These Regulations are adopted pursuant to Article 82, paragraph 3, and to Article 61 applied mutatis mutandis under Article 88, of the Futures Trading Act ("the Act")

A futures trust enterprise may conduct the following business operations:
1. Offering a futures trust fund to unspecified persons, or to persons meeting the qualification requirements fixed by the competent authority, and issuing beneficial certificates therefor, and using the assets of the futures trust fund to carry on trading or investment activities.
2. Such other relevant business operations as may be approved by the competent authority.

The term "responsible person" as used in these Regulations means a person held responsible under Article 8 of the Company Act or under any other law.

The term "associated person" as used in these Regulations means a person performing any of the following business for or on behalf of a futures trust enterprise:
1. Conducting the offering, issuance, and sale of beneficial certificates.
2. Conducting research and analysis on futures trading and related investments.
3. Operating and managing a fund.
4. Executing trading and investment activities of a fund.
5. Conducting internal audit.
6. Legal compliance.
7. Risk management.
8. Acting as in-charge accountant.
9. Conducting other approved business.

The term "fund manager" as used in these Regulations means an associated person who performs the business operations set out in subparagraph 3 of the preceding article and who is registered as a fund manager with the Chinese National Futures Association (hereinafter the "Association").

A futures trust enterprise shall adopt an internal control system pursuant to the Regulations Governing the Establishment of Internal Control Systems by Service Enterprises in Securities and Futures Markets as adopted by the competent authority, as well as the Rules Establishing Standards for the Internal Control Systems of Futures Trust Enterprises as adopted by the Association or any other futures-related institution designated by the competent authority.
The futures trust enterprise shall conduct business operations in accordance with laws and regulations, its articles of incorporation, as well as its internal control system referred to in the preceding paragraph.
The internal control system referred to in paragraph 1, and any change thereto, shall be submitted for the approval of the board of directors prior to adoption and shall be retained on file for reference. When the competent authority or the futures-related institution designated by the competent authority gives a notice requiring any change thereto, such change shall be made within the specified time limit.

A futures trust enterprise shall maintain an internal audit function to audit its finances and operations at regular intervals or from time to time, and to prepare audit reports and keep them on file for reference.
The audit reports referred to in the preceding paragraph shall contain comments on whether or not the enterprise's financial, operational, and anti-money laundering practices are in compliance with applicable laws and regulations and the enterprise's internal control system.

A futures trust enterprise shall report to the competent authority for prior approval under any of the following circumstances:
1. Change of company name.
2. Amendment of the articles of incorporation.
3. Suspension, resumption, or termination of business.
4. Dissolution or merger.
5. Transfer of all or any major portion of its business or property.
6. Receiving transfer of all or any major portion of the business or property of another entity.
7. Change in capitalization.
8. Change in the place of business of the enterprise or that of a branch unit.
9. Any other matters that the competent authority requires to be approved.

Under any of the following circumstances, a futures trust enterprise shall act in accordance with applicable laws and regulations, and also submit a report by mail to the Association, which shall submit a consolidated report to the competent authority:
1. Commencement of business.
2. Change of director, supervisor, or managerial officer.
3. Where the futures trust enterprise or any of its responsible persons, associated persons, or other personnel becomes involved in litigation or arbitration, or becomes subject to compulsory execution as an obligor, arising in connection with any business operation, or the futures trust enterprise is a bankrupt or has a negotiable instrument dishonored or is refused service by a bank.
4. Any of the circumstances stated in Article 5 of the Standards Governing the Establishment of Futures Trust Enterprises applies to a responsible person or associated person.
5. Any change in the shareholding of a director, supervisor, managerial officer, or a shareholder holding 5% or more of the total number of issued shares.
6. Any other matters that the competent authority requires to be reported in a regulatory filing.
The provisions of subparagraphs 2, 5, and 6 of the preceding paragraph do not apply to an enterprise in another line of business concurrently operating a futures trust enterprise.
For a matter under paragraph 1, subparagraph 1, the futures trust enterprise shall submit a report in advance. For a matter under subparagraphs 2 to 4, the enterprise shall submit a report within 5 business days starting from the date on which it first becomes aware of the fact or on which the fact occurs. For a matter under subparagraph 5, the director, supervisor, managerial officer, or the shareholder holding 5% or more of the total number of issued shares, as the case may be, shall submit a report to the enterprise by the 5th day of the following month, and the enterprise shall submit a consolidated report by the 15th day of the same month.
The term "business day" as used in these Regulations means a trading day on the domestic futures market.

