Chapter IV Retroactive Handling of Public Issuance Procedures and Other New Share Issue Cases
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Section I Retroactive Handling of Public Issuance Procedures
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| Article 58 | In the event that the foreign issuer intends to apply for listing on the stock exchange or for OTC trading of stock that has not been publicly issued under the Act, it shall submit the Registration Statement (Attachment 35), specifying the required particulars, and annexing the required documents such as the stock issue prospectus, to the FSC to file for retroactive handling of public issuance procedures. The filing will become effective after 12 business days from the date on which the FSC and FSC-designated institutions receive its Registration Statement.
The Regulations Governing Information to be Published in Public Offering and Issuance Prospectuses shall apply mutatis mutandis to the information to be provided in the stock issue prospectus under the preceding paragraph.
Article 4, paragraphs 2 to 4, Article 5, paragraphs 2 , 3, 5, and 6, and Article 20 shall apply mutatis mutandis to submission of the Registration Statement under paragraph 1.
If, after effective registration for initial public issuance under paragraph 1, there is discovered any violation of Article 4, paragraphs 2 to 4 herein, or of Article 20, paragraph 1 of the Act, or any circumstance under Article 9, paragraph 1, subparagraph 7, the FSC may void or revoke the effective registration.
A foreign issuer conducting initial public issuance of stock under paragraph 1 shall concomitantly conduct initial public issuance of any employee stock warrants and equity securities that have previously been issued under laws or regulations of the country of registration.
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| Article 58-1 | 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, a foreign issuer, before the foreign issuer may file for retroactive handling of public issuance procedures, it shall fill out an application form with relevant documentation attached and submit it to the TWSE or GSTM, which shall review and forward them to the FSC for special-case permission.
A foreign issuer filing for special-case permission pursuant to the preceding paragraph shall simultaneously meet the following conditions:
- Shareholding in the foreign issuer by Taiwanese enterprises is higher than shareholding in the foreign issuer by Mainland Area enterprises.
- Taiwanese enterprises have effective control over the foreign issuer.
"Taiwanese enterprise" in the preceding paragraph means a juristic person, group, or other institution of the Taiwan Area, or a company in which the same have invested in a third jurisdiction, and in which the same furthermore have direct or indirect shareholding or capital contribution exceeding 30 percent, or have effective control. If the Taiwanese enterprise engages in investment in the Mainland Area, it shall additionally obtain permission from the Investment Commission, Ministry of Economic Affairs.
"Mainland Area enterprise" in paragraph 2 means a juristic person, group, or other institution of the Mainland Area, or a company in which the same have invested in a third jurisdiction in accordance with Article 3 of the Regulations Governing Permission for People from the Mainland Area to Invest in the Taiwan Area, but does not include Taiwanese enterprises and foreign-invested enterprises incorporated in the Mainland Area.
"Foreign-invested enterprise" in the preceding paragraph means an enterprise incorporated in the Mainland Area and the total capital of which is invested by foreign investors.
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| Article 59 | When a foreign issuer files for initial public issuance of stock, the FSC may reject the filing if any of the following circumstances exists:
- The attesting CPA issues an audit report containing a disclaimer of opinion or adverse opinion.
- The attesting CPA issues an audit report containing a qualified opinion that affects the fair presentation of the financial report.
- The case review forms prepared by the foreign issuer or reviewed by the attesting CPA show any violation of laws or regulations or the articles of incorporation, and the circumstances are serious.
- The legal opinion issued by a lawyer indicates any violation of laws or regulations or the articles of incorporation, and the circumstances are serious.
- Any of the following circumstances arise in the CPA special audit of the efficacy of the internal control system design or implementation:
- Failure of the audited company to provide a statement regarding the efficacy of the internal control system design or implementation.
- The CPA review report indicates material deficiencies in the design or implementation of the audited company's internal control system and failure to improve them, or contains a disclaimer of opinion.
- Employee stock warrants or equity securities have previously been issued under laws or regulations of the country of registration, but concomitant public issuance is not conducted for the warrants along with the stock.
- The FSC discovers a violation of law or regulation, where the circumstances are serious.
- A foreign issuer in which individuals, juristic persons, groups, or other institutions from the Mainland Area have direct or indirect shareholding or capital contribution exceeding 30 percent, or effective control, fails to obtain the special permission from the FSC.
- The FSC otherwise deems necessary to protect the public interest.
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| Article 59-1 | For securities privately placed pursuant to the Act by a primary exchange (or OTC) listed company or emerging stock company, and for any securities that are distributed, converted, or subscribed subsequent to the private placement, the company shall, 3 full years after the delivery date of the privately placed securities, carry out public issuance procedures with the FSC, before it may apply to the TWSE or the TPEx for listing on the exchange or trading on the OTC market.
