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Title: Taipei Exchange Rules Governing the Review of Emerging Stocks for Trading on the TPEx
Date: 2003.10.17 ( Announced )
Date: 2016.02.19 ( Amended )

Article Content

 
Chapter I General Provisions
Article 1     These Rules are promulgated pursuant to Article 8 of the Regulations Governing Securities Trading on the Taipei Exchange.
Article 2     The competent authority referred to in these Rules is the Financial Supervisory Commission.
Article 3     When applying to register its issued common stock as a stock traded at the business places of securities firms (hereinafter, "Emerging Stock"), an issuer shall file an application with the Taipei Exchange (TPEx) in accordance with these Rules.
Article 4     The following terms used in these Rules are defined as follows:
  1. "Advisory contract" means a contract signed between the issuer and securities firms authorizing the securities firms to plan matters related to the issuer's application for TPEx listing (or TWSE listing).
  2. "Advisory recommending securities firm" means a recommending securities firm that has signed an advisory contract with the issuer.
  3. "Investment holding company" means an issuer that is a professional investment company the purpose of which is to control the operations of a holding company subsidiary or subsidiaries either directly, or indirectly through a subsidiary.
  4. "Holding company subsidiary" means any of the following invested companies:
    1. Any invested company in which an investment holding company directly holds more than 50 percent of the issued voting shares or more than 50 percent of the contributed capital;
    2. Any invested company in which an investment holding company indirectly through its subsidiary(ies) holds more than 50 percent of the issued voting shares or more than 50 percent of the contributed capital;
    3. Any invested company in which an investment holding company directly, and indirectly through its subsidiary(ies), holds more than 50 percent of the issued voting shares or more than 50 percent of the contributed capital.
  5. "Financial reports" means consolidated financial reports, or if the issuer does not have a subsidiary, means individual financial reports.
Article 5     Application (or filing) for the trading of Emerging Stocks on the TPEx, suspension and termination of TPEx trading of Emerging Stocks, and the obligations the issuer shall abide by during the period its Emerging Stock is traded on the TPEx shall uniformly be governed by these Rules, unless otherwise provided in relevant laws and regulations of the competent authority, or unless otherwise subject to restriction under the laws and regulations of the country where the foreign issuer is registered (including, in the case of an investment holding company, the country where its holding company subsidiary is registered).
Chapter II Application Requirements for Issuers
Article 6     A domestic issuer meeting the following requirements may apply to register its stock for TPEx trading:
  1. It is a public company, or it simultaneously files for retroactive conducting of public issuance procedures pursuant to the Regulations Governing the Offering and Issuance of Securities by Securities Issuers.
  2. It has signed an advisory contracts with securities firms.
  3. It has received written recommendations by two or more advisory recommending securities firms, and one of them has been designated as the lead advisory recommending securities firm, and the other(s) as co-advisory recommending securities firm(s), and the lead advisory recommending securities firm has submitted the Financial or Operational Material Event Checklist for the company for the most recent 1 month (hereinbelow, the "Checklist" (Table 1).
  4. It shall engage a professional shareholder services agent to handle shareholder services.
  5. All stocks and bonds that it offers and issues or privately places shall without exception be issued in scripless form.
  6. It has established a remuneration committee under Article 14-6 of the Securities and Exchange Act and related provisions.
    The professional shareholder services agent referred to in subparagraph 4 of the preceding paragraph shall obtain supporting documents from the Taiwan Depository & Clearing Corporation (TDCC) in evidence of the following:
  1. Its personnel and equipment for handling shareholder services all are in compliance with the Regulations Governing the Administration of Shareholder Services of Public Companies.
  2. There has been no instance in the preceding 3 years in which, after a TDCC audit, the TDCC has made written suggestions for improvement, and it has failed to make improvements by the deadline.
    Securities, futures, financial, or insurance enterprises applying for the trading of their stock as an Emerging Stock shall first obtain an approval letter from the competent authority of the target industry before the TPEx accepts their applications.
    Each month the lead advisory recommending securities firms shall obtain materials related to the items listed on the Checklist referred to in subparagraph 3 of paragraph 1 and carry out the monthly audit procedures, truthfully and completely fill in the results of the audit, and compile them into bound volumes together with the relevant working papers.
Article 7     A foreign issuer meeting the following conditions may apply for registration of its common stock for TPEx trading:
  1. It is a company limited by shares organized and registered under foreign law, and does and has not violated any applicable provision of the Act Governing Relations Between the Peoples of the Taiwan Area and the Mainland Area, and has filed for retroactive public issuance of the stock pursuant to the provisions of the Regulations Governing the Offering and Issuance of Securities by Foreign Issuers. However, if individuals, juristic persons, groups, or other institutions from the Mainland Area have direct or indirect shareholding or capital contribution exceeding 30 percent in, or effective control over, the foreign issuer, special-case permission shall be obtained from the competent authority.
  2. Its issued registered stock is not listed for trading on any overseas securities market, and it has not applied with the TPEx or the TWSE for a TPEx primary listing or TWSE primary listing of its stock.
  3. It has signed an advisory contract with securities firms.
  4. It has received written recommendations by two or more advisory recommending securities firms, and one of them has been designated as the lead advisory recommending securities firm, and the other(s) as co-advisory recommending securities firm(s), and the lead advisory recommending securities firm has submitted the checklist for the company for the most recent 1 month (Table 1).
  5. It shall engage a professional shareholder services agent to handle shareholder services.
  6. It has appointed at least one litigious and non-litigious agent who has a domicile or residence within Taiwan.
  7. It shall undertake that it will comply in the following matters:
    1. Comply with the ROC Securities and Exchange Act and related laws, regulations, and policies. If the foreign issuer is an investment holding company, its holding company subsidiary also must undertake that it will comply therewith.
    2. To cooperate with on-site audits by the TPEx when necessary, or upon request by the TPEx, appoint a designated CPA or professional institution to conduct a targeted examination within the audit scope designated by the TPEx, and to submit the examination results to the TPEx, and agrees to bear any related expenses.
    3. Shares registered for TPEx trading shall be delivered by book-entry transfer.
    4. If any important matters in connection with protection of shareholder equity conflict with mandatory provisions of laws or regulations of the issuer's country of registration, the issuer shall enhance the disclosure of the material discrepancies in its prospectus. If such matters are not in conflict with any mandatory provisions of laws or regulations of the issuer's country of registration, they shall be specified in the company's articles of incorporation or organizational documents. If specified in the organizational documents, the articles of incorporation shall state that such matters will be handled in accordance with the organizational documents, and the procedures for adoption and amendment of the organizational documents shall be the same as for the articles of incorporation.
    5. If with respect to important matters connected with the protection of shareholder equity, the laws or regulations of the issuer's country of registration contain provisions regarding exclusive jurisdiction of courts that exclude the jurisdiction of ROC courts, and further, if the jurisdiction of ROC courts is not specified within the issuer's articles of incorporation, the issuer shall take out directors liability insurance and maintain it throughout the period of registration on the emerging stock market.
  8. Any stocks and bonds offered and issued or privately placed shall be issued in scripless form; provided, this restriction shall not apply if the laws or regulations of the country of its registration provide otherwise.
  9. The laws of the Republic of China (ROC) shall be the applicable law for the Contract for TPEx Trading of Emerging Stock entered into by the foreign issuer. The Taiwan Taipei District Court shall be the competent court for litigation in the event of any dispute arising in connection with the Contract.
  10. It has established a remuneration committee under the mutatis mutandis application of Article 14-6 of the Securities and Exchange Act and related provisions.
  11. If provisions of the ROC Securities and Exchange Act that are applicable mutatis mutandis are in conflict with mandatory provisions of laws or regulations of the issuer's country of registration, the mutatis mutandis application of those provisions may be excluded only if they fall within the scope of specific provisions of the Securities and Exchange Act for which the competent authority has publicly announced an exemption from application.
  12. If with respect to important matters connected with the protection of shareholder equity, the laws or regulations of the issuer's country of registration contain provisions regarding exclusive jurisdiction of courts that exclude the jurisdiction of ROC courts, and further, if the jurisdiction of ROC courts is not specified within the issuer's articles of incorporation, the issuer must have at least two directors domiciled in Taiwan.
    The professional shareholder services institution referred to in subparagraph 5 of the preceding paragraph shall obtain supporting documents from the TDCC in evidence of the following:
  1. Its personnel and equipment for handling shareholder services all are in compliance with the Regulations Governing the Administration of Shareholder Services of Public Companies.
  2. There has been no instance in the preceding 3 years in which, after a TDCC audit, the TDCC has made written suggestions for improvement, and it has failed to make improvements by the deadline.
    Each month the lead advisory recommending securities firms shall obtain materials related to the items listed on the Checklist referred to in subparagraph 4 of paragraph 1 and carry out the monthly audit procedures, truthfully and completely fill in the results of the audit, and compile them into bound volumes together with the relevant working papers.
Article 8     An issuer applying to register its stock for TPEx trading shall allocate shares for subscription by its advisory recommending securities firms, and shall additionally set aside 1,000 shares for subscription by the Securities and Futures Investors Protection Center, and the subscription conditions shall be identical to those given to the lead advisory recommending securities firm.
    The shares to be allocated under the preceding paragraph, except in cases as required for the transfer of government-owned shares and for which the TPEx has granted special-case approval, shall be not less than 3 percent of the total number of shares such company intends for TPEx trading and shall not be less than 500,000 shares; provided that if 3 percent of the total number of shares intended for TPEx trading exceed 1.5 million shares, not less than 1.5 million shares shall be allocated for subscription by the advisory recommending securities firms.
    Each of the advisory recommending securities firms under paragraph 1 shall severally underwrite not less than 100,000 shares.
    If the issuer referred to in paragraph 1 is also a securities firm, the number of shares that the advisory recommending securities firms shall severally underwrite shall not exceed 1 percent of the total number of shares such public company intends for TPEx trading or 500,000 shares (whichever is lower).
    With respect to shares subscribed by an advisory recommending securities firm under paragraph 1 (including any shares it subsequently obtains due to any capital increase out of earnings, reserves, capital surplus, or cash), the advisory recommending securities firm may not have any of the following circumstances:
  1. The advisory recommending securities firm is a party, with the issuer of paragraph 1, with any related party or insider thereof, or with any specified person arranged by any such related party or insider, to any repurchase of the shares or stipulates the non-transferability of the shares within a specified time period.
  2. Within a short time after the issuer is registered for Emerging Stock trading, the advisory recommending securities firm, without a legitimate reason, sells in a large volume the shares that it has subscribed, causing a significant decrease in its inventory position.
Chapter III Recommending Securities Firms
Article 9     A recommending securities firms referred to in Article 6, paragraph 1, subparagraph 3, and Article 7, paragraph 1, subparagraph 4 of these Rules shall be a qualified securities underwriter, securities broker, or securities dealer and shall meet the following requirements:
  1. Be a registered member of the Taiwan Securities Association.
  2. Meet the requirements set forth in Article 23 of the Regulations Governing Securities Firms;
  3. Have had a regulatory capital adequacy ratio under Article 59 of the Regulations Governing Securities Firms of not less than 150 percent in each of the past 6 months; and
  4. Currently be a securities firm that has signed an advisory contract with the issuer; furthermore, the lead recommending securities firm shall be the lead advising securities firm.
    The lead advisory recommending securities firm referred to in the preceding paragraph shall meet the following requirements:
  1. Have served within the past 3 years as the lead securities firm in a total of at least three cases of applications for initial listing or TPEx listing of stock, or new share issue for cash capital increase, or issue of convertible corporate bonds, where the applications were approved by the competent authority and the shares are already listed and traded; or its underwriting department head and at least three members of its underwriting personnel possess the aforementioned case-handling experience.
