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Article 49-1
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If any of the circumstances listed below apply to a primary listed company, the TWSE may place that company's listed shares under an altered trading method:
1. Net worth, as indicated in its duly announced and filed consolidated financial report for the most recent period, of less than one-half of its share capital stated in the financial report, with net worth defined as shareholders' equity stated in the consolidated financial report less minority interests.
2. Failure to convene and bring to completion a regular shareholders meeting within 6 months after the conclusion of the business year.
3. The CPA-issued audit or review report indicates substantial doubt about the going-concern assumption, or the certifying CPA issued an audit or review report with a qualified opinion concerning the duly announced and filed financial report for the most recent fiscal year or half-year, provided that this restriction shall not apply if it is due to figures from an investee company's financial report that was not audited and attested by a CPA being used to calculate the amount of, and gains (losses) on, long-term equity investments for that primary listed company's semi-annual financial report, and the certifying CPA has fully disclosed in the audit report the reasons for the qualified opinion and the possible impact on the monetary amount of any accounting items, and there are no material irregularities.
4. It violated any rule or regulation relating to listed foreign securities such as rules or regulations regarding the disclosure of material information, was notified to conduct supplementary disclosure procedures, failed to do so before the deadline, and the circumstances of the case were serious.
5. Any petition for its reorganization has been submitted to the court in its home country.
6. If the situation in Article 28-8, paragraph 1, subparagraph 4 of the TWSE's Rules Governing Review of Securities Listings applies to the incumbent director, supervisor, or general manager of the primary listed company or any company it controls, and corrective action is not taken within the period prescribed by the TWSE.
7. Inability to redeem ordinary corporate bonds or convertible corporate bonds upon maturity or upon creditor request.
8. A negotiable instrument has been dishonored by a financial institution due to insufficient funds and the TWSE is aware of the situation.
9. Explanations in a press conference concerning material information fail to clarify the points in question and the TWSE deems it necessary to protect the rights and interests of investors.
10. The TWSE deems necessary based on any other reason.
When a primary listed company's securities have been placed under an altered trading method due to any circumstance in a subparagraph of the preceding paragraph, if the company meets the respective requirements listed below and is free of any other circumstances in the subparagraphs of the preceding paragraph, the TWSE may restore the regular trading method for the company's listed shares:
1. After placement under an altered trading method pursuant to subparagraph 1 of the preceding paragraph, the net worth in its CPA-audited and attested annual and semi-annual consolidated financial reports as duly filed and announced for the most recent two periods is one-half or more of its share capital as stated therein, and has not declined in comparison to the net worth stated either in the previous CPA-audited and attested annual or semi-annual consolidated financial reports as duly filed and announced.
2. After placement under an altered trading method pursuant to subparagraph 2 of the preceding paragraph, it convenes and brings to completion the regular shareholders meeting.
3. After placement under an altered trading method pursuant to subparagraph 3 of the preceding paragraph, the CPA-issued audit report for its most recent consolidated financial report indicates there is no longer any substantial doubt regarding the going-concern assumption; or its financial report has already shown improvement and after conducting a re-audit the CPA issues an audit with an unqualified opinion or issued an unqualified review report; or the semi-annual financial report of the investee company has already duly been reviewed or audited by a CPA.
4. After placement under an altered trading method pursuant to subparagraph 4 of the preceding paragraph, it conducts supplementary disclosure procedures as per notification.
5. After placement under an altered trading method pursuant to subparagraph 5 of the preceding paragraph, the petition for its reorganization is withdrawn, provided that the altered trading method implementation period may not be less than 3 months.
6. After placement under an altered trading method pursuant to subparagraph 6 of the preceding paragraph, supplementation or corrective action is taken.
7. After placement under an altered trading method pursuant to subparagraph 7 of the preceding paragraph, the company settles its obligation or reaches a conciliation agreement with the creditor.
8. Within 3 months from the next business day after placement under an altered trading method pursuant to subparagraph 8 of the preceding paragraph, it extinguishes the debt under the negotiable instrument by actual settlement of the amount of the negotiable instrument or completes payment negotiation procedures with its financial institution, and has the negotiation documents signed and certified by a CPA and attorney and submits them together with other relevant documentation to the TWSE for review and recordation.
9. After placement under an altered trading method pursuant to subparagraph 9 of the preceding paragraph, it clarifies the points in question.
