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Title Taiwan Depository & Clearing Corporation Directions for the Handling by Issuers of Registration and Book-Entry Delivery Operations for Securities Issued in Dematerialized Form CH
Date 2020.09.25 ( Amended )

Article Content

Chapter 1 General Principles
Article 1     These Directions are adopted pursuant to Articles 4, 9, 12, 62-1, 63-1, 99-1, 99-2, and 101 of the Operating Rules of the Taiwan Depository & Clearing Corporation (TDCC).
Article 2     Unless otherwise provided by applicable law or regulation of the competent authority or otherwise prescribed by TDCC, the registration, book-entry delivery, audit, termination of registration, and other relevant operations with respect to issuers' dematerialized securities shall be governed by these Directions.
Article 3     An issuer shall initially sign an account opening agreement with TDCC and submit a duplicate set of the specimen seal/signature card in duplicate to open a depository account and become a TDCC participant, as a basis for carrying out registration and book-entry delivery operations.
Article 4     Unless otherwise provided, an issuer shall retain its forms, reports, and other documents used for the purposes of the operations set out in these Directions for 15 years after the completion of the respective operating procedures.
Article 5     An issuer submitting required application documentation to TDCC electronically shall first have an electronic certificate recognized by TDCC.
Chapter 2 Criteria for Issuers' Applications
Article 6     Unless otherwise provided by law or regulation, the personnel, facilities, and internal control system of an issuer or its transfer agent or securities services agent shall comply with the following requirements:
  1. A securities services agent shall have at least one supervisory officer, and at least one full-time associated person, who
    1. Have 1 or more years of practical experience in handling operations for the relevant securities services;
    2. Are senior securities specialists or securities specialists, or specialists of the relevant securities; or,
    3. Have passed the examination for the relevant securities operations held by the institution designated by the competent authority.
  2. Handle relevant operations with computer equipment connecting to TDCC’s system.
  3. The internal control system shall include procedures for the handling of relevant securities operations and determine the scope of audit; dedicated personnel shall be assigned to carry out internal audits on a regular or irregular basis and prepare paper-based audit records for recordation.
    An issuer applying to TDCC for registration of dematerialized securities shall submit electronically the required documents to TDCC by three business days before the book-entry delivery date designated by the issuer. When necessary, TDCC may request provision of hard copies or conduct an on-site audit on the eligibility requirements set out in the preceding paragraph.
    The preceding paragraph does not apply if an issuer has submitted documents evidencing that its corporate actions or securities services are handled by a transfer agent or shareholder services unit that meets the requirements of the Regulations Governing the Administration of Shareholder Services of Public Companies.
    When there is any change to the qualified personnel or facilities, or any amendment to the internal control procedures as referred to in paragraph 1, the issuer shall notify TDCC within five days after the change or amendment.
Article 7     Before an issuer first applies for registration of dematerialized securities, the issuer or its transfer agent shall file a list of internal auditors with TDCC. If there is any change to such internal auditors, the issuer shall notify TDCC within five days after the change.
Article 8     Where the issuer referred to in the preceding Article applies for registration of stocks that are neither listed on the Taiwan Stock Exchange (TWSE) or Taipei Exchange (TPEx), nor registered on the TPEx Emerging Stock Board, the issuer shall engage a transfer agent that meets the requirements of the Regulations Governing the Administration of Shareholder Services of Public Companies to handle its corporate actions. The issuer shall also produce a statement declaring that its stocks are fully issued in dematerialized form and that, prior to TWSE's or TPEx's approval for listing or Emerging Stock Board registration, it will not accept any stockholder's application to transfer shares to a depository account opened by the stockholder with a participant.
Article 9     In accordance with these Directions, an issuer or its transfer agent or securities services agent shall accept TDCC's audits on the application documents with respect to registration and book-entry delivery, operating procedures, and corporate actions or securities services related matters.
Chapter 3 Computer Network Connection
Article 10     To execute online transactions, account reconciliation, and other relevant operations, an issuer shall arrange for a computer network connection with TDCC based on the following principles:
  1. If the issuer handles its own corporate actions or securities services, the issuer shall apply to establish a computer network connection with TDCC.
  2. If the issuer engages a transfer agent to handle its corporate actions or securities services, the agent shall apply to establish a computer network connection with TDCC.
Article 11     An issuer or its transfer agent or securities services agent shall register its email address with TDCC and receive electronic reports and conduct queries in accordance with applicable TDCC requirements.
Chapter 4 Registration Procedure
Article 12     An issuer applying for registration of securities issued in dematerialized form shall submit electronically to TDCC the relevant forms and documents required for a domestic issuer or foreign issuer, as the case may be, as set out separately in Schedule 1, 2, or 3 to these Directions.
    To register securities issued in dematerialized form pursuant to the preceding paragraph, the issuer shall apply to TDCC by 3 business days before the book-entry delivery date designated by the issuer, or, in the case of an issuer of call (put) warrants, on the business day immediately before the book-entry delivery date designated by the issuer.
Article 13     If the issuer has not completed the registration of capital change associated with its stock shares registered in dematerialized form, then after completing the registration of capital change, it shall submit electronically the approval letter permitting the change registration from the competent authority in charge of company registrations, the company incorporation/amendment registration form, or other relevant documentary proof.
Article 14     All application documents submitted by the issuer under the preceding 2 articles shall be affixed with its seal/signature-of-record, and the original of the approval letter from the competent authority in charge of company registrations permitting the change registration shall be affixed with a stamp bearing a statement, "This is to certify that an application has been submitted to the central securities depository enterprise for the dematerialized issuance of the securities."
Article 15     For a private placement of securities, the issuer shall notify TDCC when reporting to the competent authority for recordation pursuant to law.
Article 16     After reviewing and verifying the accuracy of the registration application details, TDCC will input the total amount of that issuance into its computer system. Once the registration is completed, TDCC will issue a Certificate of Registration of Dematerialized Issuance to the issuer in accordance with relevant provisions.
Chapter 5 Book-Entry Operations
Section 1 Account Opening
Article 17     An issuer shall execute an "Account Opening - Creation of Basic Information File" transaction (transaction code: 140) through the online system and establish a registration account (A/C No.: 3XXX5555555; A/C type: 80) with TDCC. The registration account shall be used to record the balances of securities that have not been transferred to the depository account.
Article 18     The issuer shall notify TDCC of the following information with respect to the "Details of Securities Owners," "Details of Securities Held in Custody," and "Details of Pledged Securities" under the registration account in the preceding Article:
  1. Name.
  2. Shareholder's uniform ID number as required under the Regulations Governing the Administration of Shareholder Services of Public Companies.
  3. Identity type.
  4. Date of birth/establishment.
  5. Place of nationality/registration.
  6. Quantity of securities and other required information.
  7. For the details of pledged securities, the pledgee's name, uniform ID number (national ID number, uniform ID number as a profit-seeking enterprise, or uniform ID number as a tax withholding entity), and amount of pledge shall be additionally recorded.
  8. Mailing address.
Article 19     A securities owner applying to an issuer to open a "general custody account" under the depository account shall present documentary proof of identity and submit an account opening agreement and an application form affixed with its seal/signature-of-record.
    After the securities owner completes the account opening procedure, the issuer shall execute an "Account Opening - Creation of Basic Information File" transaction (transaction code: 140) by inputting the account name and account type (A/C type: 42 for domestic individuals, 43 for domestic institutions, 44 for foreign individuals, and 45 for foreign institutions) and issue a securities passbook, on the basis of which book-entry operations can be carried out for creation of pledge; account transfer or remittance; direct trade between parties; inheritance; endowment; authorized sale; sale of tax-deferred or tax-payment-deferred shares; provision by subscribers of property other than cash as their capital contributions; waiver of shares; conversion, redemption, resale, forced conversion, or subscriptions for shares; placement in trust; and otherwise.
    If the account under paragraph 1 is opened for the purpose of provision by subscribers of property other than cash as their capital contributions for shares of a company in the process of establishment, the representative of the company being established shall submit documentary proof of identity, a list of the promoters, and other relevant supporting documents to the issuer of the stock to be used for the capital contribution and open the account in the name of "XXX, Representative of XXX Company's Preparatory Office." The issuer shall then carry out the account opening operation under the preceding paragraph (with a uniform ID number assigned by the issuer; A/C type: 46).
