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Article 22
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In the following types of securities underwriting cases, the part put up for public sale may be undertaken entirely by book building or partly by book building and partly by public subscription:
1. cash capital increase through an issue of preferred shares by a company already listed on a stock exchange or an OTC market;
2. preferred shares with detachable warrants;
3. corporate bonds with detachable warrants;
4. offerings of corporate bonds and financial bonds;
5. offerings of Taiwan depositary receipts; and
6. secondary distributions.
In underwriting cases contemplated under the preceding paragraph where part of the securities are allocated by book building and part by public subscription, if the book building and public subscription procedures are carried out simultaneously, the timetable for the procedures shall be subject to mutatis mutandis application of Article 42-1. However, if subscription volume exceeds by a specified multiple the number of units earmarked for public subscription, there is no need to upwardly adjust the public subscription volume or to observe the requirements of Article 42-1, paragraph 1, subparagraph 4, item 2. In an initial offering of Taiwan Depositary Receipts in which part are placed by book building and part by public subscription, the book building and public subscription procedures shall be carried out simultaneously, and shall be subject to mutatis mutandis application of Article 42-1; and the volume for allocation by public subscription shall be adjusted on a flexible basis pursuant to Article 21-1.
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Article 43
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For common corporate bonds, corporate bonds from which the detachable warrants have been detached, financial bonds not involving stock equity, and the types of underwriting cases set out in Article 22 subparagraph 6 and Article 22-1 subparagraphs 2 and 3, the types of bidders from whom a securities underwriter is allowed to accept bids shall be restricted by the mutatis mutandis application of Article 35 and Article 36 subparagraphs 8 and 9, and the securities underwriter shall also obtain declarations from bidders affirming that they meet the eligibility requirements for purchasers.
For securities allocated by an underwriter but not paid for by the subscribers and placed with a specified party, the provisions in the preceding paragraph shall apply mutatis mutandis to the specified party.
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Article 43-1
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When a securities firm conducts an underwriting case involving an initial listing on a stock exchange or an OTC market or an initial offering of Taiwan Depositary Receipts, the parties from whom it is allowed to accept book building bids shall be restricted by the mutatis mutandis application of Articles 35 and 36; in addition, the firm shall refuse bids involving the participation of any of the parties listed in the following subparagraphs, and shall also obtain declarations from bidders affirming that they meet the eligibility requirements for purchasers:
1. An employee of the issuer.
2. A director, supervisor, or managerial officer (or a spouse, son, or daughter thereof) of a company that has underwriting business dealings with an underwriter.
3. A financial holding company to which an underwriter itself belongs, or another subsidiary of such a financial holding company; however, this restriction does not apply to a securities investment trust fund offered by a securities investment trust company belonging to such a financial holding company.
4. A director, supervisor, or managerial officer (or a spouse, son, or daughter thereof) of a financial holding company to which an underwriter itself belongs, or of another subsidiary of such a financial holding company.
5. A de facto related party of the issuer or an underwriter.
6. A party listed in any of the preceding subparagraphs that uses the name of another party to participate in subscription (i.e. a de facto related party that engages in any of the acts set out under Article 2 of the Securities and Exchange Act Enforcement Rules).
When a securities firm, acting on behalf of a company already listed on a stock exchange or an OTC market, conducts an underwriting case involving a cash capital increase or an offering of corporate or financial bonds with equity characteristics, or warrants detached from preferred shares with detachable warrants or detached from corporate bonds with detachable warrants, or a secondary offering of Taiwan Depositary Receipts, the parties from whom it is allowed to accept book building bids shall be restricted by the mutatis mutandis application of the preceding paragraph, provided that it need not be restricted by subparagraphs 1 to 3 of the preceding paragraph.
When a securities firm conducts an underwriting of Taiwan Depositary Receipts, the parties from whom it is allowed to accept book building bids shall comply with the provisions of paragraphs 1 and 2; in addition, the firm shall refuse book building bids involving any participation of the depositary institution, or any director, supervisor, manager, or employee of the depositary institution, or any spouse or child thereof.
For securities allocated by an underwriter but not paid for by the subscribers and subsequently placed with a specified party, the provisions of paragraphs 1 to 3 shall apply mutatis mutandis to the specified party.
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