| Article 27 |
If the application for OTC trading in a proposed issuance of TDRs made by the foreign issuer and its depository institution has met the following criteria, the GTSM may issue a document evidencing its approval of the OTC trading in question:
1. the units of TDRs for OTC trading: not less than 10 million units or the aggregate market value of the application is equivalent to NT$100 million or more;
2. the registered stocks or the marketable securities representing the stocks issued by the foreign issuer in accordance with the laws of its home country are already traded on a foreign stock market approved by the Competent Authority prior to the OTC listing of the Taiwan Depository Receipts for which the application for OTC trading is made;
3. shareholder's equity: the shareholder's equity as audited and certified for the most recent period by a certified public accountant is valued as equivalent to NT$200 million or more;
4. profitability: there is no accumulated loss in the most recent fiscal year, and one of the following criteria has been met:
(1) the ratio of net profit before tax against the shareholder's equity on the final accounts is 4% or higher for the most recent fiscal year, or is 2% or higher for each of the past two fiscal years, or the average for the past two fiscal years is 2% or higher and the profitability in the most recent year is better year-on-year;
(2) the net profit before tax for each of the past two fiscal years is NT$4 million or more;
5.when the TDRs are traded over the counter, excluding company insiders of the issuer and any juristic persons in which such insiders hold more than 50 percent of the shares, the number of registered shareholders of the TDRs residing within the ROC shall be no less than 300, and the aggregate number of units held by them shall be at least 20% of the total issued units or more than 10 million units.
6. Transfer of the shares represented by the TDRs shall not be restricted.
7. The rights and obligations for the shares represented by the TDRs shall be the same as for the shares of the same type and in the same issuance.
The financial information referred in Subparagraphs 3 and 4 of Paragraph 1 shall be reviewed in accordance with the consolidated financial statement or financial information prepared pursuant to the laws of the home country of the foreign issuer, and the opinions given by the ROC certified public accountant on the differences between the accounting principles adopted by the ROC and the home country of the foreign issuer respectively and on the impact of such differences on the financial report presented.
A foreign issuer that has obtained an appraisal opinion from a professional institution engaged by the Industrial Development Bureau of the Ministry of Economic Affairs, or engaged by the GTSM, stating that such issuer is a technology enterprise and that it has successfully developed a product or technology with market potential may be exempted from the restrictions in Subparagraph 4 of Paragraph 1. |
| Article 28 |
In a case of an application for OTC trading of TDRs, once the Competent Authority has approved the issuance of TDRs, the GTSM will report the contract of OTC trading of TDRs (attachment 7) to the Competent Authority for its approval and after obtaining such approval, it will publicly announce the OTC trading of the TDRs in question. |
| Article 33 |
In the event that, for reason of a capital increase through cash injection, the foreign issuer and its agent apply to issue for OTC trading new TDRs with the same rights and obligations as those TDRs already traded over the counter, or in the case where the foreign issuer sponsors issuance of TDRs with its previously issued shares, the GTSM, after examining the various documents (Application for Additional Issuance of OTC traded TDRs, Attachment 15) submitted and finding that the submission is complete and that none of the following circumstances exists, may issue documents evidencing its agreement to OTC trading and, after the Competent Authority has granted approval of issuance, publicly announce such OTC trading:
1. Non-compliance with Article 27, paragraph 1, subparagraph 4.
2. Violation of relevant GTSM rules and regulations regarding material information within the most recent year, where the instance is serous in nature.
3. Unusual change in the trading price within one month before the date of application.
4. Violation of the laws and regulations of the home country or the country of listing, where the individual instance is serious in nature.
If due to issuance of new shares for reason of a capital increase through cash injection, for which existing shareholders have preemptive subscription rights, or in a regulatory filing in which the reason is specified to be issuance of bonus shares, or due to receipt of request for conversion into or subscription for shares with respect to any previously issued convertible corporate bonds, corporate bonds with warrants, or other securities whatsoever in the nature of equity conversion, the foreign issuer and its agent seek to issue for OTC trading new TDRs with the same rights and obligations as those TDRs already traded over the counter, the GTSM shall publicly announce such OTC trading after examining that the documents (Filing for Additional Issuance of OTC Traded Stocks, Attachment 15) provided are complete.
The foreign issuer and the depository institution it retains shall report before the tenth day of each month any TDRs which it reissues for OTC trading that are within the original issuance cap after redemption and have the same rights and obligations as those TDRs already traded over the counter. After receiving the report document, the GTSM shall publicly announce the OTC trading of such TDRs. |
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