    To change basic information, the securities owner shall apply to the issuer by submitting a "Customer Basic Information Change Application," affixed with the owner's seal/signature-of-record. After reviewing and verifying the accuracy of content, the issuer shall execute a "Customer Basic Information Change" transaction (transaction code: 146) and change the securities owner's basic information.
Article 20     To handle book-entry operations for delivery of pledged securities, an issuer shall execute an "Account Opening - Creation of Basic Information File" transaction (transaction code: 140) and establish a pledge account (A/C No.: 3XXX9999955; A/C type: 28).
    To enable the issuer to handle book-entry operations for delivery of pledged securities, a pledgor and a pledgee shall apply to the issuer to open a general custody account under the depository account, on the basis of which relevant operations can be carried out. The pledgee's application to the issuer to open the depository account shall be subject to Article 19.
    The issuer shall handle book-entry operations for delivery of pledged securities in accordance with TDCC's Directions for the Handling by Participants of Book-Entry Operations for Delivery of Pledged Securities.
Article 21     To enable an issuer to handle book-entry operations for securities in trust, the trustor and trustee shall apply to the issuer to open a general custody account under the depository account, on the basis of which relevant operations can be carried out; if the trustee is a trust enterprise authorized to hold new restricted employee shares in trust, for that purpose it may use the depository account it opens with a participant.
    The issuer shall handle account opening and book-entry operations for securities in trust in accordance with TDCC's Directions for the Handling of Book-Entry Operations for Securities in Trust.
Article 22     When an issuer will buy back its shares and hold them as treasury stock, for that purpose it shall execute an "Account Opening - Creation of Basic Information File" transaction (transaction code: 140) and establish an account for treasury stock (A/C No.: 3XXX6666666; A/C type: 66), on the basis of which share transfer, retirement of shares, and other relevant book-entry operations can be carried out. After establishing the account for treasury stock with TDCC, the issuer shall open a depository account (A/C type: 60) with a securities firm, on the basis of which book-entry settlement can be carried out.
    When an issuer, as provided for by its issuance rules, will retire or purchase its new restricted employee shares, for that purpose it shall execute the transaction under the preceding paragraph and establish a retirement/purchase account for new restricted employee shares, on the basis of which retirement of the shares can be carried out.
Article 23     Where an issuer's directors, supervisors, specified shareholders, owners of beneficial securities, or placees of convertible corporate bonds or corporate bonds with warrants place their securities in the central securities depository for a certain period in accordance with applicable requirements, the issuer shall handle relevant operations in accordance with the TDCC Directions for the Handling by Issuers of Central Custody and Book-Entry Operations for Securities in Specific Custody Accounts.
Section 2 Book-Entry Delivery
Article 24     An issuer shall, by 5:30 p.m. two business days before the designated book-entry delivery date, submit an "Application for Book-Entry Delivery of Dematerialized Securities (Substitute for Voucher)" (affixed with the seal/signature-of-record), data media containing a list of securities owners for book-entry delivery, electronic media containing the quantity of shares subscribable by securities owners for the purpose of the rights issue, and other relevant materials to TDCC to apply for book-entry delivery. In addition, the issuer shall, in a format prescribed by TDCC, create the data media separately for the details of securities owners with depository accounts and for the details of securities owners under the "Details of Securities Owners," "Details of Securities Held in Custody," and "Details of Pledged Securities" under the registration account.
    In an underwriting case where securities are allocated by book building subscription, public subscription, or competitive auction prior to initial TWSE/TPEx listing, the issuer shall request its underwriter to carry out the procedure under the preceding paragraph by 10 a.m. on the business day before the designated book-entry delivery date.
    When an issuer first carries out operations for registration and book-entry delivery of securities issued in fully dematerialized form, or for book-entry delivery of shares in a stock dividend distribution or a rights issue, the data media it submits under paragraph 1 that contains a list of securities owners for book-entry delivery shall have been confirmed by the supervisory personnel for corporate actions and shareholder services as filed with TDCC in accordance with the Regulations Governing the Administration of Shareholder Services of Public Companies ("shareholder services/transfer agent's supervisory personnel").
Article 25     When an issuer applies to TDCC to transfer its treasury shares to employees, it shall, by 5:30 p.m. on the business day before the designated book-entry delivery date, transfer the treasury shares to the "issuer account" (A/C No.: 99609999900) and notify TDCC.
    The issuer shall, by 3 business days before the designated book-entry delivery date, submit the following documents to TDCC to transfer treasury shares to employees:
  1. If the issuer is a TWSE/TPEx listed company:
    1. "Basic Information of Transfer of Treasury Stock to Employees" downloaded from the Market Observation Post System (MOPS). If, however, the issuer acquired the treasury shares while registered on the Emerging Stock Board, it shall instead submit an official letter for applying to transfer treasury shares to employees.
    2. "Application for Book-Entry Delivery of Dematerialized Securities (Substitute for Voucher)" (wherein the book-entry delivery date shall be the same as the scheduled date of transfer to employees recorded under item A.
    3. Data media containing a list of securities owners for book-entry delivery.
    4. Certificate of Full Collection of Proceeds.
    5. Original of the certificate of balance issued by a bank authorized to collect payment for shares subscribed.
    6. Document affixed with the seals/signatures of the shareholder services/transfer agent's supervisory personnel and internal auditors of the issuer's transfer agent, or of the issuer if it handles its own shareholder services, acknowledging that they have reviewed and verified the accuracy of the book-entry delivery information and the securities transaction tax clearance certificate.
    7. Audit report prepared by the auditing unit. The audit items shall include reviewing and verifying that the transfer date, transfer price, employee eligibility, transfer of treasury shares at discount, and other relevant matters comply with applicable laws and regulations and the issuer's transfer rules, and that the issuer has fully received the payments for shares and a certificate of balance has been issued by the agent bank designated for receiving the payments for shares. The audit report shall be affixed with the seals/signatures of the company's internal auditors and internal audit officer and of the company.
    8. If the transfer price of the shares is higher than their closing price on the cut-off date for subscription payment by employees, the issuer shall additionally submit a consent letter of voluntary subscription affixed with the seals/signatures of the employees.
  2. If the issuer is not a TWSE/TPEx listed company:
    1. Official letter for applying to transfer treasury shares to employees.
    2. The documents required under items B. to G. of the preceding subparagraph.
    The documents required under items B. and F. of subparagraph 1 of the preceding paragraph shall be affixed with the issuer's seal/signature-of-record and the documents required under items D. and G. with its company seal and responsible person's seal filed for its company amendment registration form.
    If any document submitted by the issuer does not comply with applicable provisions, and if, upon TDCC's notification, the issuer fails to cure the non-compliance by the business day before the scheduled transfer date, TDCC will notify the issuer that it will not handle the given book-entry delivery.
Article 26     After reviewing and verifying the accuracy of the book-entry delivery information, TDCC will, on the book-entry delivery date designated by the issuer, transfer the securities to the depository accounts opened by the customers with their participants. Securities not transferred to the customers' depository accounts at the participants shall be transferred to the registration account under the issuer's depository account to complete the book-entry delivery procedure.
    If the securities for the book-entry delivery described in the preceding paragraph are privately placed securities, they shall be transferred to the customers' general custody accounts under the issuer's depository account or to the registration account under the issuer's depository account, except for a customer who is a securities dealer or a custodian or who is placing the securities under the custody of an authorized custodian.
    If the securities for the book-entry delivery described in paragraph 1 are securities within the scope of Article 8, they shall be transferred to the customers' general custody accounts under the issuer's depository account or to the registration account under the issuer's depository account.
    If the securities for the book-entry delivery described in paragraph 1 are new restricted employee shares, they shall be transferred to the employees' general custody accounts under the issuer's depository account, with a notation of restriction thereon, unless the employees are required to place the shares under the custody of an authorized custodian.
