[English Translation]

TRADING MEMBER REGULATIONSTOKYO FINANCIAL EXCHANGE INC.

(This is an English translation of the Trading Member Regulations, the original of which
has been prepared in the Japanese language only. The Japanese language text hereof shallgovern for all purposes and in all respects. Accordingly, all questions that may arise
within or without courts of law in regard to the meaning of the words, provisions andstipulations of these Trading Member Regulations shall be decided in accordance with theJapanese language text. Tokyo Financial Exchange Inc. (“TFX”) assumes no responsibility
for accuracy, correctness or contents of this English text.)

Trading Member Regulations

Table of Contents
PART 1:Page
QUALIFICATIONS AND DUTIES OF TRADING MEMBERS .............. 1

CHAPTER I. GENERAL PROVISIONS........................................................................... 1
Article 1.
Purpose .............................................................................................................. 1
Article 1-2. Definitions ........................................................................................................ 1
Article 2.
Trading Members ............................................................................................. 2
Article 3.
Article 4.
Article 5.

Forms of Market Derivatives Transactions, etc. by Trading Members .. 10
Ensuring of Fair Price Formation and Adequate Market Liquidity ........ 12(Deleted).......................................................................................................... 12

CHAPTER II. TRADING MEMBER’S DUTIES ........................................................... 12
Article 6.
Delivery of Written Oath .............................................................................. 12
Article 7.
Member Link Agreement .............................................................................. 12
Article 8.
Trading Member Representative .................................................................. 13
Article 8-2. Process Agent for Remote Trading Member .............................................. 14
Article 9.
Article 10.
Article 11.
Article 12.
Article 13.

Registered Deputy Representative............................................................... 14
Contact Office ................................................................................................ 14
Payment of Exchange Fees ........................................................................... 15
Market Entry Deposit .................................................................................... 16
Non-assignability of Right of Claim for Refund of Market Entry Deposit.......................................................................................................................... 18

Article 14. Liability Due to Use of Exchange’s Market ............................................... 18
Article 15. Liability Due to Use of Market Facilities ................................................... 18
Articles 16 through 20 (Deleted) ......................................................................................... 19
Article 21. Duty of Investigation before Undertaking of Brokerage Service ............ 19
Article 22. Restriction on Brokerage Service for Other Trading Member’s Directors,
Officers or Employees ........................................................................................................... 19
Article 23. Liability for Market Derivatives Contracts Executed and L-T Link
Positions Arising .................................................................................................................... 19
Article 24. Emergency Restriction .................................................................................. 20
Article 25. Conclusion of Clearing Agreement for Market Derivatives Transactions .
.......................................................................................................................... 20

Article 25-2. Development of Risk Management System ................................................ 21
CHAPTER III. DEREGISTRATION OF TRADING MEMBERSHIP ........................... 22
Article 26. Application for Deregistration of Trading Membership ........................... 22
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Article 27. Market Derivatives Contracts Involving Deregistration Applicant ......... 23
Article 28. Special Provisions for Merger or Consolidation of Deregistration
Applicant.......................................................................................................................... 24
Article 29. Approval of Deregistration of Trading Membership................................. 25
Article 29-2. Deregistration of FX Broker Trading Membership or LP Trading
Membership .......................................................................................................................... 26
Article 29-3. Deregistration of All Trading Memberships for Interest Rate Futures
Contracts.......................................................................................................................... 26
Article 30.

Public Notice and Notification of Deregistration of Trading Membership.......................................................................................................................... 26

Article 31. Performance of Outstanding Obligations upon Deregistration ................ 27
Article 32. Settlement of Market Derivatives Contracts after Deregistration ........... 27
Article 33. Market Derivatives Contracts for Non-Clearing Member’s Account uponits Designated Clearing Member’s Deregistration ............................................................ 28
Article 34. Name Transfer for Trading Membership .................................................... 29
Article 35. Trading Deregistration Fee ........................................................................... 30
CHAPTER IV
EFFECTS OFDISCIPLINARY, REGULATORY And OTHER
MEASURES .................................................................................................................... 30
Articles 36 and 37 (Deleted)................................................................................................. 31
Article 38. Market Derivatives Contracts for Suspended or Restricted Trading
Member.......................................................................................................................... 31
Article 39. Market Derivatives Contracts for Non-Clearing Member’s Account in
Relation to Suspended Designated Clearing Member ...................................................... 32
Article 40. Notification and Announcement of Disciplinary or Any Other Measure 34
Articles 41 and 42 (Deleted)................................................................................................. 34
CHAPTER V. MEDIATION ............................................................................................ 34
Article 43. Request for Mediation ................................................................................... 35
Article 44. Joint Mediation............................................................................................... 35
Article 45. Investigation for Mediation .......................................................................... 36
Article 46. Mediation Regulations .................................................................................. 36
Article 47. Joint Mediation Regulations ......................................................................... 36
CHAPTER VI. MISCELLANEOUS PROVISIONS ....................................................... 37
Article 47-2. Amounts of Trading Registration Fees and Other Fees ............................ 37
Article 48. Acquisition of Trading ID, Clearing ID, FX Operating ID, Equity Index
Operating ID and FX Clearing Operating ID ..................................................................... 37

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Article 49. Trading Officer ............................................................................................... 38
Article 50. Clearing Officer ............................................................................................. 38
Article 50-2. FX Officer ....................................................................................................... 39
Article 50-3. Equity Index Officer ...................................................................................... 39
Article 50-4. FX Clearing Officer ....................................................................................... 40
Article 51. Decision of Necessary Matters for Trading Members .............................. 40
Article 51-2. Inactive Trading Member.............................................................................. 40
PART 2:

SELF-REGULATORY OPERATIONS ..................................................... 41

CHAPTER I. General Provisions ..................................................................................... 41
Article 52. Authority of Self-regulatory Committee..................................................... 41
CHAPTER II. Acquisition of Trading Membership ......................................................... 41
Article 53. Application for Trading Membership and Membership Approval .......... 42
Article 54. Time and Date of Acquisition of Trading Membership ............................ 43
CHAPTER III.

Investigation against Trading Members .................................................. 43

Article 55.
Article 56.
Article 57.
Article 58.

Notifiable Matters .......................................................................................... 43
Reportable Matters......................................................................................... 44
Financial Reporting ....................................................................................... 49
Investigation against Trading Members ...................................................... 50

CHAPTER IV. Disciplinary, Regulatory AND other Measures on Trading Members . 51
Article 59. Collaborative Relationship or Controlling Relationship with its Directors/ Officers or Other Persons ................................................................................................... 52
Article 60. (Deleted).......................................................................................................... 52
Article 61. Disciplinary Measures on Trading Members ............................................. 52
Article 62. Regulatory Measures for Inappropriate Controlling Relationship, etc. of
Trading Member ..................................................................................................................... 56
Article 62-2. Regulatory Measures for Defects in Risk Management System ............. 57
Article 63. Regulatory Measures on Trading Member ................................................. 57
Article 64. Lifting of Suspension of Market Derivatives Transactions, etc. or Other
Regulatory Measure ............................................................................................................... 59
Article 66. Measures on Trading Member under Statutory Sanctions ....................... 60
Article 67. Breach of Just and Equitable Principle of Trade........................................ 60
Article 68.

Recommendation to Trading Members ....................................................... 61

SUPPLEMENTARY PROVISIONS ................................................................................... 63

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Trading Member Regulations
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PART 1:QUALIFICATIONS AND DUTIES OF TRADINGMEMBERSCHAPTER I.
GENERAL PROVISIONS

Article 1.

Purpose

1.1
These Trading Member Regulations set forth the matters necessary to stipulate
in connection with the Trading Members of the Exchange, in accordance with Article
1-2.1 of the Trading Regulations.
1.2
Amendments to Chapter 4 of PartⅠ shall be effected by obtaining the concent of
the Self-regulatory Committee, and amendment to Part Ⅱ shall be effected by the
resolution of the Self-regulatory Committee.

Article 1-2.

Definitions

The terms used herein shall be as defined in the Financial Instruments andExchange Act (Law No. 25 of 1948, as amended; hereinafter called the “Act”), and theterms listed below shall have the meanings as assigned to them in the respective Items
below.
(1)“Trading Member” means a person having a qualification needed to
conduct market derivative transactions at the Exchange.

(2)“Clearing Member” means a person qualified to act as counterparty inthe Exchange’s financial instruments obligation assumption business.

(3)“Non-Clearing Member” means a Trading Member who is not a1

Trading Member Regulations

Clearing Member with respect to the type of market derivatives
transactions for which the Non-Clearing Member holds a trading
membership.
(4)

Article 2.

“Designated Clearing Member” means a Clearing Member entering
into a Clearing Agreement with a specific Non-Clearing Member andundertaking clearing for market derivatives contracts executed by thesaid Non-Clearing Member.

Trading Members

2.1
The Trading Members shall be classified into eight types: Japanese Yen Interest
Rate Trading Members, Yen Interest Rate Swap Futures Trading Members, FX Daily
Futures Trading Members, Japanese Yen Interest Rate Remote Trading Members, Equity
Index Daily Futures Trading Members, Equity Index Daily Futures Remote Trading
Members, FX Broker Trading Members and LP Trading Members.
2.2
A Japanese Yen Interest Rate Trading Member shall mean a person having aqualification to conduct market derivatives transactions of the types set forth in therespective Items below on the Exchange’s Market (hereinafter called the “Japanese Yen
Interest Rate Trading Membership”).
(1)

Three-month Euroyen futures(2)

Three-month Euroyen futures option contract(3)

Three-month TONA futures(4)

Three-month TONA futures option contract

2.3
An Yen Interest Rate Swap Futures Trading Member shall mean a person having
a qualification to conduct market derivatives transactions of the types set forth in therespective Items below on the Exchange’s Market (hereinafter called the “Yen Interest
Rate Swap Futures Trading Membership”).
(1)

Two-year ¥ SwapnoteTM
2

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(2)Five-year ¥ SwapnoteTM(3)

Seven-year ¥ SwapnoteTM(4)Ten-year ¥ SwapnoteTM

2.4
An FX Daily Futures Trading Member shall mean a person having aqualification to conduct market derivatives transactions of the types set forth in therespective Items below on the Exchange’s Market (hereinafter called the “FX Daily
Futures Trading Membership”).
(1)

U.S. Dollar−Japanese Yen FX Daily Futures contracts(2)Euro−Japanese Yen FX Daily Futures contracts(3)

British Pound−Japanese Yen FX Daily Futures contracts(4)

Australian Dollar−Japanese Yen FX Daily Futures contracts(5)

Swiss Franc−Japanese Yen FX Daily Futures contracts(6)

Canadian Dollar−Japanese Yen FX Daily Futures contracts(7)

New Zealand Dollar−Japanese Yen FX Daily Futures contracts(8)

South African Rand−Japanese Yen FX Daily Futures contracts(9)

Turkish Lira−Japanese Yen FX Daily Futures contracts(10)

Norwegian Krone−Japanese Yen FX Daily Futures contracts(11)

Hong Kong Dollar−Japanese Yen FX Daily Futures contracts(12)

Swedish Krona−Japanese Yen FX Daily Futures contracts(13)

Mexican Peso−Japanese Yen FX Daily Futures contracts
3

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(14)Polish Zloty−Japanese Yen FX Daily Futures contracts(15)Euro−U.S. Dollar FX Daily Futures contracts(16)

British Pound−U.S. Dollar FX Daily Futures contracts(17)

British Pound−Swiss Franc FX Daily Futures contracts(18)

U.S. Dollar−Swiss Franc FX Daily Futures contracts(19)

U.S. Dollar−Canadian Dollar FX Daily Futures contracts(20)

Australian Dollar−U.S. Dollar FX Daily Futures contracts(21)Euro−Swiss Franc FX Daily Futures contracts(22)Euro−British Pound FX Daily Futures contracts(23)

New Zealand Dollar−U.S. Dollar FX Daily Futures contracts(24)Euro−Australian Dollar FX Daily Futures contracts(25)

British Pound−Australian Dollar FX Daily Futures contracts(26)

Chinese Yuan−Japanese Yen FX Daily Futures contracts(27)

Korean Won−Japanese Yen FX Daily Futures contracts(28)

Indian Rupee−Japanese Yen FX Daily Futures contracts(29)

U.S. Dollar−Japanese Yen FX Daily Futures contracts (Large)(30)

Euro−Japanese Yen FX Daily Futures contracts (Large)(31)

British Pound−Japanese Yen FX Daily Futures contracts (Large)

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(32)Australian Dollar−Japanese Yen FX Daily Futures contracts (Large)(33)

Euro−U.S. Dollar FX Daily Futures contracts (Large)

2.5
A Japanese Yen Interest Rate Remote Trading Member shall mean a person
having a qualification to conduct market derivatives transactions of the types set forth in
the respective Items below on the Exchange’s Market excluding those conducted basedon orders placed by Customers resident in Japan (hereinafter called the “Japanese Yen
Interest Rate Remote Trading Membership”).
(1)

Three-month Euroyen futures(2)

Three-month Euroyen futures option contract(3)

Three-month TONA futures(4)

Three-month TONA futures option contract

2.6
An Equity Index Daily Futures Trading Member shall mean a person having aqualification to conduct market derivatives transactions of the types set forth in therespective Items below on the Exchange’s Market (hereinafter called the “Equity Index
Daily Futures Trading Membership”).
(1)

Nikkei 225 Daily Futures contracts with Reset Date

(2)

FTSE 100 Daily Futures contracts with Reset Date

(3)

DAX® Daily Futures contracts with Reset Date

(4)

DJIA Daily Futures contracts with Reset Date

(5)Gold ETF Daily Futures contracts with Reset Date(6)

WTI ETF Daily Futures contracts with Reset Date

(7)

NASDAQ-100 Daily Futures contracts with Reset Date5
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(8)Russell 2000 Daily Futures contracts with Reset Date

(9)

Silver ETF Daily Futures contracts with Reset Date

(10)

Platinum ETF Daily Futures contracts with Reset Date

2.7
An Equity Index Daily Futures Remote Trading Member shall mean a person
having a qualification to conduct market derivatives transactions of the types set forth in
the respective Items below on the Exchange’s Market excluding those conducted basedon orders placed by Customers resident in Japan (hereinafter called the “Equity Index
Daily Futures Remote Trading Membership”).
(1)

Nikkei 225 Daily Futures contracts with Reset Date

(2)

FTSE 100 Daily Futures contracts with Reset Date

(3)

DAX® Daily Futures contracts with Reset Date

(4)

DJIA Daily Futures contracts with Reset Date

(5)Gold ETF Daily Futures contracts with Reset Date(6)

WTI ETF Daily Futures contracts with Reset Date

(7)

NASDAQ-100 Daily Futures contracts with Reset Date

(8)

Russell 2000 Daily Futures contracts with Reset Date

(9)

Silver ETF Daily Futures contracts with Reset Date

(10)

Platinum ETF Daily Futures contracts with Reset Date

2.8
An FX Broker Trading Member shall mean a person having a qualification to
conduct market derivatives transactions of the types set forth in the respective Items
below on the Exchange’s Market (hereinafter called the “FX Broker Trading
Membership”).

