Detailed Trading Rules of Dalian Commodity Exchange

Transcription

1 Detailed Trading Rules of Dalian Commodity Exchange (Revised by the Forty-fifth Session of the Second Board of Governors Meeting on November 12, 2013; Promulgated subject to DCE [2013] No. 291 Document on November 28, 2013; Revised portions shall enter into force as of December 6, 2013) Chapter I General Provisions Article 1 These Rules are formulated pursuant to the Trading Rules of Dalian Commodity Exchange for the purposes of standardizing the futures trading conducts, protecting the lawful rights and interests of the parties to the futures trading and ensuring the smooth carrying out of the futures trading of Dalian Commodity Exchange (the Exchange ). Article 2 The Exchange, its Members and the clients shall comply with these Rules. Chapter II Seat Management Article 3 The trading seat shall be the channel where the Member inputs the trading orders into the Exchange's computer trading system to participate in the trading. The trading seats shall be divided into the floor trading seats and the remote trading seats. The remote trading shall refer to the manner of the trading through which the Member directly inputs the trading orders and participates in the trading of the Exchange at its business place through the communication system connected with the Exchange's computer trading system. Article 4 The Member shall obtain one (1) floor trading seat after obtaining its membership. The number of the trading seats may be increased after being approved by the Exchange. The increase of trading seats shall obligate the Member to pay the seat use fee to the Exchange subject to the charging standards formulated and promulgated by the Exchange. Article 5 The Member s increase of trading seats shall refer to the increase of the Member s trading channels only; and the Exchange s management provisions for such Member s position limit, risk control and otherwise shall remain unchanged. Article 6 The Member which applies for increasing floor trading seats shall satisfy the following conditions: (i) Having good operations; (ii) Within the three (3) consecutive months as of the application date, ranking the top fifty (50) members which have the most trading volume, or having a larger number

2 of the Exchange s futures trading; and (iii) Other conditions required by the Exchange. Article 7 The Member which applies for increasing the floor trading seats shall execute an agreement with the Exchange through the member service system and file to the Exchange an application for increasing trading seats; and the contents of the application shall mainly include the types of the seat(s), the scope of accepting returns and otherwise. The Exchange may require the Member to provide other materials, if necessary. Article 8 After the Exchange approves the application for increasing floor trading seat(s), the Member shall complete the relevant entrance formalities at the Exchange within ten (10) days. Any delay without due reason will entitle the Exchange to cancel the floor trading seats applied for by the Member. Article 9 The Member which applies for a remote trading seat shall satisfy the following conditions: (i) Having good operations; (ii) The communication and fund transfer conditions of the place where the agency is located that intends to apply for operation can satisfy the Exchange s requirements for futures trading operation; (iii) Having a perfect remote trading management system; and (iv) Having the construction and management of the remote trading system satisfied with the CSRC s and the Exchange s relevant requirements for technical management norms. Article 10 The Member which applies for a remote trading seat shall execute an agreement with the Exchange through the member service system and submit to the Exchange the following materials: (i) The application for increasing the trading seat(s), the contents of which shall include the type of the seats, the scope of accepting returns, the installation site, the business license number and otherwise; (ii) The photocopy of the business license of the agency that intends to apply for operation; (iii) The infrastructures and staffing of the remote trading system; and (iv) Other materials to be submitted as the Exchange requires. Article 11 The Exchange shall make a reply within twenty (20) trading days after receipt of the materials that are submitted by the Member and used to apply for the remote trading seat. Article 12 The Member shall pay the seat use fee to the Exchange within ten (10) trading days after receipt of the reply that the Exchange agrees its carrying out of the

