A futures commission merchant may apply to concurrently operate a leverage transaction merchant and conduct proprietary leverage contract trading at its place of business.
An application to concurrently operate a leverage transaction merchant may only be made by a futures commission merchant that engages in proprietary futures trading and that is not concurrently operated by a non-industry enterprise.
A futures commission merchant concurrently operating a leverage transaction merchant shall establish a dedicated unit to handle the leverage transaction business, and based on management requirements with respect to its enterprise size, business conditions, and internal controls, shall allocate a sufficient number of competent managerial officers and associated persons who satisfy the eligibility requirements set out in these Regulations.

A futures commission merchant applying to concurrently operate a leverage transaction merchant shall satisfy the following eligibility requirements, and shall comply with GTSM regulations:
1.It must have engaged in proprietary trading business for a full 3 years.
2.Its CPA audited and attested financial report for the most recent period must show a net worth of NT$1 billion, with no accumulated deficits, while meeting the provisions of Article 17 of the Regulations Governing Futures Commission Merchants.
3.The monthly simple arithmetic mean of the percentage accounted for by adjusted net capital in the total amount of customer margins required for the open positions of futures traders during the preceding 6 months must not have been lower than 40 percent in any month.
4.It must not have been subject to any sanction under Article 100, paragraph 1, subparagraph 1 of the Act, Article 103, subparagraph 1 of the Securities Investment Trust and Consulting Act, or Article 66, subparagraph 1 of the Securities and Exchange Act during the preceding half year.
5.It must not have been subject to any sanction under Article 100, paragraph 1, subparagraphs 2 to 4 of the Act, Article 103, subparagraphs 2 to 5 of the Securities Investment Trust and Consulting Act, or Article 66, subparagraphs 2 to 4 of the Securities and Exchange Act during the preceding 2 years.
6.It must not have been subject to a suspension or restriction of trading by the TAIFEX, the futures clearing house, the TWSE, or the GTSM pursuant to their operating rules or bylaws during the preceding year.
7.Any other requirements set by the competent authority.
If a futures commission merchant does not meet the requirements of subparagraphs 4 to 6 of the preceding paragraph, but has shown a concrete improvement of the circumstances and the competent authority has recognized the improvement, it may be exempted from those restrictions.

A futures commission merchant applying to concurrently operate a leverage transaction merchant shall apply to the competent authority for approval by filling out an application form and attaching the following documents:
1.A business plan setting out the operating principles of the leverage transaction merchant, its business development plan, internal organization and division of responsibilities, personnel recruitment and training plan, and financial forecasts for the year in which operations commence and the following year.
2.The minutes of the directors' meeting containing the resolution for concurrent operation of a leverage transaction merchant.
3.A declaration that none of the circumstances under Article 28 of the Act applies to its directors and supervisors.
4.The CPA audited and attested financial report for the most recent period.
5.A document evidencing compliance with paragraph 1, subparagraph 6 of the preceding Article, provided that exemption from this requirement is allowed when no contract for market use has been entered into with the relevant institution.
6.An application checklist.
7.A declaration stating that the application and its attachments contain no misrepresentation or concealment of information.

Within 6 months from the date of approval by the competent authority, a futures commission merchant applying to concurrently operate a leverage transaction merchant shall amend its articles of incorporation and carry out the required amendments to company registration for concurrent operation of a leverage transaction merchant, and shall further fill out an application form, with the following documents attached, and apply to the competent authority for a certificate of license:
1.Its articles of incorporation and documents evidencing amendment of company registration.
2.A description of its internal control system for the concurrently operated leverage transaction merchant.
3.A review opinion issued by the GTSM on the appropriateness of the risk management of the futures commission merchant concurrently operating a leverage transaction merchant.
4.A register issued by the Chinese National Futures Association ("Futures Association") of the managerial officers and associated persons for the leverage transaction merchant who have passed the review of their qualifications, with documentation showing their qualifications.
5.A declaration stating that none of the circumstances under Article 28 of the Act applies to the persons serving as the managerial officers and associated persons of the leverage transaction merchant.
6.The CPA audited and attested financial report for the most recent period. The financial report need not be attached if it is for the same period as the report attached with the application for approval to concurrently operate a leverage transaction merchant.
7.Documentary proof that an operating bond has been furnished pursuant to the provisions of Article 10.
8.A document evidencing compliance with Article 6, paragraph 1, subparagraph 6, provided that exemption from this requirement is allowed when no contract for market use has been entered into with the relevant institution.
9.An application checklist.
10.A declaration stating that the application and its attachments contain no misrepresentation or concealment of information.
The approval granted to the futures commission merchant concurrently operating a leverage transaction merchant will be revoked upon failure to apply to the competent authority for the issuance of a certificate of license for concurrent operation of a leverage transaction merchant within the time period set by the preceding paragraph. Given a legitimate reason, an application may be made to the competent authority for an extension prior to the deadline; such an extension may not exceed 6 months and will be granted one time only.
A futures commission merchant concurrently operating a leverage transaction merchant that enters the Futures Association under any designation other than leverage transaction merchant may not commence the business operations of a leverage transaction merchant.

If an incomplete set of documents is submitted for an application under these Regulations or the documents are not fully filled out, and if the applicant fails to correct the deficiency within a prescribed time after being so notified by the competent authority, the application will be returned.
Under any of the following circumstances, the competent authority may refuse to issue an approval or a permission license for an application by a futures commission merchant to concurrently operate a leverage transaction merchant:
1.A misrepresentation is found in any content or item in the application documents.
2.The business plan or the internal control system is insufficiently concrete or cannot be effectively executed.
3.One of the circumstances set out under Article 28 of the Act applies to a director, supervisor, or a person appointed as a managerial officer of the leverage transaction merchant.
4.The futures commission merchant is not in compliance with the provision of Article 6.
5.Any other circumstance where withholding approval is deemed necessary for protection of the public interest.