6
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(1)U.S. Dollar−Japanese Yen FX Clearing Futures contracts(2)Euro−Japanese Yen FX Clearing Futures contracts(3)

British Pound−Japanese Yen FX Clearing Futures contracts(4)

Australian Dollar−Japanese Yen FX Clearing Futures contracts(5)

Swiss Franc−Japanese Yen FX Clearing Futures contracts(6)

Canadian Dollar−Japanese Yen FX Clearing Futures contracts(7)

New Zealand Dollar−Japanese Yen FX Clearing Futures contracts(8)

South African Rand−Japanese Yen FX Clearing Futures contracts(9)

Turkish Lira−Japanese Yen FX Clearing Futures contracts(10)

Norwegian Krone−Japanese Yen FX Clearing Futures contracts(11)

Hong Kong Dollar−Japanese Yen FX Clearing Futures contracts(12)

Swedish Krona−Japanese Yen FX Clearing Futures contracts(13)

Mexican Peso−Japanese Yen FX Clearing Futures contracts(14)

Singapore Dollar−Japanese Yen FX Clearing Futures contracts(15)

Offshore Chinese Yuan−Japanese Yen FX Clearing Futures contracts(16)Euro−U.S. Dollar FX Clearing Futures contracts(17)

British Pound−U.S. Dollar FX Clearing Futures contracts(18)

British Pound−Swiss Franc FX Clearing Futures contracts(19)

U.S. Dollar−Swiss Franc FX Clearing Futures contracts
7

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(20)

U.S. Dollar−Canadian Dollar FX Clearing Futures contracts(21)

Australian Dollar−U.S. Dollar FX Clearing Futures contracts(22)Euro−Swiss Franc FX Clearing Futures contracts(23)Euro−British Pound FX Clearing Futures contracts(24)

New Zealand Dollar−U.S. Dollar FX Clearing Futures contracts(25)Euro−Australian Dollar FX Clearing Futures contracts(26)

British Pound−Australian Dollar FX Clearing Futures contracts(27)

Australian Dollar−Swiss Franc FX Clearing Futures contracts(28)

Australian Dollar−New Zealand Dollar FX Clearing Futures contracts(29)

New Zealand Dollar−Swiss Franc FX Clearing Futures contracts(30)

Australian Dollar−Canadian Dollar FX Clearing Futures contracts(31)Euro−Canadian Dollar FX Clearing Futures contracts(32)

Canadian Dollar−Swiss Franc FX Clearing Futures contracts(33)

U.S. Dollar−Hong Kong Dollar FX Clearing Futures contracts

2.9
An LP Trading Member shall mean a person having a qualification to conduct,as a counterparty to an FX Broker Trading Member market derivatives transactions of
the types set forth in the respective Items of Article 2.8 above on the Exchange’s Market(hereinafter called the “LP Trading Membership”).
2.10
Japanese Yen Interest Rate Trading Members, Yen Interest Rate Swap Futures
Trading Members, and Japanese Yen Interest Rate Remote Trading Members shall behereinafter collectively called “Interest Rate Futures Trading Members”, Japanese Yen
8
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Interest Rate Remote Trading Members and Equity Index Daily Futures Remote Trading
Members shall be hereinafter collectively called “Remote Trading Members”, Equity
Index Daily Futures Trading Members and Equity Index Daily Futures Remote Trading
Members shall be hereinafter collectively called “Equity Index Daily Futures Trading
Member(s), etc.” and FX Broker Trading Members and LP Trading Members shall behereinafter collectively called “FX Trading Members”.
2.11
Market derivatives transactions/contracts in connection with the Japanese Yen
Interest Rate Trading Membership, the Yen Interest Rate Swap Futures Trading
Membership, and the Japanese Yen Interest Rate Remote Trading Membership shall behereinafter collectively called “Interest Rate Futures transactions/contracts,” market
derivatives transactions/contracts in connection with the FX Daily Futures Trading
Membership shall be hereinafter called “FX Daily Futures transactions/contracts,”
market derivatives transactions/contracts in connection with the Equity Index Daily
Futures Trading Membership and the Equity Index Daily Futures Remote Trading
Membership shall be hereinafter called “Equity Index Daily Futurestransactions/contracts,” and market derivatives transactions/contracts in connection with
the FX Broker Trading Membership and the LP Trading Membership shall be hereinafter
called “FX Clearing Futures transactions/contracts.”
2.12
A Trading Member set forth in each Item below may hold the respective trading
membership set forth in the relevant Item.
(1)

Trading Members other than Remote Trading Members
Japanese Yen Interest Rate Trading Membership, Yen Interest Rate
Swap Futures Trading Membership, FX Daily Futures Trading
Membership, Equity Index Daily Futures Trading Membership, FX
Broker Trading Membership and LP Trading Membership(2)

Remote Trading Members
Japanese Yen Interest Rate Remote Trading Membership and Equity
Index Daily Futures Remote Trading Membership

2.13
type.

No Trading Member shall hold two or more trading memberships in the same

2.14

A Remote Trading Member shall not be qualified as a Clearing Member.
9

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Article 3.
Members

Forms of Market Derivatives Transactions, etc. by Trading

3.1
If a Trading Member holding a certain type of trading membership is a Clearing
Member for the market derivatives transactions, etc. covered by the same type of trading
membership, the market derivatives transactions, etc. by the Trading Member shall be
conducted in any of the forms set forth in the respective Items below.
(1)

To execute a market derivatives contract on the Exchange’s Market at abid or offer submitted by the Clearing Member in its own name for its
own account with respect to any type of trading membership held by
the Clearing Member(2)

To execute a market derivatives contract on the Exchange’s Market at abid or offer submitted by a Non-Clearing Member in the name of the
Clearing Member for the Non-Clearing Member’s account with respect
to any type of trading membership held by the Clearing Member(3)

To clear a market derivatives contract executed in the name of the
Clearing Member on the Exchange’s Market(4)

To bear all or part of loss incurred by the Exchange as a result of
assuming obligations arising from a market derivatives contract
executed in the name of any other Clearing Member on the Exchange’s
Market, if the referenced Clearing Member holds a clearing
membership of the same type as the market derivatives contract
involving such loss

(5)

To cause an L-T Link Position (meaning an L-T Link Position as
specified in Article 2(7) of the Trading Regulations; this interpretation
shall equally apply hereinafter) under a Link Agreement as specified in
Article 2(8) thereof and a Member Link Agreement as specified in
Article 2(9)(a) thereof to arise in the name the Clearing Member for its
own account, if the Clearing Member is an Interest Rate Futures
Clearing Member (meaning an Interest Rate Futures Clearing Member
10

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as specified in Article 3.3 of the Clearing Regulations; thisinterpretation shall equally apply hereinafter) holding a Japanese Yen
Interest Rate Trading Membership(6)

To cause an L-T Link Position under a Link Agreement and a Member
Link Agreement as specified in Article 2(9)(b) of the Trading
Regulations to arise in the name of the Clearing Member for theconcerned Non-Clearing Member’s account, if the Clearing Member isan Interest Rate Futures Clearing Member holding a Japanese Yen
Interest Rate Trading Membership(7)

To clear an L-T Link Position arising in the name of the Clearing
Member, if it is an Interest Rate Futures Clearing Member holding a
Japanese Yen Interest Rate Trading Membership(8)

To bear all or part of loss incurred by the Exchange as a result of
becoming a party to an L-T Link Position arising between the
Exchange and any other Interest Rate Futures Clearing Member or as aresult of failure to collect money due from any Linked Overseas
Clearing House, if the Clearing Member is an Interest Rate Futures
Clearing Member

3.2
Market derivatives transactions by a Non-Clearing Member shall be conductedin any of the forms set forth in the respective Items below.
(1)

To execute a market derivatives contract on the Exchange’s Market atthe Non-Clearing Member’s bid or offer for its own account in thename of its Designated Clearing Member with respect to any type of
trading membership held by the Non-Clearing Member(2)

To cause an L-T Link Position under a Link Agreement and a Member
Link Agreement as specified in Article 2(9)(b) of the Trading
Regulations to arise for the Non-Clearing Member’s account in thename of its Designated Clearing Member, if the Non-Clearing Member
is a Non-Clearing Member or Japanese Yen Interest Rate Remote
Trading Member holding a Japanese Yen Interest Rate Trading
Membership11

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Article 4.

Ensuring of Fair Price Formation and Adequate Market Liquidity

4.1
A Trading Member shall make best efforts to ensure fair price formation andadequate liquidity on the Exchange’s Market in order to maintain and enhance thefunction of the Exchange Financial Instruments Market.
4.2

A Trading Member shall be an entity engaging in market derivatives

transactions on the Exchange’s Market as part of its mainstream businesses.

Article 5.

(Deleted)

CHAPTER II.
TRADING MEMBER’S DUTIES

Article 6.

Delivery of Written Oath

A Trading Member shall deliver a written oath to the Exchange in the form
designated by the Exchange.

Article 7.

Member Link Agreement

7.1
If an Interest Rate Futures Clearing Member holding a Japanese Yen Interest
Rate Trading Membership intends to cause an L-T Link Position to arise in its own namefor its own account, the Interest Rate Futures Clearing Member shall enter into a
Member Link Agreement as specified in Article 2(9)(a) of the Trading Regulations with
the Exchange, Linked Overseas Organizations, and a member of the Linked Overseas
Exchange in the form designated by the Exchange.

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7.2
If an Interest Rate Futures Clearing Member holding a Japanese Yen Interest
Rate Trading Membership intends to cause an L-T Link Position to arise in its own namefor the account of a Non-Clearing Member, the Interest Rate Futures Clearing Member
shall enter into a Member Link Agreement as specified in Article 2(9)(b) of the Trading
Regulations with the Exchange, Linked Overseas Organizations, the Non-Clearing
Member, and a member of the Linked Overseas Exchange in the form designated by the
Exchange.
7.3

If a Non-Clearing Member or Japanese Yen Interest Rate Remote Trading

Member holding a Japanese Yen Interest Rate Trading Membership intends to cause an
L-T Link Position to arise for its own account in the name of its Designated Clearing
Member, the Non-Clearing Member shall enter into a Member Link Agreement as
specified in Article 2(9)(b) of the Trading Regulations with the Exchange, Linked
Overseas Organizations, the Designated Clearing Member, and a member of the Linked
Overseas Exchange in the form designated by the Exchange.

Article 8.

Trading Member Representative

8.1
A Trading Member shall select one (1) person suitable for the position of its
representative at the Exchange from its duly authorized representatives and designate
him/her as the Trading Member Representative (Torihiki Sankasha Daihyosha). If a
Trading Member is a corporation or other legal entity established under laws other thanJapanese laws, the Trading Member Representative shall be selected from those who are
authorized to act as the foreign legal entity’s representative in Japan as specified in
Paragraph 1 of Article 817 of the Companies Act (Act No. 86 of 2005) and who hold aposition equivalent to or higher than the position of a Japanese company’s director or
officer. Then, the Trading Member shall notify the Exchange of such designation.
8.2
Notwithstanding the provision of Article 8.1 above, a Remote Trading Member
shall select one (1) person suitable for the position of its representative at the Exchange
from its duly authorized representatives and designate him/her as the Trading Member
Representative, and notify the Exchange of such designation.
8.3
A Trading Member shall be represented only by its Trading Member
Representative as between the Trading Member and the Exchange.

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Article 8-2.

Process Agent for Remote Trading Member

A Remote Trading Member shall designate a person as its process agent who isauthorized to receive service of process for and on behalf of the Remote Trading
Member and whose address, place of residence, business office, or branch office islocated in Japan, and the Remote Trading Member shall notify the Exchange of suchdesignation; provided, however, that if the Remote Trading Member has a representativein Japan pursuant to Paragraph 1 of Article 817 of the Companies Act, the Remote
Trading Member shall notify the Exchange of the said representative.

Article 9.

Registered Deputy Representative

9.1
Notwithstanding the provision of Article 8.3 hereof, a Trading Member may
cause another person designated as its deputy representative and registered with the
Exchange in accordance with the requirements prescribed by the Exchange (hereinafter
called the “Registered Deputy Representative”) to act for and on behalf of the Trading
Member with respect to such routine operations that will be separately prescribed by the
Exchange.
9.2
If the Exchange determines a Registered Deputy Representative as being
inappropriate for that position, the Exchange may demand that the Trading Member
replace him/her.

Article 10.