  2. Have 10 or more persons who are qualified registered underwriting personnel.
Article 10     If any of the following circumstances apply to the recommending securities firm and the issuer, the TPEx may reject the recommendation for trading of the Emerging Stocks on the TPEx:
  1. Where the recommending securities firm and the issuer have mutually prepared assessment reports on public listing or TPEx listing of securities for each other;
  2. Where there exists any condition enumerated in Article 26 of the Regulations Governing Securities Firms; or
  3. Where the recommending securities firm and the issuer belong to the same business group.
Article 11     An advisory recommending securities firm shall not resign within 1 year from the date on which its recommended stock begins to be traded on the TPEx, provided that this restriction shall not apply where after the resignation there would still remain two or more advisory recommending securities firms (which shall include the lead advisory recommending securities firm).
    To resign from serving as an advisory recommending securities firm, a firm shall submit an application to the TPEx through the TPEx-designated Internet-based information reporting system; the advisory recommending securities firm will lose its status as an advisory recommending securities firm from the date of the TPEx's approval of its resignation.
Article 12     After an issuer's stock has been traded on the TPEx for one full month, a securities firm may apply to the TPEx through the TPEx-designated Internet-based information reporting system to become a recommending securities firm for such stock without being subject to the qualifying conditions set forth in Article 9, paragraph 1, subparagraph 4, and paragraph 2, of these Rules, provided that such securities firm shall hold not less than 30,000 shares of the issuer.
    A securities firm applying to join as a recommending securities firm after the Emerging Stock has begun to be traded on the TPEx pursuant to the preceding paragraph may not resign within 6 months from the date of approval by the TPEx.
    To resign from serving as a recommending securities firm, a firm shall submit an application to the TPEx through the TPEx-designated Internet-based information reporting system; the recommending securities firm will lose its status as a recommending securities firm from the date of approval of its resignation specified in the response letter from the TPEx.
Article 13     The TPEx may disqualify a recommending securities firm in the event that any of the following circumstances occur:
  1. It loses any qualification as a securities underwriter, a securities broker, or a securities dealer.
  2. For reasons relating to underwriting business, it is subject to a disposition or sanction of business suspension or of greater severity by the competent authority under the Securities and Exchange Act or related rules, or by the Taiwan Stock Exchange Corporation under its Operating Rules or related rules, or by the TPEx under its Trading Rules or related rules.
  3. Its regulatory capital adequacy ratio has failed to reach 150 percent for 3 consecutive months.
  4. Any of the circumstances enumerated in Article 10 of these Rules.
Article 14     During the period of TPEx trading of Emerging Stock recommended by it, the lead advisory recommending securities firm shall prepare Checklists (see short form Checklist in Table 1 and long form Checklist in Table 1-1) each month in accordance with paragraph 4 of Article 6 or paragraph 3 of Article 7 of these Rules and safekeep them. The TPEx may conduct sampling inspections of the Checklists from time to time.
    The lead advisory recommending securities firm shall, by the end of each month file the issuer's short form Checklist through the Internet information reporting system designated by the TPEx. However, beginning from the 3 months before the issuer's TPEx listing application, it shall each month file the issuer's long form Checklist through the Internet information reporting system designated by the TPEx, and submit the relevant materials to the TPEx by letter in writing.
    The lead advisory recommending securities firm shall immediately file with the TPEx through the Internet information reporting system designated by the TPEx upon the occurrence of any material event listed in the Checklist, and furthermore within 5 days from the filing date shall complete its audit and report its audit findings to the TPEx through the Internet information reporting system designated by the TPEx and by formal letter with the relevant materials attached.
Article 15     Any securities firm that has signed an advisory contract with the issuer during the period that the issuer is registered for TPEx trading of Emerging Stock trading is also required to serve as a recommending securities firm of the issuer.
    In the event of any change in the advisory status of an issuer's advisory recommending securities firm, the advisory recommending securities firm in which the change occurs shall report the matter to the TPEx through the TPEx-designated Internet-based information reporting system.
    In the event of any change to the lead advisory recommending securities firm, the newly appointed lead advisory recommending securities firm shall hold at least 1 percent of the issuer's total TPEx traded shares as of the time of the change; provided that if 1 percent of the total TPEx traded shares as of the time of the change exceed 500,000 shares, it shall hold at least 500,000 shares.
     In the event of any change to the lead advisory recommending securities firm, the former lead advisory recommending securities firm shall report to the TPEx by letter, explaining the reason for terminating its capacity as lead advisory recommending securities firm and its material findings during the advisement period.
    In the event of any change to the lead advisory recommending securities firm, the issuer shall undergo advisement from the newly appointed lead advisory recommending securities firm, and may not submit its application for TPEx listing (or TWSE listing) until a further 6 months or more of TPEx trading as an Emerging Stock has elapsed.
Chapter IV Registration Procedures
Article 16     An issuer filing a first-time application to register its stock for TPEx trading shall complete an Application for TPEx Trading of Emerging Stock (Attachment 1 or Attachment 1-1) and submit the same, together with all specified attachments, to the TPEx.
Article 16-1     Before a foreign issuer applies to the TPEx to register its common stock for TPEx trading, if individuals, juristic persons, groups, or other institutions from the Mainland Area have direct or indirect shareholding or capital contribution exceeding 30 percent in, or effective control over, the foreign issuer, the foreign issuer shall first complete an Application for Special-Case Permission (Attachment 1-2), and deliver it to the TPEx with the documents required to be annexed. The TPEx will issue a specific review opinion and submit it in a report to the Competent Authority. Only after the Competent Authority has approved its special-case application case may the foreign issuer apply to the TPEx to register its common stock for TPEx trading.
    Within 3 months from the date of issuance of the response letter from the Competent Authority, the foreign issuer shall apply to the TPEx for registration of its common stock for TPEx trading. If it exceeds the deadline, it must reapply to the TPEx.
     Before a foreign issuer applies to the TPEx to register its common stock for TPEx trading, if provisions of the ROC Securities and Exchange Act that are applicable mutatis mutandis are in conflict with mandatory provisions of laws or regulations of the issuer's country of registration, the foreign issuer shall first complete an Application for Special-Case Permission (Attachment 1-3), and deliver it to the TPEx with the documents required to be annexed. The TPEx will issue a specific review opinion and submit it in a report to the competent authority. After the competent authority has publicly announced that foreign issuers of that country of registration may be exempted from the application of specific provisions of the Securities and Exchange Act, the TPEx will reply by letter to the foreign issuer on the basis of that announcement.
    If a matter addressed in a foreign issuer's Application for Special-Case Permission under the preceding paragraph falls in the category of a matter that the competent authority has already publicly announced to be entitled to exemption from the application of specific provisions of the Securities and Exchange Act, then the TPEx, after reviewing and confirming the accuracy of the information, will accordingly reply by letter to the foreign issuer.
Article 17     After accepting the application for TPEx trading of Emerging Stock for processing, the TPEx personnel in charge shall prepare a Record Form of Application Documents of Emerging Stock Application by Issuer (Attachment 2 or Attachment 2-1) and, after checking that the delivered documents meet the requirements for registration for TPEx trading, shall within 3 business days from the date of receipt of the documents issue a letter of approval and publicly announce to the market the date on which the Emerging Stock begins TPEx trading, and disclose the issuer's company profile on the TPEx website for at least 5 business days; provided that if the company at the same time files for retroactive conducting of public issuance procedures pursuant to the Regulations Governing the Offering and Issuance of Securities by Securities Issuers or the Regulations Governing the Offering and Issuance of Securities by Foreign Securities Issuers, the TPEx may issue a letter of approval on the date of effective registration for the retroactive public issuance.
    The company profile referred to in the preceding paragraph shall include the company's stock symbol, company name, board chairperson, president, authorized capital, total equity, main business item(s), main product(s), statements of comprehensive income for the past 5 years, and condensed balance sheet for the past 5 years.
    An issuer whose stock has been approved by the TPEx for registration for TPEx trading shall enter a Contract for TPEx Trading of Emerging Stock with the TPEx (Attachment 3 or Attachment 3-1). The TPEx will compile Contracts for TPEx Trading of Emerging Stocks on a monthly basis and submit them to the competent authority for recordation.
Article 18     Where the documents submitted by an issuer are found incomplete, the TPEx personnel in charge shall specify the omissions and request the applicant company to furnish the relevant documents within a specified time limit.
    Where the issuer furnishes the documents within the time limit specified by the TPEx, the personnel in charge shall reprocess the application following the procedure in Article 17 of these Rules. Where the issuer fails to furnish the documents within the time limit, the personnel in charge shall prepare a clearly expressed statement disapproving the registration for TPEx trading of its stock and reject the application after receiving ratification from the authorized personnel within the TPEx.
Article 19     Upon examining application documents submitted by an issuer and finding that they do not meet the requirements for registration for TPEx trading, or if any material irregularity is present in the audit conclusions of the Checklist submitted by the lead advisory recommending securities firm, the TPEx shall prepare a clearly expressed statement disapproving the registration of its stock for TPEx trading, and reject the application after receiving signed ratification internally.
Article 20     The personnel in charge shall compile the examination information and relevant documents for applications for TPEx trading of Emerging Stocks into volumes, archive them in files, and safekeep them for reference.
Article 21     After receiving a notice issued by the TPEx pursuant to Article 17, paragraph 1, of these Rules, an issuer shall process the following matters with the TPEx within 2 business days:
  1. Pay the TPEx trading fees; and
  2. Submit other necessary documents specified by the TPEx.
Article 22     When a domestic issuer issues additional new shares of common stock and allocates a certain ratio of the shares for public sale to outside parties, with the exception of the public sale conducted for an initial TPEx (or TWSE) listing, the domestic issuer shall apply to the TPEx for issuance of an opinion letter by submitting an Application for Opinion on TPEx Trading of New Shares of Emerging Stock Issued for Capital Increase (Attachment 4-5) and relevant documents to the TPEx, and, after effective registration with the competent authority, the new shares shall be traded on the TPEx from the date on which they are delivered to the shareholders. If there is no allocation of a certain ratio of the new shares for public sale to outside parties, after effective registration with the competent authority, the new shares shall be traded on the TPEx from the date on which they are delivered to the shareholders. The domestic issuer shall, 2 business days before the new shares are traded on the TPEx, file and upload relevant documents on the TPEx-designated Internet information reporting system and pay the fees for trading on the TPEx.
    A domestic issuer shall file and upload relevant documents on the TPEx-designated Internet information reporting system for any subscription of or conversion into shares of common stock of a type already traded on the TPEx through the exercise of any preferred shares with warrants, convertible preferred shares, corporate bonds with warrants, or convertible corporate bonds offered and issued by it.
    The filed documents in the preceding two paragraphs, after confirmed by the TPEx, shall become a part of the original Contract for TPEx Trading of Emerging Stock.
Article 23     If a foreign issuer makes an issue of new shares within the ROC for purposes of cash capital increase and allocates a certain ratio of the shares for public sale to outside parties, with the exception of the public sale conducted for an initial TPEx (or TWSE) listing, the foreign issuer shall apply to the TPEx for issuance of an opinion letter by submitting an Application for Opinion on TPEx Trading of New Shares of Emerging Stock Issued for Capital Increase (Attachment 4-2) and relevant documents to the TPEx, and, after effective registration with the competent authority, the new shares shall be traded on the TPEx from the date on which they are delivered to the shareholders. If there is no allocation of a certain ratio of the new shares for public sale to outside parties, after effective registration with the competent authority, the new shares will be traded on the TPEx from the date they are delivered to shareholders. The foreign issuer, 10 business days before the new shares begin to be traded on the TPEx, shall file and upload relevant documents on the TPEx-designated Internet information reporting system, and pay the TPEx trading fees.
    The filed documents in the preceding paragraph, after confirmed by the TPEx, shall become a part of the original Contract for TPEx Trading of Emerging Stock.
