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Amendments

Title：

Regulations Governing Procedure for Board of Directors Meetings of Public Companies  CH

Amended Date： 2024.01.11 
Article Content Content Search Article No. Search Legal Basis Subordinate Legislation Amended Article Legislative History Chinese

Title： Regulations Governing Procedure for Board of Directors Meetings of Public Companies(2008.01.11)
Date：
Article 1     These Regulations are adopted pursuant to Article 26-3, paragraph 8, of the Securities and Exchange Act (the "Act").
Article 2     A public company shall adopt rules of procedure for meetings of its board of directors; the main agenda items, operational procedures, required content of meeting minutes, public announcements, and other compliance requirements for board meetings shall be handled in accordance with these Regulations.
Article 3     A board of directors shall meet at least quarterly, which shall be set out in the rules of procedure.
    The reasons for calling a board of directors meeting shall be notified to each director and supervisor at least seven days in advance. In emergency circumstances, however, a meeting may be called on shorter notice.
    All matters set out in the subparagraphs of Article 7, paragraph 1, shall be specified in the notice of the reasons for calling a board of directors meeting; none of them may be raised by an extraordinary motion except in the case of an emergency or legitimate reason.
Article 4     A board of directors meeting shall be held at the location and during the business hours of the company, or at a place and time convenient to all directors and suitable for holding such a meeting.
Article 5     The board of directors of a company shall appoint an agenda working group, which shall be specified in the rules of procedure.
    The agenda working group shall prepare agenda items for board of directors meetings and provide comprehensive pre-meeting materials, to be sent together with the notice of the meeting.
    A director of the opinion that the pre-meeting materials provided are insufficiently comprehensive may request the agenda working group to supplement the materials. If a director is of the opinion that materials concerning any proposal are insufficient in content, the deliberation of such proposal may be postponed by a resolution of the board of directors.
Article 6     Agenda items for regular board of directors meetings shall include at least the following:
  1. 1. Reports:
    1. (1) Minutes of the last meeting and actions arising.
    2. (2) Reporting on important financial and business matters.
    3. (3) Reporting on internal audit activities.
    4. (4) Other important matters to be reported.
  2. 2. Discussions:
    1. (1) Items discussed and continued from the last meeting.
    2. (2) Items for discussion at this meeting.
  3. 3. Extraordinary motions.
Article 7     A company shall submit the following items for discussion by the board of directors:
  1. 1. Corporate business plan.
  2. 2. Annual and semi-annual financial reports.
  3. 3. Adoption or amendment of an internal control system pursuant to Article 14-1 of the Act.
  4. 4. Adoption or amendment, pursuant to Article 36-1 of the Act, of handling procedures for financial or operational actions of material significance, such as acquisition or disposal of assets, derivatives trading, extension of monetary loans to others, and endorsements or guarantees for others.
  5. 5. The offering, issuance, or private placement of any equity-type securities.
  6. 6. The appointment or discharge of a financial, accounting, or internal audit officer.
  7. 7. Any matter required by Article 14-3 of the Act or any other law, regulation, or bylaw to be approved by resolution at a shareholders' meeting or board of directors meeting, or any such significant matter as may be prescribed by the competent authority.
    If a company has an independent director or directors, each independent director shall attend in person any meeting concerning a matter that requires a resolution by the board of directors under Article 14-3 of the Act, or shall appoint another independent director to attend as his or her proxy. If an independent director objects to or expresses reservations about the matter, it shall be recorded in the board meeting minutes; an independent director intending to express objection or reservations but unable to attend the meeting in person shall, unless there is some legitimate reason to do otherwise, issue a written opinion in advance, which shall be recorded in the meeting minutes.
Article 8     Apart from matters referred to in paragraph 1 of the preceding article, which are required to be submitted for discussion by the board of directors, when the board of directors delegates any exercise of its powers pursuant to laws or regulations or the company's articles of incorporation, matters such as the level and substance of the delegation shall be concretely and specifically set out.
Article 9     When a meeting of the board of directors is held, an attendance book shall be made ready for signature by directors attending the meeting and thereafter made available for future reference.
    All board directors shall attend board meetings in person; if attendance in person is not possible, they may, pursuant to the company's articles of incorporation, appoint another director to attend as their proxy. Attendance via tele- or video-conference is deemed as attendance in person.
    A director appointing another director to attend a board meeting in his or her place shall in each case give to that director a written proxy stating the scope of authorization with respect to the reasons for meeting.
    A proxy under paragraph 2 may accept a proxy from one person only.
Article 10     Meetings of the board of directors shall be called and chaired by the chairperson of the board. However, the first meeting of each newly elected board of directors shall be called and chaired by the director who received votes representing the largest portion of voting rights at the shareholders' meeting in which the directors were elected; if there are two or more directors so entitled to call the meeting, they shall choose one person by and from among themselves to do so.
    When the chairperson of the board is on leave or for any reason is unable to exercise the powers of the chairperson, the vice chairperson shall do so in place of the chairperson, or, if there is no vice chairperson or the vice chairperson also is on leave or for any reason is unable to act, by a managing director designated by the chairperson, or, if there is no managing director, by a director designated thereby, or, if the chairperson does not make such a designation, by a managing director or director elected by and from among themselves.
Article 11     When holding a meeting of the board of directors, a company may, as necessary for the agenda items of the meeting, notify non-director officers from relevant departments to attend the meeting as nonvoting participants. When necessary, the company may also invite certificated public accounts, attorneys, or other professionals to attend as nonvoting participants.
