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Article 2-1
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Unless it is a state-owned enterprise, any issuer applying for listing of domestic securities shall first have applied for registration of its stock as emerging stock and have had it traded over the counter for not less than six months, and have completed relevant procedures for dematerialized registration of the issued securities, before the TWSE will accept its listing application for processing.
The TWSE will accept for processing an initial application by a foreign issuer for a first-time listing of stock issued by the foreign issuer that is not listed on any overseas securities exchange or securities market ("a primary listing") only after that foreign issuer has first been under listing advisory guidance by the lead securities underwriter, or has applied for registration of its stock as emerging stock and had it traded over the counter, for not less than six months. Notwithstanding the foregoing, if there is any change of the lead securities underwriter during the period of listing advisory guidance, the period shall start to run again for a full six months, beginning with the date on which the new lead securities underwriter files for the listing advisory guidance.
A foreign issuer whose stock or depositary receipts already are or have been listed on any major overseas securities exchange or securities market and that is applying for a primary listing of its issued stock may be exempted from the requirement in paragraph 2 that the foreign issuer shall first undergo listing advisory guidance by the lead securities underwriter or apply for registration of its stock as emerging stock and have it traded over the counter for not less than six months; provided that this paragraph shall not apply if the foreign issuer has been delisted from a major overseas securities exchange or securities market for over 6 months.
A foreign issuer that has passed the review of stock or depositary receipt listing at any major overseas securities exchange or securities market and that, within the period of validity following the passing of such review, applies for a primary listing of its issued stock may apply on a case-by-case basis to the TAIFEX to reduce the time period specified in paragraph 2 for which the foreign issuer must first undergo listing advisory guidance by the lead securities underwriter or apply for registration of its stock as emerging stock and have it traded over the counter, provided that the time period may be not less than 2 months, and the lead securities underwriter or the lead recommending securities firm may not be changed within such period.
When a foreign issuer applies to list its issued shares or depositary receipts, the shares or depositary receipts specified in the listing application shall be issued in uncertificated (dematerialized) form and registered with the central securities depository. This requirement does not apply, however, if the laws or regulations of its country of registration contain a provision to the contrary.
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Article 26
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Approval will be granted for the application submitted by a foreign issuer or its depositary institution for listing of Taiwan depositary receipts proposed to be issued if the application meets the following requirements:
1. Units of Taiwan depositary receipts to be listed: 20 million units or more or market value of NT$300 million or more; provided that the listed units may not exceed 50 percent of the total number of shares issued by the foreign issuer.
2. The stock, or the securities representing the stock, issued by the foreign issuer in accordance with the laws of its country of registration have been listed on the main board of one of the stock exchanges or securities markets approved by the Competent Authority before the listing of the Taiwan depositary receipts under the listing application.
3. Shareholders' equity: At the time of application for listing, the shareholders' equity stated on the financial report audited and certified by a Certified Public Accountant for the most recent period shall not be less than the equivalent of NT$600 million.
4. Profitability: It does not have accumulated deficit in the most recent one (1) fiscal year and meets one of the following criteria:
(1) The income before tax for each of the most recent two years represents not less than 6 percent of the shareholders' equity as shown in its final accounts, or the average income before tax for the most recent one year is 6 percent or greater; or
(2) The ratio of income before tax to shareholder's equity in the final accounting for each of the past two fiscal years is 3 percent or higher, or the average is 3 percent or higher, and the profitability in the most recent fiscal year is better year-on-year than in the preceding year.
(3) The income before tax for each of the most recent two years shall be NT$250 million or more.
5. Dispersion of shareholdings: At the time of proposed listing, the number of holders of the Taiwan depositary receipts in the Republic of China is not less than 1,000 persons, and the total number of units held by holders other than insiders of the foreign issuer and juristic persons of which such insiders own over 50 percent of the shareholding is not less than 20 percent of the total units issued or is 10 million units or more.