Article 24     If a foreign issuer subsequently makes a further issue of new shares of common stock for purposes of distribution of bonus shares, the foreign issuer, 10 business days before the commencement of TPEx trading of the new shares, shall file and upload relevant documents on the TPEx-designated Internet information reporting system, and pay the TPEx trading fees. The new shares will be traded on the TPEx from the date they are delivered to shareholders.
    The filed documents, after confirmed by the TPEx, shall become a part of the original Contract for TPEx Trading of Emerging Stock.
Article 25     When an issuer submits a filing for TPEx trading of new shares, the TPEx will make a market announcement after confirming the relevant documents filed and uploaded by the domestic issuer.
Chapter V Commencement of TPEx Trading and Disclosure of Information
Article 26     The professional shareholder services agent engaged by an issuer of Emerging Stock, or its shareholder services unit by which it handles its own shareholder services, shall have personnel and equipment for handling shareholder services that all are in compliance with the Regulations Governing the Administration of Shareholder Services by Public Companies, and there shall have been no instance in the preceding 3 years in which, after a TDCC audit, the TDCC has made written suggestions for improvement, and it has failed to make improvements by the deadline. The issuer furthermore shall file a report with the TPEx and publicly announce the place of business and name of the responsible person thereof, and shall do the same in the event of any change thereto. If an issuer of Emerging Stock changes its shareholder services agent, it shall file a report with the TPEx and make a public announcement within 3 days from the day it obtains the letter of recordation from the Taiwan Depository and Clearing Corporation. However, an issuer that has already engaged a professional shareholder services agent to process shareholder services may not take the handling of those services back into its own hands.
    An issuer shall handle its shareholders services in accordance with the Regulations Governing Handling of Shareholder Services by Public Companies promulgated by the competent authority However, this restriction shall not apply when the laws or regulations of the country in which a foreign issuer is registered provide otherwise. In the case of stock that has no par value or a par value per share other than NT$10, Article 14 of the above-cited Regulations need not be applied
    An applicant filing (or applying) for TPEx trading of shares issued for a capital increase or shares reissued after a capital reduction shall obtain documentation evidencing registration of scripless share issuance.
Article 27     In the event of a change in an issuer's corporate name, number of issued shares, or other matter that necessitates the exchange of share certificates, the issuer shall, after making such change in compliance with relevant laws and regulations, submit a filing to the TPEx concerning the share certificate exchange operations, submitting a Filing of Changes to the Content of Shares(Attachment 5 or Attachment 5-1) and related documentation..
    Among the related documentation referred to in the preceding paragraph, the Plan for Exchange of Share Certificates shall specify the following particulars:
  1. The book closure period of the old shares may not be longer than 10 days at the nor shorter than 5 days. However, these restrictions do not apply where an extension of the book closure period is necessary as a result of an action taken under Article 168-1 of the Company Act or otherwise is approved by the TPEx.
  2. The period for which the trading of the old shares on the market shall be suspended in the event that the rights and obligations of the new shares and old shares are different due to capital decrease or other reason; the commencement day of the period shall be the second business day before the book closure date of the old shares.
  3. The record date of issuance of the new shares; according to Article 165 of the Company Act, the date shall be the fifth day counting inclusively from the book closure date of the old shares.
  4. The initial day of TPEx trading of the new shares and the day of termination of TPEx trading of the old shares shall be set on the same day.
    After examining the documents submitted with the filing for exchange of share certificates and finding the content in compliance with relevant regulations, the TPEx shall issue a letter notifying the issuer to suspend any amendment to entries in the shareholders' register pursuant to Article 29 of these Rules.
    If the issuer's company name has changed, within 3 years from the date of approval of the name change, all information on any of its issued securities and any other information required by law or regulation to be publicly disclosed shall be disclosed with both the new and the old name printed side-by-side, and on each day for 3 consecutive months after the name change, the company shall enter the information regarding the change of company into the Internet information reporting system designated by the TPEx on a daily basis for public disclosure as material information.
Article 28     Where an issuer exchanges new shares for old ones as a result of a capital decrease, such issuer shall specify in its Plan for Exchange of Share Certificates that the new share exchange affairs shall be handled within 3 months from the date on which the TPEx approves the exchange plan, and subsequently shall faithfully implement the exchange of shares in accordance with the plan. If there is any likelihood of delay or any irregularity, the issuer shall notify the TPEx in writing before expiration of the time limit and copy its lead advisory recommending securities firms.
    A domestic issuer or a foreign issuer, shall 3 business days or 10 business days, respectively, before the commencement of TPEx trading of the new shares exchanged as a result of the capital decrease, file and upload relevant documents on the TPEx-designated Internet information reporting system, and commence TPEx trading of the shares from the date they are delivered to the shareholders.
    An issuer may propose a date for commencement of TPEx trading of the new shares and file an application with the TPEx only where the number of exchanged shares has reached 30 percent of the total volume of its shares traded on the TPEx, or where this requirement of 30 percent of the total volume of its shares traded on the TPEx is not met, but the issuer makes a written undertaking that starting from the day that TPEx trading of the new shares commences the exchange procedures will commence and the old shares will be exchanged with new shares for settlement on the same day they are received.
    Where the issuer does not make a written undertaking, the commencement date for trading new shares on the TPEx shall still be no later than the 30th day from the day on which the exchange of shares commenced. From the time of commencement of TPEx trading of the new shares, the issuer shall carry out exchange procedures whenever required and exchange the old shares with new shares for settlement on the same day they are received.
Article 29     Where an issuer suspends amendment of entries in the shareholders register in accordance with Article 165 of the Company Act or with the laws and regulations of the country of registration, it shall make a public disclosure on the internet information reporting system designated by the TPEx, 12 business days prior to the date for suspension of share transfer for the shareholders meeting.
     A foreign issuer shall call a regular shareholders meeting within 6 months after the end of the accounting year. All shareholders shall be notified by 30 days before the convening of a regular shareholders meeting. If a foreign issuer, however, under the laws and regulations of the country of its registration, is unable to deliver the notice of the convening of the shareholders meeting by 30 days before the meeting, it shall deliver the notice to shareholders, at the latest, by 21 days before the meeting.
    Where necessary in special circumstances, an issuer may, after publicly announcing the date and agenda for the shareholders meeting within the period provided in paragraph 1, then follow up, at least 40 days prior to the date of the shareholders meeting, with a supplementary public disclosure on the internet information reporting system designated by the TPEx of the amount of dividends and bonuses to be distributed or rights to be allocated. If a foreign issuer, however, under the laws and regulations of the country of its registration, is unable to deliver the notice of the convening of the shareholders meeting by 30 days before the meeting, it shall make the aforesaid supplementary public disclosure by 10 days before the latest date for delivery of the shareholders meeting notice under TPEx rules. When an issuer decides the record date for distributing dividends, bonus, or other rights, it shall make a public disclosure on the internet information reporting system designated by the TPEx at least 12 business days prior to the date for suspension of amendment of entries in the shareholders register.
    If there is subsequently any change in abovementioned publicly disclosed information of an Emerging Stock company, or the public disclosure is not made by the company within the time period specified by the TPEx, then the Emerging Stock company shall bear full liability for any resultant trade dispute or damage suffered by a party to a trade.
Article 29-1      A foreign issuer, before buying back its shares at the business place of a securities firm, shall carry out registration with the Taiwan Stock Exchange Corporation and obtain an identification number, and open an account for TPEx securities trading, pursuant to the Regulations Governing Investment in Securities by Overseas Chinese and Foreign Nationals and Article 46-5 of the Taipei Exchange Rules Governing Securities Trading on the TPEx.
     A foreign issuer buying back its shares and retiring the shares shall, within 10 days counting inclusively from the date the share retirement procedures are completed, file and upload on the TPEx-designated Internet information reporting system, the board of directors meeting minutes containing the resolution for retirement, and a document certifying the retirement of the shares, issued by the competent authority of the issuer's country of registration. However, if the share retirement does not require approval from the competent authority of the country of registration, a letter of opinion issued by a lawyer or certified public accountant, or other document adequate to prove that the total number of the shares to be retired has been bought back, may be furnished instead.
Article 30     Within 4 months after the close of each fiscal year, a domestic issuer shall submit to the TPEx two copies each of the annual parent company only financial report and consolidated financial report audited and attested by the CPA; within 45 days after the close of the second quarter of each fiscal year, it shall submit to the TPEx two copies of the second quarter financial report reviewed by the CPA; for the annual reports, two copies of the consolidated financial statements of affiliates shall additionally be submitted. However, if a domestic issuer is a securities enterprise, futures enterprise, financial enterprise, or insurance enterprise, it shall submit two copies of the financial reports audited and attested by the CPA.
    In the case of a domestic issuer applying for TPEx listing or TWSE listing of its stock, it shall, during the period after the submission of the application and before the listing date, in accordance with the requirement for TPEx listed (or TWSE listed) companies and within the periods prescribed by the competent authority, file with the TPEx two copies of the financial reports for the first and third quarters, reviewed by a CPA. However, it need not make such a filing if it has withdrawn the application or the application has otherwise been rejected.
Article 31      Within 4 months after the close of each fiscal year, a foreign issuer shall submit to the TPEx two copies of the annual financial report audited and attested by the CPA; within 45 days after the close of the second quarter of each fiscal year, it shall submit to the TPEx two copies of the second quarter financial report reviewed by the CPA. If it prepares its annual financial reports in accordance with Taiwan's Regulations Governing the Preparation of Financial Reports by Securities Issuers and the International Financial Reporting Standards endorsed by the competent authority, it need not apply the provisions of Article 7, paragraph 1 of those Regulations concerning the preparation of annual parent company only financial reports, unless it otherwise is required to prepare parent company only financial reports by law or regulation of its country of registration, or it uses the parent company only financial report as a basis for distributing dividends, in which cases it shall additionally publicly disclose and submit its parent company only financial reports.
    In the case of a foreign issuer applying for TPEx listing or TWSE listing of its stock, it shall, during the period after the submission of the application and before the listing date, in accordance with the requirement for TPEx listed (or TWSE listed) companies and within the periods prescribed by the competent authority, file with the TPEx two copies of the financial reports for the first and third quarters as reviewed by a CPA. However, it need not make such a filing if it has withdrawn the application or the application has otherwise been rejected.
    The financial report referred to in paragraphs 1 and 2 shall comply with the following requirements:
  1. Its content shall be stated in units of New Taiwan Dollars.
  2. The Chinese language version shall govern; an English version may also be submitted in addition thereto.
  3. It shall be prepared in accordance with the International Financial Reporting Standards endorsed by the competent authority, US GAAP, or the International Financial Reporting Standards.
  4. It shall be produced using period-on-period comparison, and shall include balance sheets, statements of comprehensive income, cash flow statements, statements of changes in equity, and the notes or attachments thereto. The notes to the financial report shall state which accounting principles are employed. If they are prepared according to the International Financial Reporting Standards endorsed by the competent authority, then Taiwan's Regulations Governing the Preparation of Financial Reports by Securities Issuers shall govern, provided that Article 24 thereof need not be applied. If they are not prepared according to the International Financial Reporting Standards endorsed by the competent authority, then the differences in those standards and the International Financial Reporting Standards endorsed by the competent authority as applied in the period-on-period balance sheet and statement of comprehensive income account titles shall be disclosed, including any material discrepancies and the dollar amounts affected.
  5. It shall have an audit (or review) report issued by two Taiwan CPAs approved by the Competent Authority to perform attestation of financial reports for public companies; or have been audited and attested (or reviewed) by an international accounting firm that has a cooperative relationship with the aforesaid CPAs, and have an audit (or review) report that is issued by the Taiwan CPAs and that does not make reference to audit (or review) work by any other accountant.
