| 14 | The TWSE may from time to time select TWSE listed companies according to the standards for sampling checks set forth below and require them to submit financial and business related materials or photocopies thereof for purposes of verifying material information disclosures and the timeliness, accuracy, and completeness thereof. When necessary, it may also carry out an on-site audit.
- Standards for sampling checks:
- Among securities for which information for attention in trading has been publicly announced, those securities with relatively many cumulative instances thereof in the current month.
- Companies that have published very little material information in the current month, or that have published material information of an unusual nature.
- Companies that are objects of complaints for failing to publish material information, delaying its publication, or publishing untrue material information.
- Obvious severe irregularities in operating conditions.
- Any circumstances the TWSE deems to require investigation and verification.
- Financial and business materials to be submitted:
- Minutes of board of directors meetings
- Trading certificates, vouchers, books and statements, and related materials.
- Relevant materials supporting the content of the material information.
- Other materials the TWSE deems need to be provided.
When the TWSE deems necessary, pursuant to the listing contract, the TWSE Operating Rules, or these Procedures, it may make inquiries to a TWSE secondary listed company or its agent located in the ROC, or request that the company or its agent provide the relevant information.
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| 15 | If any of the following circumstances applies to a TWSE listed company, or a secondary listed company, the TWSE may request in writing improvement or impose on a case-by-case basis a penalty of NT$30,000. However, if the cumulative number of penalties imposed within the most recent one year reaches two or more (inclusive of the current penalty), or if the circumstances in an individual case are due to intent or material negligence, or have a material impact on shareholder equity or securities prices, the TWSE may impose a penalty of NT$50,000 to NT$5 million. A company that is required to take remedial action shall do so within the time limit prescribed by the TWSE, or a penalty of NT$50,000 to NT$5 million per instance may be imposed until the date of compliance.
- The company violates any provision of these Procedures concerning material information or investor conferences.
- The material information contains descriptions of an exaggerated nature or that resemble advertising or promotional language.
- The company arbitrarily publishes unconfirmed news or discloses information that diverges from fact.
- The information published does not conform with the principles for corporate governance in Article 2 of the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies, and it affects shareholder equity.
- The company fails to submit relevant sampling check materials within the time limit set by the TWSE.
If an event under Article 5, paragraph 1, subparagraph 2 is found on the part of a TWSE secondary listed company, and the company fails to simultaneously report the event on the Internet information reporting system designated by the TWSE, or fails to simultaneously submit required documents and materials to the TWSE pursuant to Article 5, paragraph 2, then the TWSE, at its sole discretion, may impose a penalty of no less than NT$1 million and no more than NT$5 million. However, if the cumulative number of penalties within the most recent 1 year reaches two or more (inclusive of the current penalty), the current penalty may be increased to NT$5 million.
The TWSE may request in writing rectification or impose a breach penalty of NT$50,000 on a TWSE listed company that violates any provision of these Procedures governing press briefings concerning material information and halt and resumption of dealings for each instance of violation, provided that if the cumulative number of penalties within 1 year reaches two or more (inclusive of the current penalty), a breach penalty of NT$100,000 shall be imposed as the current penalty. In the event that any individual case of violation is due to intent or material negligence, or has a material effect on shareholder equity or the price of securities, the TWSE may impose a breach penalty of NT$100,000 to NT$5 million. A TWSE listed company that is required to take remedial action shall do so within the time limit prescribed by the TWSE, or a breach penalty of NT$100,000 to NT$5 million per instance may be imposed until the day the action is carried out.
If any circumstance set forth in any subparagraph of paragraph 1 applies to a TWSE listed company, or a TWSE secondary listed company, and the TWSE has imposed a penalty per instance and the company still fails to comply by the deadline and the circumstances of the particular case are severe, or if, after receiving notice from the TWSE requiring it to hold a press conference or apply for a halt and resumption of dealings, the TWSE listed company still fails to do so and the circumstances of the particular case are severe, the TWSE may alter the original trading method of the company's listed securities, suspend trading of the securities, or delist the securities pursuant to Article 49, Article 49-1, Article 50, Article 50-1, or Article 50-3 of the TWSE Operating Rules.
A TWSE listed company, or a TWSE secondary listed company on which a penalty is imposed shall pay the penalty to the TWSE Finance Department within 5 days from receiving notice from the TWSE.
If any circumstance under paragraph 1, subparagraph 3 is found on the part of a TWSE listed company or a TWSE secondary listed company, the TWSE shall compile the relevant information and submit it to the competent authority as a basis for it to take further measures.
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