Article 12     When the time of a meeting has arrived and one-half all board directors are not present, the meeting chair may announce postponement of the meeting time, provided that only two postponements may be made. If the quorum is still not met after two such delays, the chair shall re-call the meeting following the procedures provided in Article 3, paragraph 2.
    The term "all board directors " as used in the preceding paragraph and in Article 17, paragraph 2, subparagraph 2 shall be calculated as the number of directors then in office.
Article 13     A board of directors meeting shall be conducted in accordance with the order of business on the agenda as specified in the meeting notice. However, the order may be changed with the approval of a majority of directors present at the meeting.
    The meeting chair may not declare the meeting closed without the approval of a majority of directors present at the meeting.
    If at any time during the proceeding of a board of directors meeting the directors sitting at the meeting are not more than half of the directors present at the meeting, then upon motion by the directors sitting at the meeting, the chair shall declare a suspension of meeting, in which case paragraph 1 of the preceding article shall apply mutatis mutandis.
Article 14     When the chair at a board of directors meeting is of the opinion that a matter has been sufficiently discussed to a degree of putting to a vote, the chair may announce the discussion closed and bring the matter to vote.
    When a proposal comes to a vote at a board of directors meeting, if the chair puts the matter before all directors present at the meeting and none voices an objection, the matter is deemed approved.
    The method of voting on matters at board of directors meetings shall be specified in the rules of procedure. Except for the case of unanimous consent of all directors present at the meeting upon inquiry [by the chair], the methods of vote monitoring and counting shall also be specified.
    "All directors present at the meeting" in the preceding two paragraphs does not include directors prohibited from exercising voting rights pursuant to Article 16, paragraph 1.
Article 15     Except as otherwise stated in the Act or in the Company Act, a resolution on a matter at a board of directors meeting requires the approval of a majority of the directors present at the meeting that shall be attended by a majority of all directors.
Article 16     an interested party relationship exists between any director, or a juristic person the director represents, and any agenda item, and such relationship is likely to prejudice the interests of the company, the director may state opinions and answer questions but may not participate in discussion of or voting on that agenda item, and shall recuse themselves during discussion of and voting on that item, and may not act as proxy of another director to exercise voting rights on that matter.
    With respect to a resolution at a board of directors meeting, the provisions of Article 180, paragraph 2, of the Company Act, as applied mutatis mutandis under Article 206, paragraph 2, of that Act, shall apply in cases where a board director is prohibited by the preceding paragraph from exercising voting rights.
Article 17     Minutes shall be prepared of the discussions at board of directors meetings; the meeting minutes shall record the following:
  1. 1. Session (or year), time, and place of meeting.
  2. 2. Name of the meeting chair.
  3. 3. Attendance of directors at the meeting, specifying the names and number of members present, excused, and absent.
  4. 4. Names and titles of those attending the meeting as nonvoting participants.
  5. 5. Name of minutes taker.
  6. 6. Matters reported on.
  7. 7. Agenda items: specify the resolution method and result for each proposal, and summarize the comments made by, and specify any objections or reservations expressed by, directors, supervisors, experts, or any others at the meeting that has been included in records or stated in writing, and any opinion issued in writing by an independent director under Article 7, paragraph 2.
  8. 8. Extraordinary motions: specify the name of the mover, the resolution method and result for each motion, and summarize the comments made by, and specify any objections or reservations expressed by, directors, supervisors, experts, or any others at the meeting that has been included in records or stated in writing.
  9. 9. Other matters required to be recorded.
    Any of the following matters in relation to a resolution passed at a meeting of the board of directors shall be stated in the meeting minutes and within two days of the meeting be published on an information reporting website designated by the competent authority:
  1. 1. Any matter about which an independent director expresses an objection or reservation that has been included in records or stated in writing.
  2. 2. If the company has an audit committee, any matter that has not been passed by the audit committee, but has been adopted with the approval of two-thirds or more of all board directors without having been passed by the audit committee.
        The attendance book forms a part of the minutes for each board of directors meeting and shall be well preserved during the existence of the company.
        The minutes of a board of directors meeting shall bear the signature or seal of both the meeting chair and the minutes taker; a copy of the minutes shall be distributed to each director and supervisor within 20 days after the meeting and well preserved as important company records during the existence of the company.
    The production and distribution of the meeting minutes referred to in paragraph 1 may be done in electronic form.
Article 18     A company shall record on audio or video tape the entire proceedings of a board of directors meeting, and preserve the recordings for at least five years, in electronic form or otherwise.
    If before the end of the preservation period referred to in the preceding paragraph any litigation arises in connection with a resolution of a board of directors meeting, the relevant audio or video recordings shall continue to be preserveduntil the litigation is concluded.
    Where a board of directors meeting is held via tele- or video conferencing, the audio and visual documentation of the meeting form a part of the meeting minutes and shall be well preserved during the existence of the company.
Article 19     there is one or more managing director on the board of directors, the provisions of Article 2, paragraph 2 of Article 3, Articles 4 to 6, Article 9, and Articles 11 to 18 shall apply mutatis mutandis to the procedure for meetings of the managing directors, provided that if a meeting of managing directors is scheduled to be convened within seven days, the notice to each managing director may be made two days in advance.
Article 20     These Regulations shall come into force from the date of issuance.