6. There shall be no restriction on transfer of stock, or securities representing such stock, represented by Taiwan depositary receipts.
7. The rights and obligations of the holders of stock, or securities representing such stock, represented by Taiwan depositary receipts shall be identical with those of other stock, or securities representing such stock, of the same class issued at the same time.
8. There is no abnormal fluctuation in the price of the stock represented by the Taiwan depositary receipts during the three months immediately prior to the approval of the listing agreement for Taiwan depositary receipts.
The financial information referred to in Subparagraphs 3 and 4 of the preceding paragraph will be examined [by the TWSE] based on the consolidated report or the consolidated financial statement prepared by the said foreign issuer in accordance with the laws and regulations of its country of registration or the country of listing and the audit opinion issued by a certified public accountant in the Republic of China stating the differences between the accounting principles applicable in the Republic of China and the accounting principles applicable in the country of registration or the country of listing of the said foreign issuer and the impact of such differences on such financial reports.
Unless otherwise prescribed by the Competent Authority, after the TWSE has submitted the listing agreement with respect to the application for listing of Taiwan Depositary Receipts to the Competent Authority and received its approval, the foreign issuer shall conduct a public sale pursuant to regulations from the date of the TWSE's written notification. If the Taiwan Depositary Receipts for which the foreign issuer applied for listing are not listed for trading within three months from the date of the TWSE's written notification, the TWSE shall void the listing agreement upon approval from the Competent Authority. Notwithstanding, if the foreign issuer, with legitimate reason, applies for an extension, then after the TWSE approves such extension and reports to the Competent Authority for approval and recordation, the foreign issuer may be granted a one-time only three-month extension.
The foreign issuer shall undertake in writing that, after listing, it will establish a reporting system with the TWSE for automatic simultaneous reporting of material information.
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Article 27
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Approval will be granted for the listing application for stock issued by a foreign issuer whose stocks are already listed on an overseas securities exchange or securities market ("a secondary stock listing") if that foreign issuer meets the requirements listed below:
1. Number of shares to be listed: 20 million shares or more, or the market price of the shares to be listed is NT$300 million or more; provided that the number of shares may not exceed 50 percent of the total number of shares issued by the foreign issuer.
2. The registered shares issued by the foreign issuer in accordance with the laws of its country of registration have been listed on the main board of one of the stock exchanges or securities markets approved by the Competent Authority before the listing of the stocks under the listing application.
3. Shareholders' equity: At the time of application for listing, the shareholders' equity stated on the financial report audited and certified by a Certified Public Accountant for the most recent period shall be the equivalent of NT$600 million or more.
4. Profitability: It does not have accumulative loss for the most recent one (1) fiscal year and meets one of the following criteria:
(1) The income before tax for the most recent one year represents not less than 6 percent of the shareholders' equity as shown in its final accounts; or
(2) The ratio of income before tax to shareholder's equity in the final accounting for each of the past two fiscal years is 3 percent or higher, or the average is 3 percent or higher, and the profitability in the most recent fiscal year is better year-on-year than in the preceding year.
(3) The income before tax for the most recent two years shall be NT$250 million or more.
5. Dispersion of shareholdings: At the time of the proposed listing, the number of registered shareholders in the Republic of China is not less than 1,000 persons, and the total number of shares held by shareholders other than insiders of the foreign issuer and juristic persons of which such insiders own over 50 percent of the shareholding is 20 percent or more of the total number of issued shares or is 10 million shares or more.
6. The stock to be listed shall be the same class of stock listed on other stock exchanges or securities markets. The rights and obligations of the holders of stock shall be identical with those of the same class of stock listed on other stock exchange or securities markets. Local holders of the stock shall not be restricted from selling the stock on foreign stock exchanges or securities markets.
7. There is no abnormal fluctuation in the price of the registered stock issued by the foreign issuer under the law of the country of registration, during the three months immediately prior to the approval of the stock listing agreement with respect to which the listing application is submitted to the TWSE.