Article 27     For securities transferred to the issuer's registration account under the preceding Article, book entries shall be recorded under the corresponding details items according to the following subparagraphs:
  1. For securities owners without a depository account, book entries shall be recorded under the "Details of Securities Owners."
  2. For securities in any of the following circumstances, book entries shall be recorded under the "Details of Securities Held in Custody":
    1. The securities owner has not surrendered the physical securities certificates.
    2. The securities have been withdrawn from the depository account but the title transfer procedure has not been completed.
    3. The stock certificates are lost.
    4. The securities owner has any unpaid income tax.
    5. Shares that the securities owner has subscribed to but not yet received in an underwriting case.
    6. Interest/proceeds arising from pledged shares to be received by the pledgee or to be received by the pledger pending agreement by the pledgee.
    7. Shares pending the completion of the inheritance procedure.
    8. Shares held by the co-owners referred to in the Land-to-the-Tiller Act.
    9. Interest/proceeds arising from any securities under the designated court auction account.
    10. Interest/proceeds arising from any securities described in items B. to I. of this subparagraph.
  3. For securities whose physical certificates have been pledged, as registered by the issuer, before the book-entry delivery, the total pledged amount shall be recorded under the "Details of Pledged Securities," with a distinction between whether the physical certificates have been "Surrendered" or "Not Surrendered."
Article 28     Securities that are tax-deferred or tax-payment-deferred shares shall be delivered by book-entry transfer to the registration account under the issuer's depository account. TDCC will only make a notation of tax deferral or tax-payment deferral for the balances of shareholdings of securities owners based on the data media provided by the issuer. The issuer must control and manage the content of tax deferral or tax payment deferral on its own.
Article 29     Treasury shares to be transferred to employees, shares subscribed by employees in cash, and employee compensation shares, transferred by a domestic issuer to employees, shall be delivered to the depository accounts opened by the employees with a securities firm. This requirement, however, does not apply in any of the following circumstances:
  1. Where an employee elects the deferral of income tax, such shares shall be delivered to the registration account under the issuer's depository account.
  2. Where the domestic issuer is a TWSE/TPEx listed company or a company registered on the Emerging Stock Board ("Emerging Stock company") and is duly delivering the shares to overseas foreign national employees of its overseas parent or subsidiary, branch, or representative's office, such shares may be delivered to the investment accounts opened by the employees with a custodian or to the Segregated Collective Investment Account for Overseas Foreign National Employees opened by the issuer's overseas parent or subsidiary, branch, or representative's office with a custodian.
  3. Where the domestic issuer is a TWSE/TPEx listed company and is duly delivering the shares to employees of its offshore subsidiary or branch with a household registration in China, such shares shall be delivered to the collective investment account for Chinese national employees opened by the issuer's offshore subsidiary or branch with a custodian.
  4. Where the domestic issuer is neither a TWSE/TPEx listed company nor an Emerging Stock company and is duly delivering the shares to employees, such shares shall be delivered to the general custody accounts opened by the employees under the issuer's depository account or to the registration account under the issuer's depository account.
    Where a foreign issuer is duly issuing shares to employees, such shares shall be delivered to the depository accounts opened by the employees with a securities firm or a custodian. This requirement, however, does not apply in any of the following circumstances:
  1. Where the foreign issuer is a TWSE/TPEx listed company or an Emerging Stock company and is delivering the shares to overseas foreign national employees, such shares may be delivered to the Segregated Collective Investment Account for Overseas Foreign National Employees opened by the foreign issuer with a custodian.
  2. Where the foreign issuer is a TWSE/TPEx listed company and is delivering the shares to employees with a household registration in China, such shares shall be delivered to the collective investment account for Chinese national employees opened by the foreign issuer with a custodian.
    The term "employees" referred to in subparagraphs 2 and 3 of paragraph 1 and subparagraphs 1 and 2 of the preceding paragraph does not include insiders such as shareholders with shareholdings of more than 10 percent.
Article 30     On the next business day after book-entry delivery, TDCC will produce and deliver the following reports to the participant and the issuer. If the issuer checks and discovers any discrepancy, it shall notify TDCC and jointly investigate the reason and address the issue:
  1. Produce a "Securities Distribution Book-Entry Transfer List" and send it electronically to the participant.
  2. Produce a "Securities Distribution Book-Entry Transfer Result Notice" and a "Merger Securities Firm Central Depository Account Transfer Confirmation" and send them electronically to the issuer.
Article 31     When an account transfer fails with respect to the securities book-entry transfer information delivered by an issuer to TDCC, TDCC shall produce a "Securities Distribution Book-Entry Transfer Failure Notice" and send it electronically to the issuer for notification of replacement or correction.
Article 32     An issuer shall handle the following operations in accordance with TDCC's Directions for the Handling of Operations for Book-Entry Distribution of Securities:
  1. The account aggregation principles, notations, and the operation of "separate account distribution for whole shares and aggregated account distribution for fractional shares," for depository accounts with respect to the issuer's book-entry delivery of new shares for capital increase and the relevant data media.
  2. The correction operation, and the freezing and unfreezing operation for the non-transferability period restriction, with respect to the book-entry delivery of securities.
    To remove a notation of restriction for new restricted employee shares, an issuer shall proceed in accordance with the following procedure:
  1. The issuer shall submit data media containing a list of securities and an application form to TDCC for application, or otherwise execute a "Restriction-on-Transfer Distribution Information Maintenance" transaction (transaction code: 606) or a "Restriction-on-Transfer Distribution/Delivery Information Maintenance - Electronic Transmission" transaction (transaction code: 606S) to notify TDCC to remove the notation of restriction for the new restricted employee shares.
  2. Upon receiving the issuer's notification, TDCC will proceed to remove the notation of restriction.
Section 3 Exercise/Conversion/Redemption-and-Reissuance with Respect to Securities
Article 33     To handle operations with respect to the exercise of employee stock option certificates, conversion of overseas convertible corporate bonds, exercise of share subscription warrants attached to overseas corporate bonds, or redemption and subsequent reissuance of Taiwan depositary receipts (TDRs), an issuer shall initially submit an "Employee Stock Option Certificates/Overseas Convertible Corporate Bonds/Overseas Corporate Bonds with Share Subscription Warrants/Taiwan Depositary Receipts Basic Information Registration Application" to notify TDCC of the issuance information, and any change thereto.
    After TDCC completes issuance information setup based on the application form described in the preceding paragraph, the issuer shall execute an "Employee Stock Option Certificates/Overseas Convertible Corporate Bonds/Overseas Corporate Bonds with Share Subscription Warrants/Taiwan Depositary Receipts Basic Information Query" transaction (transaction code: A83; query type: 1. Basic Information) and check the relevant information. If the issuer discovers any error, it shall notify TDCC.
Article 34     The issuer shall execute a "Subscription/Conversion/Redemption-and-Reissuance Information - Electronic Transmission" transaction (transaction code: EOA; processing type: 1. File Upload) to notify TDCC of relevant information on the book-entry delivery of securities (in a media format prescribed by TDCC).
    When handling the conversion of overseas convertible corporate bonds or exercise of share subscription warrants attached to overseas corporate bonds, the issuer shall first deliver a photocopy of the conversion or share subscription application details to TDCC. When handling the redemption and subsequent reissuance of TDRs, the issuer (depositary institution) shall notify TDCC by electronic means of the number of reissued TDRs and the number of securities represented thereby.
    After reviewing and verifying the accuracy of the information provided under the preceding paragraph, TDCC will notify the issuer.
Article 35     The issuer shall execute a "Subscription/Conversion/Redemption-and-Reissuance Information Query" transaction (transaction code: A86; query type: 1. For Pending Application) and check the file data uploaded under paragraph 1 of the preceding Article.
    After checking and verifying the accuracy of the information, the issuer shall, by 5:30 p.m. on the business day before the designated book-entry delivery date, execute a "Subscription/Conversion/Redemption-and-Reissuance Information Confirmation" transaction (transaction code: A87) to confirm the information. If the issuer discovers any error when checking the information, it shall execute a "Subscription/Conversion/Redemption-and-Reissuance Information - Electronic Transmission" (transaction code: EOA; processing type: 2. File Deletion) and delete the uploaded file. It shall then notify TDCC of amended information following the procedure set out in the preceding Article.