3 remote trading. Article 13 After the Member files an application for opening the remote trading system, the Exchange shall notify the specific opening date to the Member. Article 14 The floor trading seat of the Member which has opened the remote trading shall be still reserved; and during the trading period, in case the Member s remote trading seat fails to work normally, the Member shall carry out trading through its floor trading seat. The Member shall be solely liable for any consequences arising out of or in connection with the abnormal use of the remote trading seat under the circumstance of its failure to send a floor trader to be at the floor. Article 15 The Member shall strengthen the management of its remote trading and the maintenance of the remote trading system and shall be obligated to keep confidential the software interface and documents and materials provided by the Exchange. Any replacement or technical readjustment of any main facilities shall require the Exchange s prior consent. The relocation of the remote trading seat from the original registered place shall be subject to the Exchange s examination and approval. The Exchange shall have the right to supervise and inspect the use of the remote trading seats. Article 16 Any of the following circumstances may entitle the Exchange to cancel the Member s increased trading seats: (i) Having any inaccuracy in the application materials; (ii) Wholly or partially leasing, contracting or otherwise transferring the seat(s) to any other agency or individual; (iii) Having disordered management or material irregularities; (iv) Failing to satisfy the conditions for using the trading seats; (v) Using the increased trading seats to engage in other activities other than trading; (vi) Being applied by the Member for cancellation; or (vii) Other circumstances which will result in cancellation as held by the Exchange. Article 17 The use fee will not be refunded in case the Member terminates using the trading seat or the increased trading seats are cancelled by the Exchange. Article 18 In case the Member loses its membership of the Exchange, its use of all the trading seats it owns shall be terminated. Article 19 In case ten (10) percent or more Members cannot trade due to the failure in any of the computer terminals, communication systems or other trading facilities, the Exchange shall temporarily suspend trading until the failure is eliminated.

4 Chapter III Management of Floor Traders Article 20 The floor trader shall be the person who is appointed by the Member and accepts on behalf of the Member at the trading floor the Member s trading orders to carry out futures trading; and the Member shall be liable for his or her conducts in connection with the trading at the trading floor. Article 21 The floor trader shall satisfy the following conditions: (i) Being eighteen (18) years or older and of fully capacity of civil conduct; (ii) Being professionally trained by the Exchange and having obtained the certificate of conformity; (iii) Being of good conduct and good professional ethics; and (iv) Being of no criminal punishment records. Article 22 The handling of the floor trader s certificate shall be subject to the inputting through the member service system of the identity, futures practicing qualification certificate and other relevant information as required by the Exchange. Article 23 Each trading seat shall permit two (2) floor traders at the floor unless otherwise approved by the Exchange in the special circumstance. Article 24 The floor trader may enter the trading floor thirty (30) minutes prior to the market opening on each trading day to prepare for the market opening and shall leave the trading floor within thirty (30) minutes after the market closing. The floor trader shall not enter or leave the trading floor without permission unless otherwise permitted by the floor affairs managers in a special circumstance. The floor trader shall not be absent during trading, and the Member shall be solely liable for any consequences arising out of or in connection with his or her absence. Article 25 The floor trader shall wear the effective certificate and designated special dressing at the trading floor. Article 26 The floor trader shall protect any and all facilities at the trading floor and shall operate strictly subject to the Exchange s management provisions for the computer equipment and devices at the trading floor; and any damage thereto will obligate the compensation as per the prices and result in the punishment pursuant to the applicable provisions. Article 27 The floor trader s entering or leaving the trading floor with any trading equipment or devices shall be subject to the approval by the Exchange. Article 28 The floor trader shall be subject to the management by the Exchange s floor affairs managers.

