(Adopted at the 26th meeting of the 8th Board of Governors on August 4, 2025; issued by Announcement [2025] No.85 on August 8, 2025;effective as of October 9, 2025)

Chapter 1 General Provisions

Article 1 These Rules are made in accordance with the Futures and Derivatives Law of the People’s Republic of China, Measures for the Administration of Futures Exchanges, Administrative Regulations on Program Trading in the Futures Markets (Trial Implementation), other laws and regulations and related normative documents, as well as the Trading Rules of Zhengzhou Commodity Exchange for the purposes of strengthening the regulation of program trading on the Zhengzhou Commodity Exchange (the “Exchange”), regulating program trading activities, and maintaining an orderly and fair market.

Article 2 These Rules apply to all the program trading and related activities conducted on the Exchange.

The term “program trading” as referred to in these Rules means futures trading activities conducted on the Exchange via trading orders that are automatically generated or placed by computer programs.

The term “high-frequency trading” as referred to in these Rules means program trading activities that feature:

(1) a high number or frequency of order placement and cancellation within a short period of time;

(2) a high number of order placement and cancellation within a trading day; or

(3) other characteristics identified by the China Securities Regulatory Commission (“CSRC”).

The specific criteria for high-frequency trading will be prescribed by the Exchange separately.

Article 3 The term “program trader” as referred to in these Rules means a non-futures brokerage Member (“Non-FB Member”) or client who engages in program trading.

The term “high-frequency trader” as referred to in these Rules means a program trader who engages in high-frequency trading.

Article 4 Program trading activities shall comply with relevant laws, regulations, normative documents, and the Rules of the Exchange, adhere to the principle of fairness, and shall not undermine the security of the Exchange’s system or disrupt the normal course of trading.

Article 5 The Exchange shall exercise self-regulation over program trading, strengthen the monitoring and surveillance of program trading, regulate program trading behaviors, and take disciplinary sanctions or other self-regulatory measures in response to violations, in order to ensure the security of the Exchange’s system and maintain the normal course of trading.

Chapter 2 Reporting Management

Article 6 The Exchange implements reporting system for program trading, and the specific implementing methods will be announced by the Exchange separately.

Article 7 Before accepting a client’s entrustment for program trading, a futures brokerage Member (“FB Member”) shall, in accordance with relevant regulations, enter into a Program Trading Entrustment Agreement (“Entrustment Agreement”) with the client. The Entrustment Agreement shall stipulate the rights and obligations of both parties and clarify the requirements for reporting, risk control, and other matters.

An overseas broker accepting a client’s entrustment for program trading shall be subject to the requirements of the preceding paragraph.

Before accepting an overseas broker’s entrustment for program trading, an FB Member shall make an agreement with the overseas broker on their respective rights and obligations and clarify the requirements for reporting, risk control, and other matters.

Article 8 A client shall report relevant information to its carrying FB Member or overseas broker before engaging in program trading.

The FB Member or overseas broker shall verify the reported information. Upon verification with no discrepancies, the FB Member shall report to the Exchange within five (5) trading days, and the overseas broker shall report to the Exchange through its carrying FB Member within five (5) trading days. The Exchange shall give a reply within five (5) trading days after receiving the reported information. The FB Member or overseas broker shall confirm with the client after receiving the reply from the Exchange. Only after receiving the confirmation may the client commence program trading.

Article 9 A Non-FB Member shall report relevant information to the Exchange before engaging in program trading. The Exchange shall give a reply within five (5) trading days after receiving the reported information. Only after receiving the confirmation from the Exchange may the Non-FB Member commence program trading.

A Non-FB Member shall not engage in high-frequency trading.

Article 10 A program trader shall truthfully, accurately, and completely report the following information:

(1) basic account information, including the trader’s name, trading code, product manager, the carrying FB Member or overseas broker, etc.;

(2) trading and software information, including the method of trading order execution, the name, basic functions, and developer of the trading software, etc.; and

(3) any other information required by the Exchange.

In addition to the information required in the preceding paragraph, a high-frequency trader shall report the following information: the type and main content of trading strategy, maximum frequency of order placement and cancellation, maximum number of daily order placement and cancellation, server location, technical system testing report, contingency plan, risk control measures, etc.

Article 11 Any of the following changes in a program trader’s reported information shall be considered as a “significant change” and must be reported accordingly.

