| Title： |
Supplementary Provisions to the Taiwan Stock Exchange Corporation Rules for Review of Securities Listings(2017.02.14) |
| Date： |
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Article 10
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The term "material non-arms-length transaction" as used in Article 9, paragraph 1, subparagraph 4 of the Rules shall mean the occurrence of any of the following circumstances with respect to the applicant company, provided that publicly-owned enterprises operated under the relevant accounting laws shall not be subject to this restriction:
- Where the purpose, terms, or price of purchase or sale of goods, or where the occurrence of a transaction, or its form or substantive nature or the procedure involved, are at variance with those of a normal transaction or are obviously unreasonable.
- Where, in regard to transactions for acquisition or disposal of assets that require public announcement and reporting in accordance with the competent authority's Regulations Governing the Acquisition and Disposal of Assets by Public Companies, the company fails to reasonably demonstrate the legality of its internal decision-making process, the necessity of the transaction, ample disclosure of related financial statements, or reasonable price and payment terms and conditions.
- Occurrence of any of the following circumstances with regard to real estate transactions during the most recent 5 years, as determined by the signing date of any such transaction:
- A real estate purchase from a related party in which the price of the purchase is higher than the assessed value obtained in accordance with the methods given under Article 15 of the Regulations Governing the Acquisition and Disposal of Assets by Public Companies, and which does not comply with Article 16 of the Regulations Governing the Acquisition and Disposal of Assets by Public Companies.
- A sale of real estate to a related party in which the price of the sale is lower than the assessed value obtained in accordance with the methods given under Article 15 of the Regulations Governing the Acquisition and Disposal of Assets by Public Companies.
- Terms of payment in a purchase or sale of real estate with a related party obviously different from those of ordinary real estate transactions, and for which there is no legitimate reason.
- The applicant company purchases or sells land at approximately the same time in an area adjacent to land purchased or sold by a related party, where there is an obvious difference in price, and where there is no legitimate reason for such difference.
- The revenues from sales of products or leasing of real estate to a related party in the final quarters of the most recent 5 fiscal years exceeds 20 percent of yearly operating revenues, and where no legitimate reason exists for the excess.
- Purchase or sale of real estate to a non-related party where other evidence exists to show that the transaction is obviously at variance with normal transactions, and where there no legitimate reason exists for the difference.
- Where massive loans are extended to another person for purposes other than the financing necessary for business transactions between companies.
The provisions regarding the purchase or sale of real estate involving a related party under subparagraph 3 of the preceding paragraph shall also apply where either of the two previous owners had the status of related party, provided that there may be exemption from application if the period from the date on which the trading counterpart was to acquire the property under the contract to the date of execution of the present contract exceeds 5 years.
Where an applicant company profits from any of the circumstance set forth under paragraph 1, it shall meet the listing criteria for profitability after deduction of those profits.
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