(Purposes of Establishment and Organization)
A futures exchange shall be established for the purpose of promoting the public interest and preserving the transaction fairness of the futures market.
A futures exchange may be organized in form of either membership or company.

(Establishment Standards and Governing Regulations)
A futures exchange shall be established with an approval granted and a business license issued by the Competent Authority.
The establishment criteria as referred to in the preceding Paragraph and the governing regulations for the futures exchanges shall be prescribed by the Competent Authority.

(Business)
The business of a futures exchange is to provide services for a centralized futures trading market. Unless otherwise approved by the Competent Authority, a futures exchange shall neither engage in other business nor invest in other enterprises.

(Trading of Contracts)
A futures trading contract shall not be traded on the futures exchange without prior approval from the Competent Authority. Nonetheless, when the Competent Authority is approving the futures trading contract involving currency exchange between New Taiwan Dollars and foreign currencies, the Competent Authority shall consult with and obtain the consent of the Central Bank of the Republic of China (Taiwan) in advance.
The Competent Authority shall grant or deny the application as referred to in the preceding paragraph within six months, unless extraordinary circumstances are present.

(Causes for Voidance of Contracts)
An approved futures trading contract may be voided by the Competent Authority if one of the following events occurs:
1. The contract has lost its economic value;
2. The contract is not consistent with the public interest;
3. Upon the petition filed by the futures exchange.

(Futures Trading Venue)
Unless otherwise prescribed by this Act or other acts, or otherwise approved by the Competent Authority, futures trading shall be conducted only at a futures exchange.

(Prohibition of Unlawful Operation)
Unless acting pursuant to this Act, no person shall engage in operating a futures exchange or the business of a futures exchange.
No person shall provide any premises, facilities, or information for others to engage in the unlawful business as referred to in the preceding Paragraph.

(Operation Bond)
A futures exchange shall deposit an operation bond with the National Treasury. The amount and the governing regulations of the said bond shall be prescribed by the Competent Authority.

(Operating Rules)
The operating rules of a futures exchange shall contain the following particulars:
1. use of the futures trading market;
2. trading system;
3. clearing and settlement system;
4. calculating methodology of margin and premium;
5. administration of futures commission merchants;
6. surveillance of the futures trading market;
7. contingency plan;
8. handling procedures and penalties for default cases;
9. other matters as required by the Competent Authority.
The prescription and amendment of the provisions in the operating rules as referred to in the preceding Paragraph shall be approved by the Competent Authority.

(Measures for Maintaining Market Order)
A futures exchange, in the execution of market surveillance pursuant to subparagraph 6 of Paragraph 1 in the preceding Article, may publicize the very trading information where such a surveillance has detected abnormalities; in case such a trading is suspected of materially dampening the market order, the following measures may be undertaken:
1. the adjustment of margin level or the time span for collection;
2. the restriction of trading volumes for the whole or partial portion of futures commission merchants;
3. the restriction of trading volumes and/or open positions;
4. suspension or termination of the said futures trade;
5. any other necessary measure for the maintenance of the market order or for the protection of futures traders.

(Causes for Voidance of License)
In the event of the following events, the Competent Authority may void the license of a futures exchange:
1. the application for incorporation or the business license contains false statement;
2. where, three months elapsed after the issuance of the business license, the futures exchange fails to commence its business operation or, after commencing its business operation, it has voluntarily suspended its operation for a continuous period of three months or longer, unless the futures exchange, for justifiable cause shown, has applied for and obtained an extension approval by the Competent Authority.

(Filing for Approval and Recordation)
A futures exchange shall file registration statements with the Competent Authority for its approval and recordation upon commencing or suspending its business operation.

(Confidentiality)
Any directors, supervisors, or their individual representatives, managers, or employees of a futures exchange shall keep confidential any information relevant to futures transactions acquired through the performance of their duties.

(Qualifications and Governance of Responsible Persons and Associated Persons)
The rules regarding qualification and personnel governance for the responsible persons and associated persons of a futures exchange shall be prescribed by the Competent Authority.

(Nature)
A membership futures exchange shall be established as a non-profit juristic person.

(Number of Members)
The number of memberships of a membership futures exchange shall be no less than seven.

(Content of the Articles of Association)
The promoters of a membership futures exchange shall, based on an unanimous agreement, execute the "Articles of Association" containing the following particulars with signatures and chops:
1. objectives;
2. name;
3. location of the head office;
4. organization and responsibilities;
5. categories and eligibility of membership;
6. number of memberships;
7. accession and withdrawal of members;
8. membership contribution and refund;
9. matters concerning discipline of members;
10. matters concerning number, responsibilities, term of office, election and removal of directors and supervisors;
11. matters regarding clearing and settlement;
12. imposition of penalties for breach of contract;
13. matters regarding transaction fees and charges for members;
14. apportionment of membership expenses;
15. disposal of residual assets upon dissolution;
16. matters regarding accounting;
17. procedures for amending the Articles of Association;
18. methods for public announcement;
19. any other matters as required by the Competent Authority; and
20. date of executing the Articles of Association.