  6. It shall be signed or stamped with the seal of the chairperson, managerial officers, and principal accounting officers, who shall also produce a declaration that the report contains no misrepresentations or nondisclosures.
  7. In the audit (or review) report, the CPAs shall explain the accounting principles adopted by the foreign issuer and the differences between those principles and the International Financial Reporting Standards endorsed by the competent authority, and include an index to the notes, and shall expressly state that the report has been audited in accordance with Taiwan's Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and generally accepted auditing standards (or that the review work has been planned and executed in accordance with Statement of Auditing Standards No. 36: Engagements to Review Financial Statements).
Article 32     The TPEx may, in accordance with regulations or based on legitimate reasons, notify an issuer, its lead advisory recommending securities firm, or its attesting CPA to provide information in connection with the issuer or to explain the information or assessment opinion on the issuer by a certain deadline.
    The issuer, its lead advisory recommending securities firm, or its attesting CPA shall bear sole liability for any misrepresentation or falsehood contained in any information or assessment opinion that it provides or explains to the TPEx under the preceding paragraph.
Article 33     An issuer shall enter the following information into the Internet information reporting system designated by the TPEx following the prescribed time limit and format:
  1. Basic information of the company and its major subsidiaries: The information shall be entered before the commencement of TPEx trading and upon any change thereafter.
  2. The annual parent company only financial reports and consolidated financial reports, the balance sheet, statement of comprehensive income, cash flow statement, and statement of changes in equity of the second-quarter financial reports, the CPA audit (or review) reports, the names of the attesting CPAs, and relevant particulars disclosed in the notes to the financial report (related party transactions, loans of funds, and endorsements and guarantees). The filing deadlines shall be as set out in Article 30, paragraph 1, or Article 31, paragraph 1.
  3. In the case of an issuer applying for TPEx listing or TWSE listing of its stock, during the period after the submission of the application and before the listing date: The first-quarter and third-quarter balance sheets, statements of comprehensive income, cash flow statements, statements of changes in equity, CPA review report, and the names of the CPAs. However, public disclosure is not required if the issuer has withdrawn the application or the application has otherwise been rejected. The filing deadlines shall be as set out in Article 30, paragraph 2, or Article 31, paragraph 2.
  4. Business turnover, statements of the limit amounts and itemized details of loans of funds and endorsements and guarantees, and derivatives transactions:
    1. Business turnover: The information of the previous month shall be disclosed by the tenth day of each month. If the Emerging Stock company voluntarily discloses its self-assessed income information, the company shall report it by the end of the month following the close of the current month (or quarter), and the disclosure shall continue until the end of the current fiscal year. The self-assessed income information shall include the self-assessed three items of "operating income," and "net income before tax," and "comprehensive income" up to the current month (quarter). If the difference between the accumulated amount of the self-assessed comprehensive income in any quarter and the amount audited (reviewed) by the CPA is 20 percent or more, the reason for such difference shall be filed within 2 business days after the deadline for public disclosure of each quarterly financial report.
    2. Statements of the limit amounts and itemized details of loans of funds and endorsements and guarantees of the Emerging Stock company and its subsidiaries: The information of the previous month shall be filed by the tenth day of each month.
    3. Information on any derivatives transactions engaged in by the Emerging Company or any subsidiary thereof whose shares have not been publicly issued domestically: the information of the previous month shall be filed by the tenth day of each month.
  5. Information regarding appointment or dismissal, or changes in shareholding, or creation or extinguishment of pledges on shareholding, of directors, supervisors, managerial officers, and greater than 10 percent shareholders (hereinafter "insiders"), and related persons thereof: (1) Any new appointment or dismissal of persons under this subparagraph shall be filed by the company within 2 days after occurrence of the fact; (2) the information on any changes in shareholding in the previous month of persons under this subparagraph shall be filed by the 15th day of each month; (3) the information on any creation or extinguishment of pledge shall be filed by the company within 5 days from the creation or extinguishment of the pledge.
  6. "Related persons" in this subparagraph includes the spouses and minor children of insiders and any persons in whose name an insider holds stock.
  7. Voluntary disclosure of financial forecast information: A company disclosing financial forecast information voluntarily shall report and publicly disclose relevant matters in accordance with the provisions and deadlines set forth in the Regulations Governing the Publication of Financial Forecasts of Public Companies promulgated by the competent authority.
  8. Public disclosure and filing of the date of shareholders meetings: The date of the shareholders meeting shall be filed on the internet information reporting system designated by the TPEx at least 12 business days prior to the date for suspension of share transfer and entered within 2 days after the filing. In addition, a company whose fiscal year is the calendar year shall by 15 March each year, and a company whose fiscal year is not the calendar year shall within 75 days after the end of each fiscal year, preliminarily proceed to report the date for holding of the regular shareholders' meeting for the current year, and if after filing there is any change to the date on which the meeting is to be held, shall change the filed date before the public disclosure and filing of the regular shareholders meeting.
  9. Public disclosure and filing of the company's decision of the record date for distributing dividends, bonus, or other benefits and date for distributing cash dividends: Public disclosure shall be made on the internet information reporting system designated by the TPEx at least 12 business days prior to the date for suspension of amendment of entries in the shareholders register and entered within 2 days after the filing; provided that where there is an event under the provisions of Article 29, paragraph 2, the materials may be published in a supplementary public disclosure at least 40 days prior to the date of the shareholders meeting, and entered within 2 days after the filing.
  10. Reporting of information on investment in the Mainland Area: Shall be entered by the prescribed deadline for public announcement and filing of the annual and second quarter financial reports.
  11. Reporting of information on investment in overseas subsidiaries: Shall be entered by the prescribed deadline for public announcement and filing of the annual and second quarter financial reports.
  12. Dividend distributions for the current fiscal year: Input before the opening of trading hours on the business day next following, [respectively], the passage of the proposal by the board of directors and ratification by the shareholders' meeting.
  13. Table of investment and shareholding in the Emerging Stock Company by overseas Chinese and foreign persons: Input at the time of (1) distribution of shares for capital increase, (2) private placement or public issuance of overseas depositary receipts (including new and old shares), overseas convertible bonds, and securities with warrants or overseas stock, (3) capital reduction, (4) merger or consolidation, (5) public tender offer, ( 6) issuance of employee bonus shares, transfer of treasury stock, or issuance of subscription warrants to foreign employees, (7) initial registration as an Emerging Stock company or registration upon conversion into a newly incorporated company, (8) holding of a general shareholders meeting; the deadlines for filing of each item shall be as prescribed under the filing procedures for overseas Chinese and foreign investment and shareholdings.
  14. Reporting of information on corporate bonds:
    1. Within 1 day following effective registration with the competent authority, enter the basic information, the information on the plan for the raising and method for custody of the funds for repayment of the corporate bonds required by Article 248, paragraph 1, subparagraph 5 of the Company Act and any other relevant information. Any changes to the basic information during the preceding month shall be input within 10 days after the end of each month.
    2. During the duration of the corporate bonds from the issue date to the maturity date, the unaudited figures for the preceding quarter shall be input within 10 days from the end of each quarter, and the actual figures shall be input at the same time as the CPA-audited financial report is input; during the duration of the corporate bonds in the period of 1 year before the maturity date or the date that creditors may request redemption, the unaudited figures for the preceding month shall additionally be input by the tenth day of each month.
    3. During the duration of the corporate bonds in the period of 6 months before the maturity date or the date that creditors may request redemption, the issuer shall input by the tenth day of each month the source(s), and specific explanations thereof, of funds needed to repay the corporate bonds with respect to the plan for the raising and method for custody of the funds for the repayment as required to be filed under Article 248, paragraph 1, subparagraph 5 of the Company Act.
  15. Basic data on the industrial classification of the Emerging Stock company: Shall be entered by the prescribed deadline for public announcement and filing of the annual and second quarter financial reports.
  16. Reporting of relevant content of shareholders meeting agenda handbooks, shareholders meeting proposals, and electronic files of shareholders meeting minutes, information on convening a shareholders meeting to nominate candidates for director or supervisor positions (including independent directors), and information on relevant procedures for convening a regular shareholders meeting to handle shareholder proposals:
    1. 30 days before convening a regular shareholders' meeting or 15 days before a special shareholders' meeting, the company shall report the electronic files of the shareholders meeting announcement, proxy form, and background and explanatory materials relating to proposals for ratification, matters for deliberation, election or dismissal of directors or supervisors, and other matters on the shareholders' meeting agenda; 21 days before convening the regular shareholders' meeting, or 15 days before convening the special shareholders' meeting, it also shall report the electronic files of the shareholders' meeting agenda handbook and supplementary meeting materials; and 7 days before convening the shareholders' meeting it shall report the annual report prepared in accordance with the requirements prescribed by the competent authority. If a foreign issuer, however, under the laws and regulations of the country of its registration, is unable to deliver the notice of the convening of the shareholders meeting by 30 days before the meeting, it shall report the electronic files of the shareholders meeting announcement, proxy form, and background and explanatory materials relating to proposals for ratification, matters for deliberation, election or dismissal of directors or supervisors, and other matters on the shareholders' meeting agenda by the latest date for delivery of the shareholders meeting notice under TPEx rules, and on the date on which the shareholders meeting notice is issued, it also shall report the electronic files of the shareholders' meeting agenda handbook and supplementary meeting materials.
    2. Information on shareholders meeting proposals shall be reported within 2 days after the conclusion of the shareholders meeting.
    3. Information on shareholders meeting minutes shall be reported within 20 days after the conclusion of the shareholders meeting.
    4. Information on convening a shareholders meeting to nominate candidates for director or supervisor positions (including independent directors):
      1. Prior to the date of suspension of changes to the shareholders register, the acceptance of nominations, review standards, and working procedures shall be publicly announced.
      2. Within 2 days after the final day of the period for acceptance of nominations, a roster of candidates shall be publicly announced.
      3. Within 2 days after the resolution by the board of directors, 40 days prior to a regular shareholders meeting, or 25 days prior to a special shareholders meeting, whichever is earliest, the results of the board of directors' review, a roster of the candidates, and the reasons why any nominee has not been listed as a candidate shall be publicly announced.
      4. Election results shall be announced within 2 days following the election.
    5. Information on relevant procedures for convening a regular shareholders meeting to handle shareholder proposals:
      1. Prior to the date of suspension of changes to the shareholders register, the introduction of proposals, review standards, and working procedures shall be publicly announced.
      2. Within 2 days after the final day of the period for introduction of proposals, the content of any proposals shall be publicly announced.
      3. Within 2 days after the resolution by the board of directors or 30 days prior to a regular shareholders meeting, whichever is earliest, the results of the board of directors' review of proposals and the reasons why any proposal has not been listed in a motion for consideration shall be publicly announced.
      4. Within 2 days after the regular shareholders meeting, the status of resolutions shall be publicly announced.
  17. Explanations of material changes in financial ratios and financial analysis data: The information shall be entered within 4 months after the close of each fiscal year.
  18. Information on cash capital increase and issuance of domestic and overseas corporate bonds: Basic information on the capital utilization plan, items of the plan, and utilization benefits, for capital increase or corporate bond issuance shall be input within 1 day after effective registration of the filing with the competent authority, and shall be filed within 2 days after any change in the relevant information. Quarterly fund utilization statements shall be filed within 10 days following the end of each quarter.
  19. Declaration of Conversion of Domestic (Overseas) Securities: Enter the information for the preceding month by the fifth day of each month.
  20. Public disclosure and regulatory filing of information on private placement of securities within the following time limits in accordance with the Directions for Public Companies Conducting Private Placements of Securities:
    1. Within 2 days from the date on which the board of directors makes the resolution.
    2. Where the placees are determined after the shareholders' meeting notice is sent, within 2 days from the date the placees are determined.
    3. Within 2 days from the actual date of determination of the private placement price.
    4. Within 15 days from the date that payment of the share price or subscription price of the private placement has been completed.
