Section 2 Securities Brokerage Business

2 Illegally entrust others to buy or sell securities

(2) Shareholders and actual controllers of a securities firm

(2) Where any securities broker who engaging in businesses does not present his her certificate of securities broker to his her client

The recommendations contained herein typically apply to both one tier and two tier systems.

2 Customers payment of commission, expenses or taxes related to the securities trading

2 Actually control 5 equity or more of the securities firm by holding equity of the shareholders of the securities firm or by any other means.

2 Organization, forming method, roles and responsibilities, rule of procedure of the securities firm

(2) To enter workplaces or business sites of a securities firm to undertake inspections

(2) expenses on purchasing commercial insurances, securities, stock equities or collections and so on

Analysis shows that at present, new retail competition in Tier 1 cities is still a long way from a red ocean situation, and there is still plenty of Tier 2 cities yet to be explored. Enormous opportunities and potential exist in the market.

Default IPCC tier 1 methods

Article 2 Securities firms should follow the law, administrative regulation and prescription of the securities regulatory agency under the State Council, run business prudently, and perform fiduciary duties to customers.

(2) Where any shareholder and actual holder of a securities firm force, incite, assist or accept the securities firm to provide financing or warranty with assets of stock brokerage clients or stock asset management clients

This emerging four tier world presents three key challenges.

The securities firm should sign entrustment contracts with securities brokers who accept such entrustment, issue securities broker certificate, define authorized scope of securities broker and supervise working behavior of securities broker.

Without securities business license, the securities firm and its domestic branch shall not run securities business.

The securities broker should have securities working qualification.

The audit report should be submitted to the securities regulatory agency under the State Council within 2 months of his leaving

(2) To condemn the securities firm and its directors, supervisors, senior managers and persons responsible of inbound branches who are concerned

Why? Tier 1 A was the center for military intelligence.

Disagreement remained, however, regarding the proposed three tier system of ministerial government, which would allow the Governor less power than the two tier system preferred by the United Kingdom.

Securities brokers should work within authorized scope of the securities firm and show securities broker certificates to customer.

While the two tier system is not as widely utilized as the one tier system, it is nevertheless prevalent in several large economies such as Austria, Germany and the Netherlands.

Article 56 Where a securities firm carries out securities lending and borrowing but does not have sufficient funds or securities, it can borrow from the securities financial companies.

3 Trade securities or maneuver securities market with insider information

(5) Securities service agencies provided services for a securities firm.

(2) Where the securities firm does not conform to decisions made by the securities regulatory agency under the State Council according to laws to remove any director, supervisor, senior manger and person responsible of any inbound branch from his her post.

Article 41 A securities firm engaged in securities business for its own account is limited to trading of legally issued stocks, bonds, warrants, securities investment funds or other securities recognized by the securities regulatory agency under the State Council.

Securities brokers shall not handle securities subscription or trading for customers.

Article 20 If a securities firm has two or more kinds of securities brokerage business, securities assets management business, financing with capital and securities, securities underwriting, securities sponsors, its board should set up remuneration and nomination committee, auditing committee and risk control committee to perform rights prescribed in company regulation.

(2) Where enterprises, asset management agencies and securities service agencies hold or actually hold by a securities firm do not file and provide relevant information and materials to the securities regulatory agency under the State Council according to laws, or where there is any false record, misleading statement or major omission in the information and materials filed and provided.

1 Illegally buying securities issued by shareholder of the securities firm or other issuer with major relationship to securities firm against regulation

1 Customers purchase of securities, settlement of securities trading or customers withdrawal

2 Assets value entrusted by customer in single transaction is lower than minimum level prescribed by the securities regulatory agency under the State Council

(2) Where a securities firm offers investment suggestions to its client, making certainty judgment on highs and lows of security prices or market trends

(2) Approving and executing applications and instructions which use trust funds and assets and securities in secured accounts of clients in violation of provisions

Article 32 A securities firm should establish information inquiring system to ensure customers inquiring entrustment record, trading record, securities and balance during business hours of the securities firm, as well as other information such as name, practice license of the business operator and securities broker of the securities firm, certificate number of securities broker, etc.

Article 26 If a securities firm and its domestic branch are engaged in securities business prescribed in Article 125 of the Securities Law, they should follow the Securities Law and provisions of this Regulation.

Article 38 If a securities firm is engaged in securities brokerage business, it can entrust staff outside of the securities firm as securities broker, engaging in attracting and providing service for customers as agent.

Article 48 Securities lending and borrowing referred to in this article means that in the securities trading at the stock exchange or other securities trading places that have been approved by the State Council, securities firms lend capital or securities to customers for them to buy or sell securities based on the corresponding collaterals provided by the customers.

Securities account opened by the securities firm for securities assets management customer should be submitted to stock exchange for filing within 3 trading days.

(2) Where a securities firm undertakes collective investments with assets of several clients or invests its client s assets in specific targeting products without any approval.

Article 44 If a securities firm is engaged in self run securities business, its risk controlling indicators such as ratio of total securities value and company net capital, ratio of value of one type of securities and net corporate capital, and ratio of quantity of one type of securities and total issuing quantity of this type of securities should comply with prescription of the securities regulatory agency under the State Council.

Article 50 A securities firm that carries out securities lending and borrowing business shall sign a securities lending and borrowing contract with the customer, and shall open a customer securities guarantee account with the securities registration and settlement organs, and a customer funds guarantee account with the designated commercial bank in the name of the securities firm in accordance with the provisions of the securities regulatory agency under the State Council.