(Member Contributions)
The members of a membership futures exchange shall make their contributions in accordance with the provisions of the Articles of Association. The minimum contribution amount shall be prescribed by the Competent Authority according to the categories of membership.
In addition to the sharing of membership expenses according to the provisions of Articles of Association and the contribution referred to in the preceding Paragraph, a member's liability for the futures exchange is limited to ten times of its membership contribution.
The member contribution referred to in the first paragraph shall be paid in cash.

(Causes for Expulsion of Members)
In case of any of the following acts by a member of a membership futures exchange, the futures exchange shall impose upon the member a monetary penalty and may further warn, suspend or restrict such member from trading futures on the said futures exchange, or may expel the member should the offense be of a serious nature:
1. any act in violation of acts and regulations, or any failure to comply with the administrative orders issued by the Competent Authority pursuant to acts and regulations;
2. any act in violation of the Articles of Association, operating rules, standards for mandate contracts, or any other rules of the futures exchange;
3. any transaction in violation of the principles of integrity and good faith which may cause damages to others.
The expulsion of a member as referred to in the preceding Paragraph shall be reported to the Competent Authority for recordation.

(Winding Up Transactions Upon Member Withdrawal or Suspension)
Where a member withdraws from the membership or is suspended from trading, the membership futures exchange shall, in compliance with the Articles of Association, require the said member or designate an other member to wind up and settle its transactions effected on the futures exchange; within the scope of winding up the business, the said member shall not be deemed to have withdrawn from the futures exchange or suspended from trading.
Where another member is designated to wind up the transactions in accordance with the preceding Paragraph, a mandate relationship is deemed to exist between the withdrawing member and the designated member so far as it is necessary for winding up and settling the transactions.

(Election and Terms of Directors and Supervisors)
A membership futures exchange shall have at least three board directors and one supervisor elected from among its members in accordance with the Articles of Association. At least one-fourth of the directors shall be elected from among non-member experts, half of whom shall be appointed by the Competent Authority and the remaining shall be selected by the Board with the approval of the Competent Authority. The selection procedures for such directors shall be prescribed by the Competent Authority.
The term of office of both directors and supervisors shall be three years; successive terms in office are permissible upon re-election or re-appointment.
The directors shall establish a board of directors and shall elect a chairman with the consent of the majority of the directors.
The board chairman shall be a full-time executive officer; the above requirement shall not apply, however, if the membership futures exchange has assigned a manager vested with full authority to take charge of its operation.

(Causes for Discharge of Promoters, Directors, Supervisors, or Managerial Officers of a Membership Futures Exchange)
No person who falls within any of the following categories shall serve as a promoter, director, supervisor, or manager of a membership futures exchange; those already serving in any of these capacities shall be discharged:
1. any person specified in any subparagraph of Article 30 of the Company Act;
2. any person who served as the director, supervisor, manager, or other equivalent position of a juristic person at the time it was adjudicated bankrupt; and that three years have not elapsed since the close of the bankruptcy, or the reconciliation has not been fulfilled;
3. any person who has a record of a negotiable instrument being dishonored by a financial institution in the preceding three years; or
4. any person who has been discharged from his position under Paragraph 1 of Article 101 of this Act, or Article 56 or subparagraph 2 of Article 66 of the Securities and Exchange Act within the past five years;
5. any person who has been sentenced under this Act, the Foreign Futures Trading Act, the Company Act, the Securities and Exchange Act, the Banking Act, the Statute for the Regulation of Foreign Exchange, the Insurance Act, or the Credit Union Act to a punishment of not less severe than a criminal fine; and five years have not elapsed since the completion of sentence execution, the expiration of the suspension of sentence, or the pardon of the crime;
6. any person who has been removed from his or her position pursuant to subparagraph 2 of Article 100 of this Act within the past five years; or
7. any person who has been proved that, on behalf of others, he/she illegally acted as a promoter, director, supervisor or manager of a membership futures exchange.
Where the promoter, director, or supervisor of the membership futures exchange is a juristic person, the preceding Paragraph shall apply mutatis mutandis to the representatives of the said juristic person or the individuals designated to execute business for the juristic person.

(Personnel Prohibited from Trading On Their Own or Through Others Under Any Name)
Representatives of member directors or supervisors, non-member directors or supervisors, or any employees of the membership futures exchange shall not, for their own interest and using any trading account, either on their own behalf or by commissioning others, trade futures contracts in such futures exchange.
The persons referred to in the preceding Paragraph are prohibited from, providing funds to, sharing profits or losses with, or involving in any other business with any members of the exchange; however, the above restriction shall not apply to the representatives of member directors or supervisors who perform such acts for the interests of the members they represent.

