Korea Exchange: Rules On Receiving Orders Will Be Revised On May 30, 2005

Target price order will be newly introduced applicable to both markets).

• Institutions and foreign investors wish to have their orders matched at the volume-weighted average price of the day, but the current rules provide no clear ground to allow traders to place orders targeting a specific price.
• In light of such demand, the rules have been revised to permit a new type of order, the aggregated volume of which is entrusted to be matched at a specific price(target price order).

* When a trader places a target price order, the securities firm offers various quotations in multiple forms such as limit order and market order according to the market conditions so that the investor’s orders can be matched at a price close to the target price.

Rules will be revised to reflect changes brought about by new communications technologies such as e-mail and messenger, and create a basis for receiving orders via such mediums(applicable to both markets).

• Orders placed via these new types of medium will be received in the same way that orders by phone or fax are received.

The restrictions on receiving new orders from a customer with overdue payments will be eased (the Stock Market)

• Under the current rules, securities companies are prohibited from receiving new orders from a customer who has overdue payments for their executed trades(compulsory rules).
• However, the rules will be relaxed to allow securities firms to receive new orders from such customers, although to a limited extent, according to the contract, which will give more discretion to securities companies.

Effective Date: May 30, 2005(Monday)