10. After placement under an altered trading method under subparagraph 10 of the preceding paragraph, it provides supplementation or takes corrective action as required by the TWSE.
Within 1 month after it places the listed shares of a primary listed company under an altered trading method pursuant to the circumstances of paragraph 1, or restores that company's listed shares to the regular trading method under paragraph 2, the TWSE shall file with the Competent Authority for recordation.
After a primary listed company, under Article 28-7 of the Taiwan Stock Exchange Corporation Rules Governing Review of Securities Listings, adds in its articles of incorporation, organizational documents, or important financial or business documents any important matters as designated by the TWSE in connection with the protection of shareholders equity, it shall submit the draft amendment with a legal opinion by a lawyer regarding important matters in connection with the protection of shareholders equity of its articles of incorporation, organizational documents, or important financial or business documents to the TWSE 15 days before the notice or announcement of the shareholders meeting. If the TWSE deems that the draft amendment is likely to impair shareholders equity, it may issue an opposing opinion to the draft amendment. If the primary listed company, without the prior approval of the TWSE, fails to submit the draft amendment by the above-stated deadline, the TWSE may impose a penalty of NT$30,000.
If the TWSE deems that any content of a primary listed company's articles of incorporation, organizational documents, or important financial or business documents is likely to impair shareholders equity, it may require the primary listed company to amend its articles of incorporation, organizational documents, or important financial or business documents by a deadline. If the primary listed company fails to amend its articles of incorporation, organizational documents, or important financial or business documents by the deadline, the TWSE may impose a penalty of NT$30,000, and further impose a deadline for amendment of the articles of incorporation, organizational documents, or important financial or business documents. If the primary listed company still fails to amend the articles of incorporation, organizational documents, or important financial or business documents by the deadline, the TWSE may designate its listed stock as securities placed under an altered trading method. However, if in an individual case the circumstances of the impairment to shareholder equity are serious, the TWSE may proceed directly to designate the listed stock as securities placed under an altered trading method, without first imposing the penalty.
When listed stock of a primary listed company is designated as securities placed under an altered trading method because of circumstances in paragraph 5, then once the articles of incorporation, organizational documents, or important financial or business documents have been amended so that there is no longer any likelihood of impairment to shareholder equity, nor is there any other of the circumstances set out in the subparagraphs of paragraph 1, the TWSE may resume normal trading of the company's listed stock.
When the TWSE designates the listed stock of any primary listed company as securities placed under an altered trading method pursuant to paragraph 5, or resumes normal trading of its listed stock pursuant to paragraph 6, it shall report to the competent authority for recordation within one month after executing the measure.
If a secondary listed company, or a foreign issuer that issues Taiwan Depositary Receipts or the depositary institution thereof, breaches an undertaking executed at the time of its application for listing, the TWSE may depending on the case impose a breach penalty of NT$30,000 and order it to make supplementation or corrections within a certain period of time.
If a secondary listed company, or a foreign issuer that issues Taiwan Depositary Receipts or the depositary institution thereof, fails to make supplementation or corrections within the period of time under the preceding paragraph, the TWSE may place its listed securities under an altered trading method and the provisions of paragraph 3 shall apply mutatis mutandis.
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Article 50-3
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If any of the circumstances listed below applies to a primary listed company, trading of its listed shares shall be suspended by the TWSE after it reports to and obtains the approval of the Competent Authority pursuant to Article 147 Securities and Exchange Act:
1. Failure to publicly announce and file its financial report by the prescribed deadline.
2. Any suspected misrepresentation is discovered in a document or information submitted by it, and it fails to provide an explanation by a specified deadline as requested by the TWSE.
3. Failing to appoint a professional shareholder services agent in the Republic of China to handle stock affairs, and then failing to take corrective action by the specified deadline, as confirmed by the TWSE.
4. Failure to prepare its duly announced and filed financial report according to the relevant regulations and to the accounting principles of the Republic of China, the United States of America, or international financial accounting principles, as the case may be, and the circumstances are serious, and the company is notified to correct or make a restatement of the financial report but fails to do so by the specified deadline; or its certifying CPA has issued an audit report containing a disclaimer of opinion or adverse opinion, or issued a review report with an adverse opinion or disclaimer of opinion, in connection with the annual or semi-annual financial report that it announced and filed.
5. Violation of any rule or regulation regarding the disclosure of material information on a listed foreign company, in which the circumstances of the case are serious and necessitate the suspension of the trading of its securities.
