Important Measure May 2022
2022-07-28
1.The Financial Supervisory Commission Reminds TWSE/TPEx-listed Companies That Shareholders’ Meetings Held During the Pandemic Should Follow the Disease Prevention Operating Guidelines, and Encourages Investors to Exercise Their Rights via Electronic Voting (10 May 2022)
As part of its efforts to address the Covid-19 pandemic, the Financial Supervisory Commission (FSC) previously announced that as of 20 April 2020, shareholders entering venues of shareholders’ meetings shall wear face masks and have their temperature measured. Shareholders without masks or whose body temperatures taken twice with forehead temperatures over 37.5° C or ear temperatures over 38° C shall be banned from entry. With the approaching of regular shareholders’ meetings in 2022, the FSC again reminds companies to comply with the Disease Prevention Measures for Shareholder Meetings formulated and adjusted by the Taiwan Depository & Clearing Corporation, and to make proper venue arrangements prior to holding such meetings.
In addition, to facilitate shareholders’ exercise of their voting rights, the FSC stipulated that as of 1 January 2018, all TWSE/TPEx-listed companies must enable electronic transmission as one of the methods for shareholders to exercise their voting rights. To reinforce shareholder activism and to enhance corporate governance, the FSC announced a regulation on 18 January 2022 to expand the scope of the rule to all emerging stock companies, with an implementation date of 1 January 2023. The FSC also called on companies and shareholder services agencies to encourage shareholders to exercise their rights via electronic voting during the pandemic, to achieve both disease prevention and the practical needs of holding shareholders’ meetings.
2.One Year After Launch, Intraday Odd Lot Trading Proves Effective and Offers Diversified Channels for Young People and Small-cap Investors to Participate in the Capital Markets (19 May 2022)
On 26 October 2020, the securities market implemented intraday odd lot trading system to encourage young people and small-cap investors to invest in Taiwan Stock Market, and to spur the odd lot trading market. This has been of great benefit to diversify the development of the securities market.
One year after launch, the effects of intraday odd lot trading system are as follows:
(1) lot trading significantly increased in both trading value and as a percentage of total market trading value after launched.
One year after the launch of intraday odd lot trading (from 26 October 2020 to 31 October 2021), the average daily trading value of odd lots of TWSE-listed stocks amounted to NT$ 1.93 billion, accounting for approximately 0.52% of the trading value in the TWSE market. Intraday odd lot trading value of TWSE-listed stocks amounted to NT$ 1.74 billion (0.46% of the total market), representing a significant increase from the average daily trading value of NT$ 223 million (0.12% of the total market) of after-hour odd lot trading before launch (January 2020 to September 2020). The average daily trading value of odd lots of TPEx-listed stocks amounted to NT$ 271 million, accounting for approximately 0.38% of the trading value in the TPExmarket. Intraday odd lot trading value of TPEx-listed stocks amounted to NT$ 240 million (0.34% of the total market), which also represented a significant rise from the average daily trading value of NT$ 54 million (0.11% of the total market) of after-hour odd lot trading before launch.
(2) Intraday odd lot trading encouraged young people and small-cap investors to participate in the stock market.
The launch of intraday odd lot trading led to a surge in the number of accounts trading odd lots, with the number of accounts trading odd lots of TWSE-listed stocks rising from roughly 320,000 before launch to 890,000 after launch, while in the case of TPEx-listed stocks, the number of accounts grew from 350,000 to 920,000. The largest increase occurred among account holders under aged 30, whose share of accounts trading odd lots of TWSE-listed stocks rose from 21.10% to 26.8%, and of TPEx-listed stocks rose from 10.31% to 18.81%. Over the same period, the share of accounts trading round lots from this age group stood at 15.8% and 14.93% for TWSE-listed and TPEx-listed stocks, respectively, indicating that the new measure has encouraged young people and small-cap investors to participate in the stock market.
(3) Objects for intraday odd lot trading.