(1) a change in the trader’s name or the product manager;

(2) a change in the method of trading order execution and the name, basic functions, or developer of the trading software;

(3) a change in the type of high-frequency trading strategy, maximum frequency of order placement and cancellation, or maximum number of daily order placement and cancellation;

(4) the cessation of program trading; or

(5) any other significant change recognized by the Exchange.

The program trader shall submit the change report within thirty (30) trading days after any of the above significant changes occurs.

Article 12 An FB Member or overseas broker shall verify the information reported by its program trading clients semiannually or as required by the Exchange. Where a client fails to report information as required, the FB Member or overseas broker shall urge the client to make corrections. Where the client fails to make corrections after being urged, the FB Member or overseas broker shall, in accordance with the Entrustment Agreement, refuse to accept any further orders to open positions from the client.

Article 13 The Exchange shall verify the information reported by program traders semiannually or as needed, with a focus on the type of trading strategy, maximum frequency of order placement and cancellation, maximum number of daily order placement and cancellation, and other information reported by high-frequency traders.

Article 14 An FB Member or overseas broker shall keep a client’s reported information confidential, and shall not unlawfully buy, sell, provide, or disclose such information, use such information by other improper means, or divulge any commercial secrets it has learned.

The FB Member or overseas broker shall properly preserve the client’s reported information and verification records for not less than twenty (20) years.

Article 15 The Exchange’s acceptance, verification, and management of the information reported by a program trader in accordance with these Rules shall not constitute any judgment or guarantee by the Exchange regarding the availability, security, or compliance of such program trader or the program trading strategy and technical system that such program trader uses.

Chapter 3 System Access Management

Article 16 An FB Member, an overseas broker, or a program trader shall ensure that the technical system used for program trading comply with the rules of the CSRC and the Exchange, adhere to the principles of compliance, prudence, and risk controllability, and must not undermine the security of the Exchange’s system, distort market fairness, or harm the lawful rights and interests of other traders.  

An FB Member or overseas broker shall incorporate external system access management into its compliance and risk control framework, and establish a comprehensive mechanism covering access testing, trade monitoring, anomaly handling, emergency response, exit arrangement, etc.

Article 17 The technical system used by a program trader shall meet the following requirements:

(1) having an effective anomaly monitoring function to detect such situations as abnormal system connection, irregular number of order placement and cancellation, etc.;

(2) having an effective threshold management function to set risk-based thresholds and trigger alerts when the thresholds are reached;

(3) having an effective error prevention function to execute corresponding strategies by error type to prevent erroneous orders from causing significant impacts on the security of the Exchange’s system or market order;

(4) having sound and effective emergency response capabilities to suspend trading, cancel orders, etc. in the event of technical failures or other abnormalities;

(5) having a complete log recording function to ensure the traceability of business; and

(6) any other requirement specified by the CSRC and the Exchange.

In addition to the above requirements, the technical system used by a Non-FB Member for program trading shall also meet the following requirements:

(1) having an effective function to accurately verify the account funds and positions on a real-time basis before submitting trading orders, ensuring that such trading orders are legal and valid; and

(2) being designed, developed, and used in strict accordance with the Exchange’s technical specifications for member interface development.

Article 18 The trading system used by an FB Member shall meet the following requirements:

(1) the system performance and capacity shall be aligned with business and market needs, ensuring secure, continuous, and stable operation;

(2) having an effective external access authentication function to identify and verify external access systems and clients, and to reject unauthorized access;

(3) having an effective function to accurately verify traders’ account funds and positions on a real-time basis before submitting trading orders, ensuring that such trading orders are legal and valid;

(4) having an effective permission control function to set trading permissions for different traders;

(5) having an effective anomaly monitoring function to detect such abnormal situations as erroneous orders submission, repeated login, irregular number of order placement and cancellation, etc.;

(6) having an effective threshold management function to set risk-based thresholds and trigger alerts when the thresholds are reached;

(7) having an effective error handling function to execute corresponding strategies by error type to prevent system abnormalities from causing significant impacts on the security of the Exchange’s system or market order;

(8) having a sound and effective emergency response capabilities to support batch order cancellation, suspend orders submission, etc. in the event of technical failures or other abnormalities;

(9) having a complete log recording function to ensure the traceability of business;

(10) being designed, developed, and used in strict accordance with the Exchange’s technical specifications for member interface development; and

(11) any other requirement specified by the CSRC and the Exchange.

