Regulations Governing the Conduct of Securities Trading Margin Purchase and Short Sale Operations by Securities Firms Article 16

When a securities firm conducting margin purchase and short sale business provides margin purchase service to a customer, it shall collect the margin for margin purchase based on the ratio prescribed by the competent authority, and all the securities procured through margin purchase shall be used as collateral; when providing short sales to a customer, the securities firm shall collect a margin for short sale in accordance with the percentage prescribed by the competent authority, and the proceeds from the short selling shall be used as collateral.