| Title： |
Taiwan Stock Exchange Corporation Articles of Incorporation(2014.06.16) |
| Date： |
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Chapter 1 General Provisions
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| Article 1 | The purpose of the Corporation is to promote business investment, facilitate economic planning and development, provide assistance to industrial and commercial enterprises and protect rights and benefits of investors. The name of the Corporation is the Taiwan Stock Exchange Corporation.
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| Article 2 | The Corporation is organized in accordance with the Securities and Exchange Act and the Company Act. The Corporation has submitted an application to the competent authorities for approval and registration.
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| Article 3 | The Corporation is situated in Taipei, Taiwan.
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| Article 4 | The Corporation shall continue to exist for such period as approved by the competent authority upon application in accordance with the Securities and Exchange Act.
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| Article 5 | The Corporation shall make public announcements in accordance with Article 28 of the Company Act.
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Chapter 2 Business
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| Article 6 | The Corporation may engage in the following business activities:
- Providing the premises and facilities to supply to contracted securities brokers and securities dealers for centralized trading, clearing and settlement of securities under the Securities and Exchange Act and other relevant services; and
- Engaging in such other business activities as approved by the competent authority and invest in other enterprises.
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| Article 7 | As preliminarily determined, five hundred securities brokers and securities dealers may trade at the market of the Corporation. Where necessary, the board of directors (the "Board") may resolve to change the above number, subject to approval of the competent authority.
The qualifications and criteria of the securities brokers and securities dealers in the preceding paragraph shall be determined in accordance with the Securities and Exchange Act and the Standards Governing the Establishment of Securities Firms.
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Chapter 3 Shares
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| Article 8 | The total capital of the Corporation shall be NT$64,43,265,810, divided as 644,326,581 shares with a par value of NT$10 per share. All the shares shall be fully issued.
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| Article 9 | The shares of the Corporation are all registered shares. The Corporation shall not issue bearer share certificates.
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| Article 10 | The Corporation may only transfer its shares to those permitted under the Securities and Exchange Act.
No transfer of shares of the Corporation may be used against the Corporation unless the name and residence or domicile of the transferee is recorded in the shareholder roster of the Corporation.
No changes to the information recorded in the shareholder roster in the preceding paragraph may be allowed within 30 days before a regular shareholders' meeting, or 15 days before a special shareholders' meeting, or 5 days before the record date of distribution of stock dividends or bonuses or other benefits.
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Chapter 4 Shareholders' Meeting
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| Article 11 | The Board shall convene a regular shareholders' meeting within six months after the end of a fiscal year. A special shareholders' meeting may be convened in accordance with law if necessary.
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| Article 12 | All shareholders shall be notified of the date, place and agenda of the meeting 20 days before a regular shareholders' meeting or 10 days before a special shareholders' meeting.
Shareholders holding 1% or more of the total issued shares of the Corporation may submit a proposal in writing to the regular shareholders' meeting. Only one proposal may be accepted. All other proposals will not be included in the agenda.
The Corporation will issue a public announcement on solicitation of proposals from shareholders, where proposals shall be submitted to, and when proposals may be accepted prior to the date of suspension of transfer of shares before a regular shareholders' meeting. The period to accept proposals shall not be shorter than 10 days.
A proposal submitted by shareholders must not exceed 300 Chinese characters. Any proposal containing more than 300 Chinese characters will not be included in the agenda. A shareholder who has submitted a proposal must attend the regular shareholders' meeting in person or by proxy and participate in the discussion of his or her proposal.
The Board may refuse to include a proposal submitted by shareholder in the agenda in one of the following circumstances:
- The proposal is not something to be resolved at a shareholders' meeting;
- The shareholder submitting the proposal holds less than 1% of the shares of the Corporation at the time prior to commencement of the period when transfer of shares is suspended under Paragraph 2, Article 165 of the Company Act; or
- The proposal is not submitted during the scheduled period when proposals may be accepted as specified in the public announcement.
The Corporation shall notify the shareholder submitting the proposal of the status of his or her proposal before the date when the notice of the shareholders' meeting is sent, and include the proposals that have met the requirements in this article in the meeting notice. The Board shall provide reasons for not including a shareholder's proposal in the agenda at the shareholders' meeting.
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| Article 13 | Each shareholder of the Corporation shall have a voting right for each share they hold.
Voting rights may be exercised in writing or electronically at the shareholders' meeting of the Corporation. If voting rights are to be exercised in writing or electronically, how voting rights may be exercised shall be specified in the notice of the shareholders' meeting.