Contact Office

10.1
A Trading Member shall, from among its principal and other offices andbranches in Japan, designate one (1) contact office to receive notices from the Exchange
and notify the Exchange of the designated contact office in accordance with therequirements prescribed by the Exchange.
10.2
Notwithstanding the provision of Article 10.1 above, a Remote Trading Member
shall designate its principal office or any other office or branch in charge of market
derivative transactions on the Exchange’s Market as a contact office to receive notices
from the Exchange and notify the Exchange of the designated contact office in
14
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accordance with the requirements prescribed by the Exchange.
10.3
If there is any change as to a Trading Member’s contact office, the Trading
Member shall notify the Exchange to that effect in accordance with the requirements
prescribed by the Exchange.

Article 11.

Payment of Exchange Fees

11.1
A Trading Member shall pay the exchange fees, comprised of monthly exchange
fees, per-contract exchange fees, access fees, Market Facility Usage Fees, Trading ID
Usage Fees and give-up fees, in accordance with the requirements prescribed by the
Exchange.
11.2
A per-contract exchange fee payable by each Trading Member for a specific
type of market derivatives contracts shall be in the amount obtained by multiplying thesum of the trading volume, the final settlement volume (meaning a volume of positions
relevant to the final settlement specified in the Clearing Regulations; this interpretation
shall equally apply hereinafter) and the Reset Volume (meaning a volume of positions
relevant to the Reset specified in the Clearing Regulations) of the market derivatives
contracts of the said specific type executed at the Trading Member’s bids or offers on the
Exchange’s Market (excluding the contracts invalidated pursuant to Article 14.2 of theTrading Regulations) by the charging rate applicable to that type of market derivatives
contracts as separately prescribed by the Exchange.
11.3
Notwithstanding the provision of Article 11.2 above, if a Japanese Yen Interest
Rate Trading Member or a Japanese Yen Interest Rate Remote Trading Member causes
L-T Link Positions to arise, the per-contract exchange fee shall be in the amountcalculated in accordance with Article 11.2 above, plus the amount obtained bymultiplying the sum of the volume of the L-T Link Positions arising for the account of
the Japanese Yen Interest Rate Trading Member or of the Japanese Yen Interest Rate
Remote Trading Member (hereinafter called the “Accepted Volume”) and the final
settlement volume of those L-T Link Positions by the charging rate applicable to thattype of L-T Link Positions as separately prescribed by the Exchange.
11.4

Notwithstanding the provisions of Articles 11.2 and 11.3 above, the per-contract

exchange fee payable by a Trading Member with respect to market derivatives contracts
15
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and L-T Link Positions relevant to give-up shall be in the amount obtained bymultiplying the sum of the volume of market derivatives contracts and L-T Link
Positions created by the Trading Member through give-up (hereinafter called the“Given-up Volume”) and the final settlement volume of those contracts and L-T Link
Positions by the charging rate applicable to market derivatives contracts and L-T Link
Positions relevant to give-up as separately prescribed by the Exchange.
11.5
Notwithstanding the provisions of Articles 11.2 above, the per-contract
exchange fee payable by a Trading Member with respect to FX Clearing Futurescontracts shall be the aggregate amount of the fees set forth in each Item below.
(1)

Contract fee
in the amount obtained by multiplying the amount of FX Clearing
Futures contracts executed at the FX Clearing Futures Trading
Member’s bids or offers on the Exchange’s Market (excluding thecontracts invalidated pursuant to Article 14.2 of the Trading
Regulations) or, if the amount of the contracts falls below a certain
amount, the number of contracts by the charging rate as separately
prescribed by the Exchange(2)

Article 12.

Position fee
in the amount obtained by multiplying the sum of the positions of the
FX Clearing Futures contracts by the charging rate as separately
prescribed by the Exchange

Market Entry Deposit

12.1
A Trading Member shall deposit a market entry deposit in the amount set forthin each Item below with the Exchange in accordance with the requirements prescribedby the Exchange.
(1)Market entry deposit to be deposited by a person who is a Japanese Yen
Interest Rate Trading Member, a Yen Interest Rate Swap Futures
Trading Member, or a Japanese Yen Interest Rate Remote Trading
Member (hereinafter called the “Interest Rate Futures Market Entry
Deposit”)
16

Trading Member Regulations

Three million Japanese Yen (¥3,000,000)(2)Market entry deposit to be deposited by an FX Daily Futures Trading
Member (hereinafter called the “FX Daily Futures Market Entry
Deposit”)
Three million Japanese Yen (¥3,000,000)(3)Market entry deposit to be deposited by an Equity Index Daily Futures
Trading Member (hereinafter called the “Equity Index Daily Futures
Market Entry Deposit”)
Three million Japanese Yen (¥3,000,000)

(4)

12.2

Market entry deposit to be deposited by an FX Clearing Futures
Trading Member (hereinafter called the “FX Clearing Futures Market
Entry Deposit”)
Three million Japanese Yen (¥3,000,000)

If a Trading Member conducts Interest Rate Futures transactions based on its

Customers’ orders, the Interest Rate Futures Market Entry Deposit to be deposited by the
Trading Member shall be in the amount set forth in Article 12.1(1) above, plus sevenmillion Japanese Yen (¥7,000,000).
12.3
If a Trading Member conducts FX Daily Futures transactions based on its
Customers’ orders, the FX Daily Futures Market Entry Deposit to be deposited by the
Trading Member shall be in the amount set forth in Article 12.1(2) above, plus sevenmillion Japanese Yen (¥7,000,000).
12.4
A market entry deposit may be deposited in the currency of Japanese yen, or in
the form of negotiable securities in accordance with the requirements prescribed by the
Exchange.
12.5
No Trading Member shall claim a refund of the market entry deposit before alapse of six (6) months following the date of public notice made in accordance with
Article 30 hereof.
12.6

In the case the Trading Member will conduct market derivatives transactions

based on Customers’ orders, the Trading Member shall notify the Exchange in
17
Trading Member Regulations

accordance with the requirements prescribed by the Exchange to that effect.

Article 13.
Deposit

Non-assignability of Right of Claim for Refund of Market Entry

No Trading Member shall assign or agree to assign, or create any security
interest in, its right to claim a refund of its own market entry deposit.

Article 14.

Liability Due to Use of Exchange’s Market

The Exchange shall not be liable for any damage that may be incurred by a
Trading Member because of its use of the Exchange’s Market in the course of its
business operations, unless such damage is caused by willful misconduct or grossnegligence of the Exchange.

Article 15.

Liability Due to Use of Market Facilities

15.1
Notwithstanding the provision of Article 14 hereof, the Exchange shall not beliable for any damage that may be incurred by a Trading Member because of its use of asystem for executing Interest Rate Futures contracts (hereinafter called the “Trading
System”), a system for clearing Interest Rate Futures contracts (hereinafter called the“Clearing System”), a system for executing and clearing FX Daily Futures contracts andEquity Index Daily Futures contracts (hereafter called the “FX/Equity Index Trading andClearing System”), and a system for executing and clearing FX Clearing Futurestransactions (hereinafter called the “FX Clearing Trading and Clearing System”), each ofwhich is set up by the Exchange by means of electronic computers, etc., and any otherfacilities necessary for the operation of the Exchange’s Market (the said systems andfacilities being hereinafter collectively called the “Exchange System”).
15.2
The Exchange shall not be liable for any damage that may be incurred by a
Trading Member or a Clearing Member because of its use of the facilities set up by the
Trading Member in order to access the Exchange System and conduct operations at the
Exchange and the facilities necessary for participation in the Exchange’s Market(including those furnished by the Exchange) (hereinafter collectively called the18
Trading Member Regulations

“Member’s System”).
15.3
Each Trading Member shall be liable for any damage that may be incurred by
the Exchange because of the Trading Member’s use of the Exchange System or theMember’s System (hereinafter collectively called the “Market Facilities”).

Articles 16 through 20 (Deleted)

Article 21.

Duty of Investigation before Undertaking of Brokerage Service

21.1
When a Trading Member accepts its Customer’s order for market derivatives
transactions on the Exchange’s Market, the Trading Member shall beforehand investigate
the Customer’s address, name and other details prescribed by the Exchange.
21.2
When a Trading Member accepts orders for linked market derivatives
transactions or Ordering for Linked Clearing, the Trading Member shall beforehand
investigate the Customer’s address, name and other details prescribed by the Exchange.

Article 22.
Restriction on Brokerage Service for Other Trading Member’s
Directors, Officers or Employees
22.1
No Trading Member shall accept an order for market derivatives transactions on
the Exchange’s Market from a director, officer or employee of any other Trading
Member without its prior written consent.
22.2
No Trading Member shall accept an order for linked market derivatives
transactions or Ordering for Linked Clearing from a director, officer or employee of any
other Trading Member without its prior written consent.

Article 23.
Liability for Market Derivatives Contracts Executed and L-T Link
Positions Arising
23.1

A Trading Member shall be liable for any and all market derivatives contracts
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Trading Member Regulations

executed at its bids or offers or any and all L-T Link Positions arising for its own
account that have been executed or have arisen either by the method using the Member’s
terminal device set forth in Article 48 hereof or by the method specified in the Trading
Regulations.
23.2
In addition to the foregoing, a Trading Member shall be liable for any and all
market derivatives contracts executed at its bids or offers via the Member’s terminal
device in accordance with its Customers’ instructions given by electronic means.

Article 24.

Emergency Restriction

The Exchange may impose any necessary and appropriate restriction on
operations by any or all of the Trading Members, in the case where the Exchange
determines that it is urgently necessary in light of the operation of the Exchange’s
Market, in addition to the cases specified in the Trading Regulations.
Article 25.

Conclusion of Clearing Agreement for Market Derivatives

Transactions
25.1
A Non-Clearing Member for Interest Rate Futures contracts shall enter into a
Clearing Agreement, in the form designated by the Exchange, with an Interest Rate
Futures Clearing Member holding all of the same types of trading memberships as those
held by the Non-Clearing Member for Interest Rate Futures contracts to cover all market
derivatives contracts in connection with those trading memberships; provided, however,that a Japanese Yen Interest Rate Remote Trading Member shall enter into a Clearing
Agreement with an Interest Rate Futures Clearing Member holding a Japanese Yen
Interest Rate Trading Membership.
25.2
A Non-Clearing Member for FX Daily Futures contracts shall enter into a
Clearing Agreement in the form prescribed by the Exchange, with a Daily Futures
Clearing Member (meaning a Daily Futures Clearing Member as specified in Article 3 of
the Clearing Regulations; this interpretation shall equally apply hereinafter) who has an
FX Daily Futures Trading Membership to cover FX Daily Futures contracts.
25.3

A Non-Clearing Member for Equity Index Daily Futures contracts shall enter

into a Clearing Agreement, in the form designated by the Exchange, with a Daily Futures
20
Trading Member Regulations

Clearing Member who has an Equity Index Daily Futures Trading Membership (except a
Daily Future Clearing Member who is a registered financial institution) to cover Equity
Index Daily Futures contracts.
25.4
When the conditions specified in the Trading Regulations, the Special
Provisions for Trading Regulations for FX Daily Futures Transactions (hereinafter called
the “FX Special Provisions”) or Special Provisions for Trading Regulations for Equity
Index Daily Futures Transactions (hereinafter called the “Equity Index Special
Provisions”) are satisfied with respect to a bid or offer submitted by a Non-Clearing
Member, a market derivatives contract (limited to a market derivatives contract to becovered by a Clearing Agreement; this interpretation shall equally apply hereinafter inthis Article 25) shall be executed on the Exchange’s Market for the Non-Clearing
Member’s account in the name of its Designated Clearing Member. Accordingly, theDesignated Clearing Member shall acquire and assume the rights and obligations for themarket derivatives contract executed as aforesaid.
25.5
When the conditions specified in the Trading Regulations are satisfied for an
L-T Link Position to arise under the Member Link Agreement entered into by a
Non-Clearing Member, the L-T Link Position shall arise for the Non-Clearing Member’s
account in the name of its Designated Clearing Member. Accordingly, the Designated
Clearing Member shall acquire and assume the rights and obligations for the L-T Link
Position arising as aforesaid.
25.6
With respect to market derivatives contracts and L-T Link Positions createdthrough give-up by a Non-Clearing Member in the name of its Designated Clearing
Member, the Designated Clearing Member shall acquire and assume the rights andobligations for those market derivatives contracts and L-T Link Positions.
25.7
When a Non-Clearing Member enters into a Clearing Agreement or amends thesame, the Non-Clearing Member shall notify the Exchange to that effect in accordancewith the requirements prescribed by the Exchange.
25.8
Unless otherwise prescribed by the Exchange separately, termination of aClearing Agreement shall not come into effect without approval of the Exchange.

Article 25-2.

Development of Risk Management System
21

Trading Member Regulations

A Trading Member shall develop the risk management system for unsettled
market derivatives transactions on the Exchange’s Market (meaning the system tomanage the risk which may arise due to fluctuation in the prices of the unsettled
transactions held by it, default of contract by its counterparty or other reason).

CHAPTER III.
DEREGISTRATION OF TRADING MEMBERSHIP

Article 26.

Application for Deregistration of Trading Membership26.1
If a Trading Member desires to deregister any of its trading memberships, theTrading Member shall apply for deregistration of that type of trading membership in
accordance with the requirements prescribed by the Exchange.
26.2
Notwithstanding the provision of Article 26.1 above, if the Trading Member
desiring to deregister any trading membership is a Designated Clearing Member for any
other Trading Member and has entered into a Clearing Agreement relevant to market
derivatives transactions under the trading membership to be deregistered, the Trading
Member shall not apply for deregistration unless and until it terminates all such Clearing
Agreements and obtains approval from the Exchange.
26.3

Notwithstanding the provision of Article 26.1 above, if a Trading Member

designated as an FX Market Maker pursuant to Article 10 of the FX Special Provisions
desires to deregister its FX Daily Futures Trading Membership, the Trading Member
shall not apply for deregistration unless and until it resigns as FX Market Maker inadvance pursuant to Article 15 of the FX Special Provisions.
26.4
Notwithstanding the provision of Article 26.1 above, if a Trading Member
designated as an Equity Index Market Maker pursuant to Article 10 of the Equity Index
Special Provisions desires to deregister its Equity Index Daily Futures Trading
Membership, the Trading Member shall not apply for deregistration unless and until it
resigns as Equity Index Market Maker in advance pursuant to Article 16 of the Equity
22
Trading Member Regulations

Index Special Provisions.

