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Amendments

Title：

Regulations Governing the Offering and Issuance of Overseas Securities by Issuers  CH

Amended Date： 2021.03.29 
Article Content Chapter Content Search Article No. Search Legal Basis Subordinate Legislation Amended Article Legislative History Chinese

Title： Regulations Governing the Offering and Issuance of Overseas Securities by Issuers(2014.10.24)
Date：
Article 6     An issuer intending to issue and offer overseas securities shall, after obtaining a letter of approval from the Central Bank, duly file with the FSC for effective registration, enclosing all required documents.
    When an issuer registers to issue and offer overseas securities, it shall engage a securities underwriter for evaluation and duly produce an evaluation report. However, this does not apply to an issue of straight corporate bonds or a registration for issuance of overseas depositary receipts pursuant to Article 12-1.
    An amended registration shall be filed promptly with the FSC if there is any change in the particulars registered in the documents submitted.
Article 10     With regard to an issuer's offering and issuance of overseas securities, after a registration becomes effective or approval of application is granted, the FSC may revoke or annul the registration or the approval if it discovers any of the following situations:
  1. The overseas securities have not been fully subscribed to and the cash proceeds thereof have not been fully collected within 3 months from the date on which the FSC's notice of effective registration is received; provided, however, that the FSC may grant an extension of 3 months upon application where proper reasons have been given (only one extension shall be allowed).
  2. The issuance of overseas depositary receipts is sponsored, or the overseas stock is offered and issued, using a method that is at variance with the particulars of registration (application) and the issuance rules set forth in the accompanying documents, and no application for change has been filed with the FSC before the date of execution of a deposit contract or the date of fixing the price for the issuance; provided, however, that this provision shall not apply if the issuer registers (applies) to use outstanding shares to sponsor issuance of overseas depositary receipts, or to use outstanding shares to engage in trading on offshore stock exchanges.
  3. Overseas convertible bonds or bonds with warrants are not issued in accordance with registration (application) particulars, the statement of issuance methods, and other conversion rules or warrant exercise rules, and where no application for change has been filed with the FSC before the date for fixing the price of the issue.
  4. Violation of Article 20, paragraph 1 of the Act.
  5. Violation of Article 8 herein.
  6. Violation of, or failure to perform, any undertaking made at the time it offered and issued securities, where the circumstances are serious.
  7. During the period from the date on which registration becomes effective until the date on which the securities offering is completed, any publicly disclosed financial forecasts or issued information is inconsistent with the registration documentation, and there is a material impact on the securities price or shareholders equity.
  8. There is a violation of any provision of these Regulations, or of any restriction or prohibition that was in place at the time of the FSC's notice of effective registration or approval of application.
    Subparagraphs 1 to 3 and 7 of the preceding paragraph do not apply to a registration for issuance of overseas depositary receipts pursuant to Article 12-1.
    Overseas securities shall not be listed and traded overseas in New Taiwan Dollars.
Article 11     Upon issuance of its overseas securities, an issuer shall comply with the following:
  1. A prospectus prepared in accordance with the securities acts and regulations of the country where the offering took place must be uploaded to the information reporting website specified by the FSC; provided, however, that the same shall not apply to the issuance of overseas depositary receipts for conversion of or subscription to overseas corporate bonds.
  2. If the funds utilization plan has not yet been fully executed, the issuer shall disclose the implementation progress of the plan in the annual report; where the issuer is issuing overseas corporate bonds, information relating to the corporate bond issue shall be posted by the issuer to the information reporting website specified by the FSC within 2 days from the date of completion of the raising of capital, and by the tenth day of each month for the duration of the period during which the overseas corporate bonds are being issued.
  3. The issuer shall, within 10 days after the end of each quarter and in accordance with FSC regulations, post the funds utilization plan and the quarterly report on the status of funds utilization to the information reporting website specified by the FSC.