The provisions of Paragraph 2 of Article 26 shall apply mutatis mutandis to the financial reports referred to in Subparagraphs 3 and 4 of the immediately preceding paragraph.
After the TWSE has submitted the listing agreement with respect to the foreign issuer's application for listing of shares to the Competent Authority and received its approval, the foreign issuer shall conduct a public sale pursuant to regulations as from the date of the TWSE's written notification. If the stock for which the foreign issuer applied for listing is not listed for trading within three months from the date of the TWSE's written notification, the TWSE shall void the listing agreement upon approval from the Competent Authority. Notwithstanding, if the foreign issuer, with legitimate reason, applies for an extension, then after the TWSE approves such extension and reports to the Competent Authority for approval and recordation, the foreign issuer may be granted a one-time-only three-month extension.
The foreign issuer shall undertake in writing that, after listing, it will establish a reporting system with the TWSE for automatic simultaneous reporting of material information.
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Article 27-1
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Approval will be granted for listing of the stock or Taiwan depositary receipts of a foreign issuer that applies for a secondary stock listing or that sponsors issuance of Taiwan Depositary Receipts by a depositary institution if the Industrial Development Bureau of the Ministry of Economic Affairs or a professional institution engaged by the TWSE issues an unequivocal opinion it is a technology enterprise, has successfully developed marketable goods or technology, and meets each of the following criteria:
1. Number of shares to be listed or units of Taiwan depositary receipts to be listed: 20 million shares or more, or shares with a market price of NT$300 million or more; or 20 million units or more, or units with a market price of NT$300 million or more; provided that it may not exceed 50 percent of the total number of shares issued by the foreign issuer.
2. The securities underwriter has provided a written recommendation.
3. The stock, or the securities representing such stock, issued by the foreign issuer in accordance with the laws of its country of registration have been listed on the main board of one of the stock exchanges or securities markets approved by the Competent Authority before the listing of the stocks or Taiwan depositary receipts under the listing application.
4. At the time of application for listing, the shareholders' equity stated on the financial report audited and certified by a Certified Public Accountant for the most recent period shall be the equivalent of NT$300 million or more and not less than two-thirds of the sum of capital stock and capital reserve; evidence shall also be required supporting that there is a sufficient amount of working capital covering the period of twelve months after the listing and half or more of such working capital is derived from the principal operating activities.
5. At the time of the proposed listing, the number of registered shareholders or holders of the Taiwan depositary receipts in the Republic of China is not less than 1,000 persons, and the total number of shares held by the shareholders or holders of the Taiwan depositary receipts other than insiders of the foreign issuer and juristic persons of which such insiders own over 50 percent of the shareholding is 20 percent or more of the total number of issued shares or is 10 million shares or more.
6. The stock to be listed shall be the same class of stock listed on other stock exchanges or securities markets. The rights and obligations of the holders of stock shall be identical with those of the same class of stock listed on other stock exchanges or securities markets. Local holders of the stock shall not be restricted from selling the stock on foreign stock exchanges or securities markets.
7. There is no abnormal fluctuation in the price of the stock, or securities representing the stock, issued by the foreign issuer under the law of the country of registration, during the three months immediately prior to the approval of the agreement for listing of shares or Taiwan depositary receipts with respect to which the listing application is submitted.
The foreign issuer shall undertake in writing that, after listing, it will establish a reporting system with the TWSE for automatic simultaneous reporting of material information.