Article 27.

Market Derivatives Contracts Involving Deregistration Applicant

27.1
With respect to a Trading Member who has applied for deregistration of a
trading membership (hereinafter called a “deregistration applicant”), the Exchange shallsuspend the execution of market derivatives contracts (but limited to those under the
trading membership to be deregistered; this interpretation shall apply in this Article 27
except in Article 27.5 below) on the Exchange’s Market at the deregistration applicant’s
bid or offer, effective from the time and date after the business day immediately
following the date of the Exchange’s receipt of the application for deregistration
designated by the Exchange.
27.2
Where the Exchange suspends market derivatives transactions in accordancewith Article 27.1 above, if there are market derivatives contracts that have already been
executed on the Exchange’s Market at the deregistration applicant’s bids or offers andstill remain unsettled, the Exchange may cause the deregistration applicant to transfer
any such unsettled contract(s) to any other Trading Member holding a trading
membership of the same type, or liquidate them in any other manner deemed necessary
by the Exchange, within the period prescribed by the Exchange.
27.3
Notwithstanding the provision of Article 27.1 above, a deregistration applicant
may execute market derivatives contracts at its bids or offers on the Exchange’s Market,
with the Exchange’s approval, to the extent necessary for the transfer or liquidation set
forth in Article 27.2 above.
27.4
If a deregistration applicant for Japanese Yen Interest Rate Trading Membershipor Japanese Yen Interest Rate Remote Trading Membership has entered into a Member
Link Agreement, the deregistration applicant shall terminate the Member Link
Agreement by the time designated by the Exchange.
27.5
Where the Exchange suspends market derivatives transactions relevant toJapanese Yen Interest Rate Trading Membership or Japanese Yen Interest Rate Remote
Trading Membership in accordance with Article 27.1 above, if there are L-T Link
Positions that have already arisen for the deregistration applicant’s account and still
remain unsettled, the Exchange may cause the deregistration applicant to transfer any
23
Trading Member Regulations

such unsettled L-T Link Position(s) to any other Japanese Yen Interest Rate Trading
Member or Japanese Yen Interest Rate Remote Trading Member, or liquidate them inany other manner deemed necessary by the Exchange, within the period prescribed by
the Exchange.
27.6
The provision of Article 27.3 above shall apply mutatis mutandis to the transfer
or liquidation set forth in Article 27.5 above.
27.7

The liquidation pursuant to Article 27.2 may be conducted before thesuspension of execution of market derivatives contracts set forth in Article 27.1 when
deemed necessary by the Exchange.

Article 28.
ApplicantSpecial Provisions for Merger or Consolidation of Deregistration

28.1
Notwithstanding the provision of Article 27.1 hereof, the Exchange shall not be
required to suspend the execution of market derivatives contracts on the Exchange’s
Market at a deregistration applicant’s bids or offers, if the Exchange determines that it isunnecessary to cause the deregistration applicant to transfer or liquidate its market
derivatives contracts already executed at its bids or offers on the Exchange’s Market andremaining unsettled because the deregistration applicant is, upon its deregistration, going
to be merged with an entity admitted to or already holding a trading membership of thesame type, or going to cause such an entity to succeed to the deregistration applicant’s
certain business by spin-off or transfer the business to such an entity.
28.2

Notwithstanding the provision of Article 27.4 hereof, a deregistration applicant

for Japanese Yen Interest Rate Trading Membership who has entered into a Member
Link Agreement shall not be required to terminate the said agreement, if the condition
separately prescribed by the Exchange is applicable where the deregistration applicant is,upon its deregistration, going to be merged with an entity admitted to or already holding
a Japanese Yen Interest Rate Trading Membership, or going to cause such an entity tosucceed to the deregistration applicant’s certain business by spin-off or transfer thebusiness to such an entity.
28.3

Notwithstanding the provision of Article 27.4 hereof, a deregistration applicant

for Japanese Yen Interest Rate Remote Trading Membership who has entered into a
24
Trading Member Regulations

Member Link Agreement shall not be required to terminate the said agreement, if thecondition separately prescribed by the Exchange is applicable where the deregistration
applicant is, upon its deregistration, going to be merged with an entity admitted to or
already holding a Japanese Yen Interest Rate Remote Trading Membership, or going tocause such an entity to succeed to the deregistration applicant’s certain business by
spin-off or transfer the business to such an entity.

Article 29.

Approval of Deregistration of Trading Membership

29.1
When approving deregistration of a trading membership of a deregistration
applicant, the Exchange shall designate a specific future date and time from which the
deregistration will take effect; provided, however, that approving deregistration of the
FX Broker Trading Membership or the LP Trading Membership shall be governed by
Article 29-2 and approving deregistration of all trading memberships for Interest Rate
Futures contracts of a deregistration applicant who has the Interest Rate Futures Clearing
Membership shall be governed by Article 29-3.
29.2
When deregistration of a trading membership set forth in each Item below isapproved pursuant to Article 29.1 above, deregistration of a clearing membership set
forth in the relevant Item of the same deregistration applicant shall be approved
simultaneously.
(1)

FX Daily Futures Trading Membership
Daily Futures Clearing Membership (meaning a Daily Futures Clearing
Membership as specified in Article 3.2(2) of the Clearing Regulations;this interpretation shall equally apply hereinafter), excluding the cases
where the Trading Member who currently has an Equity Index Daily
Futures Trading Membership will keep holding the Equity Index Daily
Futures Trading Membership after the deregistration of the FX Daily
Futures Trading Membership, or the Trading Member acquires an
Equity Index Daily Futures Trading Membership simultaneously withthe deregistration of the FX Daily Futures Trading Membership, or the
Daily Futures Clearing Member who is a registered financial institution
conducts clearing business for Equity Index Daily Futures contracts
after the deregistration of the FX Daily Futures Trading Membership.

25
Trading Member Regulations

(2)Article 29-2.
Membership

Equity Index Daily Futures Trading Membership
Daily Futures Clearing Membership, except the cases where theTrading Member who currently has an FX Daily Futures Trading
Membership will keep holding the FX Daily Futures Trading
Membership after the deregistration of the Equity Index Daily Futures
Trading Membership, or the Trading Member acquires an FX Daily
Futures Trading Membership simultaneously with the deregistration of
the Equity Index Daily Futures Trading Membership.

Deregistration of FX Broker Trading Membership or LP Trading

Notwithstanding the provisions of Article 29 above, the Exchange shall approve
deregistration of the FX Broker Trading Membership or the LP Trading Membershipsubject to deregistration of FX Clearing Futures Clearing Membership of the
deregistration applicant pursuant to the Clearing Regulations simultaneously with the
deregistration of the FX Clearing Futures Clearing Membership.

Article 29-3.
Deregistration of All Trading Memberships for Interest Rate
Futures Contracts
Notwithstanding the provisions of Article 29 above, the Exchange shall approve
deregistration of all trading memberships for Interest Rate Futures contracts of aderegistration applicant who has the Interest Rate Futures Clearing Membership, subject
to the condition that the deregistration applicant’s Interest Rate Futures Clearing
Membership is deregistered pursuant to the Clearing Regulations simultaneously with its
deregistration of all trading memberships for Interest Rate Futures contracts.

Article 30.
Membership

Public Notice and Notification of Deregistration of Trading

When a Trading Member’s trading membership is deregistered (including thecase of deregistration due to disqualification of the trading membership pursuant toChapter IV of Part 2 hereof; this interpretation shall equally apply hereinafter), the26
Trading Member Regulations

Exchange shall immediately give public notice of the deregistration and the refund of themarket entry deposit associated with such deregistration, and shall notify all otherTrading Members holding the same type of trading membership of such deregistration;
provided, however, that, when the Japanese Yen Interest Rate Trading Membership, theYen Interest Rate Swap Futures Trading Membership, or the Japanese Yen Interest Rate
Remote Trading Membership of the said Trading Member is deregistered, the Exchange
shall notify all other Interest Rate Futures Trading Members, when the Equity Index
Daily Futures Trading Membership or the Equity Index Daily Futures Remote Trading
Membership is deregistered, the Exchange shall notify the Equity Index Daily Futures
Trading Members, etc. of such deregistration, and when the FX Broker Trading
Membership or LP Trading Membership is deregistered, the Exchange shall notify the
FX Clearing Futures Trading Members of such deregistration.

Article 31.

Performance of Outstanding Obligations upon Deregistration

A person whose trading membership has been deregistered shall perform all
outstanding obligations owed to other Trading Members or the Exchange byappropriating money, securities or other equivalents to be returned by the Exchange.

Article 32.

Settlement of Market Derivatives Contracts after Deregistration

32.1
If there is any unsettled market derivatives contract (but limited to those
relevant to the deregistered trading membership) that had already been executed on the
Exchange’s Market at a bid or offer submitted by a person whose trading membershiphas been deregistered, the Exchange shall cause the deregistered person or its general
successor to settle the said contract; provided, however, that, if the Exchange determinessuch settlement as being inappropriate, the Exchange may cause any other Trading
Member holding a trading membership of the same type to settle the said contract.
32.2
If there is any unsettled L-T Link Position that had already arisen for theaccount of a person whose Japanese Yen Interest Rate Trading Membership or Japanese
Yen Interest Rate Remote Trading Membership has been deregistered, the Exchange
shall cause the deregistered person or its general successor to settle the said position;
provided, however, that, if the Exchange determines such settlement as being
inappropriate, the Exchange may cause any other Japanese Yen Interest Rate Trading27
Trading Member Regulations

Member or Japanese Yen Interest Rate Remote Trading Member to settle the said
position.
32.3
In addition to those specified in Article 32.1 above, the Exchange may cause
any unsettled FX Daily Futures contract(s) that had been executed by a person whose FX
Daily Futures Trading Membership has been deregistered to be transferred to any other
FX Daily Futures Trading Member or liquidated in any other manner deemed necessary
by the Exchange.
32.4
In addition to those specified in Article 32.1 above, the Exchange may cause
any unsettled Equity Index Daily Futures contract(s) that had been executed by a person
whose Equity Index Daily Futures Trading Membership or Equity Index Daily Futures
Remote Trading Membership has been deregistered to be transferred to any other Equity
Index Daily Futures Trading Member, etc. or to be liquidated in any other manner
deemed necessary by the Exchange.
32.5
In addition to those specified in Article 32.1 above, the Exchange may cause
any unsettled FX Clearing Futures contract(s) that had been executed by a person whose
FX Broker Trading Membership or LP Trading Membership has been deregistered to betransferred to any other FX Clearing Futures Trading Member or liquidated in a manner
deemed necessary by the Exchange.

Article 33.
Market Derivatives Contracts for Non-Clearing Member’s
Account upon its Designated Clearing Member’s Deregistration
33.1

If the clearing membership held by a Clearing Member is deregistered, theExchange shall suspend the execution of market derivatives contracts (limited to those
relevant to the deregistered clearing membership of the Clearing Member (hereinafter
called a “Deregistered Clearing Member” in this Article 33); the same definition shallapply in this Article 33) on the Exchange’s Market in the name of the Deregistered
Clearing Member at bids or offers submitted or to be submitted by a Non-Clearing
Member who has entered into a Clearing Agreement with the Deregistered Clearing
Member (hereinafter called an “Entrusting Non-Clearing Member” in this Article 33)
covering the market derivatives contracts relevant to the deregistered Clearing
Membership.

28
Trading Member Regulations

33.2
Where market derivatives transactions are suspended in accordance with Article
33.1 above, if there are market derivatives contracts that have already been executed at
the Entrusting Non-Clearing Member’s bids or offers in the name of the Deregistered
Clearing Member and still remain unsettled, the Exchange may cause any such unsettled
market derivatives contract(s) to be transferred to any other Trading Member holding a
trading membership of the same type or liquidated in any other manner deemednecessary by the Exchange.
33.3

Notwithstanding the provision of Article 33.1 above, the Entrusting

Non-Clearing Member may execute market derivatives contracts at its own bids or offers
on the Exchange Market in the name of the Deregistered Clearing Member, with the
Exchange’s approval, to the extent necessary for the transfer or liquidation set forth in
Article 33.2 above.
33.4
If a Deregistered Clearing Member who held the Interest Rate Futures Clearing
Membership (meaning the Interest Rate Futures Clearing Membership as specified in
Article 3.2(1) of the Clearing Regulations; this interpretation shall equally apply
hereinafter) entered into a Member Link Agreement with an Entrusting Non-Clearing
Member, the Exchange shall suspend the arising of L-T Link Positions in the name of the
Deregistered Clearing Member for the Entrusting Non-Clearing Member’s account.
33.5
Where arising of a L-T Link Position is suspended in accordance with Article
33.4 above, if there are L-T Link Positions that have already arisen in the name of the
Deregistered Clearing Member for the Entrusting Non-Clearing Member’s account andstill remain unsettled, the Exchange may cause any such L-T Link Position(s) to betransferred to any other Japanese Yen Interest Rate Trading Member or Japanese Yen
Interest Rate Remote Trading Member or liquidated in any other manner deemednecessary by the Exchange.
33.6
The provision of Article 33.3 above shall apply mutatis mutandis to the transfer
or liquidation set forth in Article 33.5 above.

