Article 1
    These Directions are established by the Taiwan Stock Exchange Corporation (hereinafter the "TWSE") to provide guidance to small investors for their collective participation in national development projects and galvanization of the bond market.

Article 2
    The procedure of handling the sale by the TWSE of book-entry central government bonds as a sales agent shall be governed by the applicable regulations in addition to the requirements under these Directions.

Article 3
    The TWSE shall issue an allotment notice prior to the tender date of the book-entry central government bonds (hereinafter the "Tender Date") according to the appointed subscription date published by the Ministry of Finance and shall proceed with subscription, allotment and debit in a joint effort with the securities brokers within the following timeframes:

1. First subscription date: Participating subscribers shall place their orders by phone or in person at the business premises of the securities broker or faxing a letter of authorization (revocation) for subscription or revocation between 9 am and 2 pm any day during the subscription period.
2. Last subscription date: The last day of subscription and the last day for subscribers to deposit the subscription service fees to the bank.
3. The date prior to the Tender Date: The debit date of subscription service fees, on which the broker and the bank handle the debit of the subscriber's payment of the subscription service fees and send a list of changes to the TWSE. After the payment information is verified with the TWSE, the funds will be transferred to the TWSE "Account for Collection of Payments for Subscription of Securities". The TWSE will notify Chunghwa Post Co., Ltd. (hereinafter "Chunghwa Post") of the total number of bonds to be subscribed and verify the number of bonds for allotment with Chunghwa Post.
4. Tender Date: After the Central Bank of the Republic of China publishes the results of the tender, Chunghwa Post shall notify the TWSE of the prices of noncompetitive bids of such tender by 10 am the following day. After completion of the allotment work, the TWSE will inform the securities brokers of the results, and the securities brokers shall inform the TWSE of the number of the book-entry central government bond account opened with the clearing bank by the subscribers eligible for the allotment.
5. Two days prior to the issue date: The last day for a subscriber to inquire about the result of allotment and the last day for receipt of statements to give up the subscription.
6. One day prior to the issue date: The debit date of the subscription price, on which the securities broker and the bank handle the debit of the subscriber's payment of the subscription price and send a list of changes to the TWSE. After the payment information is verified with the TWSE, the funds will be transferred to the TWSE "Account for Collection of Payment for Securities".

    The template for the letter of authorization (revocation) for subscription mentioned in Subparagraph 1, Paragraph 1 above shall be separately established by the TWSE.

Article 4
    The TWSE shall distribute information such as the book-entry central government bond account numbers of and number of bonds to be subscribed by the subscribers who have paid the subscription price, to each applicable clearing bank and send information about the number of bonds to be subscribed allocated to each clearing bank to Chunghwa Post on the morning of the issue date.
    The TWSE will transfer the subscription price for the allotment of the book-entry central government bonds to the bank account designated by Chunghwa Post, on the issue date at the scheduled time agreed with Chunghwa Post.
    Upon receipt of the subscription price from the TWSE, Chunghwa Post will transfer such book-entry central government bonds according to the information about the subscription provided by the TWSE as in the first paragraph, from the TWSE book-entry central government bond account to the TWSE book-entry central government bond account with each clearing bank.
    Each clearing bank shall, based on the information about the subscription provided by the TWSE as in the first paragraph, allocate the book-entry central government bonds from the TWSE book-entry central government bond account to the subscriber's book-entry central government bond account.

Article 5
    The subscribers shall open a consignment trading of securities account, book-entry bond account and book-entry payment account before the securities brokers may proceed with subscription of book-entry central government bonds pursuant to their consignment.

Article 6
    Each subscriber is allowed to subscribe only one unit of bonds available for purchase.
    The unit of book-entry central government bonds available for purchase shall be in a multiple of NT$ 100,000 up to the maximum limit published by the Ministry of Finance, with the exact amount to be separately announced by the TWSE. There are five units of exchangeable bonds available for purchase, i.e. NT$ 100,000, NT$ 200,000, NT$ 300,000, NT$ 400,000 and NT$ 500,000.

Article 7
    The service fee is NT$ 30 per subscription, to be debited from the subscriber's bank account on the date set forth according to Article 3 after the securities firm accepting the subscription gives notice to the bank.

Article 8
    The securities broker may not accept orders from any subscriber for subscription and shall reject subscriptions that it has accepted from the subscriber if the subscriber:

1. Fails to open the consignment trading of securities account, book-entry bond account and book-entry payment account with the securities broker acting as agent for subscription;
2. Fails to sign a consignment contract with regard to debit of funds for subscription with the bank appointed by the securities broker;
3. Fails to subscribe within the prescribed time limit;
4. Fails to complete the requested information or provides false information in the letter of authorization for subscription; or
5. Fails to sign or seal the letter of authorization, except in the case of telephone authorization.

Article 9
    When handling a subscription order of a subscriber for book-entry central government bonds, the securities broker shall process the transfers of funds for payment of subscription price at the securities broker's securities subscription account with the bank. No funds at such account may be used for any other purposes.

Article 10
    Upon receipt of a subscription order, the securities broker shall upload the order to the TWSE computer server. Prior to the allotment, the TWSE will remove all such orders for which the subscription service fees cannot be paid timely due to insufficient bank deposits and duplicated subscription orders.
    The securities broker shall submit requests for revocation or change to the subscription orders described in the preceding paragraph via computer system.

Article 11
    During the subscription period of the book-entry central government bonds, the securities broker shall make available the subscription information as of the previous day on a daily basis at the trading floor for review by subscribers.

Article 12
    The TWSE shall complete the subscription and allotment in the following manner on the Tender Date:

1. Where the number of bonds subscribed is lower than the number of bonds offered, all qualified subscription orders will be allotted the number of bonds subscribed; and
2. Where the number of bonds subscribed exceeds the number of bonds offered, the units available for purchase shall be allotted at the ratio determined by lot drawing according to the random sequence generated by the computer. The remaining units, if any, will be allotted in the smaller unit for purchase according to the random sequence generated by the computer. Only one unit for purchase may be allotted to a subscription order. After completion of the above procedure, the results will be immediately reported to the securities firm, who will then forward the information to the subscriber.

Article 13
    The securities firms shall use the computer system to check the status of subscription and allotment of book-entry central government bonds.

Article 14
    After completion of the allotment by the TWSE, the subscriber shall be deemed to have given up the subscription in any of the following circumstances, in which case the securities firm shall notify the TWSE via computer connection.

1. The subscriber is found to have cancelled the consignment trading of securities account, book-entry bond account and book-entry payment account after the allotment, thus preventing the follow-up procedure.
2. The subscriber fails to pay the subscription price or pays only part of the subscription price within the prescribed time limit.

    The quantity that would have been allotted to such subscribers satisfying the conditions described in the above paragraphs will be subscribed by Chunghwa Post.

Article 15
    Information about the subscription and allotment of book-entry central government bonds shall be kept for 90 days after the allotment for reference.
    Notwithstanding the above, the TWSE may extend the period for keeping subscription information in dispute.

Article 16
    The subscription price payable by the subscriber shall be calculated according to the following formula:
    Subscription Price = Price of Non-competitive Bid per NT$ 100 published by the Central Bank ÷ 100 × Units Available for Purchase

Article 17
    No open session is held for the subscription and allotment of book-entry central government bonds under these Directions.

Article 18
    These Directions shall be take effect after having been submitted to and approved by the competent authority. Subsequent amendments thereto shall be effected in the same manner.