5 Article 29 The floor trader shall timely deliver the Exchange s document, notices and other materials to his or her Member. Article 30 The floor trader shall properly keep the trading passwords; and the Member shall be solely liable for any consequences arising out of or in connection with the disclosure of the trading passwords. Article 31 The floor trader shall not commit any of the following acts: (i) Accepting the trading orders from any other entity or individual; (ii) Offering any consultancy opinions to any other entity or individual; (iii) Carrying out futures trading for himself or herself; (iv) Borrowing, or using without permission, any other Member s telephone or trading terminal; (v) Falsifying or lending his or her floor trader s certificate; or (vi) Any other acts prohibited by the Exchange. Article 32 In case of the Member s dismissal or replacement of a floor trader or the floor trader s resignation from the former Member, the formalities of cancelling authorization shall be timely completed at the Exchange and the floor trader s certificate shall be returned. The Member which fails to timely collect the floor trader s certificate shall timely notify the relevant division of the Exchange and the Member s liability shall be exempted after receiving the Exchange s acknowledgement of receipt thereof. The Member shall be solely liable for any consequences arising out or in connection with no timely completion of the cancellation formalities or returning the floor trader s certificate. Article 33 For the person whose authorization as a floor trader has been cancelled, the Exchange shall not accept his or her registration application for acting as a floor trader at another Member within three (3) months except for the circumstances of the consolidation, division or insolvency of the Member or the consent by his or her former Member. Chapter IV Quotes, Trading Orders and Auction Principles Article 34 The Exchange shall timely release the following information related to the trading: (i) Opening price. In respect of a certain futures contract, the opening price shall refer to the transaction price generated after call auction within five (5) minutes prior to the market-opening. In case no transaction price is generated after the call auction, the first transaction price by auction trading after the market opening shall be the opening price. The first transaction price shall be fixed pursuant to Article 60 of the Trading Rules of Dalian Commodity Exchange, and then the immediately previous transaction

6 price shall be the closing price of the immediately previous trading day, and the immediately previous transaction price of the newly listed contract shall be the listed benchmark price; (ii) Closing price. In respect of a certain futures contract, the closing price shall refer to the last transaction price of the then-current trading. In case of no transacted contract, the then-current closing price shall be the then-current settlement price; (iii) Highest price. In respect of a certain futures contract, the highest price shall refer to the highest transaction price of the transaction prices during a certain period; (iv) Lowest price. In respect of a certain futures contract, the lowest price shall refer to the lowest transaction price of the transaction prices during a certain period; (v) Latest price. In respect of a certain futures contract, the latest price shall refer to the real-time transaction price during the trading period on a certain trading day; (vi) Increase and decrease. In respect of a certain futures contract, the increase and decrease shall refer to the difference between the latest price during the trading period on a certain trading day and the settlement price of the immediately previous trading day; (vii) Highest bid price. In respect of a certain futures contract, the highest bid price shall refer to the real-time highest price when the buyer applies for buying on the then-current day; (viii) Lowest ask price. In respect of a certain futures contract, the lowest ask price shall refer to the real-time lowest price when the seller applies for selling on the then-current day; (ix) Bid volume. In respect of a certain futures contract, the bid volume shall refer to the order-placing quantity being applied for buying at the highest but yet-not-transacted price in the Exchange s trading system on the then-current day; (x) Ask volume. In respect of a certain futures contract, the ask volume shall refer to the order-placing quantity being applied for selling at the lowest but yet-not-transacted price in the Exchange s trading system on the then-current day; (xi) Settlement price. In respect of a certain futures contract, the settlement price shall refer to the weighted average price of the transaction prices during the trading period of the then-current day on the basis of the trading volume. In case of no transacted contracts, the then-current settlement price shall be fixed pursuant to the applicable provisions of the Detailed Settlement Rules of Dalian Commodity Exchange. The settlement price shall be the basis for settling the profit and loss of the non-liquidated contracts of the then-current day and for determining the price limits of the immediately following trading day; (xii) Trading volume. In respect of a certain futures contract, the trading volume shall refer to the bilateral quantities of all the transacted contracts on the then-current day; and (xiii) Open interest. The open interest shall refer to the bilateral quantities of the