Article 34.
34.1

Name Transfer for Trading MembershipTransfer of a trading membership from a deregistration applicant shall beallowed, subject to approval by the Exchange, only in the case where a trading
29
Trading Member Regulations

membership applicant is allowed to acquire a trading membership on condition that thesame type of trading membership held by the deregistration applicant will bederegistered at the same time.
34.2
A person intending to acquire a trading membership by name transfer shall takethe procedures for the acquisition of the trading membership as set forth in Chapter II ofPart 2 hereof.
34.3

Notwithstanding the provision of Article 53.3 hereof, a person acquiring a

trading membership by name transfer shall pay the name transfer charge, in lieu of the
trading registration fee, for the acquired trading membership.
34.4
Notwithstanding the provision of Article 34.1 hereof, a deregistration applicant
which is a Bridge Financial Institution, etc. (meaning the Bridge Financial Institution,etc. defined in Article 126-34, Paragraph 3, Item 5 of the Deposit Insurance Act (Act No.
34 of 1971); this interpretation shall equally apply hereinafter) shall not be in principle
qualified for name transfer of trading membership.

Article 35.

Trading Deregistration Fee

35.1
If a Trading Member is to be deregistered, the Trading Member shall pay the
trading deregistration fee by the date and time designated by the Exchange whether the
deregistration is applied in accordance with Article 26 above or for any other reason.
35.2
The Exchange may exempt a Trading Member to be deregistered from thepayment of the trading deregistration fee in whole or in part if the Exchange deems that
there exists a particular cause for the exemption.

CHAPTER IV.
EFFECTS OFDISCIPLINARY, REGULATORY AND OTHER MEASURES

30
Trading Member Regulations

Articles 36 and 37

Article 38.
Member(Deleted)Market Derivatives Contracts for Suspended or Restricted Trading

38.1
If a Disciplinary Measure, etc. (meaning the disciplinary or regulatory measures
set forth in Articles 61 through 63 hereof, disqualification from the trading membershipset forth in Article 64.3 hereof and the actions set forth in Article 66 hereof, whichinterpretation shall equally apply hereinafter) imposed by the Exchange on a Trading
Member (meaning any of the disciplinary measures and the regulatory measures set forthin Articles 61 through 63 and 66 hereof or disqualification of a trading membership set
forth in Article 64.3 hereof; this interpretation shall equally apply hereinafter) issuspension from or restriction on the execution of market derivatives contracts at theTrading Member’s bids or offers on the Exchange’s Market, the Exchange may, during
the period of such suspension or restriction, cause to be transferred to any other Trading
Member holding a trading membership qualified for the relevant market derivatives
contracts or liquidated in any other manner deemed necessary by the Exchange, any ofthe market derivatives contracts that have already been executed at the said Trading
Member’s bids or offers on the Exchange Market and still remain unsettled.
38.2
A Trading Member subject to a disciplinary or any other measure referred to in
Article 38.1 above may execute market derivatives contracts at its bids or offers on the
Exchange’s Market, with the Exchange’s approval, to the extent necessary for thetransfer or liquidation set forth in Article 38.1 above.
38.3
If a disciplinary or any other measure imposed by the Exchange on a Trading
Member is suspension from or restriction on the execution of market derivatives
contracts by the Trading Member on the Exchange’s Market, the Exchange may, during
the period of such suspension or restriction, cause to be transferred to any other Japanese
Yen Interest Rate Trading Member or Japanese Yen Interest Rate Remote Trading
Member or liquidated in any other manner deemed necessary by the Exchange, any of
the L-T Link Positions that have already arisen for the said Trading Member’s accountand still remain unsettled.
38.4

The provision of Article 38.2 above shall apply mutatis mutandis to the transfer
31

Trading Member Regulations

or liquidation set forth in Article 38.3 above.
38.5
If the Exchange deems it necessary in the liquidation pursuant to Article 38.1 or
38.3 above (provided, however, such liquidation shall be limited on account of any
unsettled Interest Rate Futures contract that has already been executed on the Exchange’s
Market at a bid or offer of the Interest Rate Futures Trading Member who has theInterest Rate Futures Clearing Membership subject to the Disciplinary Measure, etc.
under Article 38.1, or any unsettled L-T Link Position that has already arisen for theaccount of the Trading Member (hereinafter called “Unsettled contracts for Interest Rate
Futures transactions, etc.” in this Article 38)), the Exchange may hold a Position
Liquidation Auction (meaning a “Position Liquidation Auction” specified in Article
15-9.5 of the Clearing Regulations; this interpretation shall equally apply hereinafter) for
the Unsettled contracts for Interest Rate Futures transactions, etc of such Trading
Member.
38.6
The Exchange may discuss how to deal with the Position Liquidation Auction of
the Unsettled contracts for Interest Rate Futures transactions, etc. specified in Article
38.5 with the other Interest Rate Futures Trading Members who have the Interest Rate
Furutes Clearing Membership. When the Exchange holds such discussion, the Interest
Rate Futures Trading Members shall make efforts to agree to hold such discussion.

Article 39.
Market Derivatives Contracts for Non-Clearing Member’s
Account in Relation to Suspended Designated Clearing Member
39.1
If a Designated Clearing Member is suspended from market derivatives
transactions, the Exchange may suspend the execution of market derivatives contracts on
the Exchange’s Market in the name of the Designated Clearing Member at bids or offers
to be submitted by a Non-Clearing Member who has entered into a Clearing Agreementwith the Designated Clearing Member.
39.2
If the Exchange suspends the execution of market derivatives contracts inaccordance with Article 39.1 above, the Exchange may cause to be transferred to any
other Trading Member holding a trading membership qualified for the relevant market
derivatives contracts or liquidated in any other manner deemed necessary by the
Exchange, any of the market derivatives contracts that have already been executed on the
Exchange’s market at the Non-Clearing Member’s bids or offers in the name of the32
Trading Member Regulations

suspended Designated Clearing Member and still remain unsettled.
39.3
Notwithstanding the provision of Article 39.1 above, the Non-Clearing Member
may execute market derivatives contracts at its bids or offers in the name of thesuspended Designated Clearing Member on the Exchange’s market, with the Exchange’s
approval, to the extent necessary for the transfer or liquidation set forth in Article 39.2
above.
39.4

If a Designated Clearing Member is suspended from market derivatives

transactions, the Exchange may suspend the arising of L-T Link Positions in the name of
the Designated Clearing Member for the account of a Non-Clearing Member who hasentered into a Clearing Agreement with the Designated Clearing Member.
39.5
If the Exchange suspends market derivatives transactions in accordance with
Article 39.1 above, the Exchange may cause to be transferred to any other Japanese Yen
Interest Rate Trading Member or Japanese Yen Interest Rate Remote Trading Member or
liquidated in any other manner deemed necessary by the Exchange, any of the L-T Link
Positions that have arisen in the name of the Designated Clearing Member for the
Non-Clearing Member’s account and still remain unsettled.
39.6
The provision of Article 39.3 above shall apply mutatis mutandis to the transfer
or liquidation set forth in Article 39.5 above.
39.7
If the Exchange deems it necessary in the liquidation pursuant to Article 39.2 or
39.5 above (provided, however, such liquidation shall be limited on account of any
unsettled Interest Rate Futures contracts that has already been executed on the
Exchange’s Market at a bid or offer of the Non-Clearing Member who has entered into a
Clearing Agreement with the Designated Clearing Member subject to the Disciplinary
Measure, etc. in Article 39.1 in the name of the suspended Designated Clearing Member,or any unsettled L-T Link Position that has arisen in the name of the Designated
Clearing Member for the account of the Non-Clearing Member (hereinafter called“Unsettled contracts for Interest Rate Futures transactions, etc. of Non-Clearing
Member” in this Article 39)), the Exchange may hold a Position Liquidation Auction for
Non-Clearing Member (meaning a “Position Liquidation Auction for Non-Clearing
Member” specified in Article 15-10.7 of the Clearing Regulations; this interpretation
shall equally apply hereinafter) for the Unsettled contracts for Interest Rate Futurestransactions, etc. of Non-Clearing Member.
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Trading Member Regulations

39.8
The Exchange may discuss how to deal with the Position Liquidation Auction
for Non-Clearing Member specified in Article 39.7 with the other Interest Rate Futures
Trading Members who have Interest Rate Furutes Clearing Membership. When the
Exchange holds such discussion, the Interest Rate Futures Trading Members shall makeeffors to agree to hold such discussion.

Article 40.

Notification and Announcement of Disciplinary or Any Other

Measure40.1
When the Exchange has imposed a disciplinary or any other measure on a
Trading Member, the Exchange shall notify all other Trading Members and make anannouncement to that effect.
40.2
If a disciplinary or any other measure imposed by the Exchange on a Trading
Member is suspension from or restriction on the execution of market derivatives
contracts at the Trading Member’s bids or offers on the Exchange’s Market, the Trading
Member shall place a notice of such suspension or restriction at its office and otherappropriate places in accordance with the requirements prescribed by the Exchange.
40.3
If a disciplinary or any other measure imposed by the Exchange on a Trading
Member is suspension from or restriction on the arising of L-T Link Positions, theTrading Member shall place a notice of such suspension or restriction at its office andother appropriate places in accordance with the requirements prescribed by the
Exchange.
Articles 41 and 42(Deleted)

CHAPTER V.
MEDIATION

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Trading Member Regulations

Article 43.

Request for Mediation

43.1
Upon request by a Trading Member or a Customer in accordance with theregulations prescribed by the Exchange, the Exchange shall, pursuant to its prescribed
regulations, mediate a dispute between the Trading Member and another Trading
Member in connection with market derivatives transactions on the Exchange’s Market ora dispute between the Customer and the concerned Trading Member in connection withbrokerage service for market derivatives transactions on the Exchange’s Market.
43.2
Upon request by a Trading Member or a Customer in accordance with theregulations prescribed by the Exchange, the Exchange shall, pursuant to its prescribed
regulations, mediate a dispute between the Trading Member and another Trading
Member in connection with an L-T Link Position or a dispute between the Customer andthe concerned Trading Member in connection with placement of orders for linked market
derivatives transactions or Ordering for Linked Clearing.
43.3
Notwithstanding the provisions of Articles 43.1 and 43.2 above, the Exchange
may decline to mediate a dispute if the Exchange determines that a nature of the disputeis inappropriate for being solved through mediation or that the request for mediation has
been made by the concerned party for an unjust purpose, or if one of the disputing
parties refuses mediation in the case of a dispute between a Trading Member and its
Customer.
43.4
If any Trading Member in dispute requests mediation by the Exchange for a
dispute with any other Trading Member, the other Trading Member shall accept
mediation by the Exchange.

Article 44.

Joint Mediation

44.1
With respect to a dispute in connection with a linked market derivatives contract
or an L-T Link Position between a Trading Member and a member of a Linked Overseas
Exchange as specified in Article 2(3) of the Trading Regulations who is a counterparty
under a Member Link Agreement, the Exchange shall conduct mediation jointly with the
Linked Overseas Organization as specified in Article 2(5) of the Trading Regulations(hereinafter called “joint mediation”) in accordance with the Joint Mediation Regulations
set forth in Article 47 hereof, in response to a request from the Trading Member in35
Trading Member Regulations

accordance with the regulations prescribed by the Exchange or a request from its
counterparty under the Member Link Agreement through the Linked Overseas
Organization.
44.2
When the Exchange conducts joint mediation in response to a request from thecounterparty to a Trading Member under a Member Link Agreement through the Linked
Overseas Organization, the Trading Member who is also a party to the Member Link
Agreement shall accept joint mediation by the Exchange.

Article 45.

Investigation for Mediation

When conducting mediation or joint mediation, the Exchange may investigate
the Trading Member in dispute with respect to the matters necessary for the mediation or
joint mediation.
Article 46.

Mediation Regulations

46.1
The procedures for mediation request, the mediation method and othernecessary matters for mediation shall be specified in the Mediation Regulations.
46.2
The Mediation Regulations shall be established or amended by a resolution of
the Exchange’s board of directors.
Article 47.
47.1

Joint Mediation Regulations

The procedures for joint mediation request, the joint mediation method andother necessary matters for joint mediation shall be specified in the Joint Mediation
Regulations.
47.2
The Joint Mediation Regulations shall be established or amended by aresolution of the Exchange’s board of directors with consent from a Linked Overseas
Organization.

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Trading Member Regulations

CHAPTER VI.
MISCELLANEOUS PROVISIONS

Article 47-2.

Amounts of Trading Registration Fees and Other Fees

The amounts of the monthly exchange fees, the access fees, the Market Facility
Usage Fees, the Trading ID Usage Fees and the give-up fees referred to in Article 11.1
hereof, the name transfer charge referred to in Article 34.3 hereof, the trading
deregistration fees referred to in Article 35 hereof, the Inactivity Fees referred to in
Article 51-2.2 hereof and the trading registration fees referred to in Article 53.4 hereof
shall be separately prescribed by the Exchange.

Article 48.
Acquisition of Trading ID, Clearing ID, FX Operating ID, Equity
Index Operating ID and FX Clearing Operating ID
48.1
An Interest Rate Futures Trading Member shall acquire an identification code
required to access the Trading System (hereinafter called a “Trading ID”) and an
identification code required to access the Clearing System (hereinafter called a “ClearingID”) with the Exchange’s approval. Likewise, an FX Daily Futures Trading Member
shall acquire an identification code required to access the FX/Equity Index Trading andClearing System and to conduct its operations relevant to the FX Daily Futurestransactions (hereinafter called an “FX Operating ID”) with the Exchange’s approval.
Similarly, an Equity Index Daily Futures Trading Member or a Daily Futures Clearing
Member who is a registered financial institution conducting a clearing business for
Equity Index Daily Futures contracts shall acquire an identification code required toaccess the FX/Equity Index Trading and Clearing System and to conduct its operations
relevant to the Equity Index Daily Futures transactions (hereinafter called an “Equity
Index Operating ID”) with the Exchange’s approval. Similarly, an FX Broker Trading
Member or an LP Trading Member shall acquire an identification code required to accessthe FX Clearing Trading and Clearing System and to conduct its operations relevant to
the FX Clearing Futures transactions (hereinafter called an “FX Clearing Operating ID”)
with the Exchange’s approval. (A Trading Member’s facilities used as the Member’s
System for its operations concerning market derivatives transactions using its Trading
ID, Clearing ID, FX Operating ID, Equity Index Operating ID or FX Clearing Operating

37
Trading Member Regulations

ID shall be hereinafter called the “Member’s terminal device”).
48.2
When it is determined as being necessary for giving approval set forth in Article
48.1 above, the Exchange may attach conditions on the number of Trading IDs, Clearing
IDs, FX Operating IDs, Equity Index Operating IDs or FX Clearing Operating IDs or
how to use the said ID(s), or the number of lines for the Member’s terminal device, theplace of its installation or its specifications, etc., and subsequently revise suchconditions.

