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TPEx/ESM Listing (Registration) Requirements And Procedures


‧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


‧Pamphlet for Listing (Registration) on the TPEx/ESM

1. TPEx/ESM 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.
(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.
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.
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, shareholders with shareholding of 10 percent or more, and additional persons required to place shares in centralized custody in special industries after a certain degree of expansion shall place in central custody the full amount of the shares they hold as set out in the application documents after deduction of the number of shares allocated for underwriting, and 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 One half of the "required share deposit" may be withdrawn six months after successful listing, and the remaining shares in custody may be withdrawn in full one year after successful listing.

(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.

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. Negative TPEx listing criteria:
1. Circumstances listed under Article 156, Paragraph 1, Subparagraphs 1 through 3 of the Securities and Exchange Act.
2. Finances or operations cannot be independently and clearly distinguished from those of another person.
3. Where significant labor dispute or environmental pollution occurred and no improvement has been made.
4. Failure to correct non-arm's-length transactions of material significance by the time of application.
5. 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.
6. 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.
7. 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.
8. The applicant's board of directors or one of its supervisors is unable to perform his duty independently.
9. 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.
10. 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.
11. 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. ESM registration procedure:
Public offering-Submit ESM Registration Application-(3 business days)-TPEx approves and discloses company profile-(6 business days)-ESM trading begins