7 non-liquidated contracts held by the futures traders. Article 35 In respect of a newly listed contract, the listed benchmark price shall be determined and released in advance by the Exchange. The listed benchmark price shall be the basis for determining the price limits on the first trading day of the newly listed contract. Article 36 The price limits of the newly listed contract shall be two times the price limits prescribed for the contract; and in case there is any transaction, the price limits prescribed for the contract shall prevail on the immediately following trading day; or in case there is no transaction on the then-current day, the price limits of the immediately previous trading day shall prevail on the immediately following trading day. In case there is no transaction for three (3) consecutive trading days, the Exchange may properly adjust the listed benchmark price. The Exchange may release a new benchmark price for the contract which was once transacted but currently without open contracts. Article 37 The types of the trading orders shall be: (i) Limit order: the order that the transaction must be made subject to the limited price or a better price upon the implementation of such order by the Exchange s computer order-matching system; (ii) Market order: the bid (ask) order, as applicable, that the prices of the price limits are used to participate in the trading upon the implementation of such order by the Exchange s computer order-matching system; (iii) Market stop-loss (profit) order: the order that when the market price reaches the triggering price preset by the client, the Exchange s computer order-matching system will promptly transfer it to be the market order; (iv) Limit stop-loss (profit) order: the order that when the market price reaches the triggering price preset by the client, the Exchange s computer order-matching system will promptly transfer it to be the limit order; (v) Arbitrage order: the Exchange provides the arbitrage order for the designated contract, and after receipt of the order, the Exchange s computer order-matching system concurrently carries out the execution of all the component contracts within the order subject to the prescribed proportions. The arbitrage orders shall be divided into the same-commodity calendar spread arbitrage order and the inter-commodity arbitrage order, with the specific contents listed below: Name Trading Mode (From buyer s perspective) Quotation Mode

8 Same-commodity calendar spread arbitrage order Inter-commodity arbitrage order Soybean margin order crushing arbitrage Buy nearby month contracts, Bid (ask) arbitrage price = Bid (ask) price of and sell deferred monthnearby month contracts - Ask (bid) price of contracts of the same quantity deferred month contracts Buy the contracts of a certainbid (ask) arbitrage price = Bid (ask) price of commodity and a certain month, the first commodity - Ask (bid) price of the and sell the contracts of anothersecond commodity commodity and of the same or different month Sell soybean contracts, and buybid (ask) arbitrage price = Bid (ask) price of soybean meal contracts andsoybean meal contracts + Bid (ask) price of soybean oil contracts of thesoybean oil contracts Ask (bid) price of same or different month soybean contracts (vi) Other orders prescribed by the Exchange. The maximum quantity of orders placed each time for the egg contract shall be three hundred (300) lots; the maximum quantity of orders placed each time for the coke contract shall be five hundred (500) lots, the maximum quantity of orders placed each time for the No. 1 soybeans, No. 2 soybeans, soybean meal, soybean oil, RBD palm olein, linear low density polyethylene (LLDPE), polyvinyl chloride (PVC), coking coal, iron ore, fiberboard or blockboard contracts shall be one thousand (1,000) lots; and the maximum quantity of orders placed each time for the corn contract shall be two thousand (2,000) lots. Article 38 The market order and the limit order may be added with such two attributes as fill-or-kill (FOK) orders and fill-and-kill (FAK) orders. Article 39 In respect of the contract of a certain commodity and a certain month, the opening call auction shall be carried out within five (5) minutes prior to the market opening on each trading day; and the first four (4) minutes shall be the period for buy and sell orders of the futures contracts, and the remaining one (1) minute shall be the order-matching period of call auction. Article 40 During the call auction ordering period and the auction trading period after the market opening, the Exchange s computer order-matching system shall accept the trading orders; and the types of the trading orders shall be prescribed by the Exchange and released to the market. During the call auction order-matching period and the auction trading suspension period, the Exchange s computer order-matching system will not accept the trading orders. Article 41 The Exchange s computer order-matching system shall sort the buy and sell orders under the principle of price priority and time priority, and the automatic