  4. A company listed on a securities exchange or traded on an OTC market shall, on a quarterly basis, request the original securities underwriter or CPA to prepare an evaluation opinion on progress in implementation of the funds utilization plan, the legitimacy of the purpose of the unused funds, and a statement concerning whether there has been any change to the plan. Within 10 days after the end of each quarter, the issuer shall post such opinion together with the information referred to in the preceding subparagraph to the information reporting website specified by the FSC.
  5. Where the issuer is sponsoring issuance of overseas depositary receipts through capital increase, and its purpose in so doing is to acquire a foreign company, acquire the shares of a foreign company, or sponsor issuance of new shares for the purpose of an acquisition or separation of a foreign company conducted in accordance with the law, the issuer shall, on a quarterly basis for the first year following completion of registration, request the original underwriter to prepare an opinion evaluating the impact of such matters upon the issuer's financial operations, business operations, and shareholders' equity. The issuer shall post such opinions to the information reporting website specified by the FSC.
  6. Where, as the result of a change to an item or a dollar amount in an individual item in the funds utilization plan, the total amount of capital needed for the original item increases or decreases by 20 percent or more of the total amount of capital raised, after reporting the change for approval by the Central Bank, the issuer shall register an amendment of the plan and, within 2 days after the amendment is approved by a resolution of the board of directors, the issuer shall make a related public announcement via the information reporting website specified by the FSC. The issuer shall also submit the change to a shareholders meeting for confirmation. Where the funds utilization plan is amended, the issuer shall, upon such change and within 10 days after the end of each subsequent quarter, also request the original underwriter to issue an evaluation opinion on the progress of implementation of the funds utilization plan and the legitimacy of the purpose of the unused funds, and shall post such opinion together with the information referred to in subparagraph 3 above to the aforementioned website.
  7. Where a material event occurs that requires real-time public announcement or reporting in accordance with the laws of the country in which the overseas securities are listed or the rules and bylaws of its securities exchange, the issuer shall simultaneously post the information to the information disclosure website specified by the FSC.
    If overseas securities are subscribed to by specific persons or strategic investors, the issuer shall disclose the subscription list as well as individual subscription prices and quantities in the prospectus, and shall post this information to the information reporting website designated by the FSC.
    The provisions of the preceding two paragraphs do not apply to a registration for issuance of overseas depositary receipts pursuant to Article 12-1.
    When an issuer that offers and issues overseas securities receives a written inquiry from the competent authority for securities of the country in which the securities are listed, it shall report to the FSC within 2 business days from the date on which it receives the inquiry and at the same time that it provides the information requested by the inquiry.
Article 12     An issuer registering to use either (i) a capital increase through a new share issue or (ii) outstanding shares, to sponsor issuance of overseas depositary receipts in a foreign exchange market by a depositary institution, shall, depending on the nature of the issue, file [one of ten different types of] Registration to Sponsor Issuance of Overseas Depositary Receipts (Attachments 1 to 5), specifying therein the required particulars, together with the required supporting documents, and may proceed to the issuance only after the registration filed with the FSC has become effective.
    An issuer registering to use a capital increase through a new share issue to sponsor issuance of overseas depositary receipts shall state the basis for setting the issue price, the legitimacy thereof, and any effects on shareholders' equity and refer the same to a shareholders meeting for approval by resolution.
Article 12-1     An issuer registering to use outstanding shares to sponsor issuance of overseas depository receipts in a foreign over-the-counter market shall submit the matter to the board of directors or shareholders meeting for approval by resolution. Afterwards, the issuer shall file with the FSC for effective registration by submitting the Registration Form (Attachment 5-1), specifying therein the maximum total amount and the required particulars, together with the required supporting documents.
    Only after the issuer has filed for effective registration pursuant to the preceding paragraph may an investor, directly or via a depositary institution, within the maximum total amount, purchase the original securities on the domestic market and deliver them, or deliver the original securities that it already holds, to the custodian institution, for the depositary institution to issue overseas depositary receipts evidencing the securities. However, the persons specified in Article 22-2 of the Act are prohibited from doing as provided hereinabove.
