by the bills dealer (or agent clearing bank) with the Central Bank's Department of Banking or with a foreign currency clearing bank, and the bills dealer will be notified.
Article 52     When a bills dealer is engaged by an issuer to handle presentment of the issuer's short-term bills for redemption prior to the stated maturity date, the following procedure shall be observed:
  1. The bills dealer shall purchase the entire batch of short-term bills for which it is handling presentment for redemption prior to the stated maturity date.
  2. If the issuer applies through the TDCC Short-Term Bills Registration System on its issuance platform, the BCSS will forward the issuer's application content to the bills dealer for confirmation. If the issuer applies in writing, the bills dealer shall obtain a Consent to Early Redemption of Short-Term Bills from the issuer and send the consent form to the TDCC.
  3. After returning a confirmation message or delivering the consent form under the preceding subparagraph to the TDCC, the bills dealer shall send an "early redemption" instruction to the BCSS to complete the change of the redemption date. The BCSS will carry out presentment and redemption on the changed redemption date. If payment is not received, the BCSS will not return the bills, but will instead automatically reinstate the original stated maturity date of the bills as their redemption date.
    The short-term bills of the preceding paragraph are restricted to Commercial Paper II (CP II) and foreign currency denominated commercial paper, and the instruction shall be sent no later than the second business day prior to the stated maturity date.
    The bills dealer, the TDCC, and the physical securities deposit bank shall each retain one copy of the Consent to Early Redemption of Short-Term Bills of paragraph 1, subparagraph 2 for their records.
Article 53     When a bills dealer handles the reissuance and net settlement of CP II and foreign currency denominated commercial paper at their stated maturity dates, the following procedure shall be observed:
  1. The bills dealer shall send a reissuance instruction to the BCSS.
  2. When the BCSS receives the bills dealer's notice of reissuance, it will transfer the quantity of the matured commercial paper from the bearer's proprietary position into its pending settlement position.
  3. The BCSS will observe the following principles in handling fund payment and receipt between the deposit accounts opened at the Central Bank's Department of Banking or a foreign currency clearing bank by the bills dealer, the investor custodian bank, or an agent clearing bank and by the physical securities deposit bank:
    1. If the issuer is the net payer, then when the BCSS has received a "confirmation of reissuance" message from the physical securities deposit bank, it will send an "fund payment and receipt " instruction to the Central Bank's Department of Banking or the FISC, which will deduct taxes payable on the commercial paper at maturity, supplementary National Health Insurance premiums ("supplementary insurance premiums") payable, and best-efforts underwriting fees from the issuer's net funds payment and transfer that amount from the deposit account of the physical securities deposit bank into the deposit account of the bills dealer, the investor custodian bank, or the agent clearing bank.
    2. If the bearer of the bills is the net payer, the BCSS will send an "fund payment and receipt " instruction to the Central Bank's Department of Banking or the FISC, which will transfer the bearer's net funds payment from the deposit account of the bills dealer, investor custodian bank, or agent clearing bank into the deposit account of the physical securities deposit bank.
    3. If the issuer and the bearer of the bills are both required to make payments, then after receiving a "confirmation of reissuance" message from the physical securities deposit bank, the BCSS will send an "fund payment and receipt " instruction to the Central Bank's Department of Banking or the FISC, which will transfer the funds payable by the bearer from the deposit account of the bills dealer, investor custodian bank, or agent clearing bank into the deposit account of the physical securities deposit bank.
  4. When the BCSS completes fund payment and receipt, it will deduct the quantity of the matured commercial paper from the bills bearer's pending settlement positions and transfer the quantity of reissued commercial paper into the bills bearer's proprietary position.
  5. After the BCSS completes the procedure of the preceding subparagraph, it will notify the bills dealer and either the bills bearer or its investor custodian bank of settlement completion. If the bills bearer is the net payer, the BCSS will also notify the physical securities deposit bank to remit the funds receivable by the issuer into its designated account.
    Before carrying out the reissuance procedure of the preceding paragraph, the bills dealer shall first complete the procedure for either deposit or issuance registration of the dematerialized commercial paper to be reissued.
Article 54     A bills dealer may send a "non-presentment" instruction to the BCSS to handle non-presentment of short-term bills that it holds.
    The "non-presentment" instruction of the preceding paragraph shall at the latest be sent three business days prior to the stated maturity date in the case of all short-term bills with the exceptions of CP II and foreign currency denominated commercial paper, for which it may be sent on the stated maturity date, and of beneficial securities and asset-backed securities, for which it shall be sent by the business day preceding the stated maturity date.
Article 55     When, upon redemption at maturity, payment is not received for short-term bills in physical form held by a bills dealer, the BCSS will send a dishonor notice to the bills dealer, and the physical securities deposit bank shall send the physical bills being dishonored and a statement of the reasons for the dishonor of the bills by registered mail with advice of delivery. The bills dealer also may apply to collect those documents in person.