    5. Within 10 days from the end of each quarter.
    6. If a placee is an insider or a related party of the company, if the placee has sold or sells shares of the company within 3 months before or after the date on which the placee's payment of the share price or subscription price of the private placement has been completed, the company shall, within 15 days from the completion date of the payment of the share price or subscription price, or within 2 days from the occurrence of the event, report the relevant information.
  21. Information on changes in convertible corporate bonds: Enter the information on the day of adjustment to the conversion price or of change of other terms and conditions of issuance.
  22. Information on employee stock option certificates: (1) Basic information on issuance, subscription method, and other matters shall be input on the day following the day of receipt of effective registration from with the competent authority; (2) information on actual status of issuance and other matters shall be input on the date of issuance and on the day following the time of expiration of the issuance period; (3) relevant information shall be input no later than the next day after any change to the issuance information; (4) within 2 days from the day on which the board of directors resolves to buy back shares for purposes of exercise of employee stock option certificates, the company shall input the anticipated cost of acquiring the shares, the difference between the price of employee subscription to the shares and the cost of the company's acquisition of the shares, and the impact on shareholders' equity.
  23. Issuance of new restricted shares for subscription by employees: (i) On the day following the day of receipt of effective registration from the competent authority, the company shall input the main content of the issuance rules and a description of the possible dilution of shareholders' equity; (ii) on the day following the day of issuance of the new shares, the company shall input the information on the issue; (iii) on the day following the time when employees meet the vesting conditions, the company shall input the information on the release of the restrictions on the new employee shares; (iv) on the day following any recall or repurchase of the shares, the company shall input the information on the recall or repurchase.
  24. Financial and business information of investor/press conferences convened or participated in: The information of an investor/press conference convened or participated in by an Emerging Stock company shall be disclosed on the Internet information reporting system designated by the TPEx, and the content of relevant financial and business information shall simultaneously be entered in Chinese and English. For an investor/press conference that is to be held on multiple days in multiple sessions, where the content is the same, the content shall be filed no later than after the conference on the same day that it is first convened or participated in, and need not be input again each day. When an Emerging Stock company convenes on its own initiative, or is invited to attend, an investor/press conference, it shall comply with the following particulars.
    1. It may not do so during the trading hours of the TPEx, except under the following circumstances:
      1. An overseas investor/press conference is convened during TPEx trading hours as a result of the time difference.
      2. It attends an investor/press conference by invitation.
      3. Other circumstances for which it has made an application and the TPEx considers to be necessary circumstances.
    2. The time and venue of the conference shall be disclosed, at the latest, 1 day prior to the date of convening or 1 day prior to the date of attending of the conference.
    3. The complete press releases and financial and business information shall be input on the Internet information reporting system designated by the TPEx, at the latest, on the day of conference. However, if the conference is convened or attended during trading hours, it shall be done during non-trading hours before the conference.
    4. The financial and business information disclosed in the conference may not go beyond the content of the information that has been filed.
  25. Any matter required to be publicly disclosed and filed pursuant to Articles 24, 30, and 31 of the Regulations Governing the Acquisition and Disposal of Assets by Public Companies and Articles 22 and 25 of the Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies promulgated by the competent authority: Information for matters falling under the requirements of Article 34 of these Regulations shall be entered within the deadline for reporting under that article; for those not falling under the requirements of Article 34, the information shall be reported according to the deadlines specified under the aforementioned Regulations.
  26. Information on acquisition or disposal of privately placed securities by an Emerging Stock company or subsidiary thereof: The information shall be entered within the deadline for reporting under Article 34.
  27. Correction or supplement of financial reports: Any matters that are required to be corrected or supplemented in the CPA audited or reviewed financial reports publicly disclosed by the Emerging Stock company shall be publicly disclosed to the investors; if the requirement for a restatement of the financial report under Article 6 of the Securities and Exchange Act Enforcement Rules is not yet met, input relevant information within 2 days from the occurrence of the fact.
  28. Information on the establishment of a functional committee under the Securities and Exchange Act: Enter the information within 2 days following the establishment or abolishment of the functional committee or the appointment (or election) of, or any change in, committee members.
  29. Information on the annual internal control system statement: The internal control system statement shall be filed within 4 months after the close of the fiscal year.
  30. Information on the internal control special audit report: The audit report for the special audit of internal controls conducted by the CPA shall be filed within 2 days after it is obtained.
  31. Any matter required to be publicly disclosed and filed pursuant to the Regulations Governing Public Tender Offers for Securities of Public Companies promulgated by the competent authority.
  32. Any accounting change required to be filed under Article 6 of the Regulations Governing the Preparation of Financial Reports by Securities Issuers issued by the Competent Authority:
    1. The information on any change relating to an accounting policy or accounting estimate shall be input within 2 days counting inclusively from the day the resolution is passed by the board of directors.
    2. In the retrospective application of an accounting change, if for the fiscal year preceding the year of the change, the difference between the actual effect of the change and the effect originally presented in public disclosure and filing is NT$10 million or more, and is also 1 percent or more of net operating revenues for the preceding fiscal year, or 5 percent or more of share capital, the cause of the difference and related information shall be filed by the end of February of the fiscal year in which the new accounting policy is adopted.
    3. If the stock of an issuer has no par value or a par value other than NT$10, the aforesaid calculation of 5 percent of share capital shall be replaced by 2.5 percent of the equity attributable to the owners of the parent company.
  33. Explanatory chart of changes in major subsidiaries: The reason for the change shall be input within 2 days after the actual date of the change; the chart and related evidentiary documents shall be submitted in a filing to the TPEx within 5 days.
  34. The matters required to be filed and publicly announced pursuant to Article 7, paragraph 1 of the Business Mergers and Acquisitions Act, and Article 7, paragraph 4 of the Regulations Governing the Establishment by Public Companies of Special Committees for Mergers and Acquisitions and Related Matters: Shall be filed within the deadlines set out in the aforesaid Act and Regulations.
  35. Information required to be additionally disclosed by a venture capital company:
    1. By the end of each month, file its net worth per share of the preceding month, and the information of the five invested companies in which it has the largest monetary amounts of investment.
    2. By the deadlines for public disclosure and filing of the second-quarter and annual financial reports, file the information of its invested companies.
  36. Any other information required on any matter as specified in a public announcement or notice by the TPEx shall be filed within the prescribed deadline.
    The deadlines for information filed under the preceding subparagraphs shall be based on Taiwan time, and the content of the primary version of the report shall be in Chinese, although an English version may also be attached. No misrepresentation, nondisclosure, or misleading presentation may be included in either the Chinese or English filed content referred to above. A foreign issuer may authorize its litigious and non-litigious agent to handle information filing.
    If the laws and regulations of the country where a foreign issuer is registered do not require its filing, or there is some other reasonable cause as approved by the TPEx, the issuer need not publicly disclose and file the business turnover portion of the information in paragraph 1, subparagraph 4.
Article 33-1      The TPEx may, as it deems necessary, set up a special area on its designated Internet information filing system, and publish thereon summarized financial information obtained from the information filed by issuers, to bring the information to the attention of investors; the items of financial information to be so published shall be determined by the TPEx.
Article 34     Upon occurrence of any of the following events, an issuer shall enter the information into the Internet information reporting system designated by the TPEx before the commencement of trading hours of the next business day following the occurrence of the event; provided that if any news release is published before that time, the information shall be entered simultaneously therewith.
  1. Dishonor of a negotiable instrument due to insufficient deposits, refusal by a financial institution to honor a transaction, or any other loss of credit of the company or a responsible person, parent company, or subsidiary thereof.
  2. Any material effect on company finances or business resulting from a litigious or non-litigious matter, administrative disposition, contentious administrative procedure, or motion for provisional attachment or provisional injunction, or compulsory execution thereof, with respect to the company or a responsible person thereof; or a chairperson or managerial officer of the company violates the Securities and Exchange Act, Futures Trading Act, Company Act, Banking Act, Insurance Act, Act Governing Bills Finance Business, Financial Holding Company Act, or Commercial Accounting Act, or is indicted for a crime of corruption, malfeasance in office, fraud, breach of trust, or misappropriation.
  3. Any effect on company operations resulting from any serious decrease in production, complete or partial stoppage of work, leasing out of a company plant or principal equipment, or pledge or mortgage of all or a principal portion of company assets.
  4. Any circumstance set forth in paragraph 1 of Article 185 of the Company Act.
  5. Reorganization or bankruptcy procedure of the company or parent or subsidiary thereof, and any and all events occurring in the course of such procedure, including any petition made to a court or any notice given or ruling handed down by a court, or any ruling prohibiting transfer of shares or any precautionary measure ordered by a court under relevant laws such as the Company Act or the Bankruptcy Act, or any material change in any of the above matters.
  6. Appointment (or election) of, or change in, the chairman, a general manager, a juristic-person director, supervisor, or representative thereof, an independent director, a natural person director or supervisor, or a member of a functional committee established under the Securities and Exchange Act, a change in one-third or more of directors, or departure of all independent directors from office, or where in the case of a foreign issuer there is no independent director with a registered household address in the Republic of China (ROC).
  7. Change of attesting CPA for any reason other than internal adjustments within the attesting accounting firm.
  8. Any material effect on company finances or business resulting from any signing, amendment, termination, or rescission of an important memorandum of understanding, a plan for a strategic alliance or other business cooperation or undertaking of non-competition, or an important contract, change in any material respect of a business plan, completion of development of a new product, or successful development and formal entry into the full-scale production stage of an experimental product, where there is a material impact on the company's finances or business.
  9. Resolution by the board of directors to carry out a capital reduction; merger or consolidation; demerger; corporate acquisition; exchange, conversion, or transfer of shares from another; dissolution; issue of new shares for capital increase; capital reduction or record date of cash capital increase; issue of corporate bonds; issue of employee stock option certificates; issue of new restricted shares for employees; issue of other securities; private placement of securities; change in the par value of its shares; participation in the establishment of or conversion into a financial holding company, investment holding company, or subsidiary thereof; or any material change in any of the above matters; failure by companies participating in a merger or consolidation, demerger, corporate acquisition, or transfer of shares form another, to convene on the same day and pass resolutions by their boards of directors or shareholders' meetings; or inability for any reason to convene a subsequent shareholders' meeting of a company participating in a merger, consolidation, demerger, corporate acquisition, or transfer of shares from another, or veto by either side of the proposal for merger, consolidation, demerger, corporate acquisition, or transfer of shares from another; or resolution of the board of directors to cancel a merger or consolidation during the implementation of the merger or consolidation plan following the initial board resolution in favor of the merger or consolidation.
  10. Any matter required to be publicly disclosed and filed pursuant to the Regulations Governing Public Tender Offers for Securities of Public Companies.
  11. A change in company personnel, including company spokesperson, acting spokesperson, important operations officer (chief executive officer, chief operating officer, chief marketing officer, or chief strategy officer, or other officer at an equivalent level) litigious and non-litigious agent, financial officer, accounting officer, research and development officer, or internal audit officer.
  12. Resolution by the board of directors to publish financial forecast information, inapplicability of such financial forecast information, or correction or updating of such financial forecast information, or in the case of a company that has already published complete financial forecasts, the existence of any of the circumstances below, where such discrepancy is 20 percent or more and the amount affected reaches NT$30 million and 0.5 percent of paid-in capital, provided that in the case of a company whose stock has no par value or a par value per share other than NT$10, for the calculation of the aforesaid 0.5 percent of paid-in capital, 0.25 percent of equity attributable to owners of the parent company shall be substituted:
    1. Discrepancy between the unaudited comprehensive income publicly disclosed and filed within 1 month after the close of the fiscal year and the most recently publicly disclosed and filed comprehensive income forecast figure.
    2. Discrepancy between the actual figure for comprehensive income in the publicly disclosed and filed annual financial report and the forecasted figure.