    When the issuer does as provided in paragraph 1, the number of shares represented by the maximum total amount for the overseas depositary receipts registered for issuance may not exceed 10 percent of the total number of issued shares of the issuer.
    After the issuer has done as provided in paragraph 1, if the depository institution fails to conduct the initial issue of overseas depositary receipts within 6 months from the date on which the notice of effective registration is received, the FSC may void the effective registration; provided, the FSC may grant an extension of 6 months upon application therefor with legitimate reasons and provided further that such extension shall be limited to one.
Article 13     When an issuer carries out a cash capital increase, merger, receipt of a transfer of shares of another company, or an acquisition or separation in accordance with law, and therefore issues new shares to sponsor the issuance of overseas depositary receipts, it shall not be subject to the prohibition against issuance of shares below par value set forth in Article 140 of the Company Act.
    An issuer registering to sponsor issuance of overseas depositary receipts by issuance of new shares at below par value shall, in addition to complying with Article 12, paragraph 2, state its reasons for not using other capital raising methods, state the legitimacy thereof, and refer the same to a shareholders meeting for approval by resolution.
Article 14     After the issuance of overseas depositary receipts, the issuer must obtain effective registration with the FSC before it may carry out any follow-on issue, except under the following circumstances:
  1. The additional depositary receipts are issued in accordance with the provisions of the Regulations Governing Investment in Securities by Overseas Chinese and Foreign Nationals; provided, however, that the deposit contract and custody contract must expressly provide that overseas depositary receipts may be re-issued following redemption.
  2. Following the issuance of overseas depositary receipts, the issuer carries out a cash capital increase through a new share issue, a new share distribution from earnings, or a new share distribution from capital reserve, and in connection therewith carries out a follow-on issue of depositary receipts corresponding to the amount of the newly issued shares.
  3. The issuance is made within the maximum total amount set out in Article 12-1.
    An issuer's director, supervisor, manager, or shareholder holding more than 10 percent of the total issued shares, intending to issue additional depositary receipts under subparagraph 1 of the preceding paragraph shall comply with Article 22-2, paragraph 1, subparagraph 1 of the Act by filing an application (Attachment 6) specifying therein the required particulars and may proceed to the issuance only after the approval by the FSC.
    Where the issuer referred to in paragraph 1 needs to carry out a follow-on issue of overseas depositary receipts in order to carry out a cash capital increase through a new share issue, if the proceeds raised offshore are to be converted into New Taiwan Dollars and used onshore, the issuer shall obtain a consent letter from the Central Bank before registering with the FSC to carry out a cash capital increase.
Article 15     In registering to sponsor issuance of overseas depositary receipts, the issuer shall submit an issuance plan that specifies the following particulars:
  1. Purpose of the offering.
  2. Projected date of issuance, total dollar amount, total number of units to be issued, number of the underlying securities evidenced by overseas depositary receipts, and method for determining the per unit issue price. However, in the case of an issuance pursuant to Article 12-1, the issuance plan shall specify the maximum total amount of the overseas depositary receipts to be issued, the maximum total amount of the securities represented by those overseas depositary receipts, and the ratio of the number of shares represented by the maximum total amount to the total number of issued shares.
  3. Rights and obligations of the holders of overseas depositary receipts.
  4. Source of the underlying securities evidenced by overseas depositary receipts; where the issuance of overseas depositary receipts is sponsored through cash capital increase, if a shareholders' meeting authorizes the board of directors to adjust the issuance amount in accordance with market conditions within the scope of the authorized issuance, and all the depositary receipts are issued in one tranche, such shall be expressly stated in the offering plan.
