Article 1
　These regulations are prescribed pursuant to Article 35, Paragraph 2, of The
Central Bank of the Republic of China (Taiwan) Act, and Article 37 of the 
Regulation Governing Foreign Exchange Business of Banking Enterprise.

Article 2
　Banks approved by the Central Bank of the Republic of China (Taiwan) (the "Bank") 
to conduct foreign exchange business ("Authorized Banks") shall comply with the 
following provisions when engaging in discretionary foreign currency margin trading
business ("Discretionary Margin Trading"). Matters not provided from herein shall 
be governed by other relevant laws and regulations.

Article 3

　The term "Discretionary Margin Trading" as used in these Regulations shall mean,
Banks approved to engage in Discretionary Margin Trading Business ("Authorized
Institutions"), accepting the customer's ("Consignee) consignment, which shall,
based on its investing judgment, within the net liquidating amount of the foreign
currency margin trading account ("Trading Account") for the best interests of the
Consignee, fully conduct a foreign currency margin trading business on the
Consignee's behalf.

　The Trading Account mentioned above shall mean the deposit account opened by the
Consignee at Authorized Institutions or other Authorized Banks for accepting/
disbursing and clearing of Discretionary Margin Trading. The opening of a trading
account shall based on the foreign currency margin trading agreement signed by the
Consignee and the Account Bank. A trading account shall not be shared among
different discretionary margin trading agreements, or for other trading acceptance
and clearance purposes at the same time.

　The Account Bank shall mean the bank where the Consignee opens the trading account.

Article 4

　The Authorized Bank conducting the Discretionary Margin Trading shall meet the
following requirements, and apply for approval in accordance with Article 5:

　1.Obtain the Bank's approval to conduct the foreign currency margin trading
　　business.

　2.Establish a Dedicated Unit for conducting Discretionary Margin Trading ( 
　　"Dedicated Unit") outside its treasury department and trust business
　　department.

Article 5

　The Authorized Bank applying for the Discretionary Margin Trading should submit
the following documents to the Bank for approval:

　1.Business Plan.

　2.Minutes of the board of directors meeting indicating the decision to conduct
　　the business mentioned herein in the case of domestic banks, or the power of
　　attorney issued from the headquarters or the regional headquarters of a foreign
　　bank.

　3.Declaration of regulatory compliance.

　4.Risk disclosure statement.

　5.The resumes of the Dedicated Unit's supervisor and trading manager.

　6.Other documents required by the Bank.

　The business plan mentioned in the preceding paragraph, Section 1, shall specify
　the operation principles of Discretionary Margin Trading, risk management, policy
　and procedures, segregation of duties between the Account Bank and Dedicated Unit,
　the fire wall system, internal control systems and the procedures for handling
　business disputes.

Article 6
　If Authorized Banks submit incomplete documents in applying for approval pursuant
to the preceding article, and if upon receiving the notice for correction, such
correction cannot be made within the period specified by the Bank, the Bank will
reject these application.

Article 7

　The Bank may reject the application in the event of any of the following:

　1.Such application cannot meet the requirements established in Article 4.

　2.If any of the documents submitted by the Authorized Bank pursuant to Article 5
　　fail to comply with the regulations or contain false information.

　3.The Authorized Bank has seriously violated the regulations for margin trading
　　business or other foreign exchange business, been notified by the bank of such
　　violation, but failed to improve within the period specified by the Bank.

　4.There is evidence indicating that there is concern over the soundness of
　　operation of the authorized bank, or that the authorized bank is unable to
　　comply with financial policy.

Article 8

　The Bank may revoke or cancel its approval of any Authorized Institution permitted
to engage in Discretionary Margin Trading in the event of any of the following:

　1.The Authorized Institution has seriously violated the provisions of these
　　Regulations and was notified of such violations by the Bank, but has failed to
　　rectify within the period specified by the Bank.

　2.After obtaining the Bank's approval, the Authorized Institution was found to
　　have provided false information in its application, which is deemed a serious
　　violation; or

　3.The Authorized Institution suspends operations, is dissolved, or declares
　　bankruptcy.