(Handling of Violations)
In the event that the Competent Authority finds that any director or supervisor of the futures exchange was improperly elected, or any director, supervisor or manager was in violation of any act or regulation, or the Articles of Association, or failing to comply with any administrative dispositions issued by the Competent Authority under and pursuant to this Act and related regulations, the Competent Authority may notify the futures exchange to discharge such persons from their offices.

(Provisions Applied Mutatis Mutandis)
Unless otherwise provided in this Act, the provisions of the Company Act regarding directors, supervisors, or managers shall apply mutatis mutandis to the directors, supervisors, or managers of a membership futures exchange.

(Provisions Applied Mutatis Mutandis)
The provisions of this section regarding directors and supervisors shall apply mutatis mutandis to their designated representatives.

(Causes for Dissolution)
A membership futures exchange shall proceed with the dissolution process upon the occurrence of any one of the following causes:
1. any event of dissolution specified in the Articles of Association occur;
2. by resolution of the general meeting of members;
3. The number of membership is less than seven;
4. bankruptcy; or
5. voidance of the approval for the establishment of the futures exchange.
The dissolution referred to in subparagraph 2 of the preceding Paragraph shall not become effective without the approval from the Competent Authority.

(Organization)
A futures exchange organized as a company shall be a company limited by shares; the shareholding of any shareholder shall not exceed five percent of the paid-in capital in the said company unless an approval was granted by the Competent Authority under special circumstances.

(Content of the Articles of Incorporation)
The Articles of Incorporation of a futures exchange organized as a company shall be executed in accordance with the Company Act. The following particulars shall not be effective unless they are explicitly stipulated in the Articles of Incorporation:
1. qualifications of traders;
2. establishment of a clearing department;
3. any other matters required by the Competent Authority.

(Directors and Supervisors)
At least one-fourth of the directors and supervisors of a futures exchange organized as a company shall be non-shareholder experts, half of whom shall be appointed by the Competent Authority, and the remaining half shall be selected by the Board subject to approval by the Competent Authority. The selection procedures for such board members shall be prescribed by the Competent Authority, and Paragraph 1 of Article 192 and Paragraph 1 of the Article 216 of the Company Act shall not be applicable.

(Prohibition of Bearer Stock)
A futures exchange organized as a company shall not issue bearer stocks.
Persons to whom the stock of a futures exchange organized as a company may be transferred or pledged are limited to lawfully established futures commission merchants, securities firms, securities finance enterprises, banks, or securities and futures related institutions for which the Competent Authority has granted approval.

(Establishment of a Business Committee and a Discipline Committee)
A futures exchange organized as a company shall establish a business committee and a discipline committee, and at least one-third of the members of each committee shall consist of the futures commission merchants trading on the exchange.
The organization and responsibilities for the committees referred to in the preceding Paragraph shall be filed for approval with the Competent Authority.

(Required Content of the Contract for the Usage of the Centralized Futures Trading Market)
Futures commission merchants trading in a futures exchange organized as a company shall enter into a contract for the usage of the centralized futures trading market with the exchange specifying the following:
1. the rate of futures trading processing fees;
2. that any futures commission merchant who violates any provisions of Paragraph 1 of Article 25 of this Act shall be punished with a monetary penalty for breach of contract, have its trading suspended or restricted, or have its usage contract terminated;
3. that any futures commission merchant who has been designated to wind up or settle trades made by other futures commission merchants shall have the obligation to perform in accordance with the contract.
The contract referred to in the preceding Paragraph together with other relevant materials shall be registered by the futures exchange with the Competent Authorities for its approval and recordation.

(Contract Termination)
The contract referred to in the preceding Article shall be terminated either pursuant to the provisions of the contract, or upon the dissolution, voidance of the business license, or suspension of business of either party to the contract.

(Requirement of Recordation of Contract Termination)
A futures exchange organized as a company, when terminating the contract with a futures commission merchant pursuant to subparagraph 2 of Paragraph 1 of Article 39 of this Act shall register such contract termination with the Competent Authority for its recordation.

(Obligation to Wind Up)
Where a futures commission merchant terminates the contract pursuant to Article 40 under this Act or is suspended from trading, it shall bear the obligation to wind up its transactions in the centralized futures trading market.

(Rate for Allocation of Special Reserve)
The Competent Authority, at its discretion, may order a futures exchange organized as a company to allocate a certain proportion of its earnings as special reserve in addition to the legally required reserve.
The rate for allocation per annum of the special reserve referred to in the preceding Paragraph shall be determined by the Competent Authority depending upon the earnings status of the futures exchange.

(Provisions Applied Mutatis Mutandis)
The provisions of Article 28, Article 30, and Article 32 of this Act shall apply mutatis mutandis to a futures exchange organized as a company.