  5. Statement of issuance methods: It shall be expressly stated whether all the depositary receipts will be publicly issued or whether a portion thereof will be subscribed to by a specific person or persons. If it is agreed that a portion thereof will be subscribed to by a specific person or persons, the purpose of subscription by a specific person or persons, the total number of units subscribed to by the specific person or persons, total dollar amount, and the relation between the specific person or persons and the issuer shall be specified in the offering plan. However, if the issuer files for registration with the FSC to sponsor an issuance of overseas depositary receipts using shares, obtained due to the split, of holders of overseas depositary receipts previously sponsored for issuance by the split company, the issuer may deliver the full amount to the holders of the aforementioned overseas depositary receipts previously sponsored for issuance by the split company.
  6. Place of issuance and transaction.
  7. The funds utilization plan and the expected benefits (where the issuer is sponsoring issuance of overseas depositary receipts through cash capital increase).
  8. Where the issuer registers to sponsor issuance of overseas depositary receipts through capital increase and its purpose in so doing is to merge with a foreign company, to acquire the shares of a foreign company, or to issue new shares for the purpose of an acquisition or separation of a foreign company conducted in accordance with law, the offering plan shall specify the following particulars:
    1. The name and volume of shares (business operations or assets) acquired, and the name of the party from whom they are to be acquired.
    2. Schedule for implementation and completion of the plan.
    3. Method of determining the share exchange ratio, and the legitimacy thereof.
    4. Any conditions or restrictions upon future transfer of the shares, business, or assets to be acquired.
    5. Expected returns.
    6. Where the company to be acquired or the company whose shares are to be acquired is an related enterprise or related party, the issuance plan shall specify the issuer's relationship with the related enterprise or related party, the reason for choosing the related enterprise or related party, the necessity for such choice, and the impact upon shareholders' equity.
  9. Allocation of responsibility for payment of relevant fees incurred during the offering period and the period when the facility remains outstanding.
  10. Other items as required by the FSC.
Article 17     After a depositary institution has issued overseas depositary receipts, it shall act in accordance with all acts or regulations for foreign exchange matters when handling exchange settlement matters arising in connection with its receipt of: (1) cash dividend distributions; (2) proceeds from the redemption and sale of securities underlying overseas depositary receipts; and (3) funds required by a depositary institution in order to re-issue such overseas depositary receipts, where an investor (or a depositary institution acting on such investor's behalf) has (within the scope of the original number of shares redeemed or the maximum total amount and in accordance with the provisions of Article 14, paragraph 1, subparagraph 1 or 3) purchased on a domestic market the underlying securities evidenced by the depositary receipts, and such investor or depositary institution has delivered the securities to a custodian institution, and a depositary institution (as mentioned above) uses these securities to issue or re-issue such overseas depositary receipts.
Article 19     With respect to an issuer that is seeking to sponsor issuance of overseas depositary receipts, once the registration becomes effective, the issuer shall, within 2 days after signing a deposit contract, make a public announcement of the following matters on the information reporting website specified by the FSC:
  1. Total dollar amount, unit price, volume, and issue date of the overseas depositary receipts issue; provided, however, that if the overseas depositary receipts are for conversion of overseas corporate bonds, the issuer may opt to announce only the estimated number of units to be issued. However, in the case of an issuance pursuant to Article 12-1, the issuer may opt to announce only the maximum total amount of the overseas depositary receipts to be issued.
  2. The number of shares of the underlying securities and their unit price; provided, however, that if the overseas depositary receipts are for conversion of overseas corporate bonds, the issuer may opt to announce only the estimated number of shares. However, in the case of an issuance pursuant to Article 12-1, the issuer may opt to announce only the securities represented by the overseas depositary receipts, the maximum total amount of those securities, and the ratio of the number of shares represented by the maximum total amount to the total number of issued shares.
  3. Place of issuance and transaction.
  4. The issuer's reason for arranging for subscription by the specific person or persons, the total number of units subscribed to by the specific person or persons, total dollar amount, and the relationship between the specific person or persons and the issuer (if the statement of issuance methods provides that a portion of the depositary receipts shall be subscribed to by a specific person or persons).