Article 49.

Trading Officer

49.1
An Interest Rate Futures Trading Member shall elect one person from its
employees who are responsible for its operations conducted by using its Trading ID(s)and appoint him/her as a Trading Officer who shall be responsible for supervising suchoperations and handling the matters related thereto, and notify the Exchange in advanceof the Trading Officer appointed as aforesaid.
49.2
An Interest Rate Futures Trading Member may cause its Trading Officer to
conduct any of the operations separately prescribed by the Exchange, in addition to
his/her duties set forth in Article 49.1 above.

Article 50.

Clearing Officer

50.1
An Interest Rate Futures Trading Member shall elect one person from its
employees who are responsible for its operations conducted by using its Clearing ID(s)(or who are responsible for the entrustment of such operations, if the said Trading
Member is a Japanese Yen Interest Rate Remote Trading Member entrusting suchoperations to its Designated Clearing Member) and appoint him/her as a Clearing Officer
who shall be responsible for supervising such operations and handling the matters related
thereto, and notify the Exchange in advance of the Clearing Officer appointed as
aforesaid.
50.2
An Interest Rate Futures Trading Member may cause its Clearing Officer to
conduct any of the operations separately prescribed by the Exchange, in addition to
his/her duties set forth in Article 50.1 above.
38
Trading Member Regulations

Article 50-2.

FX Officer

50-2.1 An FX Daily Futures Trading Member shall elect one or more persons from its
employees who are responsible for its operations conducted by using its FX Operating
ID(s) and appoint each of them as an FX Officer who shall be responsible forsupervising such operations and handling the matters related thereto (or if the FX Daily
Futures Trading Member is an FX Market Maker and also conducts acceptance of orders
as Non-FX Market Maker, it shall appoint one or more persons who shall be responsible
for supervising the operations to be conducted to fulfill the responsibility as an FX
Market Maker and handling the matters related thereto and one or more persons who
shall be responsible for supervising of the acceptance of orders and handling of thematters related thereto, respectively), and notify the Exchange in advance of the FX
Officer(s) appointed as aforesaid.
50-2.2 An FX Daily Futures Trading Member may cause any of its FX Officers to
conduct any of the operations separately prescribed by the Exchange, in addition to
his/her duties set forth in Article 50-2.1 above.

Article 50-3.

Equity Index Officer

50-3.1 An Equity Index Daily Futures Trading Member, etc. or a Daily Futures
Clearing Member who is a registered financial institution conducting a clearing businessfor Equity Index Daily Futures contracts shall elect one or more persons from its
employees who are responsible for its operations conducted by using its Equity Index
Operating ID(s) and appoint each of them as an Equity Index Officer who shall be
responsible for supervising such operations and handling the matters related thereto (or if
the Equity Index Daily Futures Trading Member, etc. is an Equity Index Market Maker
and also conducts acceptance of orders as Non-Equity Index Market Maker, it shallappoint one or more persons who shall be responsible for supervising the operations to
be conducted to fulfill the responsibility as an Equity Index Market Maker and handlingthe matters related thereto and one or more persons who shall be responsible forsupervising of the acceptance of orders and handling of the matters related thereto,respectively), and notify the Exchange in advance of the Equity Index Officer(s)appointed as aforesaid.
39
Trading Member Regulations

50-3.2 An Equity Index Daily Futures Trading Member, etc. or a Daily Futures
Clearing Member who is a registered financial institution conducting a clearing businessfor Equity Index Daily Futures contracts may cause any of its Equity Index Officers to
conduct any of the operations separately prescribed by the Exchange, in addition to
his/her duties set forth in Article 50-3.1 above.

Article 50-4.

FX Clearing Officer

50-4.1 An FX Broker Trading Member and an LP Trading Member shall elect one ormore persons from its employees who are responsible for its operations conducted byusing its FX Clearing Operating ID(s) and appoint each of them as an FX Clearing
Officer who shall be responsible for supervising such operations and handling thematters related thereto (or if the FX Clearing Futures Trading Member has both FXBroker Trading Membership and LP Trading Membership, it shall appoint an FX
Clearing Officer for each trading membership), and notify the Exchange in advance of
the FX Clearing Officer(s) appointed as aforesaid.
50-4.2 An FX Broker Trading Member or an LP Trading Member may cause any of its
FX Clearing Officers to conduct any of the operations separately prescribed by the
Exchange, in addition to his/her duties set forth in Article 50-4.1 above.

Article 51.

Decision of Necessary Matters for Trading Members

In addition to the provisions of these Regulations, any matters necessary to
stipulate in connection with Trading Members shall be separately prescribed by the
Exchange.

Article 51-2.

Inactive Trading Member

51-2.1 An Interest Rate Futures Trading Member may apply for suspension of its rights
and obligations as Trading Member in the manners prescribed by the Exchange, andwhen such application is approved by the Exchange, the rights and obligations of such
Interest Rate Futures Trading Member as Trading Member shall be suspended from the40
Trading Member Regulations

date and time designated by the Exchange.
51-2.2 The Trading Member whose rights and obligations are suspended in accordancewith Article 51-2.1 hereof (hereinafter called the “Inactive Trading Member”) shall pay
the Exchange the Inactivity Fee for the suspension as prescribed by the Exchange.
51-2.3 The Inactive Trading Member may apply for lifting of the suspension under
Article 51-2.1 hereof in the manners prescribed by the Exchange, and when suchapplication is approved by the Exchange, the rights and obligations of such Inactive
Trading Member as Trading Member shall be resumed from the date and time designatedby the Exchange.

PART 2:

SELF-REGULATORY OPERATIONSCHAPTER I.
GENERAL PROVISIONS

Article 52.

Authority of Self-regulatory Committee

Decisions on the matters concerning the self-regulatory operations set forth in
this Part 2 shall be made by the Self-regulatory Committee.

CHAPTER II.
ACQUISITION OF TRADING MEMBERSHIP

41
Trading Member Regulations

Article 53.

Application for Trading Membership and Membership Approval

53.1
A person who desires to acquire a trading membership (hereinafter called a“trading membership applicant”) shall file an application for each desired type of trading
membership with the Exchange in accordance with the requirements prescribed by the
Exchange.
53.2
Upon receipt of an application for trading membership referred to in Article
53.1 above, the Self-regulatory Committee shall examine the applicant in light of thequalification criteria prescribed by the Exchange for each type of trading membership.
If the Self-regulatory Committee determines that the trading membership applicant isqualified for the trading membership as a result of such examination, the Exchange shallapprove the trading membership for the said applicant.
53.3
Notwithstanding the provision of Article 53.1 hereof, a trading membership
applicant which is a Bridge Financial Institution, etc. may file an application for any
trading membership with the Exchange in accordance with the requirements prescribedby the Exchange. In such case, the Exchange may admit the said trading membership
applicant to the trading membership.
53.4
When the Exchange approves a trading membership for a trading membership
applicant in accordance with the provision of Article 53.2 hereof, the applicant shall pay
a trading registration fee to the Exchange, deposit a market entry deposit with the
Exchange, and take other procedures for the acquisition of the trading membershipseparately prescribed by the Exchange.
53.5

When the Exchange approves a trading membership for a trading membership

applicant in accordance with the provision of Article 53.3 hereof, the applicant shalldeposit a market entry deposit with the Exchange, and take other procedures for theacquisition of the trading membership separately prescribed by the Exchange.
53.6
If a trading membership applicant does not acquire a clearing membershiprelevant to the market derivative transactions, etc. covered by the trading membership tobe acquired, the applicant shall enter into a Clearing Agreement set forth in Article 25.1,
25.2 or 25.3 hereof before filing an application for the trading membership.
53.7

If a trading membership applicant fails to take the procedures set forth in Article
42

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53.4 or 53.5 above by the designated deadline, the applicant shall be deemed to havewithdrawn its application for the trading membership.

Article 54.

Time and Date of Acquisition of Trading Membership54.1
A trading membership applicant who has completed the procedures set forth in
Article 53.4 hereof by the designated due date shall acquire the trading membership asfrom the time and date designated by the Exchange.
54.2
A trading membership applicant which is a Bridge Financial Institution, etc. andwhich has completed the procedures set forth in Article 53.5 hereof that have been
designated by the Exchange by the designated due date shall acquire the trading
membership as from the time and date designated by the Exchange.
54.3
When a trading membership applicant becomes a Trading Member inaccordance with Article 54.1 or 54.2 above, the Exchange shall notify all other Trading
Members holding the same type of trading membership to that effect; provided, however,
that, when the said trading membership applicant becomes a Japanese Yen Interest Rate
Trading Member, a Yen Interest Rate Swap Futures Trading Member, or a Japanese Yen
Interest Rate Remote Trading Member, the Exchange shall notify all other Interest Rate
Futures Trading Members to that effect, the said trading membership applicant becomes
Equity Index Daily Futures Trading Member or Equity Index Daily Futures Remote
Trading Member, the exchange shall notify all other Equity Index Daily Futures Trading
Members, etc. to that effect, and the said trading membership applicant becomes FXBroker Trading Member or LP Trading Member, the Exchange shall notify all other FX
Clearing Futures Trading Members to that effect.

CHAPTER III.
INVESTIGATION AGAINST TRADING MEMBERS

Article 55.

Notifiable Matters
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Before taking any of the following actions, a Trading Member shall notify the
Exchange of the details thereof in accordance with the requirements prescribed by the
Exchange.
(1)

Amendment to the articles of incorporation or equivalent of the Trading
Member (excluding the cases referred to in Item (4) below or Item (6)or (9) of Article 56.1 hereof)(2)

Merger(3)

Succession of the whole or part of business to or from anothercompany due to company split(4)

Transfer of the whole or substantial part of the Trading Member’sbusiness(5)

Reduction of the Trading Member’s total capital(6)

Abolition of financial instruments business, business conducted in thecapacity of a registered financial institution, trading business at the
Exchange (hereinafter collectively called “financial instruments orother specified business”)

Article 56.

Reportable Matters

56.1
If any of the following events occurs to a Trading Member, the Trading Member
shall immediately report the details thereof to the Exchange in accordance with therequirements prescribed by the Exchange; provided, however, that the foregoing shallnot apply if the Exchange determines such reporting as being unnecessary.
(1)

The Trading Member ceases to satisfy any of the qualification criteria
for trading membership separately prescribed by the Exchange(excluding those qualification criteria provided in Article 15.3 (4) (b),(c), (e) and (f), Article 15.4 (4) (b), (d) and (e), Article 15.6 (3) (b), (c),(e) and (f), Article 15.7 (3) (c), (e) and (f), Article 15.10 (3) (b) and (c),44

Trading Member Regulations

Article 15.11 (3) (c), Article 15.13 (4) (b), (c), (e) and (f), Article 15.14(4) (b), (d) and (e), Article 15.16 (4) (b), (c), (e) and (f) and Article
15.17 (4) (b), (c), (e) and (f) of the Enforcement Regulations for
Trading Member Regulations).
(1)-2

With respect to the FX Daily Futures Trading Member, the Equity
Index Daily Futures Trading Member, etc. or the FX Clearing Futures
Trading Member not guaranteed by its parent company (meaning theentity holding a majority of the voting rights of all shareholders of the
FX Daily Futures Trading Member, the Equity Index Daily Futures
Trading Member, etc. or the FX Clearing Futures Trading Member; thisinterpretation shall equally apply in Article 63.2 (2) and (4) below)
when it acquired the trading membership, its net asset value falls below
three hundred million Japanese Yen (¥300,000,000).

(1)-3The FX Daily Futures Trading Member, the Equity Index Daily Futures
Trading Member, etc. or the FX Clearing Futures Trading Member falls
under any of the following cases.

(a)With respect to a financial instruments firm (meaning the financial
instruments firm (kinyu’u shouhin torihiki gyousha) set forth inParagraph 9 of Article 2 of the Act; this interpretation shall equally
apply hereinafter), its Capital-to-Risk Ratio falls below one hundredand forty percent (140%).

(b)With respect to a special financial instruments firm (limited to a
special financial instruments firm (tokubetsu kinyu’u shouhin
torihiki gyousha) set forth in Paragraph 2 of Article 57-2 of the Act
who files the notification under Paragraph 2 of Article 57-5 of theAct; this interpretation shall equally apply hereinafter), its
Consolidated Capital-to-Risk Ratio calculated by the method set
forth in Article 2 of the Financial Services Agency Notification
No. 128 of 2010 (hereinafter called “Consolidated Capital-to-Risk
Ratio on Downstream Consolidation”) falls below one hundred andforty percent (140%).

(c)

With respect to a designated special financial instruments firm
45

Trading Member Regulations

(meaning a designated special financial instruments firm (taishou
tokubetsu kinyu’u shouhin torihiki gyousha) set forth in Paragraph 3
of Article 57-12 of the Act; this interpretation shall equally apply
hereinafter), in relation to its Consolidated Capital-to-Risk Ratio set
forth in Article 2 of the Financial Services Agency Notification No.
130 of 2010 (hereinafter called “Consolidated Capital-to-Risk Ratioon the Uniform International Standard”), the consolidated common
equity Tier 1 ratio set forth in Item 1 of the said Article (hereinafter
called “Consolidated Common Equity Tier 1 Ratio”) falls below
two point two five percent (2.25%), the consolidated Tier 1 ratio set
forth in Item 2 of the said Article (hereinafter called “Consolidated
Tier 1 Ratio”) falls below three percent (3%) or the total
consolidated capital-to-risk ratio set forth in Item 3 of the said
Article (hereinafter called “Total Consolidated Capital-to-Risk
Ratio”) falls below four percent (4%) or the consolidated
capital-to-risk ratio calculated by the method set forth in Article 4 ofthe said Notification (hereinafter called “Consolidated
Capital-to-Risk Ratio on Sample Downstream Consolidation”) falls
below one hundred and forty percent (140%).
(2)

The Trading Member falls under any of the items listed in Paragraph 1
of Article 29-4, Paragraph 1 of Article 33-5, or Paragraph 1 of Article60-3 of the Act.