Article 36     Where new shares are issued and to be delivered for the exercise of options or warrants or conversion of bonds, or where TDRs are redeemed and subsequently reissued, after reviewing and verifying the accuracy of the application details based on the issuer's confirmation notification, TDCC will register the number of shares underlying the exercised options or warrants or converted bonds or the number of reissued TDRs, and, on the book-entry delivery date designated by the issuer, transfer the securities to the depository accounts opened by the securities owners with a securities firm or a custodian. If TDCC discovers any error when reviewing the information, it will notify the issuer to address the issue. However, if the issuer is a non public offering company, it shall first complete registration of change of the company's capital, and then submit the amended and registered company incorporation/amendment registration form to TDCC to apply for registration and book-entry delivery operations for the securities issued in dematerialized form.
    Where treasury shares are to be delivered for the exercise of options or warrants or conversion of bonds, in addition to the operations required under the preceding 3 Articles, the issuer shall, by 5:30 p.m. on the business day before the designated book-entry delivery date, transfer the quantity of shares underlying the exercised options or warrants or converted bonds from the participant's depository account to the issuer account (A/C No.: 99609999900) and notify TDCC. After reviewing and verifying the accuracy of the issuance information based on the exercise or conversion information as confirmed by the issuer, TDCC will, on the book-entry delivery date designated by the issuer, transfer the shares to the depository accounts opened by the securities owners with a securities firm or a custodian. If TDCC discovers any error when reviewing the information, it will notify the issuer to address the issue.
    When a domestic issuer delivers to employees the shares underlying employee stock option certificates exercised by the employees, after the performance of relevant operations in accordance with the procedures required in paragraph 1 or 2, such shares shall be delivered to the depository accounts opened by the employees with a securities firm. This requirement, however, does not apply in any of the following circumstances:
  1. Where the domestic issuer is a TWSE/TPEx listed company or an Emerging Stock company and is delivering the shares to employees electing the deferral of tax payment or deferral of income tax, or where the domestic issuer is neither a TWSE/TPEx listed company nor an Emerging Stock company and is delivering the shares to employees, such shares shall be delivered to the registration account under the issuer's depository account.
  2. Where the domestic issuer is a TWSE/TPEx listed company or an Emerging Stock company and is delivering the shares to overseas foreign national employees of its overseas parent, subsidiary, branch, or representative's office, such shares may be delivered to the investment accounts opened by the employees with a custodian or to the Segregated Collective Investment Account for Overseas Foreign National Employees opened by the issuer's overseas parent, subsidiary, branch, or representative's office with a custodian.
  3. Where the domestic issuer is a TWSE/TPEx listed company and is delivering the shares to employees with a household registration in China, such shares shall be delivered to the collective investment account for Chinese national employees opened by the issuer's offshore subsidiary or branch with a custodian.
    The term "employees" referred to in subparagraphs 2 and 3 of the preceding paragraph does not include insiders such as shareholders with shareholdings of more than 10 percent.
    A foreign issuer delivering to employees the shares underlying employee stock option certificates exercised by the employees shall, after the completion of the procedures required under paragraph 1 or 2, be subject to Article 29, paragraphs 2 and 3.
Article 37     An issuer handling book-entry operations for conversion, redemption, resale, forced conversion, or subscriptions for shares with respect to convertible corporate bonds, corporate bonds/preferred stock with warrants, stock warrants, or preferred stock shall proceed in accordance with TDCC's Directions for the Handling of Book-Entry Operations for Centrally Deposited Convertible Corporate Bonds, Directions for the Handling of Book-Entry Operations for Centrally Deposited Corporate Bonds/Preferred Stock with Warrants and Stock Warrants, and Directions for the Handling of Book-Entry Operations for Closed-End Beneficial Certificates, Depositary Receipts, Preferred Stock, and Retirement of Shares.
Article 38     When a TWSE/TPEx listed company or an Emerging Stock company handles the conversion of privately placed overseas convertible corporate bonds, it shall, by 5:30 p.m. two business days before the book-entry delivery, submit an "Application for Registration of Dematerialized Issuance," photocopies of the conversion application documents submitted by the securities owners, and data media containing a list of securities for book-entry delivery and apply to TDCC for registration and book-entry delivery of the underlying shares, in which case this Section does not apply.
    After reviewing and verifying the accuracy of the information provided under the preceding paragraph, TDCC will register the shares after the conversion in accordance with Article 16, and make book-entry delivery for the conversion of privately placed overseas convertible corporate bonds into common shares in accordance with Article 26, paragraph 2.
Chapter 6 Account Operations for Issuers' Depository Accounts and Registration Accounts
Section 1 Account Transfer of Deposited Securities
Article 39     For deposited securities in a general custody account under an issuer's depository account that are not tax-deferred or tax-payment-deferred shares, any transfer of such securities to the depository account opened by the relevant securities owner with a participant shall proceed as follows:
  1. The securities owner must apply to open a depository account and obtain a securities passbook.
  2. The securities owner shall submit the securities passbook, relevant supporting documents, and an "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer Application" (affixed with the seal/signature-of-record), and apply to the issuer for account transfer.
  3. After reviewing and verifying the accuracy of content, the issuer shall execute an "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer" transaction (transaction code: 671) or an "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer - Electronic Transmission" transaction (transaction code: 671S) to notify TDCC.
  4. Upon receiving the notification described in the preceding subparagraph, TDCC will transfer the shares from the general custody account to the depository account of the securities owner.
    For deposited securities in the registration account under an issuer's depository account that are not tax-deferred or tax-payment-deferred shares, any transfer of such securities to the depository account opened by the relevant securities owner with a participant shall proceed in accordance with the preceding paragraph. However, if the issuer provides its own deposited securities account transfer application form to the securities owner to fill in the depository account number and affix the seal/signature-of-record, such application form may be used as a substitute for the "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer Application" form when applying to the issuer for account transfer.
Article 40     For securities in a general custody account or registration account under an issuer's depository account, upon receiving an imposition or lifting of a court-ordered attachment from an enforcing authority, the issuer shall, based on the order, execute a "Court-Ordered Attachment Information Setup" transaction (transaction code: 150) or a "Court-Ordered Attachment Information Change" transaction (transaction code: 151; change type: 1. lifting of Attachment) to notify TDCC of the relevant information of the imposition or lifting of a court-ordered attachment.
    For securities in a general custody account or registration account under an issuer's depository account, upon receiving notification from an enforcing authority for delivery of securities to it, the issuer shall, based on the order, execute a "Court-Ordered Attachment Information Change" transaction (transaction code: 151; change type: 2. Account Transfer Due to Court-Ordered Attachment) to notify TDCC. Upon receiving the notification, TDCC will transfer the securities from the general custody account or registration account to the auction account designated by the enforcing authority.
Article 41     For deposited securities under the "Details of Securities Owners" under the registration account under an issuer's depository account that are securities within the scope of Article 8, except in the cases of securities owners without a depository account, the issuer shall, within the timeframes prescribed below, submit an "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer Application" (affixed with the seal/signature of the shareholder services unit) to effect account transfer of deposited securities in either of the following manners, in which case the provisions of Article 39, paragraphs 1 and 2 do not apply that require account transfer application forms to be submitted by securities owners:
  1. Before the TWSE/TPEx listing or Emerging Stock Board registration date as announced by TWSE or TPEx, the issuer shall create data media consolidating the deposited securities account transfer information for all relevant securities owners and execute an "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer - Electronic Transmission" transaction (transaction code: 671S) to notify TDCC. Upon receiving the notification, TDCC will transfer the securities from the "Details of Securities Owners" under the registration account to the depository accounts of the securities owners.
