To maintain the steady operation after the internationalization of iron ore futures, Dalian Commodity Exchange (DCE) has set up the access requirements of suitability for clients attempting to engage in iron ore futures trading. And it has made clear relevant issues in the rules, such as how to open an account for trading and what to be noted in opening an account, for clients that have passed the suitability examination.
A DCE official introduced that, at the beginning of the internationalization of iron ore futures, there are two ways for overseas traders to open an account.
The first is the direct way. That is, a client can open an account through a domestic futures company, which will open an account for it through the platform of China Futures Market Monitoring Center. This method is similar with that for domestic clients.
The second is sub-entrustment. That is, a client opens an account at an overseas broker, which should entrust a domestic futures company to engage in the trading of specified futures products. In this situation, the overseas broker should apply for a trading code through the account-opening system of China Futures Market Monitoring Center, and the futures company accepting the entrustment should make management and control but not look up for the personal information of the overseas trader. For the detailed procedures and documents of overseas participants to open an account, please refer to relevant requirements of China Futures Market Monitoring Center.
In the trader suitability system of specified products, DCE has set up some access requirements like capital requirement, knowledge test and trading experience, and the account-opening institution should check whether clients have meet these requirements. Besides, as a trading code is unique, an overseas trader that opens an account in both ways or through different overseas brokers cannot trade futures through the same futures company. For example, if an overseas client entrusts overseas broker A to open an account through a domestic futures company C, the client cannot entrust overseas broker B to open an account through domestic futures company C or directly open an account through domestic futures company C.
Besides, the specified products and other products of DCE share the trading code. When opening an account, an account-opening institution and an overseas client should meet the basic requirements on relevant business of local regulatory institutions apart from the requirements of the exchange.