A shareholder exercising voting rights in writing or electronically shall be deemed to have attended the shareholders' meeting in person and waived his or her rights to the extempore motion and amendments to existing proposals at the shareholders' meeting.
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| Article 14 | If a shareholder cannot attend a shareholders' meeting in person, he or she may issue a proxy form in accordance with law, stating the scope of authorization, to authorize an agent to attend the meeting on his or her behalf. The proxy form must be delivered to the Corporation or its stock agent at least five days before the shareholders' meeting.
If the agent in the preceding paragraph acts as the proxy for two or more shareholders at the same time and the voting rights he or she represents exceed 3% of the voting rights of all the issued shares, the excess voting rights will not be exercised.
A corporate shareholder shall send the name(s) of its representative(s) who will attend a shareholders' meeting to the Corporation or its stock agent at least five days before the meeting of the shareholders' meeting.
There may be one or more representatives in the preceding paragraph but the voting rights that may be exercised by them at the shareholders' meeting shall be calculated on the basis of the total number of voting shares hold by such corporate shareholder.
If, after the Corporation has received a proxy form, a shareholder sending the proxy form decides to attend the shareholders' meeting in person or intends to exercise his or her voting rights in writing or electronically, he or she shall issue a written notice to revoke the authorization to the Corporation two days before the shareholders' meeting. If the revocation is not provided within the specified time limit, exercise of the voting rights by the proxy attending the meeting shall prevail.
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| Article 15 | If a shareholder intends to exercise his or her voting rights in writing or electronically, he or she must express this intent to the Corporation two days before the shareholders' meeting. In the case of repeated expressions of intent, the first one given to the Corporation shall prevail, except for a declaration to revoke a prior expression of intent.
If, after having exercised the voting rights in writing or electronically, a shareholder intends to attend the shareholders' meeting in person, he or she shall revoke the prior expression of intent on exercise of voting rights in the same manner as how he or she has exercised the voting rights two days before the shareholders' meeting. If the revocation is not made within the specified time limit, exercise of voting rights in writing or electronically shall prevail.
In a shareholder exercises his or her voting rights in writing or electrically and issues a proxy form to authorize an agent to attend the shareholders' meeting, exercise of the voting rights by the authorized agent shall prevail.
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| Article 16 | The chairperson of the Board shall chair the shareholders' meeting. In the event of absence of the chairperson of the Board for cause, a director may be designated to act as the meeting chair or the meeting chair may be elected from among the directors.
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| Article 17 | Unless otherwise provided for in the Company Act, a resolution of a shareholders' meeting shall be adopted with a consent of the shareholders representing a majority of the voting rights at the meeting attended by shareholders holding a majority of the total issued shares. In the case of a tie in the votes, the meeting chair shall have a deciding vote.
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| Article 18 | Resolutions of a shareholders' meeting shall be recorded in the meeting minutes signed or affixed with the chop by the meeting chair and kept together with the attending shareholders' signature book and attendance proxy forms.
Meeting minutes in the preceding paragraph may be produced and distributed electronically.
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Chapter 5 Directors, Supervisors and Managers
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| Article 19 | The Corporation has 15 directors and 3 supervisors, all to be elected at the shareholders' meeting in accordance with law, except that at least one third of them shall be appointed by the competent authority from among the professionals with related expertise as provided under the Securities and Exchange Act.
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| Article 20 | The directors and supervisors shall have a term of office of three years and may be reelected or reappointed. A director or supervisor filling the vacancy shall be in the office for the remaining period of term of the former director or supervisor whose vacancy he or she fills.
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| Article 21 | The Board comprises directors. The chairperson of the Board shall be elected from among the directors with a consent of a majority of the directors present at a meeting attended by more than two thirds of the directors. The chairperson of the Board shall be the representative of the Corporation.
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| Article 22 | The chairperson of the Board shall convene and chair the meeting of the Board. Unless otherwise provided for under the Company Act, a resolution shall be adopted with a consent of a majority of the directors present at a meeting of the Board attended by a majority of the directors.
If chairperson of the Board cannot attend the meeting of the Board for cause, a director may be designated to act as the meeting chair or the meeting chair may be elected from among the directors.
A director unable to attend the meeting of the Board in person may authorize another director in writing as his or her agent. One director may only act as the agent of another director.
