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Listed Companies > Listing Requirements and Procedures > Guidelines for Stock Listing (Registration) on TPEx/ESM > TPEx/ESM Listing (Registration) Requirements And Procedures

TPEx/ESB Listing (Registration) Requirements And Procedures

Regulations：

‧Taipei Exchange Rules Governing the Review of Securities for Trading on TPEx
‧Taipei Exchange Rules Governing the Review of Emerging Stocks for Trading on TPEx
‧Application Documents for Listing on the TPEx
‧ESB registration application documents

Information：

‧Guidelines for Listing (Registration) on the TPEx/ESB

1. TPEx/ESB Listing (Registration) Requirements：
Item		General Stock	Emerging Stocks
Company scale		A paid-in capital of NT$50 million or more. (excluding privately placed securities that have not been publicly issued)	No restriction.
Years established		Have been registered for 2 full fiscal years. ※ Except for technology companies, state-owned enterprises or privatized public enterprises.	No restriction.
Financial requirements (meet one of the criteria)	Profitability (The percentage is the ratio of net profit before tax over capital shown in the financial statements.)	Most recent year： 4%, no cumulative losses. Most recent 2 years： Both 3% or more. Averaging 3% or more, with the figure in the most recent year being better than the year before. Net profit before tax in the most recent year was not lower than NT$4 million. ※ Except for technology companies or state-owned enterprises.	No restriction.
Financial requirements (meet one of the criteria)	Net worth, operating revenue and cash flows from operating activities	Shall meet each of the following requirements: Net worth for the most recent period shall be not less than NT$600 million and two-third of the share capital. Operating revenue from main business for the most recent fiscal year shall be not less than NT$ 2 billion and greater than that for the immediately preceding fiscal year. Cash flows in the most recent fiscal year shows a positive net cash flow from operating activities.	No restriction.
Shareholder dispersion	Number of non-corporate registered shareholders in the company who hold more than 50% of the shares	300 or more ※ Does not apply to state-owned enterprises.	No restriction.
Shareholder dispersion	Status of holdings by registered shareholders above	1.20% of the total number of shares issued; or2.more than 10 million shares. ※ Except for state-owned enterprises.	No restriction.
Taiwan Depository & Clearing Corporation		Directors, supervisors, or shareholder that holds more than 10 percent of the total shares required to place shares in centralized custody. The persons required to place shares in centralized custody shall place the full amount of the shares they hold as set out in the application documents after deduction of the number of shares placed with the recommending securities firm for underwriting. The total shares placed in central custody shall not be less than a certain percentage of the total capital. If there is any deficit, arrangements shall be made with other shareholders to make up the deficit. Any additional shares obtained by major shareholders subject to central depository between the application date and the listing date should be added and submitted in full to the custodian. One half of the shares placed in custody may be withdrawn upon expiration of the 6-month period after listing on TPEx, and the remaining shares in custody may be withdrawn in full upon expiration of a 1-year period after listing on TPEx. ※ Otherwise provided for Technology- Based Enterprises, Cultural and Creative Enterprises, and enterprises adopting financial requirements of “Net worth, operating revenue and cash flows from operating activities". (Please see Article 3, Paragraph 1, Item 4 of the Taipei Exchange Rules Governing the Review of Securities for Trading on the TPEx) ※ Except for state-owned enterprises.	No restriction.
Functional Committee		The registrant shall have a compensation committee in place. An audit committee shall be established in place of supervisors if the paid-in capital is not less than NT$600 million at the time of application.	The registrant shall have a compensation committee in place.
Directors		The registrant shall appoint independent directors, not less than two in number and not less than one-fifth of the total number of directors. Note: If the applicant company's chairperson and the general manager are the same person, or are spouses or relatives within one degree of kinship, the independent director seats shall be no fewer than three seats	The registrant shall appoint independent directors, not less than two in number and not less than one-fifth of the total number directors. ※ provided that this requirement does not apply if it submits the application by 30 June 2020 and by the time of the application it has passed a board of directors meeting resolution for election of independent directors and it undertakes to complete the election at a shareholders' meeting to be held within 3 months from the date on which its stock is registered for TPEx trading.
Recommending dealers		When there are two or more recommending dealers, one must be designated as the lead dealer and the others co-dealers.	Same as on the left.
Shareholder service providers		Must assign a professional shareholder services provider to handle shareholder services where the TPEx is located.	Same as on the left.
Advisory period		Not required to undergo an advisory period, but must have been trading on the ESM market for six months or more. ※ Except for state-owned enterprises.	Must have previously submitted one month of checklists since public offering.
Non-physical issuance		Stocks and bonds issued by offering should be issued in dematerialized form without exception.	Same as on the left.
Underwriting system		1. Public offerings should be made. 10% or more of the intended number of shares to obtain TPEx listing should be put forward for underwriting. The number of shares may not be less than 1 million shares. If 10% exceeds 10 million shares, not less than 10 million shares should be put forward for underwriting. 2. For ESM stocks that have not been traded on the TPEx for two years or more, the aforementioned number of shares put forward to be subscribed by securities dealers may be deducted from the total number of shares being underwritten, up to a limit of 30%. 3. The source of shares allocated to public offering before TPEx listing should be new shares only and combination of new shares, old shares and new shares issued for cash capital increase is prohibited. Issuers shall offer for sale to the public all of the shares prior to TPEx listing after deducting the number of shares that must be retained to be offered for purchase by employees in accordance with applicable laws and regulations. 4. Recommending dealers perform overallotment for stabilization of the underwriting price. 5. Private institutions participating in public infrastructure may provide old shares to be underwritten. 6. State-owned enterprises applying for TPEx listing may be exempted from asking recommending dealers to underwrite their stocks and may provide old shares to be underwritten.	1. Public underwriting is not allowed until the company is listed. 2. Starting on July 1, 2007, recommending dealers should subscribe 3% or more of the total number of outstanding shares and not less than 500,000 shares. However, if 3% exceeds 1.5 million shares, then recommending dealers should subscribe a minimum of 1.5 million shares. 3. Recommending dealers should each subscribe 100,000 shares or more.

