Notwithstanding the fact that an issuing company applying for the listing of its stock meets the listing criteria set forth in these Rules, the TWSE may disagree to its listing if the issuing company has any of the events listed below, except for any of those in subparagraphs 8, 9, or 10 under which the TWSE shall disagree to its listing, and is deemed by the TWSE to be inappropriate for listing:
Subparagraph 2 of the immediately preceding paragraph shall not apply to companies applying for listing which are government-owned enterprises. The ending date of the applicable periods referred to in various subparagraphs of paragraph 1 of this Article shall be the day immediately before the date on which the Agreement for Listing takes effect.
- It has any of the events set forth in Article 156, paragraph 1, subparagraphs 1 and 2 of the Securities and Exchange Act, or has made misrepresentation or false statement or conducted unlawful activities that may affect the price of its securities after listing thereof, and will cause fear that the market order may be affected or the public interests may be harmed.
- Its financial or business affairs are not independent from other person(s).
- It has had any material labor dispute or environmental pollution sufficient to affect its normal financial and business operations, and has not made improvement.
- It has been discovered any material non-arms-length transaction and has not made improvement.
- After the capital increase through a new share issue which has been effected or is being effected in the year in which it applies for listing is included in the amount of paid-in capital in its final account for the respective year, it does not meet the listing criteria.
- It has failed to effectively implement its written accounting system, internal control system, or internal audit system, or has failed to prepare financial reports in accordance with relevant laws and regulations and generally accepted accounting principles, and the event of this failure is considered as material.
- There has been serious deterioration in its business operation.
- Where the applicant company conducted any activities in violation of the principle of good faith in the most recent 5 years, or where its directors, supervisors, general manager or de facto responsible person violated the same principle in the most recent 3 years.
- If an applicant company has less than five directors on its board of directors, or its independent directors number less than two persons or less than one-fifth of the number of directors; or less than three supervisors; or if any of its board of directors or supervisors are unable to independently exercise their functions; or if it has not appointed the remuneration committee pursuant to Article 14-6 of the Securities and Exchange Act and related provisions. However, if pursuant to Article 14-4 of the Securities and Exchange Act an audit committee has been established in lieu of supervisors, the requirements of this subparagraph regarding supervisors shall not apply. Additionally, the elected independent directors must be persons that are not juristic persons or representatives thereof under Article 27 of the Company Act, and at least one of them must be a professional in accounting or finance.
- Where the applicant company has been registered for trading as an emerging stock on the GTSM in the fiscal year of the listing application and the most recent fiscal year thereto, and there has been, from the GTSM registration date onward, any trading of stock issued by the applicant company by any incumbent director, supervisor, or shareholder holding 10 percent or greater of its total issued shares other than on the emerging stock market; provided, this restriction shall not apply where such trading is for purposes of underwriting under Article 11 of these Rules or for other legitimate reason.
- Where the applicant company is the existing or newly established company accepting transfer of business or assets due to a demerger of a TWSE (or GTSM) listed company, and transfers of equity conducted by the TWSE (or GTSM) listed company in the most recent 3 years for purposes of reducing its shareholding ratio in the applicant company have damaged shareholders' equity.
- Where the listing is considered by the TWSE as inappropriate due to its scope of business, nature or special circumstances.
A foreign issuer that applies for a TWSE primary listing of its stock may not have less than five directors on its board, and shall appoint independent directors numbering not less than two persons and not less than one-fifth of the number of directors, and at least one of the independent directors shall be domiciled in the Republic of China. However, when the laws and regulations of a foreign issuer's country of registration explicitly provide that important matters in connection with protection of shareholder equity are subject to mandatory provisions regarding exclusive jurisdiction of courts, such that the jurisdiction of Republic of China courts is not adopted as part of its articles of incorporation or organizational documents, then it shall have no less than two directors (including the independent directors) who are domiciled in the Republic of China.
A foreign issuer shall install either an audit committee or supervisors. That audit committee shall comprise all the independent directors; it may not have less than three members, one of whom shall be the convener. The minimum number of supervisors is three.
ROC laws and regulations regarding securities shall apply mutatis mutandis to the professional qualifications, restrictions on shareholding and the holding of concurrent posts, and the determination of independence, of the independent directors of the two preceding paragraphs.
A foreign issuer shall appoint a remuneration committee. ROC securities laws and regulations shall apply mutatis mutandis to the professional qualifications of and the exercise of powers by the committee members and related matters.