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Taiwan Securities Association Rules Governing Underwriting and Resale of Securities by Securities Firms(2010.02.23) |
| Date： |
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Article 5
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With the exception of that portion of underwritten units held for its own account in accordance with the preceding article, a securities underwriter carrying out the underwriting of securities (hereinafter, "public sale to outside parties") shall use the following methods to allocate units:
1. competitive auction;
2. book building;
3. public subscription; or
4. negotiated sale.
The allocation methods described in the above subparagraphs shall be undertaken in accordance with Articles 6, 7, 21, 21-1, 22, 22-1, 22-3, 31 and 52 of these Rules.
When different placement methods are used in the same underwriting case, the relevant timetable for the procedures from placement with specific parties until the distribution date of the securities shall be consistent between the different placement methods.
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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.
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Article 22-3
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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 10 percent of the volume that is to be publicly sold shall first be put up for public subscription, and the volume allocated for public subscription shall be adjusted according to the subscription volume.
If the underwritten subscription volume (defined as the final confirmed total volume of subscriptions that brokers have transmitted to the TWSE by the public subscription deadline) falls short of the volume allocated for public subscription as referred to in the preceding paragraph, the shortfall may be added to the volume to be underwritten through book building, and allocated in that manner. If the subscription volume exceeds by a certain multiple the volume allocated for public subscription, the volume allocated for public subscription shall be adjusted upward in accordance with the following provisions:
(1) If the subscription multiple is at least 15 times but less than 20 times, the amount allocated for public subscription shall be adjusted to 15 percent.
(2) If the subscription multiple is at least 20 times but less than 25 times, the amount allocated for public subscription shall be adjusted to 20 percent.
(3) If the subscription multiple is at least 25 times but less than 30 times, the amount allocated for public subscription shall be adjusted to 25 percent.
(4) If the subscription multiple is at least 30 times but less than 35 times, the amount allocated for public subscription shall be adjusted to 30 percent.
(5) If the subscription ratio is 35 times or more, the amount allocated for public subscription shall be adjusted to 35 percent.
If the post-adjustment volume allocated for public subscription as calculated per any of the subparagraphs of paragraph 2 is not a whole number, the number shall be rounded up to the nearest whole number.
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. The timetable for the procedures shall be subject mutatis mutandis to the provisions of Article 42-1.
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