| Article 16 |
|
| Article 17 |
|
| Article 18 |
|
| Article 19 |
When a subsidiary company in a subsidiary-parent company relationship applies for GTSM listing of its stock, even if the subsidiary meets the applicable requirements set out in these Rules, the GTSM may deny approval for GTSM listing of its stock if it fails to meet all of the following conditions:
The subsidiary company shall annex to its application the financial statement of the parent company and all subsidiary companies of the parent company prepared in accordance with international financial reporting standards recognized by the Competent Authority, US accounting standards, or the International Financial Reporting Standards. If they are not prepared according to international financial reporting standards recognized by the Competent Authority, then the differences in the disclosure of the period-on-period balance sheet and the comprehensive income statement titles with the international financial reporting standards recognized by the Competent Authority shall be disclosed, including any material discrepancies and the dollar amounts affected.
Its profitability calculated according to the annexed financial statement submitted pursuant to the requirements of the preceding paragraph shall meet the requirements set out in Article 4, paragraph 1, subparagraph 6. However, this profitability restriction may be lifted if the applicant company applies for GTSM listing pursuant to the requirements of Article 4, paragraph 4 herein, or during the fiscal year of application for GTSM listing and the preceding fiscal year, the dollar amount of purchase/sales transactions between the applicant company and its parent company is less than 10 percent of its total amount of purchases/sales.
During the fiscal year of application for GTSM listing and the preceding fiscal year, no more than 50 percent of its operating revenue came from its parent company, and no more than 70 percent of its principal raw materials, principal products, or total purchase amount came from its parent company.
The total number of shares of the applicant company held by the parent company and all of its subsidiaries, and by the directors, supervisors, representatives, and shareholders holding more than 10 percent of its total issued shares, of the aforesaid companies, and by related party(ies) thereof, shall not in total exceed 70 percent of the applicant company's total issued shares.
The independent directors of the applicant company may not be fewer than three persons in number.
At the time of application for GTSM listing by a subsidiary of a domestic GTSM (or TWSE) listed company or a GTSM (or TWSE) primary listed company, the pro forma operating revenue or operating income as stated in the CPA-reviewed pro forma financial statements of the GTSM (or TWSE) listed parent company for the most recent 4 quarters, excluding the financial data for the applicant company, was not down by 50 percent or more from the operating revenue or operating income stated in the financial statements for the preceding same period, and the parent company has not transferred any material customers or business within the most recent 2 fiscal years. However, this need not apply if the parent company and the subsidiary have different business types, industrial classifications, or product types, and moreover are not mutually competitive, or if it resulted from another reasonable cause.
The requirements of subparagraphs 2 and 3 of the preceding paragraph may be waived in situations resulting from industry characteristics, market demand and supply conditions, government policy, or any other reasonable causes.
When a subsidiary applies for GTSM listing pursuant to the proviso of subparagraph 6 of paragraph 1, with regard to any activities of equity ownership dispersion conducted by the parent company to reduce its shareholding percentage in the subsidiary within the 3 years before the application for GTSM listing, such activities shall have been done in a manner in which the pre-emptive subscription right is given to the original shareholders of the parent or other manner not detrimental to the interests of the parent's shareholders. Subparagraph 10 of the Standards for Determining Unsuitability for GTSM Listing under Article 10, Paragraph 1 of the GreTai Securities Market Rules Governing the Review of Securities for Trading on the GTSM shall apply mutatis mutandis to the review of such applications by subsidiaries. |