A futures trust enterprise shall make known to the public any matter that materially affects the interests of beneficial owners within 2 days starting from the date of its occurrence, and report the same to the competent authority, with a copy to the Association.
The term "any matter that materially affects the interests of beneficial owners" as used in the preceding paragraph refers to any of the following:
1. Dishonor of a negotiable instrument for insufficient funds, refusal of service, or any other loss of creditworthiness.
2. Any instance of a material adverse effect on the operations of the enterprise due to any litigation, non-litigious matter, administrative disposition, or administrative litigation.
3. Application to a court for reorganization.
4. A change in the chairperson, general manager or one-third or more of the directors.
5. A change in the certifying CPA of the enterprise or of a futures trust fund it manages, except for a change occurring as a result of an internal adjustment of the CPA firm.
6. Any of the circumstances under Article 8, subparagraphs 3 through 6.
7. Any purchase of real estate from a company having a relationship of affiliated enterprise with the futures trust enterprise, as set out in Chapter VI-I of the Company Act, or from a director, supervisor, managerial officer, or a shareholder holding 5% or more of the total issued shares, of the futures trust enterprise, or from a related party of such a person.
8. Suspension or resumption of calculation of the redemption price for a futures trust fund that is offered to unspecified persons.
9. Transfer of a futures trust fund it manages for succession by another futures trust enterprise.
10. Merger of a futures trust fund that is offered to unspecified persons.
11. Termination of contract for a futures trust fund that is offered to unspecified persons.
12. Application by a managed futures enterprise that concurrently operates a futures trust enterprise concurrently to be reorganized into a futures trust enterprise pursuant to Article 45 of the Standards Governing the Establishment of Futures Trust Enterprises.
"Related party" in subparagraph 7 of the preceding paragraph means any party or parties meeting any of the following circumstances:
1. In the case of a natural person, the person's spouse, blood relative within the second degree of kinship, or any enterprise of which the person or the person's spouse is a responsible person.
2. In the case of a juristic person, any juristic person having a relationship of affiliated enterprise as set out in Chapter VI-I of the Company Act.

Except as otherwise prescribed by the competent authority, no director, supervisor, or shareholder holding 5% or more of the total number of issued shares, of a futures trust enterprise may concurrently act as a shareholder holding 5% or more of the total number of issued shares of another futures trust enterprise.
Except as otherwise prescribed by the competent authority, no entity that has a relationship of affiliated enterprise, as set out in Chapter VI-I of the Company Act, with a director, supervisor, or a shareholder holding 5% or more of the total number of issued shares, of a futures trust enterprise may act as a director, supervisor, or a shareholder holding 5% or more of the total number of issued shares, of another futures trust enterprise.
If a merger results in non-compliance with either of the preceding two paragraphs, compliance shall be effected within 1 year from the date of merger.
The calculation of the shareholding of a shareholder holding 5 percent or more of the total number of issued shares under paragraphs 1 and 2 shall include shares held by the shareholder's spouse and minor children and shares held through nominees.
The term "held through nominees" as used in these Regulations means that the following criteria are met:
1. Directly or indirectly providing the stock to another person or providing funds to another person for the purpose of purchasing the stock.
2. Having rights/interest in the management, use, or disposal of the stock held by such other person.
3. Being the principal to whom belong, in whole or in part, profits or losses of the stock held by such other person.

A futures trust enterprise shall have one or more shareholders meeting the qualification requirements set out in Article 12 of the Standards Governing the Establishment of Futures Trust Enterprises, with shareholding or combined shareholding of no less than 20% of the total number of issued shares (excluding shareholding from distribution of new shares as employee bonuses, or from issuance of new shares that are reserved for subscription by employees, or shareholding meeting certain conditions).
Before any transfer of shares by any shareholder under the preceding paragraph, the futures trust enterprise shall file an advance report of such transfer with the competent authority for recordation.

With the exception of shareholders meeting the qualification requirements set out in Article 12 of the Standards Governing the Establishment of Futures Trust Enterprises, the sum total of the shares held by any single shareholder of a futures trust enterprise and by that shareholder's related parties and by that shareholder through nominees may not exceed 25% of the total number of shares issued by the enterprise.
The term "related parties" in the preceding paragraph means any party or parties meeting any of the following circumstances:
1. If the shareholder is a natural person: the shareholder's spouse, blood relative within the second degree of kinship, or any enterprise of which the shareholder or the shareholder's spouse is a responsible person.
2. If the shareholder is a juristic person: any juristic person having a relationship of affiliated enterprise as set out in Chapter VI-I of the Company Act.

A futures trust enterprise may not serve as a director or supervisor of an issuing company in which any of its futures trust funds holds shares of stock. The same shall not apply, however, where the competent authority prescribes otherwise.

A futures trust enterprise shall have its business operations performed by registered and qualified associated persons.

Any act performed by a responsible person, associated person, or other employee of a futures trust enterprise in the course of conducting futures trust business operations or any other relevant business operations as approved by the competent authority shall be deemed an act authorized by the enterprise.