Regulations Governing Foreign Exchange Business of Securities Enterprises Article 65

When a securities enterprise conducts the foreign exchange derivatives business, the procedure for verifying that the counterparty meets the criteria for professional customers, trading rules, implementation of risk management, information disclosure, and related internal control and audit systems shall comply with relevant regulations set out by the FSC. In addition, the following rules shall apply：1. Receipt/payment between the securities enterprise and its customer related to settlement and fees, and payments due to the early termination of a contract or expiration of a contract shall be made in the denominated currency. Except for payments that are transferred from the customer’s bank deposit account or the customer’s foreign currency account, the customer shall carry out the foreign exchange settlement against NTD through an authorized bank or the securities enterprise if it is a DSF in accordance with“Regulations for Declaration”. The securities enterprise shall not be entrusted with handling the foreign exchange settlement against NTD for the customer.2. Securities enterprises shall not, either for themselves or for customers, utilize foreign exchange derivatives to defer or hide losses, misrepresent or recognize income earlier, or use other illicit means to engage in window dressing or manipulate financial statements.3. A head office authorizing its branch to carry out the sale of foreign exchange derivatives products that have been approved by the Bank or reported to the Bank for record shall comply with the provisions of“Taipei Exchange Directions Governing Sales of Financial Derivatives Products by Associated Persons of Securities Firms Accepting Orders to Trade Securities”.When a DSF engages in the foreign exchange business under Subparagraph 3 Paragraph 1 of Article 4 herein involving the foreign exchange settlement against NTD or the conversion between foreign currencies, the DSF shall handle the matter in accordance with“Regulations for Declaration”and“Directions for Domestic Securities Firm Approved To Conduct Foreign Exchange Business while Assisting Customers to Declare Foreign Exchange Receipts and Disbursements or Transactions”.