Important Measure March 2021
2021-05-07
1. To Support the Launch of New Innovative Boards, the FSC Issues Amendments to Related Regulations and Ratifies Relevant Rules of the TWSE and TPEx
The Financial Supervisory Commission (FSC) is further building out Taiwan's multi-level capital market framework with the upcoming launch of the Taiwan Innovation Board and the Pioneer Stock Board by the Taiwan Stock Exchange and the Taipei Exchange respectively. The purposes of the two new boards are to support the development of innovative businesses, provide more extensive fund-raising channels, and increase the scale of Taiwan's capital market. To support the launch of the new innovative boards, the FSC issued amendments to the Regulations Governing the Offering and Issuance of Securities by Securities Issuers and other related regulations and administrative directions on 29 March 2021. On 30 March, the FSC also ratified related rules submitted to the FSC by the TWSE, TPEx, Taiwan Securities Association, and Taiwan Depository & Clearing Corporation, and the agencies then promptly announced those rules. The TWSE and TPEx are expected to complete work on their systems infrastructure for the two new boards by the 2nd quarter of 2021 and to begin formally operating the boards from the 3rd quarter of 2021.
2. FSC Issues Amended Interpretive Order Regarding Allocation of Special Reserve Under Article 41 of the Securities and Exchange Act on 31 March 2021
To bring the allocation of special reserve more closely in line with the legislative intent of the Securities and Exchange Act, and taking into reference the Ministry of Economic Affairs' adjustment of the allocation basis of legal reserve, the FSC has issued an amended interpretive order regarding the allocation of special reserve under Article 41 of the Securities and Exchange Act. Key points of the amended order include the provision of an option, after a corresponding express provision has been made in a company's articles of incorporation, to deduct "the cumulative amount of other net deductions from equity in the preceding period" from "current profits and losses," to better accord with the legislative intent of the Securities and Exchange Act. Additionally, the basis for allocation of special reserve is expanded from "current profits and losses" to "current after-tax net income plus items added to the current year's undistributed earnings other than current after-tax net income." This amendment unifies the allocation basis for legal reserve and special reserve, and provides a clear rule for companies to follow.
The Financial Supervisory Commission (FSC) is further building out Taiwan's multi-level capital market framework with the upcoming launch of the Taiwan Innovation Board and the Pioneer Stock Board by the Taiwan Stock Exchange and the Taipei Exchange respectively. The purposes of the two new boards are to support the development of innovative businesses, provide more extensive fund-raising channels, and increase the scale of Taiwan's capital market. To support the launch of the new innovative boards, the FSC issued amendments to the Regulations Governing the Offering and Issuance of Securities by Securities Issuers and other related regulations and administrative directions on 29 March 2021. On 30 March, the FSC also ratified related rules submitted to the FSC by the TWSE, TPEx, Taiwan Securities Association, and Taiwan Depository & Clearing Corporation, and the agencies then promptly announced those rules. The TWSE and TPEx are expected to complete work on their systems infrastructure for the two new boards by the 2nd quarter of 2021 and to begin formally operating the boards from the 3rd quarter of 2021.
2. FSC Issues Amended Interpretive Order Regarding Allocation of Special Reserve Under Article 41 of the Securities and Exchange Act on 31 March 2021
To bring the allocation of special reserve more closely in line with the legislative intent of the Securities and Exchange Act, and taking into reference the Ministry of Economic Affairs' adjustment of the allocation basis of legal reserve, the FSC has issued an amended interpretive order regarding the allocation of special reserve under Article 41 of the Securities and Exchange Act. Key points of the amended order include the provision of an option, after a corresponding express provision has been made in a company's articles of incorporation, to deduct "the cumulative amount of other net deductions from equity in the preceding period" from "current profits and losses," to better accord with the legislative intent of the Securities and Exchange Act. Additionally, the basis for allocation of special reserve is expanded from "current profits and losses" to "current after-tax net income plus items added to the current year's undistributed earnings other than current after-tax net income." This amendment unifies the allocation basis for legal reserve and special reserve, and provides a clear rule for companies to follow.
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Update：
2021-05-10