(3)

The Trading Member becomes or is likely to become insolvent.

(4)

The amount of the Trading Member's net assets is decreased by twenty
percent (20%) or more, compared with the amount of net assets as of
its latest fiscal year end or the amount most recently reported to the
Exchange in accordance with this Item (4).

(5)

An order of attachment is imposed on the Trading Member due tocoercive tax collection or any other reason or an equivalent disciplinary
measure is imposed on the Trading Member in a foreign country(excluding the case referred to in Item (10) below).

(6)

The Trading Member’s total capital is increased, or its total number of46

Trading Member Regulations

authorized shares or equivalent is changed.
(7)

There is a change in any of the shareholders or investors whose equity
interest or contribution (either held directly by itself or indirectly
through another person) in the Trading Member is ten percent (10%) or
more.

(8)

The Trading Member takes over the whole or a substantial part ofbusiness.

(9)

There is a change in the Trading Member's head office or any of its
other business offices or branches engaged in market derivatives
transactions on the Exchange’s Market.

(10)

The Trading Member is subject to an inquiry, inspection, detention,
visitation, investigation, attachment, hearing, a disciplinary measure, ora punishment pursuant to applicable provisions of the Act or any otherrelevant law or regulation or any equivalent foreign law or regulation;
provided, however, that the foregoing shall apply only when the causal
event is related to market derivatives transactions, etc. (meaning
market derivatives transactions or foreign market derivatives
transactions; this interpretation shall equally apply hereinafter) ortransactions on commodity markets, and further provided that theevents covered by this Item (10) shall not include an event referred toin Item (2) above.

(11)

A disciplinary measure is imposed on the Trading Member by anyother financial instruments exchange, a commodity exchange, afinancial instruments firms association or a commodity futuresassociation, or any other equivalent foreign exchange or organization;
provided, however, that the foregoing shall apply only when thedisciplinary measure imposed is related to market derivatives
transactions, etc. or transactions on commodity markets.

(12)

A director or officer of the Trading Member is sentenced to a fine orseverer punishment in accordance with applicable provisions of the Act
and other financial instruments legislation, the Foreign Exchange and47

Trading Member Regulations

Foreign Trade Act (Act no. 228 of 1949, hereinafter called the “Foreign
Exchange Act”) or any regulations thereunder (hereinafter called the“Foreign Exchange Acts”), the Commodity Derivatives Act (Act No.
239 of 1950, hereinafter called the “Commodity Derivatives Act”) or
any regulations thereunder (hereinafter called the “Commodity
Derivatives Acts”), or any equivalent foreign legislation; provided,
however, that the foregoing shall apply only when the sentence isrelated to market derivatives transactions, etc. or transactions oncommodity markets;(13)

The Trading Member is registered as a financial instrument firm or as alicensed financial institution (registered financial institution), or
approved as an exchange licensed firm, or such registration or approvalis revoked.

(14)

There is any change in the business description or operation proceduresfor the Trading Member’s financial instruments or other specified
business controlling its market derivatives transactions on the
Exchange’s Market.

(15)

The Trading Member becomes a party to a litigation in connection withmarket derivatives transactions on the Exchange’s Market or brokerage
service therefor, or the said litigation comes to an end.

(16)

There occurs any other event for which the Exchange determines thatreporting by the Trading Member is needed.

56.2
If an entity which controls a Trading Member as a subsidiary or which isdesignated by the Exchange as substantially controlling a Trading Member (hereinafter
called a “Parent Company”) falls under any of the events set forth in Article 55(5) hereof
or Item (3), (4) or (5) of Article 56.1 above, the Trading Member shall immediately
report the details thereof to the Exchange in accordance with the requirements prescribedby the Exchange. In this case, the term “Trading Member's net assets” referred to in
Article 56.1(4) above shall be replaced with “Parent Company’s net assets,” and thephrase “the amount of net assets as of its latest fiscal year end or the amount mostrecently reported to the Exchange in accordance with this Item (4)” shall be replacedwith “the amount of net assets as of its latest fiscal year end.”48
Trading Member Regulations

56.3
If a Trading Member becomes a party to a litigation in connection with linked
market derivatives transactions specified in Article 2(6) of the Trading Regulations orplacement of orders therefor, acceptance, etc. of orders for linked market derivatives
transactions, Acceptance of Linked Clearing, or the arising of an L-T Link Position, or if
the said litigation comes to an end, the Trading Member shall immediately report thedetails thereof to the Exchange in accordance with the requirements prescribed by the
Exchange.
56.4
If and when any of the events separately prescribed by the Exchange occurs to a
Trading Member which is a special financial instruments firm or a designated special
financial instruments firm, such Trading Member shall report on the details of such eventto the Exchange without delay unless the Exchange determines such report notnecessary.

Article 57.

Financial Reporting

57.1
A Trading Member shall periodically report its financial condition to the
Exchange in accordance with the requirements prescribed by the Exchange.
57.2
A Trading Member controlled by its Parent Company shall periodically submit
financial statements of the Parent Company to the Exchange in accordance with therequirements prescribed by the Exchange.
57.3
If and when an FX Daily Futures Trading Member, an Equity Index Daily
Futures Trading Member, an Equity Index Daily Futures Remote Trading Member or an
FX Clearing Futures Trading Member prepares the monitoring survey under Article 56-2of the Act, it shall report on the details of the monitoring survey to the Exchange in themanners prescribed by the Exchange.
57.4
If and when an FX Daily Futures Trading Member, an Equity Index Daily
Futures Trading Member, or an FX Clearing Futures Trading Member prepares the
document under the Acts or files the notification with the Commissioner of the Financial
Services Agency with respect to its Capital-to-Risk Ratio and the Exchange deems it
necessary, it shall report on its Capital-to-Risk Ratio to the Exchange in the manners
prescribed by the Exchange.
49
Trading Member Regulations

57.5
If and when an FX Daily Futures Trading Member, an Equity Index Daily
Futures Trading Member or an FX Clearing Futures Trading Member who is a special
financial instruments firm prepares the document under the Acts or files the notification
with the Commissioner of the Financial Services Agency with respect to its Consolidated
Capital-to-Risk Ratio on Downstream Consolidation and the Exchange deems it
necessary, it shall report on such consolidated Capital-to-Risk Ratio to the Exchange inthe manners prescribed by the Exchange.
57.6
If and when an FX Daily Futures Trading Member, an Equity Index Daily
Futures Trading Member or an FX Clearing Futures Trading Member who is a
designated special financial instruments firm prepares the document under the Acts orfiles the notification with the Commissioner of the Financial Services Agency withrespect to its Consolidated Common Equity Tier 1 Ratio with respect to Consolidated
Capital-to-Risk Ratio on the Uniform International Standard, Consolidated Tier 1 Ratio
and Total Consolidated Capital-to-Risk Ratio or Consolidated Capital-to-Risk Ratio on
Sample Downstream Consolidation, and the Exchange deems it necessary, it shall reporton each such ratio to the Exchange in the manners prescribed by the Exchange.

Article 58.

Investigation against Trading Members

58.1
In any of the cases set forth in the respective Items below, or in any other casewhere the Exchange determines as being necessary for the operation of the Exchange’s
Market, the Exchange may require a Trading Member to submit a report or documents
concerning its business or assets, or may cause the Exchange’s staff to inspect the actual
state of the Trading Member’s business or assets, or its books and records or otherproperties.
(1)

When the Exchange investigates the Trading Member's compliancewith financial instruments legislation including the Act (hereinafter
called the “Acts”), the Foreign Exchange Acts, the Commodity
Derivatives Acts or any equivalent foreign legislation (the Acts and allsuch legislations being hereinafter collectively called the “Acts, etc.”);or any disciplinary measures imposed by the competent administrative
authorities under the Acts, etc. (but limited to those related to market
derivatives transactions, etc. or transactions on commodity markets), or50

Trading Member Regulations

the Articles of Incorporation, the Trading Regulations, the Brokering
Terms, Clearing Agreements, the Clearing Regulations and othervarious rules and regulations of the Exchange or any disciplinary
measures imposed thereunder, Member Link Agreements, or the justand equitable principle of trade.
(2)

When the Exchange investigates the Trading Member’s financial
condition.

(3)

When the Exchange examines the contents of market derivatives
transactions conducted by the Trading Member on the Exchange’s
Market (excluding such examinations that will be immediately carriedout in order to facilitate market derivatives transactions on the
Exchange’s Market), or conducts any other investigation in order toensure fairness of market derivatives transactions on the Exchange’s
Market.

(4)

When the Exchange determines that it is appropriate to provide
information, in response to a request from any other financial
instruments exchange or a financial instruments firms association (orany similar foreign organization), in order to facilitate theirinvestigation conducted with a view to ensuring fairness of market
derivatives transactions, etc.

58.2
The Exchange may require a Trading Member who is controlled by its Parent
Company to submit a report or documents concerning the Parent Company’s business orassets to the Exchange, when the Exchange determines that it is necessary in order to
conducts investigations against the said Trading Member in accordance with Article 58.1
above, or necessary for the operation of the Exchange’s Market.

CHAPTER IV.
DISCIPLINARY, REGULATORY AND OTHER MEASURESON TRADING MEMBERS
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Article 59.
Collaborative Relationship or Controlling Relationship with its
Directors / Officers or Other Persons
59.1
If the Exchange determines that a Trading Member’s collaborative orcontrolling relationship with any of its directors or officers or other persons is
inappropriate in light of the operation of the Exchange’s Market, the Exchange may
conduct hearings against the Trading Member and then, by a resolution of the
Self-regulatory Committee, demand that the Trading Member correct such relationship.
Provided, however, if such Trading Member submits a written statement, the submission
thereof may be substituted for the hearings.
59.2
If the Trading Member does not agree to the hearings under Article 59.1 above
without due cause, the Exchange may demand the correction set forth in Article 59.1
above without the hearings.
59.3

If the Trading Member considers the demand for correction under Article 59.1

above to be unreasonable, the Trading Member may submit a written objection by
showing its grounds to the Exchange, within ten (10) business days (a business daymeans a Japanese banking day) after the date of receipt of the notice of such demand
from the Exchange.
59.4
Upon receipt of an objection referred to in Article 59.3 above, the Exchange
shall convene a meeting of the Self-regulatory Committee without delay.
59.5

If the Self-regulatory Committee determines in its meeting referred to in Article

59.4 above that it is appropriate to modify or withdraw the demand under Article 59.1
above, the Exchange shall immediately modify or withdraw the demand.

Article 60.

(Deleted)

Article 61.

Disciplinary Measures on Trading Members

61.1

If the Exchange determines that a Trading Member falls under any of the cases
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set forth in the respective Items below, the Exchange may conduct hearings against theTrading Member and then, by a resolution of the Self-regulatory Committee, impose thedisciplinary measure set forth in the relevant Item on the Trading Member.
(1)

If the Trading Member has acquired a trading membership by wrongfulmeans, the trading membership will be disqualified.

(2)

If the Trading Member ceases to satisfy any of the qualification criteria
for trading membership separately prescribed by the Exchange, thetrading membership will be disqualified (provided, however, withrespect to the criteria of the financial resources for an FX Daily Futures
Trading Member, an Equity Index Daily Futures Trading Member, etc.
or an FX Clearing Futures Trading Member, if such Trading Member
ceases to satisfy any of the qualification criteria set forth in Items (1)through (3) of Article 63.2).

(3)

If the Trading Member becomes insolvent and is not likely to readily
recover from the state of insolvency, its trading membership(s) will bedisqualified.

(4)

If the Trading Member fails to perform any of its obligations under anagreement entered into with the Exchange or any other Trading
Member in connection with market derivatives transactions on the
Exchange’s Market, the Trading Member will be subject to suspension
from or restriction on the execution of market derivatives contracts at
its bids or offers on the Exchange’s Market for six (6) months or less,suspension from or restriction on the arising of L-T Link Positions for
its own account, or disqualification of its trading membership(s).

(5)

If the Trading Member fails to pay or deposit any money, securities orother equivalents to the Exchange that the Trading Member is required
to do so in the capacity of Trading Member in accordance with therequirements prescribed by the Exchange, the Trading Member will be
subject to suspension from or restriction on the execution of market
derivatives contracts at its bids or offers on the Exchange’s Market forsix (6) months or less, suspension from or restriction on the arising of
L-T Link Positions for its own account, or disqualification of its trading
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membership(s).
(6)

If a disciplinary measure (but limited to those related to market
derivatives transactions, etc. or transactions on commodity markets) is
imposed on the Trading Member by any other financial instruments
exchange, a commodity exchange, a financial instruments firms
association, or a commodity futures association, or any equivalentforeign exchange or organization, the Trading Member will be subject
to suspension from or restriction on the execution of market derivatives
contracts at its bids or offers on the Exchange Market for six (6)months or less, suspension from or restriction on the arising of L-T
Link Positions for its own account, or disqualification of its trading
membership(s).

(7)

If the Trading Member fails to make notification in accordance with
Article 55 hereof or reporting in accordance with Article 56 or 57
hereof, or makes false notification or reporting, the Trading Member
will be subject to a fine of one hundred million Japanese Yen(¥100,000,000) or less, an admonition, suspension from or restriction
on the execution of market derivatives contracts at its bids or offers on
the Exchange’s Market for six (6) months or less, or disqualification of
its trading membership(s).