6. Violation of an undertaking issued at the time it applied for listing; provided that this subparagraph does not apply to any amendment to the articles of incorporation, organizational documents, or important financial or business documents involving any important matter in connection with the protection of shareholders equity.
7. Violation of Article 49-1, paragraph 1, subparagraph 7, and inability to meet the requirements of paragraph 2, subparagraph 7 of that same Article within 3 months.
8. Violation of Article 49-1, paragraph 1, subparagraph 8, and inability to complete the supplementation procedures specified in paragraph 2, subparagraph 8 of that same Article within 3 months from the next business day after its shares are placed under an altered trading method.
9. Violation of Article 49-1, paragraph 5, and failure to amend the articles of incorporation, organizational documents, or important financial or business documents within 3 months from the next business day following placement of the stock under an altered trading method.
10. Any other circumstance requiring that the trading of listed securities be suspended.
When trading of the listed securities of a primary listed company is suspended due to any circumstance in a subparagraph of the preceding paragraph, if the company meets the respective requirements listed below and is free of any other circumstances in the subparagraphs of the preceding paragraph, then after filing with the Competent Authority and obtaining its approval pursuant to Article 147 of the Securities and Exchange Act the TWSE may publicly announce restoration of the trading of its listed securities:
1. After suspension of trading pursuant to subparagraph 1 of the preceding paragraph, has duly made a supplementary announcement and filing of its financial report.
2. After suspension of trading pursuant to subparagraph 2 of the preceding paragraph, has duly made corrections, or provided explanations as requested by the TWSE, with solid evidence.
3. After suspension of trading pursuant to subparagraph 3 of the preceding paragraph, has duly taken corrective action with solid evidence.
4. After suspension of trading pursuant to subparagraph 4 of the preceding paragraph, has made corrections to or a restatement of its financial report as required by the TWSE; or its CPA conducts a re-audit and issues an audit report free of the original disclaimer of opinion or adverse opinion, or a review report free of the original adverse opinion or disclaimer of opinion; or there is no audit report containing a qualified opinion or review report containing a qualified opinion in connection with Article 49-1, paragraph 1, subparagraph 3.
5. After suspension of trading pursuant to subparagraph 5 of the preceding paragraph, has made supplementation or taken corrective action pursuant to rules or regulations regarding disclosure of material information on listed foreign companies.
6. After suspension of trading pursuant to subparagraph 6 of the preceding paragraph, has made supplementation or taken corrective action pursuant to regulations and is in compliance with the undertaking it issued.
7. After suspension of trading pursuant to subparagraph 7 of the preceding paragraph, it makes supplementation or takes corrective action pursuant to regulations.
8. After suspension of trading pursuant to subparagraph 8 of the preceding paragraph, completed the supplementation procedures under Article 49-1, paragraph 2, subparagraph 8 within 6 months after the next business day after trading was suspended and presented the relevant evidentiary document to verify that it has done so.
9. After suspension of trading pursuant to subparagraph 9 of the preceding paragraph, has amended the articles of incorporation, organizational documents, or important financial or business documents, and there is no longer any likelihood of impairment to shareholders equity.
10. After suspension of trading pursuant to subparagraph 10 of the preceding paragraph, it makes supplementation or takes corrective action pursuant to the relevant rules and regulations.
If any of the circumstances listed below applies to a primary listed company, the TWSE shall file with the Competent Authority for approval to delist its listed securities pursuant to Article 144 of the Securities and Exchange Act:
1. Dissolution upon cancellation of its organizational registration in its home country.
2. Declaration of bankruptcy by a final and unappealable court ruling in its home country.
3. A ruling of the court in its home country approving reorganization, or dismissing a petition for reorganization, becomes final and unappealable.
4. There is a material change in the company's scope of business such that the TWSE deems it unsuitable to continue listed trading.
5. Six months after trading of its listed shares is suspended pursuant to any subparagraph of paragraph 1, any circumstance in any subparagraph of paragraph 1 still exists.
6. The most recent duly announced and filed consolidated financial report, or a consolidated financial report announced and filed on a supplementary basis, shows a negative net worth.
7. The Competent Authority has ordered suspension of the trading of all of its securities due to a circumstance under Article 156 of the Securities and Exchange Act and the suspension has for been effective for 3 months or longer.