  2. By 2 business days before the TWSE/TPEx listing or Emerging Stock Board registration date as announced by TWSE or TPEx, the issuer shall notify TDCC in the manner described in the preceding subparagraph. Upon receiving the notification, TDCC will transfer the securities from the "Details of Securities Owners" under the registration account to the issuer account (A/C No.: 99609999900). The issuer shall also submit the application form and data media described in Article 24, paragraph 1 and apply to TDCC to transfer, by means of book-entry delivery, the shares to the depository accounts of the securities owners on the TWSE/TPEx listing or Emerging Stock Board registration date.
    The relevant shareholder services/transfer agent's supervisory personnel shall affix their seals/signatures on the "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer Application" form acknowledging their confirmation about the data media described in subparagraphs 1 and 2 of the preceding paragraph.
Article 42     For deposited securities in a general custody account under an issuer's depository account that are new restricted employee shares, when the issuer retires or purchases any such shares pursuant to its issuance rules, the operation shall proceed as follows:
  1. An employee shall submit the securities passbook and a "Deposited Securities Transfer Application" (affixed with the seal/signature-of-record) to the issuer for review.
  2. After reviewing and verifying the accuracy of content, the issuer shall apply to TDCC for release of shares and then execute a "Controlled Securities - Deposited Securities Transfer" transaction (transaction code: A63) to notify TDCC.
  3. Upon receiving the notification described in the preceding subparagraph, TDCC will transfer the shares from the general custody account to the issuer's retirement/purchase account for new restricted employee shares, while retaining the notation of restriction.
    For new restricted employee shares that an issuer transfers from a general custody account, a customer account under a custodian's depository account, or a trustee's trust account to the issuer's retirement/purchase account pursuant to its issuance rules, the issuer shall handle the relevant operations for retirement of shares in accordance with TDCC's Directions for the Handling of Book-Entry Operations for Closed-End Beneficial Certificates, Depositary Receipts, Preferred Stock, and Retirement of Shares. Before handling such operation, the issuer shall first notify TDCC to remove the notation of restriction for such shares in accordance with Article 32, paragraph 2.
Article 43     After an issuer removes the notation of restriction for new restricted employee shares, the maintenance operation for relevant tax-deferred or tax-payment-deferred shares with respect to which employees elect the deferral of tax payment or deferral of income tax shall proceed in accordance with the following procedure:
  1. After removing the notation of restriction for new restricted employee shares in accordance with Article 32, paragraph 2, the issuer shall execute an "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer" transaction (transaction code: 671), or otherwise create data media consolidating the deposited securities account transfer information for all relevant securities owners and execute an "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer - Electronic Transmission" transaction (transaction code: 671S), to notify TDCC to transfer the shares from the general custody accounts to the issuer account (A/C No.: 99609999900).
  2. The issuer shall, by 5:30 p.m. on the business day before the delivery of the tax-deferred or tax-payment-deferred shares, submit an "Application for Book-Entry Delivery of Dematerialized Securities (Substitute for Voucher)" (affixed with the seal/signature-of-record) and data media containing a list of owners of tax-deferred or tax-payment-deferred shares for delivery, and apply to TDCC to transfer the employees' tax-deferred or tax-payment-deferred shares to the "Details of Securities Owners" under the issuer's registration account.
  3. TDCC will deliver by book-entry transfer the employees' tax-deferred or tax-payment-deferred shares to the registration account under the issuer's depository account in accordance with Article 26, paragraph 1 and Article 28. TDCC will also make a notation of tax deferral or tax payment deferral for the balances of shareholdings of the employees based on the data media provided by the issuer. The issuer must control and manage the content of tax deferral or tax payment deferral on its own.
    The relevant shareholder services/transfer agent's supervisory personnel shall affix their seals/signatures on the "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer Application" form acknowledging their confirmation about the data media described in subparagraph 1 of the preceding paragraph.
Article 44     For deposited securities in a registration account that are tax-deferred or tax-payment-deferred shares, any transfer of such shares to the general custody account opened by the relevant securities owner under the issuer's depository account shall proceed in accordance with the procedure set out in Article 39, paragraph 2.
    When the securities owner of a general custody account under an issuer's depository account applies to remove the notation of tax deferral or tax payment deferral, the securities owner shall submit the securities passbook and proceed in accordance with the procedure set out in Article 55.
Article 45     When the securities owner of a general custody account under an issuer's depository account applies for a direct trade between parties, inheritance, endowment, provision by subscribers of property other than cash as their capital contributions, or waiver of shares, or when an heir to securities in a specific custody account under an issuer's depository account applies for inheritance, the operation shall proceed as follows:
  1. The assignee, heir, donee, company receiving property other than cash as capital contributions, or company whose shares are waived must apply to the issuer to open a general custody account and obtain a securities passbook.
  2. The securities owner shall submit the securities passbook, relevant supporting documents, and an "Issuer Depository Account - Account Transfer Application" (affixed with the seal/signature-of-record) and apply to the issuer for account transfer. In the case of the heir to securities in the specific custody account under the issuer's depository account, before account transfer may be applied for, the control shall be removed by the issuer in accordance with the TDCC Directions for the Handling by Issuers of Central Custody and Book-Entry Operations for Securities in Specific Custody Accounts.
  3. After reviewing and verifying the accuracy of content, the issuer shall execute an "Issuer Depository Account - Account Transfer" transaction (transaction code: A53) to notify TDCC.
  4. Upon receiving the notification described in the preceding subparagraph, TDCC will transfer the deposited securities from the general custody account or specific custody account of the securities owner to the general custody account of the assignee, heir, donee, company receiving property other than cash as capital contributions, or company whose shares are waived.
    If any stock dividends are delivered by book-entry transfer to the legator's (decedent) general custody account under the issuer's depository account after the fact of inheritance, when applying to transfer the stock dividends to his or her general custody account, the heir shall submit the legator's household deregistration transcript or death certificate and an affidavit (there is no need to submit a certificate of estate tax payment or exemption) and the operation shall proceed in accordance with the preceding paragraph.
    When conducting the review under paragraph 1, subparagraph 3 with respect to a direct trade between parties or an endowment, the issuer shall verify the assignee's identity type and that the assignee is legally entitled for the assignment of securities.
Article 46     When a stockholder uses stock of a company held by the stockholder to make a capital contribution for shares of another company in the process of establishment, if, because the company is not successfully established, the stock used for the contribution is to be returned to the shareholder, the operation shall proceed as follows:
  1. The representative of the company shall submit the securities passbook, the voucher for the original account transfer application, relevant supporting documents showing the company is not established, and an "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer Application" (affixed with the seal/signature-of-record) and apply to the issuer for account transfer.
  2. After reviewing and verifying the accuracy of content, and after submitting required documents to TDCC to apply for release, the issuer shall execute an "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer" transaction (transaction code: 671) to notify TDCC.
  3. Upon receiving the notification described in the preceding subparagraph, TDCC will transfer the deposited securities from the general custody account to the depository account of the stockholder.
Article 47     When a securities owner (principal) under an issuer's registration account authorizes a third party (agent) to sell securities on behalf of the securities owner, the outward transfer operation shall proceed as follows:
  1. The securities owner shall submit the seal/signature-of-record, relevant supporting documents, and an "Authorization of Sale - Principal's Outward Transfer Application/Voidance Application" in triplicate (affixed with the seal/signature-of-record) and apply to the issuer for account transfer.
  2. After reviewing and verifying the accuracy of content, the issuer shall execute an "Authorization of Sale - Principal's Outward Transfer Application/Voidance" transaction (transaction code: 678) to notify TDCC (if the securities for the authorized sale include tax-deferred or tax-payment-deferred shares, the reporting entity for the income derived from such shares and relevant tax deferral information shall be indicated on the application form). After the transaction is successfully completed, the issuer shall deliver two of the triplicate of the application form to the securities owner for grant of sale authorization to an agent.
  3. Upon receiving the notification described in the preceding subparagraph and notification from the securities firm of the authorized agent through an "Authorization of Sale - Agent's Inward Transfer Application" transaction (transaction code: 378), and after comparing and verifying the accuracy of transaction details, TDCC will transfer the deposited securities from the registration account to the depository account of the agent.
    When the securities owner of a general custody account under an issuer's depository account authorizes a third party to sell securities on behalf of the securities owner and applies for outward transfer of securities, the securities owner shall submit the securities passbook and proceed in accordance with the preceding paragraph.