    3. Discrepancy between the actual figure for comprehensive income in the annual publicly disclosed and filed annual financial report and the unaudited comprehensive income publicly disclosed and filed within 1 month after the close of the fiscal year.
  13. Resolution by the board of directors or a shareholders' meeting to directly or indirectly carry out an investment plan of an amount not less than 20 percent of the company's own share capital stated on its financial report and NT$100 million, or any material change in any of the above matters. In the case of an issuer whose stock has no par value or a par value per share other than NT$10, for the calculation of the aforesaid 20 percent of share capital, 10 percent of equity attributable to owners of the parent company shall be substituted.
  14. A change by resolution of the board of directors in a plan for capital increase by cash or offering of corporate bonds after such plan has become effective upon registration, or such change in a plan for private placement of securities after passage by the board of directors or a shareholders' meeting.
  15. Important resolution of a regular or special shareholders' meeting.
  16. Occurrence of a significant event of internal control-related fraud, non arms-length transaction, or defalcation of company assets.
  17. Occurrence of any of the following circumstances in acquisition or disposal of assets:
    1. The assets acquired by the company, or by a subsidiary thereof whose shares have not been publicly issued domestically, fall within the applicable scope of assets under Article 3 of the Regulations Governing the Acquisition and Disposal of Assets by Public Companies promulgated by the competent authority, while the circumstances set forth in Article 30 or 31 of those Regulations requiring public disclosure are also present. However, exceptions are allowed under any of the following circumstances:
      1. The company has conducted a merger, consolidation, demerger, corporate acquisition, or transfer of shares from another pursuant to subparagraph 9 of this paragraph.
      2. The company has already carried out public disclosure of an acquisition or disposal of privately placed securities pursuant to subparagraph 18 of this paragraph.
      3. The company acquires or disposes of any kind of open-ended fund.
      4. The information is information on derivatives trading that is to be filed by the 10th of each month.
    2. The company incurs unrealized losses from derivatives trading that amount to 3 percent or more of equity attributable to owners of the parent company.
  18. Information on acquisition or disposal of privately placed securities by Emerging Stock company or subsidiary thereof: Enter the information within 2 days following the day of the fact.
  19. Any endorsements/guarantees that the company is required to publicly disclose and file pursuant to Article 25 of the Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies; or total endorsements and guarantees by the company itself in favor of enterprises in the same group reaching 50 percent or more of the company's net worth on its financial statements for the most recent period.
  20. Any loans of funds to other persons that the company is required to disclose and file pursuant to Article 22 of the Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies.
  21. Occurrence of a disaster, group protest, strike, environmental pollution event, or any other material event, where the company incurs a material loss, or where a relevant authority orders suspension of work, suspension of business, termination of business, or revokes or voids a relevant permit, or imposes administrative fines reaching NT$100,000 or more, and where the circumstance is severe.
  22. Resolution by the board of directors (or a shareholders' meeting) to permit a managerial officer (or director) to engage in competitive conduct; or knowledge by the company that a managerial officer is operating business of the same kind independently or on behalf of another person or that a director engages in conduct within the company's scope of business independently or on behalf of another person, and the investment or business engaged in by the managerial officer or director is a Mainland-area enterprise, and there is any failure to duly obtain permission from the board of directors (or shareholders' meeting); or there is any material change in any of the above matters.
  23. Dishonor of a negotiable instrument, petition for bankruptcy, reorganization, or other similar circumstance with respect to a related party or principal debtor of the company or a joint and several guarantor thereof; inability by a principal debtor in favor of whom the company has made an endorsement or guarantee to settle a matured negotiable instrument, loan, or other debt.
  24. Failure by the company to make a public disclosure or a filing within a prescribed time limit; an error or omission in a financial report prepared by the company, with respect to which Article 6 of the Securities and Exchange Act Enforcement Rules requires a correction to and further a restatement of the financial report; a certified public accountant (CPA) issues an audit report containing an opinion other than an unqualified or modified unqualified opinion on a publicly disclosed and filed financial report; or a CPA issues a review report other than an unqualified report on a publicly disclosed and filed financial report; provided, this shall not apply in cases where the CPA issues a an audit or review report with a qualified opinion for the reason of annual amortization of losses, as permitted by law, or for the reason that investment in a non-major subsidiary that is accounted for under the equity method and the profit/loss thereupon presented in an interim financial report is calculated on the basis of financial reports that have not been audited or reviewed by a CPA. However, if an aforesaid non-major subsidiary is a subsidiary of a financial holding company, its interim financial reports shall be audited or reviewed by CPAs in accordance with applicable laws and regulations.
  25. Any re-filing and public disclosure of the regular annually filed internal control system statement of the company due to any change in the content thereof, or obtaining of the Internal Control Special Audit Report for the special audit of internal controls conducted by the CPA.
  26. Mass media reportage or information circulating around the market sufficient to affect the market status of the company's securities.
  27. A director or supervisor is subject to a provisional injunction ruling suspending them from the exercise of their powers or is subject to an emergency disposition; or, a director is subject to a provisional injunction ruling suspending the director from the exercise of powers or is subject to an emergency disposition and the board of directors is thereby rendered unable to exercise its powers.
  28. Suspension or termination of TPEx trading of its securities under Article 38 or 40 of these Rules, or any material change in such a matter.
  29. If a domestic issuer issues securities overseas, the making of any adjustment for differences in the overseas financial report due to inconsistency in the accounting principles applied in the two places with respect to financial information filed for any period in the place of overseas listing. If a financial report of a foreign issuer is not prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers, and the cumulative dollar amount of any discrepancy in net income before tax reaches NT$10 million or more, it shall disclose any items with material discrepancies and the amount of any monetary impact of those discrepancies.
  30. If the company uses a press conference, an investor conference, or by any other means promulgates financial or business information that has not yet been input to the Market Observation Post System the date, time, and place thereof, and any relevant financial and business information. When an Emerging Stock company convenes on its own initiative, or is invited to attend, an investor conference or press conference, it shall comply with all of the items in subparagraph 22 of paragraph 1, Article 33 of these Regulations, which items shall be applicable mutatis mutandis.
  31. Resolution by the board of directors to distribute or not to distribute dividends or a change in dividend distributions by a resolution of the board of directors or a shareholders' meeting, or resolution of a record date for dividend distribution, or change of date of distribution of cash dividends after an ex-dividend announcement, or failure to distribute cash dividends by the date set for distribution of the cash dividends.
  32. Resolution of the board of directors on the date for convening a regular shareholders' meeting or special shareholders' meeting, the cause or subjects of such a meeting, or the date of suspension of changes to entries in the shareholders' register.
  33. Suspension of part or all business transactions between a company and a principal purchaser or supplier, where such purchaser or supplier accounted for 10 percent or more of the company's total amount of sales or purchases in the most recent fiscal year.
  34. Occurrence of any of the changes in shareholding set forth in Article 369-8, paragraphs 1 and 2 of the Company Act and receipt of notice of the same.
  35. Occurrence of any of the following matters to the Emerging Stock company due to capital reduction or change of par value per share:
    1. Completion of capital amendment registration.
    2. Passage of a plan for share replacement operations.
    3. Any subsequent failure to execute such share replacement plan.
    4. At the time of announcement of the financial report, the procedures have not yet been completed for replacement of the old shares with new ones because of a capital reduction or change of par value per share, and there is any resulting discrepancy between the number of the old shares actually outstanding and the number of common shares stated in the most recently announced and reported financial statement.
    5. If the Emerging Stock company is required to carry out share replacement operations due to a capital reduction, and the transferee company of the demerger is neither a TWSE listed nor TPEx listed nor Emerging Stock company, then 3 business days before the date on which trading resumes, public disclosure and filing shall be made of the following information for the demerged company and the transferee company of the demerger for the day prior to the record date of the demerger: the unaudited or CPA-reviewed share capital, net worth, and net worth per share, and the CPA-attested (or reviewed) earnings per share for the most recent period.
  36. Any expression of objection or reservation, by an independent director about a resolution by the board of directors, or by a member of the remuneration committee about a resolution by a remuneration committee meeting, of which there is a record or a written statement; if the company has established an audit committee, any resolution that is adopted with the approval of two-thirds or more of all directors without having been passed by the audit committee, as pursuant to the provisions of Article 14-5, paragraph 2 of the Securities and Exchange Act; any remuneration passed by the board of directors that is more favorable than that recommended by the remuneration committee.
  37. Forfeiture by the directors and supervisors as a whole of subscription rights to shares in a number reaching one-half or more of subscribable shares upon cash capital increase of the company, and opening of the shares for subscription by a specific person or persons through negotiation, except in the case where the company conducts a cash capital increase for the purpose of applying for TPEx listing or TWSE listing of its stock.
  38. Results of the consultations of a consultative meeting held between the company and a creditor bank are confirmed.
  39. Change in accounting year, or any accounting change resolved upon by the board of directors that is required to be submitted for the competent authority's approval and publicly announced and reported in accordance with the applicable regulations governing the preparation of financial reports adopted by the competent authority for the relevant industry, or any non-approval by the competent authority of any application made to the competent authority for an accounting change.
  40. A donation to a related party or a major donation to a non-related party.
  41. Resolution by the board of directors to buy back shares, expiration of the buyback period, or completion of the buyback.
  42. Any other major policy resolution of the board of directors, or other matter having a material effect on the shareholders' equity or securities prices of the emerging stock company.
    Upon occurrence of any of the events enumerated in the subparagraphs of the preceding paragraph, the issuer shall handle events set forth in paragraph 9 by inputting an explanation of the event into the Internet information reporting system designated by the TPEx after the close of trading hours on the day of occurrence of the event, and shall handle events set forth in all other subparagraphs by inputting the information content into the Internet information reporting system designated by the TPEx before the commencement of trading hours on the business day next following the day of occurrence of the event; provided, where a press release is issued prior thereto, it shall input it at the time of issuance of the press release.
    An issuer discovering that the mass media has reported any of the events enumerated in paragraph 1, or that the report content is sufficient to affect the market price of the emerging stock company's securities, or that the report is inconsistent with fact, shall immediately enter an explanation of the material information, no later than 12 noon of the same day; provided that if the discovery is made during a weekend or holiday, or after 12 noon on a business day, the issuer shall enter an explanation of the information before the commencement of trading hours of the business day next following the day of discovery of the mass media report.
    If a foreign issuer issues securities outside of the ROC, during the duration of those securities, experiences any material event that requires immediate filing under the laws or regulations of the country of listing or the country of registration or otherwise under the rules of a securities exchange, it shall simultaneously input such information into the Internet information reporting system designated by the TPEx, and if it receives any written enquiry from the securities regulatory agency or securities exchange of the country of listing with respect to any matter that has a material effect on shareholder equity or the price of securities, it shall immediately forward a copy of the content of the written enquiry and any response thereto to the TPEx.
    Where an issuer experiences an event specified in paragraph 1 yet fails to publish the material information, or an event specified in paragraph 3 yet fails to furnish an explanation thereof, the TPEx may, via facsimile, telephone, or e-mail, request the issuer to enter relevant explanations into the Internet information reporting system designated by the TPEx within a specified time limit.
    When the TPEx discovers any irregularity in securities trading pursuant to the Directions for Announcement or Notice of Attention to Emerging Stock Trading Information and Dispositions, it may complete a Public Statement Concerning Material Information (Attachment 6), and via facsimile, telephone, or e-mail, request the issuer to enter relevant explanations into the Internet information reporting system designated by the TPEx within a specified time limit.
    The deadlines for information filed under the subparagraphs of paragraph 1 shall be based on Taiwan time, and the content of the primary version of the report shall be in Chinese, although an English version may also be attached. It is prohibited for any content of the aforesaid filed information in Chinese or English to make descriptions that are exaggerated or resemble advertising or promotional language. A foreign issuer may authorize its litigious and non-litigious agent to handle information filing.