8. Serious breach of the listing contract.
9. The shareholding in it by another exchange- (or OTC-) listed company (including another primary listed or primary-OTC-listed company) accounts for 70 percent or more of its total issued shares or authorized capital.
10. Any other circumstance that necessitates the suspension of the listing of securities.
When trading of the listed shares of a primary listed company has been suspended by the TWSE due to any circumstance in paragraph 1, subparagraph 1, 4, or 8 and the suspension has lasted for a full 6 months during which the company has not taken corrective action, and the TWSE has announced but not yet implemented the delisting of the company's listed shares, if the company then meets the respective requirements listed below, is free of any other circumstance in any subparagraph of the preceding paragraph, and submits relevant substantiating evidence to apply to the TWSE at least 8 working days before the implementation date, then after obtaining the approval of the Competent Authority, the TWSE may announce an exemption from implementation of the company's delisting:
1. If trading of its listed shares was suspended by the TWSE, due to a circumstance in subparagraph 1 or 4 of the preceding paragraph, for a full 6 months during which it failed to take corrective action, and it submits the regularly scheduled financial report that it previously failed to submit before the original deadline, or it duly makes corrections or restates the relevant financial report.
2. After announcement of its delisting due to a circumstance in paragraph 1, subparagraph 8, it completes the supplementary procedures listed under Article 49-1, paragraph 2, subparagraph 8, and submits the relevant documents as evidence.
After the announcement of the delisting of a primary listed company's listed shares, if that company completes supplementation before the delisting implementation date, it shall be eligible to have delisting implementation waived on those grounds only if the company has not previously been given an exemption of implementation of delisting of its listed shares for the same reason.
The Procedures for Handling Applications by Listed Companies for the Delisting of Securities shall apply mutatis mutandis to a primary listed company that applies to delist its listed shares.
If any of the following conditions applies to any foreign stock, Taiwan Depositary Receipt, or foreign bond that is listed with the TWSE by a secondary listed company, the TWSE may suspend the trading of, or delist, that stock, depositary receipt, or bond after reporting to and obtaining the approval of the Competent Authority:
1. The listed shares, or foreign securities represented by Taiwan Depositary Receipts, of a secondary listed company have already been suspended from trading or delisted by the securities exchange on which they are listed.
2. There has been a ruling by a court of the issuer's home country that duly prohibits transfer of the listed shares, foreign securities represented by Taiwan Depositary Receipts, or foreign bonds, of a secondary listed company.
3. A secondary listed company, depositary institution, or issue agent violates government laws or regulations, or the bylaws, rules, or public announcements of the TWSE, or refuses to pay the listing fee, or fails to perform the obligations required by the listing contract.
4. If, for 3 consecutive months the number of units of listed Taiwan Depositary Receipts outstanding and in circulation has been less than 10 million units, and additional issuance has not been completed within 3 months from the date of written notification from the TWSE to do so, the Taiwan Depositary Receipts may be delisted after reporting to and obtaining the approval of the Competent Authority.
5. The TWSEs deems it necessary to delist the listed shares, Taiwan Depositary Receipts, or foreign bonds, of a secondary listed company, based on any other reason sufficient to affect market order or investor rights and interests.
If due to the expiration of the issuing period, or if in accordance with the provisions of Article 145 of the Securities and Exchange Act the foreign issuer and its depositary institution, or the agent of the foreign issuer applies for the delisting of the listed shares, foreign securities, Taiwan Depositary Receipts, or foreign bonds, of a secondary listed company, such application shall be made to the TWSE for inclusion of its opinion, and then reported to and approved by the Competent Authority before the delisting becomes effective.
If delisting of listed Taiwan Depositary Receipts has been announced because of circumstances in paragraph 7, subparagraph 4, and corrective action is completed before the delisting is implemented, and none of the other circumstances in the subparagraphs of paragraph 7 exist, the issuer may submit relevant substantiating evidence to apply to the TWSE at least 8 working days before the implementation date, and the TWSE, after obtaining the approval of the Competent Authority, may announce an exemption from implementation of the delisting. However, this shall apply only insofar as no exemption from delisting has previously been granted for the same reason.
In cases of delisting under paragraphs 7 and 8, the foreign issuer and its responsible person shall undertake to unconditionally purchase the remaining outstanding shares or Taiwan Depositary Receipts of the company, and the Application Procedures for Terminating the Listing of Securities by Listed Companies shall apply mutatis mutandis.
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