    If the shares sold by the securities firm include tax-deferred or tax-payment-deferred shares, then after the account transfer TDCC will remove the notation of tax deferral or tax payment deferral and, on the next business day, produce a "Tax-Deferred and Tax-Payment-Deferred Shares Balance - Sale Reporting List" for notification to the securities firm and the issuer.
    If the reporting entity for the income from the sale of shares under the preceding paragraph is the issuer, the securities firm shall execute a "Tax-Deferred/Tax-Payment-Deferred Share Sale Trade Price Notification" transaction (transaction code: G50) and input the trade price and quantity and other relevant information, to provide documentation for the issuer's declaration of the income from the transfer of the tax-deferred/tax-payment-deferred shares. Additionally, the securities firm and the issuer may execute a "Tax-Deferred/Tax-Payment-Deferred Share Sale Trade Price Notification Query" transaction (transaction code G51) to query information related to the share sale.
Article 48     When a securities owner under a registration account sells shares with the right of tax deferral or tax payment deferral, or when a pledgee under a registration account sells pledged shares by self-conducted auction ("private auction"), the outward transfer operation shall proceed as follows:
  1. The securities owner or pledgee shall submit relevant supporting documents and a "Sale of Tax-Deferred or Tax Payment-Deferred Shares/Pledgee's Private Auction Sale - Outward Transfer Application/Voidance Application" in triplicate (affixed with the seal/signature-of-record) and apply to the issuer for account transfer.
  2. After reviewing and verifying the accuracy of content, the issuer shall execute a "Sale of Tax-Deferred or Tax Payment-Deferred Shares/Pledgee's Private Auction Sale - Outward Transfer Application/Voidance" transaction (transaction code: 457) to notify TDCC (if the securities for the sale include tax-deferred or tax-payment-deferred shares, the reporting entity for the income derived from such shares and relevant tax deferral information shall be indicated on the application form). After the transaction is successfully completed, the issuer shall deliver two of the triplicate of the application form to the securities owner for grant of sale authorization to a securities firm.
  3. Upon receiving the notification described in the preceding subparagraph and notification from the securities firm of the owner of tax-deferred or tax-payment-deferred shares or of the pledgee through a "Registration Account - Sale of Tax-Deferred or Tax-Payment-Deferred Shares/Pledgee's Private Auction Sale - Inward Transfer Application" transaction (transaction code: 467), and after comparing and verifying the accuracy of transaction details, TDCC will transfer the deposited securities from the registration account to the depository account of the securities owner or pledgee.
  4. If the shares sold by the securities firm include tax-deferred or tax-payment-deferred shares, then after the account transfer TDCC will remove the notation of tax deferral or tax payment deferral and, on the next business day, produce a "Tax-Deferred and Tax-Payment-Deferred Shares Balance - Sale Reporting List" for notification to the securities firm and the issuer.
  5. If the reporting entity for the income from the sale of shares under the preceding paragraph is the issuer, the securities firm shall execute a "Tax-Deferred/Tax-Payment-Deferred Share Sale Trade Price Notification" transaction (transaction code: G50) and input the trade price and quantity and other relevant information, to provide documentation for the issuer's declaration of the income from the transfer of the tax-deferred/tax-payment-deferred shares. Additionally, the securities firm and the issuer may execute a "Tax-Deferred/Tax-Payment-Deferred Share Sale Trade Price Notification Query" transaction (transaction code G51) to query information related to the share sale.
    When a securities owner of a general custody account under an issuer's depository account sells shares with the right of tax deferral or tax payment deferral, the securities owner shall submit the securities passbook and proceed in accordance with the preceding paragraph.
Article 49     For deposited securities under "Details of Pledged Securities" ("Surrendered") under the registration account under an issuer's depository account, any transfer of such securities to the pledge account under the depository account of a pledgee's participant shall proceed as follows:
  1. The pledgor and the pledgee must both open a depository account and obtain a securities passbook.
  2. The pledgee shall submit an "Issuer Registration Account Details of Pledge - Account Transfer Application (Substitute for Voucher)" (affixed with the pledgor's and the pledgee's seals/signatures-of-record) and apply to the issuer for account transfer.
  3. After reviewing and verifying the accuracy of the content, the issuer shall execute an "Issuer Registration Account Details of Pledge - Account Transfer" transaction (transaction code: C70) to notify TDCC.
  4. Upon receiving the notification described in the preceding subparagraph, TDCC will transfer the shares from the "Details of Pledged Securities" ("Surrendered") under the registration account under the depository account of the issuer to the pledge account under the depository account of the pledgee's participant.
  5. After TDCC completes the account transfer described in the preceding subparagraph, the pledgee's participant shall print and deliver a single-page format passbook to the pledgee in accordance with TDCC's Directions for the Handling by Participants of Book-Entry Operations for Delivery of Pledged of Securities. The issuer shall retain the source pledge documents after the extinguishment of the pledge for the number of years prescribed by the competent authority.
    The preceding paragraph does not apply to pledged shares that are neither listed on the TWSE/TPEx nor registered on the Emerging Stock Board, or to shares that are tax-deferred or tax-payment-deferred shares, privately placed shares, or shares restricted for TWSE/TPEx listing.
Article 50     When a securities owner places any balance of tax-deferred or tax-payment-deferred shares in the central securities depository that involves the shareholding of director, supervisor, or specified shareholder, the securities owner can directly apply to the issuer for account transfer of deposited securities.
Section 2 Detail Adjustment
Article 51     When a securities owner under a registration account applies for account adjustment for reason of a direct trade between parties, inheritance, endowment, or otherwise, the securities owner shall submit relevant supporting documents and a "Registration Account Shareholding Detail Adjustment Application" (affixed with the seal/signature-of-record) and apply to the issuer for shareholding detail adjustment. However, if the issuer provides its own account adjustment application form to the securities owner to fill out and affix the seal/signature-of-record when applying to the issuer for account adjustment, such application form may be used as a substitute for the "Registration Account Shareholding Detail Adjustment Application" form.
    After reviewing and verifying the accuracy of content, the issuer shall execute a "Registration Account Shareholding Detail Adjustment" transaction (transaction code: 673) to notify TDCC. However, if the securities owner uses the substitute form for the account adjustment application, then after the transaction is successfully completed, the issuer shall execute a "Registration Account Details Query" transaction (transaction code: 672) to print and deliver a "Registration Account Details Query Datasheet" to the securities owner.
    If the securities owner's basic information has not been input into the TDCC online system, the issuer shall first execute a "Shareholder Information Registration" transaction (transaction code: 670) and input the basic information before it can carry out the shareholding detail adjustment operation.
    If any stock dividends are delivered by book-entry transfer to the registration account under an issuer's depository account after a fact of inheritance, when applying for account adjustment by changing the title from the name of the legator to his or her name, the heir shall submit the legator's household deregistration transcript or death certificate and an affidavit (there is no need to submit a certificate of estate tax payment or exemption) and the operation shall proceed in accordance with paragraphs 1 to 3.
    When conducting the review under paragraph 2 with respect to direct trade between parties or an endowment, the issuer shall verify the assignee's identity type and that the assignee is legally entitled for the assignment of securities.
    The issuer or its transfer agent shall adopt risk early warning indicators for account adjustment in the quantity of shares or dollar amount and the procedure for review by the shareholder services/transfer agent's supervisory personnel.
Article 52     When an issuer applies for all physical securities certificates to be exchanged for securities issued in dematerialized form and applies for corresponding detail adjustments in registration account balances (the uniform ID number is set as 5555555555), it may proceed in any of the following manners:
  1. Execute a "Registration Account Shareholding Detail Adjustment" transaction (transaction code: 673) and record the details of each securities owner under the registration account in accordance with Article 27.
  2. For online batch operation (within a daily total limit of 5,000 entries), create data media for shareholding detail adjustment in accordance with Article 27 and execute a "Registration Account Shareholding Detail Adjustment - File Upload" transaction (transaction code: BOS). Then execute a "Registration Account Shareholding Detail Adjustment Query" transaction (transaction code: K64) and check the media data. After verifying the accuracy of data, on the same day execute one single "Registration Account Shareholding Detail Adjustment - Transfer Confirmation" transaction (transaction code: K63) and record the details of each securities owner under the registration account.