    An issuer may not arbitrarily issue news that has not been confirmed, nor may it make public information that is inconsistent with facts. An issuer also may not issue information that is inconsistent with the principles of corporate governance in any of the subparagraphs below and that will affect shareholder equity:
  1. Establishing an effective corporate governance framework.
  2. Safeguarding shareholder equity.
  3. Strengthening the functions of the board of directors.
  4. Fulfilling the functions of the supervisors.
  5. Respecting the rights and interests of interested parties.
  6. Increasing the level of information transparency.
    A foreign issuer need not publicly disclose the information in paragraph 1, subparagraph 18.
    If any of an Emerging Stock company's major subsidiaries that is neither TWSE-listed (nor TPEx-listed) nor registered as an Emerging Stock company experiences any circumstance in any subparagraph of paragraph 1, it shall be deemed material information of the Emerging Stock company. If the Emerging Stock company is an investment holding company or financial holding company, in addition to a major subsidiary, if any subsidiary as described below experiences any circumstance in any subparagraph of paragraph 1, it shall be deemed material information of the Emerging Stock company.
  1. an investment holding company's subsidiary that is neither TWSE-listed (nor TPEx-listed) nor registered as an Emerging Stock company, and the equity of which accounts for 2 percent or more of the equity attributable to owners of the parent company on the annual financial report of the investment holding company for the most recent year;
  2. a financial holding company subsidiary in the name of which appears any of the terms "bank," "insurance," "securities," "futures," "bills," or the shareholders' equity of which accounts for 2 percent or more of the equity attributable to owners of the parent company on the annual financial report of the financial holding company for the most recent year.
    The term "major subsidiary" in the preceding paragraph means a major subsidiary as defined in Article 2-1, paragraph 2 of the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants.
    When the combined dollar amount of investment by the Emerging Stock company and its subsidiaries in any single enterprise exceeds 10 percent of the Emerging Stock company's equity attributable to owners of the parent company, if that invested single enterprise is not a domestic public company, and there occurs any event under Article 7, subparagraphs 1 to 8 of the Securities and Exchange Act Enforcement Rules, the Emerging Stock company shall report on the enterprise's behalf before the opening of trading hours on the business day next following the day it learns of the occurrence of an aforesaid event or of the media reportage of the event.
    If an Emerging Stock company itself is a subsidiary of a parent company that is neither TWSE-listed (nor TPEx-listed) nor registered as an Emerging Stock company, if any circumstance in any subparagraph of paragraph 1 applies to the parent company, it shall be deemed material information of the Emerging Stock company. If the parent company is a foreign company, the TPEx listed subsidiary shall report on its behalf any of the particulars set forth in the following subparagraphs before the opening of trading hours on the business day next following the day it learns of the occurrence or media reportage of such event with respect to the parent company:
  1. Material change in shareholders' equity;
  2. Material change in business operation policy;
  3. Material disaster resulting in serious reduction or complete cessation of production;
  4. Material effect on shareholders' equity or company operations resulting from a change in laws, regulations, or rules of the home country;
  5. Mass media reportage about the parent company sufficient to affect securities prices of the Emerging Stock subsidiary in Taiwan;
  6. Occurrence of any other material event that is required to be immediately filed pursuant to law or regulation of the foreign company's home country.
     The meanings of "parent" and "subsidiary" as used in these Rules shall be determined in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.
     The term "net worth" as used in these Rules means the equity attributable to owners of the parent shown in the balance sheet prepared in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers.
Article 35     Material information in an emerging stock company's press conferences concerning material information means the following particulars provided by an issuer of its own initiative or investigated and verified at the initiative of the TPEx:
  1. Dishonor of a negotiable instrument due to insufficient deposits, refusal by a financial institution to honor a transaction, or any other loss of credit of the company or a responsible person thereof.
  2. Any material effect on company finances or business resulting from a litigious or non-litigious matter, administrative disposition, contentious administrative procedure, or motion for provisional attachment or provisional injunction, or compulsory execution thereof, with respect to the company or a responsible person thereof.
  3. Serious decrease in production or complete stoppage of work.
  4. Any circumstance set forth in paragraph 1 of Article 185 of the Company Act.
  5. Reorganization or bankruptcy procedure of the company or parent or subsidiary thereof, and any and all events occurring in the course of such procedure, including any petition made to a court and any notice given or ruling handed down by a court, or any ruling prohibiting transfer of shares or any precautionary measure ordered by a court under relevant laws such as the Company Act or the Bankruptcy Act.
  6. Resolution by the board of directors for capital reduction (excluding retirement of treasury shares), merger or consolidation, cancellation of merger or consolidation, demerger, corporate acquisition, share exchange, share conversion, transfer of shares from another, dissolution, or participation in the establishment of or conversion into a financial holding company or investment holding company or subsidiary thereof; or inability for any reason to convene a subsequent shareholders' meeting of a company participating in a merger or consolidation, demerger, corporate acquisition, or transfer of shares from another, or veto of the proposal for merger, consolidation, demerger, corporate acquisition, or transfer of shares from another for any reason; provided, this shall not apply to a whale-minnow merger conducted in accordance with Article 18, paragraph 6, of the Business Mergers and Acquisitions Act, where the merged enterprise is a non-TPEx-listed company that has paid-in capital of less than NT$100 million, or a merger/acquisition conducted in accordance with Article 19 of the Business Mergers and Acquisitions Act. If the stock of the merged enterprise has no par value or a par value other than NT$10, for the aforesaid calculation of paid-in capital, equity attributable to owners of the parent company shall be substituted.
  7. Occurrence of a significant event of internal control-related fraud, non arms-length transaction, or defalcation of company assets.
  8. Occurrence of a disaster, group protest, strike, environmental pollution event, where the anticipated loss prior to receiving insurance indemnification exceeds 20 percent of the company's paid-in capital or NT$300 million or more. In the case of an issuer whose stock has no par value or a par value per share other than NT$10, for the calculation of the aforesaid 20 percent of paid-in capital, 10 percent of equity attributable to owners of the parent company shall be substituted.
  9. Mass media reportage or information circulating around the market that is sufficient to materially affect the market status of the company's securities.
  10. (Deleted)
  11. Resolution by the board of directors or a shareholders' meeting to apply for termination of TPEx trading of its securities.
  12. Results of the consultations of a consultative meeting held between the company and a creditor bank are confirmed.
  13. Any other major policy resolution of the board of directors, or matter having a material effect on the shareholders' equity or securities prices of the emerging stock company.
    An issuer to which any of the subparagraphs above applies shall complete a Report to Convene a Press Conference Concerning Material Information specifying the content of the information, and promptly send it to the TPEx for handling, and unless the TPEx deems there to be a necessity to postpone handling, the issuer shall promptly dispatch a spokesperson or acting spokesperson to participate in a press conference to provide explanations by the business day next following the occurrence of the event or the broadcast media report. If foreign laws or regulations impose time constraints concerning the subject matter of a material information press conference that the issuer is required to hold under these Rules, the issuer may handle the matter in accordance with the deadlines under the foreign laws or regulations, provided that, in addition to complying with any requirement to publish the material information in advance, if the aforesaid press conference is held on a non-business day in Taiwan or after 9 p.m. Taiwan time, the issuer shall hold a press conference in Taiwan within one hour before the start of trading hours on the next business day in Taiwan.
    Where any circumstance in paragraph 1, subparagraph 6 applies, the issuer shall, during the earliest non-trading time following the date of the board of directions resolution, call a press conference at the place of the TPEx; if there is more than one participating TWSE listed, or TPEx listed, or Emerging Stock company, the companies shall call the press conference simultaneously; if there is an exceptional circumstance such that it is impossible to call the press conference in a timely manner and the TPEx has given approval, the issuer shall immediately input the content or explanations of the information into the TPEx's designated Internet information reporting system, and promptly make up holding of the press conference.
    When the TPEx discovers or mass media report the existence of any material information set forth in the subparagraphs of paragraph 1 with respect to the issuer, and such information is verified by the TPEx, the TPEx may specify the source and content of the information to notify the emerging stock company to request that it dispatch a spokesperson or acting spokesperson to hold a news conference in person or through video conferencing within a time limit set by the TPEx.
    In addition to its spokesperson and acting spokesperson, a foreign issuer may dispatch its litigious and non-litigious agent or an independent director to hold a press conference pursuant to this Article.
    An issuer may hold a material information press conference by means of videoconferencing. However, it may not hold the press conference by means of videoconferencing in cases where there exists with respect to the domestic issuer any circumstance set out in paragraph 1, subparagraphs 1, 2, 6, or 11, or any other matter that the TPEx deems material.
    If, for any reason, the video press conference referred to in the preceding paragraph becomes impossible to hold or complete, the issuer shall, within a time limit set by the TPEx, dispatch personnel to hold a material information press conference at the TPEx.
    A report submitted by the issuer pursuant to paragraph 2 shall be filled out consistently with the facts, and shall be chopped with the chops of the company and its responsible person or manager, to indicate that they take responsibility for it. However, to ensure timeliness, the issuer shall first transmit the report by facsimile to the TPEx and then deliver the original report. If after delivery of the original report any discrepancy with the originally facsimiled is discovered, the issuer shall bear the responsibility, and shall publicly disclose and explain the discrepancy.
    When convening a press conference, a representative of the issuer shall state in detail the facts that occurred, the cause, the effect on company finances and business, the projected monetary amount of such effects, and countermeasures to be taken, and shall prepare at lease twenty written copies of relevant news releases and written materials.
     With the exception of occurrence of an event under subparagraph 6 of subparagraph 1, in which event the issuer the issuer shall input the information about the event into the TPEx's designated Internet information reporting system at the time it convenes the press conference or within 2 hours after the press conference in accordance with the Article 34 hereof, in any of the other circumstances set forth in the subparagraphs of paragraph 1, the issuer shall input the content of such event into the TPEx's designated Internet information reporting system on the date of occurrence of the event or the same day as the media reportage, provided that if it has already convened a press conference on the date of occurrence of the event or the same day as the media reportage, it shall input the information, at the latest, no more than two hours after the press conference.
    The issuer shall not externally disclose any information prior to inputting the information about an event into the TPEx's designated Internet information reporting system, or holding a press conference concerning material information about the event, pursuant to the provisions of these Rules.
    If a subsidiary, meeting the criteria set out in the preceding article, of the Emerging Stock company, experiences any circumstance in any subparagraph of paragraph 1, or if an Emerging Stock company itself is a subsidiary of a domestic parent company that is neither TWSE-listed (nor TPEx-listed) nor registered as an Emerging Stock company, and the domestic parent company experiences any circumstance in any subparagraph of paragraph 1, it shall be deemed material information of the Emerging Stock company.
Article 36     An issuer shall specify in material information published under the preceding article the facts of the events, and their causes, possible impact on the finances and business of the company, estimated monetary amount of the impact, and countermeasures, following the format prescribed for the Internet information reporting system designated by the TPEx.
    To ensure the correctness of and equal access to information, an issuer may not disclose any information in private before publishing material information.
     If there is any material change in the development of subsequent events with respect to material information that an issuer has published, the issuer shall update or supplement in a timely manner the content of the relevant information in accordance with the provisions under which the information was reported.
    An issuer shall publish material information and send a copy to its advisory recommending securities firms, and the lead advisory recommending securities firm shall disclose such information through proper channels.
    An advisory recommending securities firms shall pay attention to reports about the issuer in the mass media and upon discovering any inconsistency with facts, shall prompt and supervise the issuer to publish a clarification of material information. Also, the lead advisory recommending securities firm shall audit relevant materials such as the board of directors meeting minutes and upon discovering any material information of the issuer that should be disclosed, shall prompt and supervise the issuer to disclose it. If the issuer delays announcing the information despite the prompting and supervision, the lead advisory recommending securities firms shall immediately report to the TPEx.