  5. The proceeds plan and the expected benefits (where the issuer is sponsoring issuance of overseas depositary receipts through cash capital increase).
  6. The name of the company involved in such acquisition or share exchange, the number of shares involved, the schedule for implementation and completion of the plan, the expected benefits, the share exchange ratio, the method (and legitimacy thereof) for determining the value of the overseas depositary receipts for which the issuer is to sponsor issuance, and the method (and legitimacy thereof) for determining the value of the assets to be acquired by the issuer (the above disclosures are to be made where the issuer intends to acquire a foreign company, to acquire the shares of a foreign company, or to issue new shares for the purpose of an acquisition or separation of a foreign company conducted in accordance with the law).
  7. The primary impact on shareholders' equity (e.g. expenses incurred by the issuer in sponsoring issuance of the overseas depositary receipts, impact on shareholding structure, etc.).
    After the announcement of the items referred to in the preceding paragraph, should there be any change to any of these items, a public announcement of such change shall be made within 2 days from the date on which any of the originally announced items is changed.
Article 20     With respect to an issuer that is seeking to sponsor issuance of overseas depositary receipts, once the registration becomes effective, the issuer shall submit one of each of the following documents to the FSC for recordation within 10 days after issuance of the overseas depositary receipts:
  1. A prospectus prepared in accordance with the securities acts and regulations of the country where the offering took place; provided, however, that these requirements do not apply to the issuance of overseas depositary receipts for conversion of or subscription to overseas corporate bonds.
  2. A duplicate copy of the deposit contract.
  3. A duplicate copy of the custody contract.
  4. An opinion letter in Chinese issued by an ROC attorney-at-law confirming that there is no material discrepancy between the issuance rules and the particulars of the issuance as set forth in a registration that the FSC has allowed to become effective.
  5. Documentary evidence providing proof of deposit of funds collected in full, provided that such evidence need not be submitted where an issuer registers to use previously issued shares to sponsor issuance of overseas depositary receipts.
  6. A list of those whose subscriptions account for 10 percent or more of the total value of the issue as well as the individual subscription prices and quantities thereof.
  7. Other documents required by the FSC.
    The provisions of the preceding paragraph do not apply to a registration for issuance of overseas depositary receipts pursuant to Article 12-1.
    If an issuer sponsoring issuance of overseas depositary receipts is required by a deposit contract to provide any information to a depositary institution, within 3 days after providing such information the issuer shall report such provision to the FSC for recordation.
Article 21     After the issuance of overseas depositary receipts, the sponsor shall, both by the 20th day and within 5 days after the end of each month, post separately a Statement of Outstanding Balance of Overseas Depositary Receipts and Securities Represented Thereby (Attachment 14) as of the 15th day of the current month or as of the end of the previous month, as the case may be, to the information reporting website specified by the FSC, and shall also submit a report to the Central Bank for recordation.
    In the event that the sponsor carries out a cash capital increase through a new share issue, a new share distribution from earnings, or a new share distribution from capital reserve, and the depositary institution carries out a follow-on issue of overseas depositary receipts in a corresponding amount pursuant to Article 14, paragraph 1, subparagraph 2, the sponsor shall, within 2 days after issuance of the overseas depositary receipts, report to the Central Bank the total dollar amount of the overseas depositary receipts, total units, and the number of the underlying securities, and shall post the relevant information to the information reporting website specified by the FSC.
Article 28     After the issuance of overseas corporate bonds, an issuer shall, both by the 20th day and within 5 days after the end of each month, post separately a Statement of Outstanding Overseas Corporate Bonds (Attachment 15) as of the 15th day of the current month or as of the end of the previous month, to the information reporting website specified by the FSC and shall also submit a report to the Central Bank.
    After conversion of the overseas corporate bonds or exercise of the warrants is accepted by an issuer, the issuer shall report any instances of warrant exercise by overseas investors in accordance with the requirements of the Investment Commission of the Ministry of Economic Affairs.