Article 9
　Discretionary Margin Trading shall be restricted to individual Consignment at the
Authorized Bank's Over-the-Counter for sale/purchase of spot/forward foreign
exchange transactions, and other transactions approved by the Bank with the
outstanding amount of the trading account served as collateral to above mentioned
transactions.

Article 10

　When the Authorized Institution conducts Discretionary Margin Trading, matters
regarding agreement, account opening, purchase and sale, settlement, clearance,
accounts processing, obligations of notification, operating returns and expenses,
the qualifications and requirements for the manager and trader of the Dedicated
Unit, prevention of conflicts of interest, obligations and rights of the Authorized
Institution, the Account Bank, and the Consignee, and other guidelines and practices
, shall be governed by the "Taipei foreign exchange market development foundation" 
"Foundation"), discussed with the R.O.C. Bankers Association ("BAROC"), and will be
established upon approval by the Bank. The same requirement shall also apply to any
amendment thereof.

　The Authorized Institutions conducting Discretionary Margin Trading shall comply
with the preceding business guidelines.

　If any disputes arise from Discretionary Margin Trading, related acceptance and
payment, or clearance among the Authorized Institutions, Account Banks, and the
Consignee, the relevant party may, pursuant to their agreement, appeal to or ask for
mediation from the BAROC.

Article 11

　Prior to conducting Discretionary Margin Trading, the Authorized Institution must
sign the discretionary agreement and risk disclosure statement with the consignee.
The Authorized Institution shall obtain Consignee's signed statement confirming that
such institution has assigned staff to clearly explain the documents captioned in
the preceding documents, and the Consignee shall be allowed for 7 or more days to
review the documents prior to execution.

　Samples of the discretionary agreement, risk disclosure statement and margin
trading agreement made in accordance with the regulation captioned above, shall be
filed with and approved by the Bank after the Foundation has established and
discussed with the BAROC. The same requirement shall apply to any amendment thereof.

Article 12
　The Authorized Institution operating Discretionary Margin Trading must perform
its duties with due diligence and faithfulness conduct, and shall reiterate to the
Consignee that such trading account is not protected by deposit insurance, and that
any risk regarding operating losses shall be born solely by the Consignee.

Article 13
　Conducting Discretionary Margin Trading, the Authorized Institution may set the
minimum balance requirement for each consignment.

Article 14

　The Authorized Institution, the director and auditor of such Authorized
Institution, the manager of the Dedicated Unit, relevant staff, and other related
employees, shall avoid any conflict of interest when conducting the Discretionary
Margin Trading. In addition to comply with the relevant laws/regulations, the
following activities are prohibited:

　1.Conducting foreign currency margin trading or Discretionary Margin Trading for
　　a third party whose interest conflicts with that of the Consignee, or engaging
　　in trading that may impair the Consignee's rights and interests.

　2.The Authorized Institution, with gross negligence or willful misconduct,
　　conducts counter-trade between consigned investment funds and its own funds or
　　other Consignees' investment funds, buckets with the Consignee, or violates the
　　agreement, internal procedures, and internal controls...etc..

　3.Utilizing the Consignee's trading account to conduct foreign currency margin
　　trading for itself or for any third party other than the Consignee.

　4.Sub-mandating or assigning all or part of the discretionary agreement to other
　　parties.

　5.Without any proper reasons, alters the completed consigned trade made in the
　　name of the consignee's account to the name of the Authorized Institution, the
　　employees of the Authorized Institution described above, the account bank or
　　 any third parties other than the Consignee, and vice versa.

　6.Other activities prohibited by the Bank.

　In addition to the preceding regulations, the manager of the Dedicated Unit,
relevant staff, or other related employees shall not conduct the foreign currency
margin trading or Discretionary Margin Trading for themselves.

Article 15
　The Authorized Institution shall be liable if its Discretionary Margin Trading's
operation conflicts with the law or other agreements and causes the Consignee to
suffer damages as a result.

Article 16
　The Authorized Institution's promotion or advertisement connected to Discretionary
Margin Trading shall comply with the self-discipline rules of the BAROC. If there is
any obviously fraudulent, exaggerated, or untruthful promotion or advertisement, the
BAROC may report to the Bank.

Article 17
　This regulation will be effective from the date of promulgation.