    The TPEx may require the issuer to submit financial and business related materials for purposes of verifying timeliness, accuracy, and completeness with respect to disclosure of material information, and may, when necessary, carry out an on-site audit.
Article 37     Where information filed by an issuer is discovered to be erroneous, the issuer shall promptly enter the correct information upon discovery or upon receiving the notice from the TPEx.
    The TPEx may announce to the public via relevant information systems or make available for examination by the competent authority any information filed by an issuer. Where the content of information filed by an issuer is false, the matter shall be handled under the applicable provisions of these Rules, and the issuer shall bear sole legal liability.
Chapter VI Suspension and Termination of TPEx Trading
Article 38     Under any of the following circumstances, the TPEx may suspend the trading of an issuer's stock on the TPEx:
  1. There is no lead advisory recommending securities firm.
  2. Only one advisory recommending securities firm remains.
  3. The issuer fails to publicly announce or report a financial report or financial forecast by a deadline provided by law or regulation; or the financial report publicly announced and filed pursuant to Article 36 of the Securities and Exchange Act is not produced in compliance with relevant laws and regulations and generally accepted accounting principles and the non-compliance is serious and corrections or rewrites are not made within a notified time period for correction or rewrites; or the CPA attesting the publicly announced and filed financial report issues a disclaimer of opinion or an adverse opinion in the audit report, or issues an adverse opinion or disclaimer of opinion in the review report; or where, in a publicly announced and filed financial forecast of the issuer reviewed by a CPA, the attesting CPA issues an adverse opinion or disclaimer of opinion in the review report.
  4. The issuer fails to publish material information in accordance with relevant regulations and fails to correct the situation within a certain time period as ordered.
  5. The issuer fails to handle its shareholder services in accordance with Article 26, paragraph 1 of these Rules and fails to correct the situation within a certain time period as ordered by the TPEx.
  6. Any of the circumstances under Article 282 of the Company Act exist at the issuer, and the transfer of its shares is prohibited by a court ruling pursuant to Article 287, paragraph 1, subparagraph 5 of the Company Act.
  7. A foreign issuer no longer has a litigious and non-litigious agent who has a domicile or residence in Taiwan.
  8. The issuer breaches any undertaking it has made.
  9. A financial report publicly disclosed and filed by a foreign issuer does not meet the requirements set out in Article 31, paragraph 3 of these Rules.
  10. The issuer evades or refuses a targeted audit conducted by the TPEx or a CPA or professional institution designated by the TPEx, and the circumstances are material.
  11. Any other event that the TPEx deems to necessitates the suspension of trading of the stock on the TPEx.
    For stocks for which TPEx trading is to be suspended under the preceding paragraph, except where TPEx trading is suspended pursuant to subparagraph 6 of that paragraph, the TPEx shall promptly make a public announcement that the TPEx trading of the issuer's stock will be suspended starting from the fifth business day following the announcement date.
    If TPEx trading of a stock is suspended pursuant to paragraph 1, subparagraph 6, the TPEx shall make a public announcement on the date it becomes aware of such circumstance or the date on which it receives notification from the court, or the Emerging Stock company shall make a public announcement on the date of disclosure of the material information (whichever date comes first), and trading will be suspended starting from the business day next following the public announcement date.
Article 39     Where trading of an issuer's stock on the TPEx is suspended due to occurrence of an event referred to in any subparagraph of the preceding Article, the issuer may, upon extinction of the cause and where no event in any other subparagraph thereof exists, submit relevant supporting documents to apply for reinstatement of trading. Upon examining such documents and finding them accurate, the TPEx shall promptly publicly announce that trading of the issuer's stock on the TPEx is reinstated from the business day next following the day the announcement is made.
Article 40     Under any of the following circumstances, the TPEx may terminate the trading of an issuer's stock on the TPEx:
  1. The stock has been TPEx listed on the TPEx or publicly listed on the TWSE.
  2. The TPEx trading of the stock has been suspended under Article 38 of these Rules, and the cause of the suspension, which need not be limited to a single cause, has not been extinguished after 3 months.
  3. The issuer lacks an advisory recommending securities firm.
  4. The issuer has been adjudicated bankrupt by a final and irrevocable court ruling.
  5. A court has ruled for re-organization or has dismissed an application for re-organization pursuant to Article 285-1, paragraph 3, subparagraph 2 of the Company Act, and the rulory dismissal has become final and irrevocable.
  6. A relevant competent authority revokes an issuer's corporate registration or dissolves it due, in the case of a domestic issuer, to occurrence of an event under Article 9, Article 10, Article 11, Article 17, paragraph 2, Article 315, paragraph 1, subparagraph 1 through subparagraph 7, or Article 397 of the Company Act, or other cause, or, in the case of a foreign issuer, due to a violation of laws or regulations of the country of registration.
  7. A relevant competent authority of the ROC or of the country of registration revokes the issuer's approval for issuance of stocks or corporate bonds due to any event in Article 251 or Article 271 of the Company Act or for other cause, and the circumstances are material.
  8. Upon application by the issuer or occurrence of any other material events where the TPEx deems it necessary to terminate TPEx trading of the issuer's stock.
    Where TPEx trading is to be terminated under subparagraph 1 of the preceding paragraph, the TPEx shall promptly announce that the trading will be terminated from the first business day following the day the announcement is made; where TPEx trading is to be terminated under subparagraphs 2 to 8 of the preceding paragraph, the TPEx shall promptly publicly announce that the trading will be terminated from the 15th day following the day the announcement is made.
    Where TPEx trading of an issuer's stock is terminated in accordance with paragraph 1, the issuer shall not apply for re-registration until after 6 months have elapsed from the date on which the TPEx trading of its stock is terminated.
Article 41     After suspending, reinstating, or terminating the trading of an Emerging Stock on the TPEx under Articles 38 to 40 of these Rules, the TPEx shall promptly report to the competent authority for recordation and send a copy to the advisory recommending securities firms for such Emerging Stock. The advisory recommending securities firms shall disclose such information through proper channels.
Chapter VII Registration Fees
Article 42     An issuer applying for registration of TPEx trading of its stock shall pay a fee of NT$20,000 to the TPEx for handling the TPEx registration of the stock; provided that this shall not apply where an issuer that already has stock registered for TPEx trading reports newly issued shares for registration for TPEx trading.
    After an issuer's application for trading of its Emerging Stock on the TPEx has been acknowledged by the TPEx mail office with a signed receipt, the paid registration fee shall without exception be non-refundable.
Article 43     Issuers shall pay the TPEx trading fees for trading of their Emerging Stock on the TPEx. The fee schedule shall be as follows:

┌─────────────┬────────────────┐
│Total Number of Shares    │ Quick Calculation of Annual Fee│
│Traded on the TPEx        │                                │
├─────────────┼────────────────┤
│30 million or less shares │    NT$200 per 100,000 shares   │
├─────────────┼────────────────┤
│The portion exceeding 30  │    NT$150 per 100,000 shares   │
│million and up to 50      │                                │
│million                   │                                │
├─────────────┼────────────────┤
│The portion exceeding 50  │    NT$100 per 100,000 shares   │
│million and up to 100     │                                │
│million                   │                                │
├─────────────┼────────────────┤
│The portion exceeding 100 │    NT$50 per 100,000 shares    │
│million and up to 200     │                                │
│million                   │                                │
├─────────────┼────────────────┤
│The portion exceeding 200 │    NT$25 per 100,000 shares    │
│million and up to 300     │                                │
│million                   │                                │
├─────────────┼────────────────┤
│The portion exceeding 300 │     NT$12.5 per 100,000 shares │
│million.                  │                                │
└─────────────┴────────────────┘
    Fees collected under the preceding paragraph shall be no less than NT$50,000 and no more than NT$225,000 at highest. An issuer shall pay the TPEx trading fee for each fiscal year to the TPEx by the end of January of the given year.
Article 44     When Emerging Stock initially begins to be traded on the TPEx or for subsequent fiscal years in which new shares issued due to capital increase begin to be traded on the TPEx, the annual fees shall, following the schedule set forth in the preceding article, be calculated and collected based upon the month TPEx trading begins, pro-rata to the number of months of trading (days less than a month shall count as a full month).
    An issuer shall pay the fees referred to in the preceding paragraph at the time it enters into the contract with the TPEx for TPEx trading of the Emerging Stock and subsequently when filing new shares issued due to capital increase for trading on the TPEx.
Article 45     Commencing from the fiscal year next following the year they begin to be traded on the TPEx, new shares issued due to capital increase shall be counted together with shares already traded on the TPEx in determining the fees for trading on the TPEx, and the fees shall be calculated according to the schedule set forth in Article 43 of these Rules.
Article 46     When trading of an issuer's stock on the TPEx is suspended, the issuer may not claim for refund of TPEx trading fees already paid. From 1 January 2013, when trading of an issuer's stock is terminated by the TPEx, the TPEx will calculate the proportion of time, in months, during which it was actually registered for TPEx trading in the given year (amounts less than 1 full month will be counted as 1 month), and the fees for the remainder of the year will be returned.
Chapter VIII Penalties
Article 47     The TPEx may impose a penalty of NT$10,000 on any issuer that violates Article 29, Article 29-1, Article 30, Article 31, Article 32, Article 33, Article 34, Article 36, or Article 37 of these Rules.
    The TPEx may impose a penalty of NT$30,000 on an issuer that violates Article 35 of these Rules for each individual case of violation;
    When the issuer violates any provision specified in the preceding two paragraphs and the cumulative number of penalties imposed within the most recent year, inclusive of the current penalty, reaches two or more, or the circumstances in the specific case arise out of intent or a material deficiency, or have a material effect on shareholder equity or the price of securities, the TPEx may impose a penalty of NT$30,000 to NT$1 million.
    If under any circumstance under the three preceding paragraphs, an issuer is required to carry out the filing of information on a make-up basis, the issuer, upon receiving notice from the TPEx, shall do so by the deadline. If the issuer fails to do so by the deadline, the TPEx may impose a penalty of NT$10,000 per day until the day that the issuer has done so. If the circumstances in the specific case are material, or if, upon receiving notice from the TPEx requiring it to hold a press conference, the company still fails to do so and the circumstances in the specific case are material, the TPEx may suspend the trading of the issuer's securities on the TPEx under Article 38, paragraph 1, subparagraph 4 of these Regulations.
     If an issuer fails to distribute cash dividends within 3 months after the ex-dividend record date, the TPEx may impose a penalty of NT$100,000, and notify the issuer in writing to make corrections within one month from the date of receipt of the notification. If it still fails to distribute cash dividends within the time limit, the TPEx may further impose a penalty of not less than NT$200,000 and not more than NT$1 million, and may impose a new deadline for correction according to the circumstances of the individual case. If the issuer still fails to distribute the cash dividends within the time limit, the TPEx may continue to impose a penalty of not less than NT$200,000 and not more than NT$1 million for each successive instance.
    The TPEx will disclose, in the Section Designated for Violations by Emerging Stock Companies of Rules Governing Information Reporting, Material Information, and Press Conferences on the Market Observation Post System, any penalty imposed on an issuer for a violation of these Regulations.
Article 48     The TPEx may impose a penalty of NT$10,000 on any recommending securities firm that violates Article 32, Article 36, or Article 41of these Rules.
Article 49     Anyone upon whom a penalty is imposed pursuant to provisions of this Chapter shall pay such penalty to the TPEx within 5 days from receiving the notice issued by the TPEx.
Chapter IX Supplemental Provisions
Article 50     These Rules, and any amendments hereto, shall enter into force after approval and recordation by the competent authority.
    The Attachments to these Rules, and any amendments hereto, shall enter into force after ratification by the president of the TPEx.