  3. Create data media containing a list of securities owners for book-entry delivery based on the details of each securities owner in accordance with Article 27 and transfer the "registration account" balances (the uniform ID number is set as 5555555555) to the issuer account (A/C No.: 99609999900). Then apply to TDCC to record the details of each securities owner under the registration account in the form of book-entry delivery.
    The shareholding detail adjustment to the registration account described in the preceding paragraph shall be confirmed by the shareholder services/transfer agent's supervisory personnel and written records shall be retained.
Article 53     When an auction winner applies for account adjustment for securities under a registration account sold at an auction by an enforcing authority, the auction winner shall submit documentary proof from the enforcing authority, a securities transaction tax clearance certificate, and a "Registration Account Shareholding Detail Adjustment Application" and apply to the issuer for shareholding detail adjustment.
    After reviewing and verifying the accuracy of content, the issuer shall execute a "Court-Ordered Attachment Information Change" transaction (transaction code: 151; change type: 1. Release of Attachment) to notify TDCC, and then proceed in accordance with Article 51, paragraphs 2 and 3.
Article 54     When a securities owner under the "Details of Securities Held in Custody" under a registration account, or a pledgee under the "Details of Pledged Securities" under a registration account surrenders physical certificates to the issuer to be exchanged for dematerialized securities, the securities owner or pledgee shall submit the seal/signature-of-record, the physical certificates, and the issuer's replacement notification document, and apply to the issuer for shareholding detail adjustment.
    After reviewing and verifying the accuracy of content, the issuer shall execute a "Registration Account Shareholding Detail Adjustment" transaction (transaction code: 673) to notify TDCC.
    When an issuer adopting fully dematerialized issuance of securities carries out operations for exchange for physical certificates unclaimed by the relevant securities owners over the past years, it shall submit a "Registration Account Shareholding Detail Adjustment Application" (affixed with the seal/signature of the shareholder services unit) and create data media for shareholding detail adjustment. After the relevant shareholder services/transfer agent's supervisory personnel affix their seals/signatures on the "Registration Account Shareholding Detail Adjustment Application" form acknowledging their confirmation, the issuer may proceed in either of the following manners:
  1. Execute a "Registration Account Shareholding Detail Adjustment - Electronic Transmission" transaction (transaction code: 673S) and make an account adjustment by transferring the securities from the "Details of Securities Held in Custody" under the registration account to the "Details of Securities Owners" under the same account.
  2. For online batch operation (within a daily total limit of 5,000 entries), execute a "Registration Account Shareholding Detail Adjustment - File Upload" transaction (transaction code: BOS). Then execute a "Registration Account Shareholding Detail Adjustment Query" transaction (transaction code: K64) and check the media data. After verifying the accuracy of data, on the same day execute one single "Registration Account Shareholding Detail Adjustment - Transfer Confirmation" transaction (transaction code: K63) and make an account adjustment by transferring the securities from the "Details of Securities Held in Custody" under the registration account to the "Details of Securities Owners" under the same account.
    The issuer handling the operation under the preceding paragraph is not subject to the provision of paragraph 1 with respect to securities owners applying for shareholding detail adjustment.
Article 55     When a securities owner applies to waive the right to defer tax on tax-deferred shares under a registration account, or to transfer tax-payment-deferred shares to the depository account at the securities owner's participant, the securities owner shall submit an application form (affixed with the seal/signature-of-record), or submit other sufficient supporting documents, and apply to the issuer to remove the notation of tax deferral or tax payment deferral.
    After reviewing and verifying the accuracy of content, the issuer shall execute a "Removal of Notation of Tax Deferral or Tax Payment Deferral" transaction (transaction code: 674) to notify TDCC to remove the notation of tax deferral or tax payment deferral.
    An issuer shall first remove the notation of tax deferral or tax payment deferral in accordance with the preceding paragraph before it may carry out any account transfer under Articles 39 to 41 that involves tax-deferred or tax-payment-deferred shares in a general custody account, or in the registration account, under its depository account.
Section 3 Inquiries
Article 56     When a securities owner under a registration account applies for a written copy of securities holdings or pledge details, the operation shall proceed as follows:
  1. The securities owner shall submit the seal/signature-of-record and apply to the issuer.
  2. After reviewing and verifying the accuracy of content, the issuer shall execute a "Registration Account Details Query" transaction (transaction code: 672) to print and deliver a "Registration Account Details Query Datasheet" to the securities owner for retention.
Article 57     When a pledgee under the "Details of Pledged Securities" under the registration account applies for a written copy of pledge details, the operation shall proceed as follows:
  1. When the pledgee surrenders the original pledged physical certificates, the issuer shall review the pledgor's consent document. After the certificates are exchanged for book-entry registration, the issuer shall execute a "Registration Account Details Query" transaction (transaction code: 672) to print and deliver a "Securities Pledge Registration Details" report to the pledgee for retention.
  2. In the event of any change in the pledge details under the registration account, the issuer shall take back the original details report issued under the preceding subparagraph and carry out subsequent operations. It shall then, based on the updated pledge registration details, print and deliver an updated "Securities Pledge Registration Details" report to the pledgee for retention.
Section 4 Issuers' Daily Account Balances
Article 58     An issuer shall execute a "Registration Account Daily Balance Query" transaction (transaction code: 677) to print a "Registration Account Daily Balance Query Datasheet" and check the summary information on the changes in deposited securities under the registration account for the current day.
    An issuer may execute a "Details Change under Registration Account Query" transaction (transaction code: A54) to query for, download, or print a "Details Change under Registration Account Query Report" and check the relevant information on account transfer of deposited securities and shareholding detail adjustment.
Article 59     An issuer shall execute a "Securities Transaction Daily Balance Query" transaction (transaction code: 165) to print a "Deposited Securities Transaction Balance Change Report" or a "Deposited Securities Transaction Daily Balance Statement" and check the summary information on changes in deposited securities under its depository account.
Chapter 7 Auditing
Article 60     TDCC will conduct document reviews and on-site audits in its audits of issuers or their transfer agent or securities services agent. An auditor may, as required for the purposes of auditing, request an audited entity to furnish relevant written records, reports, documents, and detailed statements so that the auditor can review them or request detailed explanations. The auditor may photocopy these materials and may request the audited entity to sign or affix seal to or make a notation on the photocopies. The audited entity may not avoid or refuse any such audit.
Article 61     An issuer or its transfer agent or securities services agent is deemed to avoid or refuse an audit in either of the following circumstances:
  1. Where it fails to provide relevant materials within the time limit prescribed by TDCC.
  2. Where it creates an incident on purpose, or though not created purposely, allows an incident to happen despite being able to foresee it, or fails to immediately eliminate an incident despite being able to do so in its course, so that the audit work cannot proceed smoothly.
Article 62     For any deficiencies discovered during an TDCC audit, the issuer shall make improvement within the time limit prescribed by TDCC.
Chapter 8 Termination of Registration
Section 1 Causes for Termination of Registration
Article 63     When an issuer is eligible to issue securities in physical form, it may apply to TDCC for termination of the registration of its dematerialized securities and switch to physical issuance.
Article 64     TDCC may duly terminate the registration of dematerialized securities for an issuer when the issuer fails to make improvement in any of the following circumstances within the time limit prescribed by TDCC:
  1. Where the issuer fails to meet the criteria for applications set out in Chapter 2.
  2. Where the issuer refuses or avoids an audit or fails to provide relevant materials for audit.
  3. Where the issuer violates any law, regulation, bylaw, or rule, or any provision of its account opening agreement with TDCC.