    When the bills dealer applies to collect in person under the preceding paragraph, it shall notify the physical securities deposit bank by telephone no later than 9:30 a.m. on the business day following the dishonor, and shall also fill out a Short-Term Bills Withdrawal Statement and submit it to the physical securities deposit bank to withdraw the bills. If the bank branch where the application is made is the same bank branch where the physical bills being dishonored were originally deposited, the bills shall be withdrawn on the application date; if the bank branch where the bills were originally deposited and the bank where the application is made are located in the same county or city, the bills shall be withdrawn on the first business day after the application date; if they are not located in the same county or city, the bills shall be withdrawn on the second business day after the application date.
Article 56     When, upon redemption at maturity, payment is not received in full for dematerialized short-term bills held by a bills dealer, the BCSS will send a notice of insufficient payment to the bills dealer, and the TDCC shall send, via registered mail with advice of delivery, a certificate of claim and documentary proof of presentment and dishonor. The bills dealer may also apply to collect those documents in person.
    When the bills dealer collects the documents in person under the preceding paragraph, it shall notify the TDCC no later than 9:30 a.m. on the next business day following non-receipt of payment in full, and submit an Application for a Certificate of Claim and Documentary Proof of Presentment and Dishonor of Dematerialized Short-Term Bills to the TDCC to collect those documents.
    If the bills dealer is located in the same county or city as the TDCC, it shall collect the documents in person by 5 p.m. on the date of notification. If it is not located in the same county or city, it shall collect the documents at a service counter by 5 p.m. on the third business day after the date of notification.
    If the bills dealer fails to give notice or pick up the certificates by the deadline under the two preceding paragraphs, the TDCC shall deliver them via registered mail with advice of delivery as set out in paragraph 1.
Article 57     When physical CP II or foreign currency denominated commercial paper are dishonored, the bills dealer shall provide a photocopy of the issuer’s authorization for certification and underwriting, stamped with the bills dealer's seal retained by the TDCC, to the physical securities deposit bank to handle the dishonor procedure.
    The procedure of the preceding paragraph may be handled by fax on the day of the dishonor, but the bills dealer is still required to mail the photocopies to the physical securities deposit bank.
Article 58     When an investor and a bills dealer create a pledge on short-term bills in favor of the bills dealer and the bills mature without the pledge having been cancelled, the BCSS, on the stated maturity date, will proceed directly to initiate cancellation of the pledge on those short-term bills and carry out redemption.
    The investor custodian bank or the physical securities deposit bank shall establish an account in which the redemption funds for the short-term bills of paragraph 1 are listed for oversight as restricted funds, shall record the terms of the original pledge, and shall handle these matters in accordance with one of the procedures below, as set out in the pledge application form submitted when the parties created the pledge. In the event of non-payment or insufficient payment, the pledgee shall go to the investor custodian bank or the physical securities deposit bank either to collect the physical bills and a statement of reasons for the dishonor of the bills, or to collect a certificate of insufficient payment from the TDCC.
  1. The pledgor agrees, with respect to the debt that it has secured, while the debt has not yet come to term, the pledgee may still collect amounts payable for the pledged subject. The investor custodian bank or the physical securities deposit bank shall take the redemption funds (less taxes and supplementary National Health Insurance premiums), deduct related processing fees, and transfer the remaining amount into the account designated by the pledgee.
  2. The pledgee bills dealer shall use the redemption funds (less taxes and supplementary National Health Insurance premiums) to handle the investor's purchase of short-term bills from the bills dealer and creation of pledge in favor of that bills dealer. However, if there are extra funds, the bills dealer may notify the investor custodian bank to transfer the funds, after deduction of the related processing fees, into the account designated by the bills dealer or into the investor's monetary funds settlement account.
  3. The investor custodian bank or the physical securities deposit bank shall retain the redemption funds (less taxes and supplementary National Health Insurance premiums).
    When the pledgee applies to withdraw the redemption funds that the third subparagraph of the preceding paragraph requires to be retained by the investor custodian bank or the physical securities deposit bank, it shall submit an Application to Withdraw Redemption Funds for the Subject of a Pledge to the investor custodian bank or the TDCC to process the withdrawal.
Article 59     When the short-term bills of a bills dealer that are subject to restricted settlement reach the stated maturity date and the restriction has not yet been lifted, the BCSS, on the stated maturity date, will proceed directly to initiate lifting of the settlement restrictions on the short-term bills and carry out redemption. In the event of non-payment or insufficient payment, the provisions of Articles 55 and 56 will apply mutatis mutandis.