The technical system used by an overseas broker for program trading shall meet the requirements in Items (1) and (2), Items (4) through (9), and Item (11) of the preceding paragraph.

Article 19 Before the technical system used by a client or an overseas broker for program trading connects to an FB Member, such system shall be tested by the FB Member either directly or through a third-party testing organization.

The FB Member shall properly preserve the testing records required in the preceding paragraph for not less than twenty (20) years.

Article 20 Before offering futures brokerage service for program trading, an FB Member shall establish a simulation testing environment, separate from the production environment, to test its own trading system.

The FB Member shall properly preserve the testing records required in the preceding paragraph for not less than twenty (20) years.

Article 21 An FB Member shall not deploy its trading system on the same physical equipment as the technical system of a client or an overseas broker, grant system management access to a client, an overseas broker, or an IT service provider, or allow direct connection of a client’s or an overseas broker’s technical system to the Exchange’s trading system.

A program trader shall not use the system interface to illegally operate futures business, solicit traders or process third-party trading orders, transfer or lend its own technical system, or provide external access to the system for a third party. 

Chapter 4 Co-location and Seat Management

Article 22 The Exchange implements an information reporting system for co-location service and a trading seat management system, and provides co-location service and allocate trading seats based on the principles of security, fairness, and reasonableness.

The Exchange semiannually verifies the use of co-location resources and trading seats.

Article 23 An FB Member shall report to the Exchange each time it applies for an additional co-location resource. The report submitted by the FB Member shall include details of its relevant management systems and their implementation, trading software and its deployment, and clients using the Exchange’s co-location resources.

Where there are significant changes in the reported information, the FB Member shall submit a change report to the Exchange within five (5) trading days after such changes occur.

The specific contents and submission methods for co-location service report will be announced by the Exchange separately.

Article 24 An FB Member shall establish a co-location resource management system, reasonably use the Exchange’s co-location resources, ensure fair trading practices, and report to the Exchange on the use of the Exchange’s co-location resources by program trading clients.

Article 25 An FB Member shall not provide the Exchange’s co-location service to a program trading client that frequently engages in abnormal trading, experiences significant faults in the client’s technical system, or violates the Rules of the Exchange. The specific requirements will be announced by the Exchange separately.

Article 26 An FB Member shall establish a trading seat management system, allocate trading seats fairly, and report to the Exchange on the use of trading seats by program trading clients.

Chapter 5 Trading Monitoring and Risk Management

Article 27 A program trader shall enhance compliance awareness and strengthen risk prevention and control.

A legal entity or an unincorporated organization engaging in program trading shall establish and effectively implement internal control, risk management, and compliance management systems for program trading.

Article 28 An FB Member or overseas broker shall establish and effectively implement internal control, risk management, and compliance management systems for program trading.

The FB Member or overseas broker shall strengthen the monitoring of clients’ program trading activities, review program trading orders, promptly identify and manage abnormal trading behaviors, and cooperate with the Exchange in taking relevant measures.

Article 29 The Exchange shall monitor program trading on a real-time basis, with a focus on the following abnormal program trading behaviors that may undermine the security of the Exchange’s system or disrupt the normal course of trading:

(1) the number or frequency of order placement and cancellation within a short period of time, or the number of order placement and cancellation within a trading day, reaches a certain threshold;

(2) the number of order placement and cancellation and the ratio of order placement and cancellation to executed trades within a short period of time or within a trading day reaches a certain threshold;

(3) large, continuous, or intensive order placement within a short period of time, resulting in executed trades meeting certain thresholds and causing significant abnormalities in futures trading price or trading volume; and

(4) other situation as the Exchange deems necessary to conduct special monitoring.

The identification and handling of abnormal program trading behaviors is governed by the Rules of Zhengzhou Commodity Exchange on Abnormal Trading Behaviors.

Article 30 The Exchange conducts special oversight over high-frequency trading.

The Exchange implements such systems as order placement and cancellation fees and trading limits, and may adjust the applicable standards as appropriate. Specific standards will be announced by the Exchange separately.

The Exchange may apply differentiated fee criteria for high-frequency trading.

Article 31 Where an emergency such as a force majeure event, an unexpected event, a major technical failure, or a significant human-initiated error occurs in a trader’s program trading practice and may cause significant abnormal price movement or market disruption, the trader shall promptly take such measures as suspending trading, cancel orders, etc.