9 order-matching transaction will be made when the bid price is higher than or equal to the ask price. The position liquidation sequence for the same contract of the same trading code shall be first opening the position, first liquidation. When an order is placed at the price of the price limits in respect of a certain futures contract, the order-matching principle shall be liquidation priority and time priority, and the Exchange s forced liquidation orders shall prevail over other liquidation orders. Article 42 The call auction shall be subject to the principle of maximum trading volume, that is, the transaction at such price may result in the maximum trading volume. All of the buy orders which are higher than the price resulted from the call auction will be closed; all of the sell orders which are lower than the price resulted from the call auction will be closed; and in respect of the buy or sell orders which are equal to the price resulted from the call auction, the orders of at least one side will be fully closed. In case there is more than one price which satisfies the principle of maximum trading volume, the opening price shall be the price proximate to the settlement price of the immediately previous trading day; and the opening price of the newly listed contract shall be the price proximate to the listed benchmark price. Article 43 The unclosed orders in the opening call auction shall automatically participate in the auction trading after the market opening. Article 44 After the market opening, the order-matching transaction price shall be equal to the middle one of the buy price ( bp ), the sell price ( sp ) and the previous transaction price ( cp ), that is, Where bp sp cp, the latest transaction price = sp; Where bp cp sp, the latest transaction price = cp; or Where cp bp sp, the latest transaction price = bp. Chapter V Trading Code Policy Article 45 The Exchange shall implement the investor trading code policy. The trading code shall refer to the special code which is made by the Member pursuant to these Rules and used in the client s futures trading. Article 46 The trading codes shall be divided into the non-futures company Member codes and the client trading codes. The trading code is comprised of the Member number and the client number. Article 47 The client trading code consists of a 12-digit number, the first four digits being the Member number and the remaining eight digits being the client number. For instance, if a client trading code is , then the Member number is 0001 and the client number being

10 Article 48 The number of the digits of the non-futures company Member trading code shall be the same with that of the client trading code, however, with the last eight digits being its Member number. For instance, if the Member number of a non-futures company Member is 120, then its non-futures company Member trading code shall be Article 49 A non-futures company Member trading code shall not be identical to a client trading code. Article 50 One client can have only one client number in the Exchange but may open different accounts at different futures company Members; and in respect of the trading code, only the Member numbers will be different and the client numbers must be the same. Article 51 The futures company Member shall input the client data and information as the electronic records as per the client data entry prompts indicated by the Member service system; and any skipping or omission shall be prohibited. The futures company Member which changes the client data or deregisters the trading code shall timely modify the relevant data and information through the Member service system. The futures company Member shall file to the Exchange for recording the data and information of the client s account-opening, change and deregistration. The futures company Member shall ensure the truthfulness and accuracy of the client s data and information on the record. Article 52 After the futures company Member inputs the client s account-opening data and information in the Member service system, the client trading code will be automatically generated by the Member service system and may be used only after being confirmed by the Exchange. Article 53 The futures company Member shall set up the files of the data and information of the client s account-opening, change and deregistration. The data and information of the client s account opening shall include the Individual Client Account-Opening Registration Form of The Futures Market (See Annex 1), the photocopy of his or her identity card and otherwise for an individual client, or the Entity Client Account-Opening Registration Form of The Futures Market (See Annex 2), the photocopy of the lawful certificate(s) of having the qualification as the China legal person or other economic organization, et cetera, for an entity client. The data and information of the client deregistration shall include the Client Deregistration Application Form of The Futures Market (See Annex 3), et cetera. The futures company Member must keep the aforesaid data and information for a

11 period of no less than twenty (20) years. Article 54 In case of any of the following circumstances, the client trading code will be deregistered: (i) Any of the client filed data or information is inaccurate; (ii) The client is determined to be prohibited from market access ; (iii) The client has completed the deregistration formalities at the futures company; or (iv) Any other circumstance which will result in the deregistration. For a trading code which shall be deregistered, the futures company Member shall have it deregistered after the settlement through the Member service system. Article 55 In case the client provides any false account-opening data or information or the futures company Member assists the client to use any false account-opening data or information to open an account, the Exchange shall order the futures company Member to carry out liquidation within a limited period; the client trading code shall be deregistered after the liquidation; and applicable provisions of the Measures for Handling of Violations of Dalian Commodity Exchange shall concurrently apply. Article 56 The Member and the client shall properly manage the trading codes under the good faith principle. Any Member or client that improperly manages the trading codes, which results that any trading code is used by others to commit any irregularity will be punished by the Exchange subject to the applicable provisions. Chapter VI Supplementary Provisions Article 57 Any violation of these Rules will be punished by the Exchange subject to the applicable provisions of the Measures for Handling of Violations of Dalian Commodity Exchange. Article 58 These Rules shall be interpreted by Dalian Commodity Exchange. Article 59 These Rules shall enter into force as of the date of promulgation.