Article 60     When a bills dealer handles re-presentment of dishonored short-term bills that it holds, the following procedure shall be observed:
  1. The bills dealer shall apply with the physical securities deposit bank to handle re-presentment of the dishonored bills by filling out an Application by Bills Dealer for Re-Presentment of Dishonored Bills and submitting it together with its dishonored physical bills as well as a statement of reasons for the dishonor of the bills, or with a certificate of claim and documentary proof of presentment and dishonor.
  2. After the physical securities deposit bank has completed the procedures in connection with the re-presentment of the returned short-term bills and deducted related fees from the redemption funds, it shall transfer the remaining amount into the account designated by the bills dealer. If the physical securities deposit bank is still unable to complete redemption, it shall carry out the procedure for dishonor of the bills, and the bills dealer shall either withdraw the dishonored physical bills and obtain a statement of reasons for the dishonor of the bills subject to the mutatis mutandis application of Article 55, or collect an Application for a Certificate of Claim and Documentary Proof of Presentment and Dishonor of Dematerialized Short-Term Bills subject to the mutatis mutandis application of Article56.
Article 61     After the stated maturity date for unpresented short-term bills held by a bills dealer, the bills dealer may carry out deferred presentment for redemption by sending a "deferred presentment for redemption" instruction to the BCSS.
    The "deferred presentment for redemption" instruction of the preceding paragraph shall at the latest be sent three business days prior to the date of deferred presentment for redemption in the case of all short-term bills other than CP II and foreign currency denominated commercial paper, for which it shall be sent no later than one business day prior to the date of deferred presentment for redemption.
Article 62     A bills dealer shall, after the stated maturity date (not including the stated maturity date itself), withdraw unpresented short-term bills in physical form that the bills dealer holds. To handle this procedure, the bills dealer, shall pay the payable taxes into the segregated tax account opened by the TDCC at the physical securities deposit bank, and then fill out a Short-Term Bills Withdrawal Statement to withdraw the bills from the physical securities deposit bank.
    The bills dealer shall handle the procedure for withdrawing the bills under the preceding paragraph in one of the following two ways:
  1. Withdraw all of the bills.
  2. On or after the date of deferred presentment for redemption, withdraw all of the bills that remain. The bills dealer may withdraw the short-term bills in physical form under paragraph 1 in person or by registered mail with advice of delivery. If the bills dealer chooses to collect it in person, its handling of the matter will be subject to mutatis mutandis application of the provisions of Article 55, paragraph 2.
Article 63     A bills dealer may, after the stated maturity date (not including the stated maturity date itself), collect a certificate of claim for unpresented dematerialized short-term bills that the bills dealer holds. To carry out this procedure, the bills dealer, shall pay the payable taxes into the segregated tax account opened by the TDCC at the physical securities deposit bank, and then apply with the TDCC to collect the certificate of claim by filling out an Application for a Certificate of Claim and Documentary Proof of Presentment and Dishonor of Dematerialized Short-Term Bills.
Article 64     When a bills dealer, acting on behalf of an issuer, withdraws short-term bills in physical form that have already been redeemed by the issuer, the bills dealer shall withdraw the short-term bills already redeemed by the issuer by filling out a Short-Term Bills Withdrawal Statement and submitting it to the physical securities deposit bank.
    When a bills dealer acting as a guarantor withdraws short-term bills in physical form for which it has advanced the payment of redemption funds on behalf of the issuer, the bills dealer shall withdraw the short-term bills already redeemed by the issuer by filling out a Short-Term Bills Withdrawal Statement and submitting it to the physical securities deposit bank. It shall also submit a deposit slip or remittance slip as proof that it has advanced the payment.
    The bills dealer may collect the short-term bills in physical form under the preceding two paragraphs in person or by registered mail with advice of delivery. If the bills dealer chooses to collect it in person, it will be subject to mutatis mutandis application of the provisions of Article 55, paragraph 2.
Article 65     When a bills dealer is engaged by an issuer to handle withdrawal, from a redemption account, of funds for short-term bills issued by the issuer, the following procedure shall be observed:
  1. If the issuer applies through the TDCC Short-Term Bills Registration System on its issuance platform, the BCSS will forward the issuer's application content and related fund deposit or remittance or other evidentiary information to the bills dealer for confirmation. If the issuer applies in writing, the bills dealer shall obtain an Issuer's Letter of Authorization to Apply for Withdrawal of Funds from the Redemption Account and photocopies of related documentation and send them to the TDCC.
  2. The, After TDCC reviewing and verifying that the application content of the preceding subparagraph is correct, will notify the physical securities deposit bank to deposit (or remit) the redemption funds of the issuer, after deducting the relevant processing fees, into the issuer's designated account.
VI. Supplementary Provisions
Article 66     Any matters not set forth herein shall be governed by the TDCC Operating Rules for Short-Term Bills and other applicable requirements.
Article 67     These Directions, and any amendments hereto, shall take force after having been submitted to and approved by the competent authority and submitted to the Central Bank of the Republic of China (Taiwan) for recordation.
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