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Article 28
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Where a foreign issuer and its agent or depositary institution apply for the listing of stock or Taiwan depositary receipts issued as a result of capital increase by cash and having rights and obligations identical with those of the stock or depositary receipts already listed; or where a foreign issuer, using its previously issued shares, sponsors issuance of Taiwan depositary receipts with the same rights and obligations as Taiwan depositary receipts that are already listed, the TWSE may, after examining and verifying the completeness of the submitted supporting documents and finding that the foreign issuer meets all of the requirements listed below, issue documents evidencing approval of the listing and, after the foreign issuer has filed for and obtained effective registration with the Competent Authority and the issue has been completed, publicly announce the listing:
1. Compliance with Article 26, paragraph 1, subparagraph 4 and Article 27, paragraph 1, subparagraph 4.
2. No violation of TWSE rules and regulations relating to material information within the most recent year, where the violation is serious in nature.
3. No abnormal fluctuation in the trading price within one month before the date of application.
4. No violation of the laws and regulations of the country of registration or the country of listing within the most recent year, where the individual violation is serious in nature.
5. The number of additional shares planned to be issued in the current issue of new shares or Taiwan depositary receipts plus the number of the already listed shares or Taiwan depositary receipts does not exceed 50 percent of the total number of issued shares.
Where a foreign issuer and its depositary institution apply to sponsor issuance, by means of shelf registration, of Taiwan depositary receipts with the same rights and obligations as Taiwan depositary receipts that are already listed, they shall, in addition to meeting the requirements in all the subparagraphs of the preceding paragraph, meet all of the conditions in the subparagraphs of paragraph 1, Article 39 of the Regulations Governing the Offering and Issuance of Securities by Foreign Issuers, before the TWSE will issue a document evidencing its approval of the listing of the Taiwan depositary receipts and, after the issuer has filed and obtained effective registration with the Competent Authority and completed the issue, publicly announce the listing thereof.
Where a foreign issuer and its agent or depositary institution file for the listing of additional stock due to the allocation to existing shareholders of preemptive subscription rights or bonus shares resulting from a cash capital increase with a new share issue, or due to requests for conversion or subscription of already-issued convertible corporate bonds, corporate bonds with warrants, or any other type of securities that can be converted to equity, and the rights and obligations of the holders of stock or Taiwan depositary receipts to be newly issued are identical with those of the stock or depositary receipts already listed, the TWSE will, after having verified that the supporting documents attached to the application are complete, publicly announce the listing thereof.
Where a foreign issuer and its depositary institution re-issue, within the amount that has been redeemed, or re-issue, within the scheduled issuance period and permitted number of units for issue under a shelf registration, Taiwan depositary receipts with the same rights and obligations as Taiwan depositary receipts that are already listed, the TWSE shall, after receiving the documents, proceed directly to publicly announce the listing thereof.
When a foreign issuer sponsors issuance of Taiwan depositary receipts and the depositary receipts have been listed, if shareholders of the foreign issuer, using shares that are already issued and held by such shareholders, engage a depositary institution to apply to domestically issue Taiwan depositary receipts for listing, if all of the conditions listed below are met, the TWSE, upon examining and verifying the completeness of the submitted documents, may issue documents evidencing its agreement to the listing of the depositary receipts, and after the filing and effective registration with the Competent Authority, publicly announce the listing thereof:
1. The foreign issuer meets the conditions in all the subparagraphs of paragraph 1.
2. The number of units for which listing is applied is not less than 10 million.
3. The engaged depositary institution and custodian institution shall be the same depositary institution and custodian institution engaged by the foreign issuer for its sponsored issuance of Taiwan depositary receipts. .
4. The rights and obligations of the stock represented by the Taiwan depositary receipts shall be the same as the rights and obligations of the stock represented by the Taiwan depositary receipts of which the foreign issuer sponsored issuance.
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Article 28-1
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The TWSE may issue documentation evidencing listing approval of the application by a foreign issuer for a primary stock listing if that issuer meets all of the requirements listed below:
1. It complies with regulations in connection with the Act Governing Relations Between Peoples of the Taiwan Area and the Mainland Area.
2. At the time it applies for listing, the applicant company or any of its controlled companies shall have an operational track record of three years or longer.
