||Taiwan Stock Exchange Corporation Rules Governing Review of Securities Listings(2009.07.08)
In addition to complying with the relevant provisions of these Rules, securities, financial and insurance enterprises, and enterprises exclusively engaged in futures commission merchant business, that apply for listing of their stock shall first obtain a letter of consent from the authority in charge of the enterprises concerned, before the TWSE will accept their applications. Provided, that if a financial enterprise or insurance enterprise applying for listing of its stock has previously obtained and provided such a letter before its stock began to be traded over the counter on the GreTai Securities Market in accordance with Article 3 of the GreTai Securities Market Rules Governing Review of Securities Traded on Over-the-Counter Markets, it does not need to provide such letter again.
Aside from complying with the relevant provisions of these Rules, a securities company applying for listing its stock shall have contemporaneously engaged in securities underwriting, buying and selling for its own account and such activities as commission agent or intermediary for at least five full fiscal years.
Where a foreign issuer and its depositary institution applying for listing Taiwan depositary receipts meet the following requirements, the TWSE may issue documentation evidencing approval of the listing thereof:
1. Number of units of Taiwan depositary receipts to be listed: 20 million units or more, or market value of NT$300 million or more.
2. The registered shares issued by the foreign issuer in accordance with the laws of its home country have been listed on one of the stock exchanges or securities markets approved by the Competent Authority before the listing of the Taiwan depositary receipts under the listing application.
3. Shareholders' equity: At the time of application for listing, the shareholders' equity stated on the financial report audited and certified by a Certified Public Accountant for the most recent period shall not be less than the equivalent of NT$600 million.
4. Profitability: It does not have accumulated deficit in the most recent one (1) fiscal year and meets one of the following criteria:
(1) The income before tax for each of the most recent two years represents not less than 6 percent of the shareholders' equity as shown in its final accounts, or the average income before tax for the most recent one year is 6 percent or greater; or
(2) The ratio of income before tax to shareholder's equity in the final accounting for each of the past two (2) fiscal years is 3 percent or higher, or the average is 3 percent or higher, and the profitability in the most recent fiscal year is better year-on-year than in the preceding year.
(3) The income before tax for each of the most recent two years shall be NT$250 million or more.
5. Dispersion of shareholdings: At the time of proposed listing, the number of holders of the Taiwan depositary receipts in the Republic of China is not less than 1,000 persons, and the total number of units held by holders other than insiders of the foreign issuer and juristic persons of which such insiders own over 50% of the shareholding is not less than 20 percent of the total units issued or is 10 million units or more.
6. There shall be no restriction on transfer of stock represented by Taiwan depositary receipts.
7. The rights and obligations of the holders of stock represented by Taiwan depositary receipts shall be identical with those of other stock of the same class issued at the same time.
The financial information referred to in Subparagraphs 3 and 4 of the preceding paragraph will be examined [by the TWSE] based on the consolidated report or the consolidated financial statement prepared by the said foreign issuer in accordance with the laws and regulations of its home country and the audit opinion issued by a certified public accountant in the Republic of China stating the differences between the accounting principles applicable in the Republic of China and the accounting principles applicable in the home country of the said foreign issuer and the impact of such differences on such financial reports.
After the foreign issuer obtains the TWSE's evidentiary documentation approving its application to list Taiwan Depositary Receipts and receives written notification from the TWSE that its listing application has been approved by the Competent Authority, it shall conduct a public sale pursuant to regulations. If the Taiwan Depositary Receipts for which the foreign issuer applied for listing are not listed for trading within three months from the date of the TWSE's written notification, after a report has been submitted to and approved by the Competent Authority, the listing contract shall be voided. If the foreign issuer, with legitimate reason, applies for an extension, then after the TWSE approves such extension and reports to the Competent Authority for approval and recordation, the foreign issuer may be granted a one-time only three-month extension.