To carry out public issuance pursuant to the preceding paragraph, it shall be necessary to file with the FSC registration statements (Attachments 35-1 to 35-7) specifying all the required particulars, together with the required supporting documents, and the provisions of Articles 68 to 71 of the Regulations Governing the Offering and Issuance of Securities by Securities Issuers shall apply mutatis mutandis.
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| Article 59-2 | Under any of the following circumstances, the FSC may engage the TWSE or TPEx to handle matters in connection with suspension of the public issuance of the stock of a foreign issuer:
- In the case of a primary exchange listed company, the stock is delisted from the TWSE.
- In the case of a primary OTC listed company, the OTC trading of the stock is terminated by the TPEx for reasons other than for purposes of listing on the TWSE.
- In the case of an emerging stock company, the OTC trading of the stock is terminated by the TPEx for reasons other than for purposes of listing on the TWSE or the TPEx.
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Section II Issuance of Employee Stock Warrants and New Restricted Employee Shares
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| Article 60 | A primary exchange (or OTC) listed company or emerging stock company issuing employee stock warrants or new restricted employee shares shall file a Registration Statement for Issuance of Employee Stock Warrants (Attachment 36) or Registration Statement for Issuance of New Restricted Employee Shares (Attachment 36-1), specifying the required particulars, together with the required supporting documents, and may proceed with the issue only after the registration filing with the FSC becomes effective.
The provisions of Chapter IV of the Regulations Governing the Offering and Issuance of Securities by Securities Issuers shall apply mutatis mutandis to a primary exchange (or OTC) listed company or emerging stock company issuing employee stock warrants or new restricted employee shares.
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| Article 61 | A primary exchange (or OTC) listed company or emerging stock company that issues employee stock warrants or new restricted employee shares shall prepare a prospectus with the content in the Chinese language or a Chinese-English bilingual format, provided that if the English-Chinese bilingual format is used and there is any discrepancy in the interpretation of the meaning of the text, the Chinese version shall prevail.
The content of the prospectus referred to in the preceding paragraph shall meet the requirements listed below, and additionally shall comply, mutatis mutandis, with Chapter III of the Regulations Governing Information to be Published in Public Offering and Issuance Prospectuses:
- The content below shall be printed prominently on the front cover of the prospectus:
- Country of registration of the issuer.
- The issuer is a company that is a foreign enterprise listed in Taiwan using New Taiwan Dollars.
- On the inside front cover of the prospectus shall be printed the name, job title, contact telephone number, and email address of the litigious and non-litigious agent within the ROC.
- Content of the prospectus:
- Company overview, including a company introduction and the structure of the group.
- The financial statements printed in the prospectus shall be the consolidated financial statements audited and attested by a CPA (not including the notes and schedules to the financial report), and the CPA audit report, for the most recent 2 fiscal years as of the time of the filing for the issue of employee stock warrants or new restricted employee shares.
- If the filing date falls more than 45 days after the end of a given quarter, the consolidated financial statement for the most recent quarter reviewed by a CPA (but not including the accompanying notes and schedules of the financial statement), and the CPA review report, shall additionally be submitted.
If, before the printing of the prospectus, there is any most recent financial statement audited by a CPA, it shall also be disclosed therewith.
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Section III Capital Reduction |
| Article 62 | A primary exchange (or OTC) listed company or emerging stock company conducting a capital reduction shall file a Registration Statement (Attachment 37), specifying the required particulars, together with the required supporting documents, with the FSC. Such filings will become effective, respectively, 12 business days or 7 business days immediately from the date the FSC and the institution designated by the FSC receive the Capital Reduction Registration Statement.
Article 4, paragraphs 2 to 4 and Article 5, paragraphs 2, 3, 5, and 6 shall apply mutatis mutandis to cases under the preceding paragraph.
If, after effective registration, there is discovered any circumstance under Article 9, paragraph 1, subparagraph 6 or 7 or any violation of Article 4, paragraphs 2 to 4 herein, the FSC may void or revoke the effective registration.
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| Article 63 | When a primary exchange (or OTC) listed company or emerging stock company files for a capital reduction, the FSC may reject the filing case if any of the following circumstances exists:
- The attesting CPA issues an audit report containing a disclaimer of opinion or adverse opinion.
- The attesting CPA issues an audit report containing a qualified opinion that affects the fair presentation of the financial report.
- The case review forms prepared by the foreign issuer or reviewed by the attesting CPA show any violation of laws or regulations or the articles of incorporation, and the circumstances are serious.
- Breach or non-performance of a commitment made at the time of the application for listing or OTC trading of stock, where the circumstances are serious and remain uncorrected.
- The FSC discovers a violation of law or regulation, where the circumstances are serious.
- The FSC otherwise deems necessary to protect the public interest.
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