(8)

If the Trading Member refuses, hinders or evades any inspection under
Article 58 hereof, fails to submit a report or document in accordancewith the same Article or submits a false report or document, or refuses,
hinders or evades any investigation under Article 45 hereof , theTrading Member will be subject to a fine of one hundred million
Japanese Yen (¥100,000,000) or less, an admonition, suspension fromor restriction on the execution of market derivatives contracts at its bids
or offers on the Exchange’s Market for six (6) months or less, ordisqualification of its trading membership(s).

(9)

If the Trading Member has committed an act, other than those set forthin Items (1) through (8) above, in violation of any of the Acts, etc., or
has become subject to or has committed an act in violation of any
disciplinary

measures

imposed54

Trading Member Regulations

thereunder

by

the

competentadministrative authorities (but limited to those related to market
derivatives transactions, etc. or transactions on commodity markets), or
has committed an act in violation of the Articles of Incorporation, theTrading Member Regulations, the Clearing Regulations, the Trading
Regulations, the Brokering Terms, any clearing agreement or otherregulations or rules of the Exchange or any disciplinary measures
imposed thereunder, or if the Trading Member has committed an act
contrary to the just and equitable principle of trade, the Trading
Member will be subject to a fine of one hundred million yen(¥100,000,000) or less, an admonition, suspension from or restriction
on the execution of market derivatives contracts at its bids or offers on
the Exchange’s Market for six (6) months or less, suspension from or
restriction on the arising of L-T Link Positions for its own account, or
disqualification of its trading membership(s).
(10)

If the Trading Member commits an act in violation of any Member
Link Agreement or contrary to the just and equitable principle of trade,
the Trading Member will be subject to an admonition, suspension fromor restriction on the arising of L-T Link Positions for its own account,suspension from or restriction on the execution of market derivatives
contracts at its bids or offers on the Exchange’s Market for six (6)months or less, or disqualification of its trading memberships.

61.2
If a Trading Member commits an act in violation of any of the Acts, etc. or
disciplinary measures imposed by the competent administrative authorities set forth in
Article 61.1(9) above and such violation is determined as significantly discrediting the
Exchange, the Exchange may conduct hearings against the Trading Member and then
impose a fine not exceeding five hundred million yen (¥500,000,000) on the Trading
Member.
61.3
Notwithstanding the provision of Article 61.1 above, in the case of any of thefollowing items, the Exchange may conduct hearings against the relevant Trading
Member and then, by a resolution of the Self-regulatory Committee, may impose on it anadmonition, or suspension from or restriction on the execution of market derivatives
contracts at its bids or offers on the Exchange’s Market for six (6) months or less, ordisqualify its relevant trading membership.

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(1)In respect of an FX Daily Futures Trading Member, if a corporation
acting as its guarantor and holding a majority of the voting rights of allshareholders of such Trading Member fails to satisfy the criteria set
forth in Article 15.4 (4) (m) of the Enforcement Regulations for
Trading Member Regulations for three consecutive business years, as
indicated in financial reporting under Article 57.2 hereof (hereinafter
called the “Financial Report” in this Article 61.3), or the said
corporation becomes insolvent and is unlikely to recover from the stateof insolvency within the immediately following business year.

(2)

In respect of an Equity Index Daily Futures Trading Member etc., if a
corporation acting as its guarantor and holding a majority of the voting
rights of all shareholders of such Trading Member fails to satisfy thecriteria set forth in Article 15.7 (3) (g) or Article 15.11 (3) (e) of the
Enforcement Regulations for Trading Member Regulations for threeconsecutive business years, as indicated in the Financial Report, or thesaid corporation becomes insolvent and is unlikely to recover from thestate of insolvency within the immediately following business year.

(3)

In respect of an FX Clearing Futures Trading Member, if a corporation
acting as its guarantor and holding a majority of the voting rights of allshareholders of such Trading Member fails to satisfy the criteria set
forth in Article 15.14 (4) (m) or Article 15.17 (4) (n) of the
Enforcement Regulations for Trading Member Regulations for threeconsecutive business years, as indicated in the Financial Report, or thesaid corporation becomes insolvent and is unlikely to recover from thestate of insolvency within the immediately following business year.

61.4
When imposing a fine on a Trading Member in accordance with Article 61.1 or
61.2 above, the Exchange may, in addition to the fine, impose suspension from or
restriction on the execution of market derivatives contracts at the Trading Member’s bids
or offers on the Exchange’s Market or an admonition.

Article 62.
Regulatory Measures for Inappropriate Controlling Relationship,
etc. of Trading Member

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If a Trading Member falls under any of the cases set forth in the respective
Items below, the Exchange may conduct hearings against the Trading Member and then,by a resolution of the Self-regulatory Committee, suspend market derivatives
transactions, etc. or impose any other regulatory measure deemed necessary andappropriate by the Exchange.
(1)

The Trading Member fails to respond to the Exchange’s demand under
Article 59 hereof to correct an inappropriate collaborative orcontrolling relationship with any of its directors or officers or otherpersons.

(2)

The Trading Member is controlled by a person who is determined by
the Exchange as being inappropriate in light of the operation of the
Exchange’s Market and whose investment or contribution in the
Trading Member’s total capital is one half (1/2) or more.

(3)

A counselor, an advisor, or a person with any other title whatsoever
who has a controlling power over the Trading Member that is similar orsuperior to the one held by a director or officer of the Trading Member
is determined by the Exchange as being inappropriate in light of theoperation of the Exchange’s Market.

Article 62-2.

Regulatory Measures for Defects in Risk Management System

If the risk management system of a Trading Member set forth in Article 25-2
hereof is determined by the Exchange as being extremely inappropriate in light of theoperation of the Exchange’s Market, the Exchange may conduct hearings against theTrading Member and then, by a resolution of the Self-regulatory Committee, impose any
regulatory measure deemed necessary by the Exchange for the improvement of thesystem.

Article 63.
63.1

Regulatory Measures on Trading Member

If a Trading Member becomes insolvent or is determined by the Exchange as

being likely to become insolvent, the Exchange may conduct hearings against the57
Trading Member Regulations

Trading Member and then, by a resolution of the Self-regulatory Committee, suspend theexecution of market derivatives contracts at the Trading Member’s bids or offers on the
Exchange’s Market or impose any other measure deemed necessary and appropriate by
the Exchange, until the cause for such actual or likely insolvency ceases to exist.
63.2
If a Trading Member falls under any of the cases set forth in the respective
Items below, the Exchange may conduct hearings against the Trading Member and then,by a resolution of the Self-regulatory Committee, suspend the execution of market
derivatives contracts at the Trading Member’s bids or offers on the Exchange’s Market
or impose any other measure deemed necessary and appropriate by the Exchange, until
the cause of such situation ceases to exist.
(1)

The amount of the paid-in capital of an FX Daily Futures Trading
Member, Equity Index Daily Futures Trading Member, etc. or an FX
Clearing Futures Trading Member falls below three hundred million
Japanese Yen (¥300,000,000) and it is unlikely to be recovered
promptly.

(2)

With respect to the FX Daily Futures Trading Member, the Equity
Index Daily Futures Trading Member, etc. or the FX Clearing Futures
Trading Member not guaranteed by its parent company when it
acquired the trading membership, its net asset value falls below threehundred million Japanese Yen (¥300,000,000) and it is unlikely to be
recovered promptly.

(3)

The FX Daily Futures Trading Member, the Equity Index Daily Futures
Trading Member, etc. or the FX Clearing Futures Trading Member falls
under any of the following cases.
(a)With respect to a financial instruments firm, its Capital-to-Risk
Ratio falls below one hundred and twenty percent (120%) and it isunlikely to be recovered promptly.

(b)With respect to a special financial instruments firm, its Consolidated
Capital-to-Risk Ratio on Downstream Consolidation falls below one
hundred and twenty percent (120%) and it is unlikely to be
recovered promptly.
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(c)With respect to a designated special financial instruments firm, in
relation to its Consolidated Capital-to-Risk Ratio on the Uniform
International Standard, the Consolidated Common Equity Tier 1
Ratio falls below two point two five percent (2.25%), theConsolidated Tier 1 Ratio falls below three percent (3%) or the
Total Consolidated Capital-to-Risk Ratio falls below four percent(4%) or the Consolidated Capital-to-Risk Ratio on Sample
Downstream Consolidation falls below one hundred and twenty
percent (120%) and it is unlikely to be recovered promptly.

(4)

With respect to the FX Daily Futures Trading Member, the Equity
Index Daily Futures Trading Member, etc. or the FX Clearing Futures
Trading Member guaranteed by its parent company when it acquired
the trading membership, the parent company of the Trading Member
ceased to satisfy the criteria of the financial resources set forth in
Article 15.4 (4) (m), Article 15.7 (3) (g) , Article 15.11 (3) (e), Article
15.14 (4) (m) or Article 15.17 (4) (m) of the Enforcement Regulations
for Trading Member Regulations and it is unlikely to be recovered
promptly.

Article 64.
Lifting of Suspension of Market Derivatives Transactions, etc. or
Other Regulatory Measure
64.1
If a Trading Member suspended from the execution of market derivatives
contracts at its bids or offers on the Exchange’s Market for an indefinite period in
accordance with Article 63 hereof has eliminated the cause for such suspension, theTrading Member may submit a written application for lifting of such suspension
accompanied by an explanatory statement of such elimination.
64.2
If the Exchange determines that it is appropriate to lift the suspension based on
the application set forth in Article 64.1 above, the Exchange shall approve theapplication by a resolution of the Self-regulatory Committee.
64.3

If a Trading Member suspended from the execution of market derivatives

contracts at its bids or offers on the Exchange’s Market for an indefinite period in
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accordance with Article 63 hereof is unable to obtain approval referred to in Article 64.2
above within one (1) year from the starting date of such suspension, the Exchange may
disqualify the Trading Member’s trading membership by a resolution of the
Self-regulatory Committee.

Article 65.

Objection to Disciplinary Measures or Regulatory Measures

The provisions of the proviso to Article 59.1 and Article 59.2 hereof shall apply
mutatis mutandis to the hearings set forth in Articles 61 through 63 hereof and theprovisions of Articles 59.3 through 59.5 hereof shall apply mutatis mutandis to thedisciplinary or regulatory measures set forth in Articles 61 through 63 hereof anddisqualification from the trading membership set forth in Article 64.3 hereof.

Article 66.
66.1

Measures on Trading Member under Statutory Sanctions

If a Trading Member is subject to suspension of the whole or a part of its

financial instruments or other specified business or any other equivalent disciplinary
measure by virtue of the Acts, etc., the Exchange shall suspend or restrict the executionof market derivatives contracts at the Trading Member’s bids or offers on the Exchange’s
Market in accordance with the conditions of the order.
66.2
If a Trading Member is subject to suspension of the whole or a part of its
financial instruments or other specified business or any other equivalent disciplinary
measure by virtue of the Acts, etc., the Exchange may suspend or restrict the arising of
L-T Link Positions for the Trading Member’s account in accordance with the conditionsof the order.

Article 67.

Breach of Just and Equitable Principle of Trade

A breach of the just and equitable principle of trade set forth in this Chapter IVmeans any of the acts including, but not limited to, those mentioned in the following
Items that may discredit the Exchange or any Trading Member, or that is contrary to ajust and equitable principle toward the Exchange or any Trading Member or any Linked
Overseas Organization or its members, in light of the operation of the Exchange’s
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Market.
(1)

Interference with or disturbance of operations by the Exchange or any
other Trading Member(2)

A fraudulent act, a dishonest or improper conduct, or an extremely
careless or negligent business operation in connection with market
derivatives transactions, etc. or brokerage service therefor, etc.

(3)

A fraudulent act, a dishonest or improper conduct, or an extremely
careless or negligent business operation in connection with linked
market derivatives transactions or placement or acceptance of orders
therefor, etc., Acceptance of Linked Clearing, or the arising of L-T Link
Positions

Article 68.

Recommendation to Trading Members

68.1
If the Exchange determines that a Trading Member's status of business or assets
is inappropriate in light of the operation of the Exchange’s Market, the Exchange may,by a resolution of the Self-regulatory Committee, recommend the Trading Member totake appropriate actions.
68.2
When the Exchange determines that it is necessary in connection with arecommendation issued under Article 68.1 above, the Exchange may, by a resolution of
the Self-regulatory Committee, require the concerned Trading Member to report theaction(s) taken.

SUPPLEMENTARY PROVISIONS
1.

These amended Regulations shall take effect as from April 1, 2013.

2.
An Interest Rate Futures Trading Member whose rights and obligations havebeen suspended as of the date of enforcement of these amended Regulations based on
Paragraph 3 of the Supplementary Provisions which came into force as of April 1, 2004
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shall apply for either continuance or discontinuance of the suspension in the manners
prescribed by the Exchange. If the Interest Rate Futures Trading Member applies forcontinuance of the suspension, Article 51-2.1 shall apply to such Interest Rate Futures
Trading Member.

SUPPLEMENTARY PROVISIONS
These amended Regulations shall take effect as from December14, 2015.

SUPPLEMENTARY PROVISIONS
These amended Regulations shall take effect as from February 27, 2017.

SUPPLEMENTARY PROVISIONS
These amended Regulations shall take effect as from June 9, 2017.

SUPPLEMENTARY PROVISIONS
These amended Regulations shall take effect as from October 26, 2020; provided,
however, that the amended provisions with respect to Article 27.1 and Article 27.7 shalltake effect as from July 13, 2020.

SUPPLEMENTARY PROVISIONS
These amended Regulations shall take effect as from April 12, 2021.

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SUPPLEMENTARY PROVISIONS
These amended Regulations shall take effect as from February 28, 2022.

SUPPLEMENTARY PROVISIONS
These amended Regulations shall take effect as from March 20, 2023.

SUPPLEMENTARY PROVISIONS
These amended Regulations shall take effect as from September 11, 2023.

SUPPLEMENTARY PROVISIONS
These amended Regulations shall take effect as from March 1, 2024.

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