In such cases, a client shall timely report to its carrying FB Member or overseas broker, and a Non-FB Member shall timely report to the Exchange.

Article 32 Where an FB Member or overseas broker discovers that a client is involved in a situation as described in the first paragraph of Article 31, the FB Member or overseas broker shall, in accordance with the Entrustment Agreement, promptly take such measures as suspending order acceptance, cancelling relevant orders, etc., and timely report to the Exchange. The overseas broker may report to the Exchange either through its carrying FB Member or directly.

Where the client of an FB Member falls under the above circumstance, such FB Member shall also report to the local office of the CSRC where it is domiciled.

Article 33 Where a situation as described in the first paragraph of Article 31 occurs and undermines the security of the Exchange’s system or disrupts the normal course of trading, the Exchange may take such measures as suspending trading, adjusting opening and closing time, cancelling trades, etc. and shall promptly report to the CSRC.

Chapter 5 Supervision

Article 34 The Exchange may conduct on-site or off-site inspection of an FB Member, an overseas broker, and a program trader as needed for self-regulatory purpose to assess their compliance with these Rules. Relevant organizations and individuals shall cooperate and provide relevant materials truthfully, accurately, completely, and timely.

Article 35 Any program trader that falls under any of the following circumstances may be ordered to make corrections and be subject to such measures taken by the Exchange as an alert, requiring a written explanation, arranging for a regulatory meeting, and restricting the opening of new positions:

(1) failing to fulfill the obligation of reporting and updating reported information as required, or frequently engaging in trading activities inconsistent with reported information;

(2) a Non-FB Member’s engaging in high-frequency trading in violation of regulations;

(3) using the technical system that fails to meet regulatory requirements for program trading;

(4) using the system interface to illegally operate futures business, solicit traders, or process third-party trading orders, transferring or lending its own technical system, or providing external access to the system for a third party; 

(5) failing to use co-location resources or trading seats as required;

(6) failing to establish or effectively implement internal control, risk management, and compliance management systems for program trading as required;

(7) failing to take appropriate measures or report timely in response to emergencies as required when engaging in program trading;

(8) failing to cooperate with the Exchange in conducting on-site or off-site inspection;

(9) engaging in program trading that undermines the security of the Exchange’s system or disrupts the normal course of trading; or

(10) other situations specified by the Exchange.

Article 36 Any FB Member or overseas broker that falls under any of the following circumstances may be ordered to make corrections and be subject to such measures taken by the Exchange as an alert, arranging for a regulatory meeting, issuing a written warning, and issuing a supervisory opinion letter:

(1) failing to verify a client’s reported information on program trading, urge a client to make corrections, or suspend opening orders from a client that refuse to make corrections after being urged;

(2) using non-compliant trading system or technical system for program trading, or failing to test the systems as required;

(3) an FB Member’s deploying its trading system on the same physical equipment as the technical system of a client or an overseas broker, granting trading system management access to a client, an overseas broker, or an IT service provider, or allowing direct connection of a client’s or an overseas broker’s technical system to the Exchange’s trading system;

(4) failing to establish a co-location resource management system or a trading seat management system as required or use co-location service or trading seats as required; 

(5) failing to establish or effectively implement internal control, risk management, and compliance management systems for program trading as required;

(6) failing to manage a client’s program trading behaviors or cooperate with the Exchange in taking relevant measures;

(7) failing to take appropriate measures or report timely as required upon discovering that a client is involved in an emergency;

(8) failing to preserve a client’s reported information on program trading, verification records, or technical system testing records as required;

(9) failing to cooperate with the Exchange in conducting on-site or off-site inspection;

(10) engaging in program trading that undermines the security of the Exchange’s system or disrupts the normal course of trading; or

(11) other situations specified by the Exchange.

Chapter 6 Ancillary Provisions

Article 37 Any serious violation of these Rules will be handled in accordance with the Rules of Zhengzhou Commodity Exchange on Violations.

Article 38 The provisions governing high-frequency trading in these Rules do not apply to a market-maker engaging in market-making activities via program trading.

Article 39 The Exchange reserves the right to interpret these Rules.

Article 40 These Rules take effect on October 9, 2025.

(This English version is for reference ONLY. In case of any inconsistency between the different language versions, the Chinese version prevails.)