2. Standards for Determining Unsuitability for TPEx Listing:
Circumstances listed under Article 156, Paragraph 1, Subparagraphs 1 through 3 of the Securities and Exchange Act. Finances or operations cannot be independently and clearly distinguished from those of another person. Where significant labor dispute or environmental pollution occurred and no improvement has been made. Failure to correct non-arm's-length transactions of material significance by the time of application. Where after consolidating the new shares from capital increase already issued or being issued in the fiscal year of application for trading stocks on the TPEx into the share capital stated on the financial statement for the most recent year, the profitability does not meet the requirements for trading stocks on the TPEx. Where financial statements are not prepared in accordance with relevant laws and regulations and generally accepted accounting principles, or the internal control, internal auditing, and/or written accounting system are not soundly established and effectively executed in a materially significant way. The company or one of its directors, supervisors, CEO or de facto responsible persons at the time of application had violated the principle of good faith in the last three years. The applicant's board of directors or one of its supervisors is unable to perform his duty independently. Where the applicant company has been registered for trading as an emerging stock on the TPEx in the fiscal year of the listing application and the most recent fiscal year thereto, and there has been, from the TPEx registration date onward, any trading of stock issued by the applicant company by any incumbent director, supervisor, or shareholder holding 10% or greater of its total issued shares other than on the emerging stock market; provided, this restriction shall not apply where such trading is for purposes of underwriting under Article 4 or for other legitimate reason. Where, within the 3-year period before a transferee company of a demerger conducted by a TPEx listed company applies for TPEx listing, the demerged company has acted to disperse equity ownership in order to reduce its shareholding percentage in the transferee company, and harm has been done to the shareholder equity of the demerged company. Where there is serious deterioration in the business it operates. Where the TPEx deems listing inappropriate for any other reason related to the scope or nature of the enterprise or any other special circumstance.

2. Standards for Determining Unsuitability for TPEx Listing:

Circumstances listed under Article 156, Paragraph 1, Subparagraphs 1 through 3 of the Securities and Exchange Act.
Finances or operations cannot be independently and clearly distinguished from those of another person.
Where significant labor dispute or environmental pollution occurred and no improvement has been made.
Failure to correct non-arm's-length transactions of material significance by the time of application.
Where after consolidating the new shares from capital increase already issued or being issued in the fiscal year of application for trading stocks on the TPEx into the share capital stated on the financial statement for the most recent year, the profitability does not meet the requirements for trading stocks on the TPEx.
Where financial statements are not prepared in accordance with relevant laws and regulations and generally accepted accounting principles, or the internal control, internal auditing, and/or written accounting system are not soundly established and effectively executed in a materially significant way.
The company or one of its directors, supervisors, CEO or de facto responsible persons at the time of application had violated the principle of good faith in the last three years.
The applicant's board of directors or one of its supervisors is unable to perform his duty independently.
Where the applicant company has been registered for trading as an emerging stock on the TPEx in the fiscal year of the listing application and the most recent fiscal year thereto, and there has been, from the TPEx registration date onward, any trading of stock issued by the applicant company by any incumbent director, supervisor, or shareholder holding 10% or greater of its total issued shares other than on the emerging stock market; provided, this restriction shall not apply where such trading is for purposes of underwriting under Article 4 or for other legitimate reason.
Where, within the 3-year period before a transferee company of a demerger conducted by a TPEx listed company applies for TPEx listing, the demerged company has acted to disperse equity ownership in order to reduce its shareholding percentage in the transferee company, and harm has been done to the shareholder equity of the demerged company.
Where there is serious deterioration in the business it operates.
Where the TPEx deems listing inappropriate for any other reason related to the scope or nature of the enterprise or any other special circumstance.

3. TPEx Listing Procedures：

4. ESB registration procedure：