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Article 43-1
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The provisions of Article 35 apply mutatis mutandis to the parties from which a securities underwriter is allowed to accept book building bids. In addition, when conducting an underwriting case involving an initial listing on a stock exchange or an OTC market or an initial offering of Taiwan Depositary Receipts, the underwriter 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:
- An employee of the issuer.
- A director, supervisor, or managerial officer (or a spouse, son, or daughter thereof) of a company that has underwriting business dealings with an underwriter.
- 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.
- 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.
- A de facto related party of the issuer or an underwriter.
- An attesting CPA of the issuer, any other CPA of that CPA’s office, or a spouse thereof.
- A lawyer who has issued a legal opinion in connection with the underwriting case, or the spouse thereof.
- An equity-method investee of the issuing company (issuing institution).
- An investor that has equity-method investments in the issuing company (issuing institution).
- A company whose chairman or general manager is the same person as the chairman or general manager of the issuing company (issuing institution), or is the spouse thereof, or is a relative thereof within the second degree of kinship.
- A foundation that has received one-third or more of its paid-in endowment from the issuing company (issuing institution).
- The issuing company's (issuing institution's) directors, supervisors, general manager, assistant general manager(s), deputy assistant general managers, or any division officer serving directly under the general manager.
- The spouse of a director, a supervisor, or the general manager of the issuing company (issuing institution).
- A relative within the second degree of kinship of a director, a supervisor, or the general manager of the issuing company (issuing institution).
- A director, supervisor, or employee of the underwriting syndicate, or a spouse thereof, or a relative thereof within the second degree of kinship.
- A depositary institution of Taiwan depositary receipts and any director, supervisor, or managerial officer, employee (or a spouse, son, or daughter thereof) of the depositary institution.
- 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, the parties from whom it is allowed to accept book building bids shall be restricted by the mutatis mutandis application of subparagraphs 3 to 15 and 17 of the preceding paragraph.
In a case of a secondary offering of Taiwan Depositary Receipts, the parties from whom book building bids are accepted shall be restricted by the mutatis mutandis application of subparagraphs 3 to 17 of paragraph 1.
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.
When a securities firm conducts an underwriting case involving an initial listing on a stock exchange or an OTC market, or involving an initial issue of Taiwan depositary receipts, it furthermore shall obtain declarations from the bidders affirming their consent for the provision of the book building information (including the remittance bank and account number) to the TWSE and the TPEx for the establishment of files, provided that the information will not be externally disclosed for any purpose other than provision to the TWSE, TPEx, and the competent authority for securities for supervision and auditing purposes.
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