  4. Where the issuer breaches any representation made in the written statement described in Article 8.
Section 2 Operation for Termination of Registration
Article 65     When the registration for an issuer is terminated under Article 63 or 64, TDCC shall designate a date for the termination of registration ("termination date") and notify the issuer of information related to the owners of the securities, current as of the business day before the termination date, including the owners' names, uniform ID numbers (national ID numbers, uniform ID numbers of profit-seeking enterprises, or uniform ID numbers of tax withholding entities), domiciles or residences, numbers of holdings, securities recorded as trusted assets, pledge, or attachment by court order, and notify the issuer to complete the exchange, printing, and delivery of or with physical certificates within 30 days from the termination date. TDCC will also give notice by official letter to all participants for forwarding to customers.
Article 66     Starting from the termination date, TDCC will suspend all book-entry functions for the securities other than those connected with extinguishment of pledge (transaction code: 320), information setup for attachment by court order (transaction code: 150), change for attachment by court order (transaction code: 151), and closing out of margin purchases and short sales. Participants may apply to withdraw physical certificates only after the issuer has delivered them to TDCC.
Article 67     The issuer shall carry out the exchange, printing, and delivery of or with securities based on the securities owner information provided by TDCC and according to the following paragraphs:
  1. For securities not under the issuer's depository account.
    1. If the issuance is fully dematerialized, the issuer shall, based on each participant depository account balance, print unfixed-amount certificates, each bearing the name of one securities owner (i.e., one certificate for one TDCC account with a participant), and deliver the physical certificates to TDCC for withdrawal by the participants.
    2. If the issuance is partially dematerialized, TDCC, the issuer, and the attestation bank shall jointly carry out the cancellation/invalidation of the physical certificates in inventory, while the issuer shall, as described above, print unfixed-amount certificates, each bearing the name of one securities owner (i.e., one certificate for one TDCC account with a participant), and deliver the physical certificates to TDCC for withdrawal by the participants.
  2. For securities under the proprietary account, customer account, pledge account, or registration account under the issuer's depository account, the issuer shall on its own print and deliver physical certificates to those entitled to exercise the rights therein.
Article 68     After registration is terminated for securities under TDCC custody, the relevant customers may apply to their participants for documentary proof of holdings as of the termination date. In addition, if the issuer is unable to the printing of physical certificates and also unable to provide documentary proof for holdings, the securities owners under the issuer's depository account, and the investors under the issuer's registration account, may apply to TDCC to record their registered holdings as notified by the issuer as of the termination date.
Section 3 Aggregated Account Withdrawal
Article 69     When the registration for an issuer's dematerialized securities is terminated and replaced with physical issuance, a customer may apply to any participant with which the customer has an account to withdraw the relevant securities from the customer's accounts with other participants. The withdrawal shall, without exception, be handled by means of aggregated account withdrawal.
    The customer applying to withdraw the securities under the preceding paragraph shall, by 2:30 p.m. on the application date, present the securities passbook and submit a "Deposited Securities Aggregated Account Withdrawal Application - Substitute for Debit Voucher" (affixed with the seal/signature-of-record) to the participant for application. The customer shall also agree to authorize the participant to apply to TDCC for aggregated account withdrawal.
Article 70     After reviewing and verifying the accuracy of the customer's application details for the aggregated account withdrawal, the participant shall execute an "Aggregated Account Withdrawal Application" transaction (transaction code: A23) to notify TDCC of the aggregated account withdrawal information. Upon receiving the aforesaid notification, and after confirmation of accuracy by those other participants, TDCC will, except for securities subject to attachment by court order or pledged securities, transfer the balances of securities requested by the customer from the customer accounts opened by the customer under the depository accounts of those other participants to the customer account opened by the customer under the depository account of the withdrawing participant.
Article 71     The withdrawing participant or other participants from whose accounts the customer's balances of securities are transferred shall, before accounts are settled on the application date afternoon, execute an "Aggregated Account Withdrawal Query/Confirmation" transaction (transaction code: A25) to query for or print an "Aggregated Account Withdrawal Inward Transfer Query Report" or an "Aggregated Account Withdrawal Outward Transfer Query Report" and check the transfer details. If a participant from whose account one of the customer's balances of securities is transferred does not agree with respect to the transfer for aggregated account withdrawal, it shall, before accounts are settled on the afternoon that day, execute an "Aggregated Account Withdrawal Adjustment" transaction (transaction code: A24) to notify TDCC.
Chapter 9 Supplementary Provisions
Article 72     Chapters 2, 7, and 8 do not apply to securities registered with TDCC that are government bonds.
Article 73     Unless otherwise provided, a securities owner may not apply to transfer securities held in the securities owner's depository account at a participant to the registration account under the issuer's depository account.
    A securities owner may not apply to transfer securities held in the securities owner's general custody account under the issuer's depository account to the registration account under the issuer's depository account. This restriction, however, does not apply to the following securities:
  1. Privately placed securities.
  2. Tax-deferred or tax-payment-deferred shares.
  3. Securities within the scope of Article 8.
  4. Securities delisted from TWSE/TPEx or deregistered from the Emerging Stock Board.
    A securities owner may not apply to transfer the following securities held in the securities owner's general custody account, or in the registration account, under the issuer's depository account to the depository account at another participant:
  1. Privately placed securities. This restriction, however, does not apply if the application is made to transfer such securities to the depository account of securities dealer, of custodian, or for custody by authorized custodian.
  2. Tax-deferred or tax-payment-deferred shares.
  3. Securities within the scope of Article 8 that have not been announced by TWSE or TPEx for TWSE/TPEx listing or Emerging Stock Board registration.
  4. Securities delisted from the TWSE/TPEx or deregistered from the Emerging Stock Board.
Article 74     An issuer executing a "Passbook Replacement/Magnetic Stripe Re-Recording" transaction (transaction code: 149) or a "Lost Passbook Report Cancellation" transaction (transaction code: 148) shall proceed in accordance with TDCC's Directions for Early Warnings by Participants for Central Depository Operations.
Article 75     An issuer handling registration and book-entry delivery operations for its dematerialized securities shall check the content and be responsible for its truthfulness.
Article 76     When an issuer conducts an account transfer from its registration account, if an error occurs in the transfer of securities as to type or amount for a cause not attributable to a securities owner, and if TDCC's operational service is needed to correct the error, the issuer shall apply to TDCC for correcting the error by submitting an official letter (affixed with the company seal and responsible person's seal filed with the competent authority in charge of company registrations) stating the reason for correction and acknowledging its assumption of all responsibilities, as well as an account transfer correction application form (affixed with the seals/signatures of the relevant shareholder services/transfer agent's supervisory personnel and internal audit officer acknowledging their confirmation), the original and a photocopy of the "Issuer Depository Account/Registration Account - Deposited Securities Account Transfer Application" form submitted by the securities owner when applying for the original account transfer (the original copy will be returned after verification), and the online transaction report as notified by TDCC upon completion of the original account transfer. The issuer shall also deliver a copy of the official letter to the participant of the party who has received the securities in error ("incorrect recipient").
    After reviewing and verifying the accuracy of relevant information, TDCC will, before the securities market opens on the next business day, transfer the erroneously transferred securities, of the type or in the amount as specified by the issuer applying for correction, from the depository account of the incorrect recipient at the participant back to the registration account under the issuer's depository account, and notify the participant to record necessary information in its customer account book. If the balance in the account of the securities owner (incorrect recipient) is insufficient for the transfer, TDCC will not accept the correction application and will notify the issuer to address the issue.
Article 77     When an issuer announces book closure, TDCC will produce a list of securities owners for notification to the issuer, and also, based on the balances of holdings in the registration account under the issuer's depository account, produce a "Registration Account Details of Securities Owners Report" for notification to the issuer.
    If the issuer has issued new restricted employee shares, TDCC will additionally produce a report(s) related to notation of restriction for notification to the issuer.
Article 78     For handling registration and book-entry delivery operations for securities issued in dematerialized form, TDCC will charge fees in accordance with its fee-charging standards.
Article 79     When handling registration and book-entry delivery operations for securities issued in dematerialized form, if TDCC discovers any discrepancy of information or if any uncertainty arises, the related issuer shall cooperate with TDCC to investigate the reason and correct the situation.
Article 80     Any matters on which these Directions are silent shall be handled in accordance with the TDCC Operating Rules and other applicable provisions.
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