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| Article 23 | The Board shall have the following powers and authorities:
- Deliberating and deciding on the important policies and regulations of the Corporation;
- Reviewing and discussing the operational guidelines and annual budget of the Corporation;
- Reviewing and discussing the final accounts and profit allocation proposal of the Corporation;
- Reviewing and discussing the proposals and reports submitted to the shareholders' meeting;
- Appointing or discharging the general manager and deputy general managers, and the assistant general managers, business commissioners, and managers and deputy mangers of various departments;
- Approving and determining the Corporation's investment activities;
- Deliberating and deciding on the Contract for Use of the Centralized Securities Exchange Market;
- Deliberating and deciding on the Criteria Governing Consignment Contracts of Securities Brokers trading at the Corporation's centralized securities exchange market;
- Deliberating and deciding on cases where a securities broker or securities dealer is restricted or prohibited from trading or its contract for use of the centralized securities exchange market is terminated for trading at the Corporation's centralized securities exchange market in violation of the law, regulations, rules and contract;
- Deliberating and deciding on the amount of the brokerage/handling fees and other charges payable by securities broker and securities dealer for trading at the Corporation's centralized securities exchange market, and the rate of the service charge collected by securities broker from its principal;
- Deliberating and deciding on the criteria for review of securities listings and the rules governing listing contract;
- Approving and determining the listing, delisting, suspension or resumption of trading of securities;
- Deliberating and deciding on the rate of the listing fee payable by issuer for the securities to be listed; and
- Approving and determining other important matters.
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| Article 24 | A resident supervisor shall be elected from among the supervisors.
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| Article 25 | Supervisors shall have the following powers and authorities:
- Reviewing the annual final report;
- Supervising the business of the Corporation and examining all accounts and relevant details; and
- Other matters as required or permitted by law.
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| Article 26 | The Corporation shall have one general manager, two or three deputy general managers, several assistant general manager (acting as department head concurrently) and business commissioners, and various departments responsible for different matters, each to have one manager and one to three deputy managers.
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| Article 27 | Appointment and discharge of the general manager and deputy general managers of the Corporation shall be approved with the consent of a majority of the directors present at the meeting of the Board attended by a majority of the directors. The same rule shall apply to the appointment and discharge of assistant general managers, business commissioners, and managers and deputy managers of various departments.
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| Article 28 | Remunerations of the chairperson of the Board, directors, resident supervisor and supervisors shall be discussed and determined at the shareholders' meeting.
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| Article 29 | The Board may establish the business consulting commissions, and the bylaws and rules of proceedings of these commissions shall be separately established by the Board.
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Chapter 6 Business Commissions
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| Article 30 | The Corporation may establish various business commissions based on the needs.
Commissioners of these business commissions shall be selected and appointed by the Board from scholars and experts or securities business operators and the staff of the Corporation.
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| Article 31 | The bylaws and rules of proceedings of these business commissions shall be separately established.
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Chapter 7 Accounting
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| Article 32 | The Corporation adopts a fiscal year ending end of July on a six-month basis or ending end of December on a full-year basis.
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| Article 33 | At the end of a fiscal year, the Board shall prepare the following reports and statements to be reviewed by the supervisors before they will be submitted to the regular shareholders' meeting for recognition:
- Business report;
- Financial statements; and
- Proposal for allocation of profits or compensation of losses.
The reports and statements in the preceding paragraph shall be submitted to the competent authority and published in accordance with law.
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| Article 34 | After close of a fiscal year, the Corporation shall first compensate the losses from previous years, aside from paying the income taxes in accordance with law, before contributing 10% of the remaining net profits as legal reserve as well as a certain percentage of the remaining net profits as special reserve determined by the competent authority in accordance with the Regulations Governing Stock Exchanges. If there are profits left after the above allocation, the remaining profits together with the retained earnings from the previous year shall be further allocated in the following order:
- For employee bonus between 1% and 12% of the profits, the allocation ratio and rules shall be determined by the Board as authorized; and
- For the remaining profits, the Board shall propose an allocation plan to be resolved at a shareholders' meeting.
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| Article 35 | The Corporation shall make the allocations of earnings upon resolution at the shareholders' meeting. The stock dividends of the Corporation shall be distributed based on the shareholders' register on the distribution date as set forth in accordance with Paragraph 2, Article 165 of the Company Act.
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Chapter 8 Supplementary Provisions |
| Article 36 | Operation of the Corporation's securities exchange shall be separately provided for in the Operating Rules.
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| Article 37 | Disputes arising from and/or in connection with trading of securities in accordance with the Securities and Exchange Act between the Corporation and securities brokers or securities dealers shall be resolved through arbitration in accordance with the Securities and Exchange Act. Where necessary, the Corporation may approach the Taiwan Securities Association for mediation services prior to arbitration.
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| Article 38 | These Articles of Incorporation shall be approved by resolution of the shareholders' meeting and submitted to the competent authority for recordation before coming into force. The same shall apply in the case of any amendments hereto.
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