3. The company scale meets one of the following criteria:
(1) At the time of application for listing, paid-in capital or shareholders' equity is NT$600 million or higher.
(2) At the time of listing, market capitalization is NT$1.6 billion or higher.
4. Its cumulative income before tax for the most recent three fiscal years is NT$250 million or higher, and its income before tax for the most recent fiscal year is NT$120 million or higher, and it does not have any accumulated deficit.
5. Its number of shareholders of record is 1,000 or more, and the number of shareholders other than insiders of the foreign issuer and juristic persons of which such insiders own over 50 percent of the shareholding is no less than 500 and their total shareholdings constitute 20 percent or more of the total issued shares or not less than 10 million shares.
6. The number of shares planned to be listed and traded shall exceed 50 percent of the total number of its issued shares.
7. It is recommended, in writing, by two or more securities underwriters.
Where a foreign issuer applies for a primary listing of stock, if the foreign issuer or a company controlled by it that accounts for 50 percent of its overall operating revenue obtains an unequivocal opinion issued by the Industrial Development Bureau, Ministry of Economic Affairs, or a TWSE-designated professional institution, indicating that the company is a technology enterprise and has successfully developed products or technology and those products or technology are moreover marketable, if the foreign issuer meets the requirements of the following subparagraphs, the TWSE may issue evidentiary documentation indicating its approval of the listing:
1. It complies with the relevant provisions of the Act Governing Relations Between Peoples of the Taiwan Area and the Mainland Area.
2. At the time of the listing application, the applying company or the controlled company that is a technology enterprise shall have a business record of one full fiscal year or more.
3. At the time of the listing application, the paid-in capital or shareholders' equity reaches NT$300 million or more, or the market capitalization reaches NT$800 million or more.
4. At the time of the listing application, the net worth on the most current financial report audited and attested by a certified public accountant is not lower than two-thirds of the capital stock, with proof that the company has operating capital sufficient for 12 months of operation following the listing.
5. Its number of shareholders of record is 500 or more, and the total shareholdings of the shareholders of record other than insiders of the foreign issuer and juristic persons of which such insiders own over 50 percent of the shareholding constitute 20 percent or more of the total issued shares or not less than 5 million shares.
6. The number of shares planned to be listed and traded shall exceed 50 percent of the total number of its issued shares.
7. It is recommended by two or more securities underwriters.
When a foreign issuer applies for a primary listing of stock, if its operating revenue derived from construction business represents 20 percent or greater of its total operating revenue, or its gross profit derived from construction business represents 20 percent or greater of its total gross profit, or its operating revenue or gross profit derived from construction business is more than that derived from other business items, during the most recent two fiscal years, it shall meet all of the requirements provided in Articles 16 and 17 herein, in which case, the TWSE may issue evidentiary documentation indicating its approval of the listing thereof. However, the foreign issuer may be exempt from the requirements of Article 17, subparagraphs 1 to 3 herein if the construction company and the foreign issuer are not related parties, and the foreign issuer has established adequate internal control systems and tender procedures for contracting projects out, and the payment terms comply with usages of trade.
"Controlled company" in paragraphs 1 and 2 means any of the following circumstances:
1. Any controlled company in which the foreign issuer directly holds more than 50 percent of the issued voting shares or has contributed more than 50 percent of the capital.
2. Any controlled company in which the foreign issuer, indirectly through a subsidiary company, holds more than 50 percent of the issued voting shares or has contributed more than 50 percent of the capital.
3. Any controlled company in which the foreign issuer directly, or indirectly through a subsidiary, holds more than 50 percent of the issued voting shares or has contributed more than 50 percent of the capital.
If a foreign issuer is a professional investor and its purpose is to directly, or indirectly through a subsidiary company, control the operations of a holding company or companies, 70 percent or more of that foreign issuer's operating income in its consolidated financial statement shall be derived from a controlled company or companies. However, it may be excluded from the application of Articles 28-5 and 28-6.
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