Objects for intraday odd lot trading of TWSE-listed stocks were primarily focused on heavily-weighted stocks, stocks with high price, and financial stocks, with constituents of the Taiwan 50 Index accounting for 68% of the trading value. For objects of TPEx-listed stocks, the focuses were on biotech, medicine and technological stocks, which collectively accounted for 47.82% of the trading volume.
The FSC stated that intraday odd lot trading expanded the channels available for investors to trade odd lots during trading hours. It also achieved the goal of financial inclusion by facilitating young people and small-cap investors to make investment for effective capital allocation. The FSC also reminded investors to carefully evaluate trading costs and personal financial circumstances, understand the business and financial fundamentals of the companies, and be aware of relevant investment risks.
As part of its efforts to address the Covid-19 pandemic, the Financial Supervisory Commission (FSC) previously announced that as of 20 April 2020, shareholders entering venues of shareholders’ meetings shall wear face masks and have their temperature measured. Shareholders without masks or whose body temperatures taken twice with forehead temperatures over 37.5° C or ear temperatures over 38° C shall be banned from entry. With the approaching of regular shareholders’ meetings in 2022, the FSC again reminds companies to comply with the Disease Prevention Measures for Shareholder Meetings formulated and adjusted by the Taiwan Depository & Clearing Corporation, and to make proper venue arrangements prior to holding such meetings.
In addition, to facilitate shareholders’ exercise of their voting rights, the FSC stipulated that as of 1 January 2018, all TWSE/TPEx-listed companies must enable electronic transmission as one of the methods for shareholders to exercise their voting rights. To reinforce shareholder activism and to enhance corporate governance, the FSC announced a regulation on 18 January 2022 to expand the scope of the rule to all emerging stock companies, with an implementation date of 1 January 2023. The FSC also called on companies and shareholder services agencies to encourage shareholders to exercise their rights via electronic voting during the pandemic, to achieve both disease prevention and the practical needs of holding shareholders’ meetings.
2.One Year After Launch, Intraday Odd Lot Trading Proves Effective and Offers Diversified Channels for Young People and Small-cap Investors to Participate in the Capital Markets (19 May 2022)
On 26 October 2020, the securities market implemented intraday odd lot trading system to encourage young people and small-cap investors to invest in Taiwan Stock Market, and to spur the odd lot trading market. This has been of great benefit to diversify the development of the securities market.
One year after launch, the effects of intraday odd lot trading system are as follows:
(1) lot trading significantly increased in both trading value and as a percentage of total market trading value after launched.
One year after the launch of intraday odd lot trading (from 26 October 2020 to 31 October 2021), the average daily trading value of odd lots of TWSE-listed stocks amounted to NT$ 1.93 billion, accounting for approximately 0.52% of the trading value in the TWSE market. Intraday odd lot trading value of TWSE-listed stocks amounted to NT$ 1.74 billion (0.46% of the total market), representing a significant increase from the average daily trading value of NT$ 223 million (0.12% of the total market) of after-hour odd lot trading before launch (January 2020 to September 2020). The average daily trading value of odd lots of TPEx-listed stocks amounted to NT$ 271 million, accounting for approximately 0.38% of the trading value in the TPExmarket. Intraday odd lot trading value of TPEx-listed stocks amounted to NT$ 240 million (0.34% of the total market), which also represented a significant rise from the average daily trading value of NT$ 54 million (0.11% of the total market) of after-hour odd lot trading before launch.
(2) Intraday odd lot trading encouraged young people and small-cap investors to participate in the stock market.
The launch of intraday odd lot trading led to a surge in the number of accounts trading odd lots, with the number of accounts trading odd lots of TWSE-listed stocks rising from roughly 320,000 before launch to 890,000 after launch, while in the case of TPEx-listed stocks, the number of accounts grew from 350,000 to 920,000. The largest increase occurred among account holders under aged 30, whose share of accounts trading odd lots of TWSE-listed stocks rose from 21.10% to 26.8%, and of TPEx-listed stocks rose from 10.31% to 18.81%. Over the same period, the share of accounts trading round lots from this age group stood at 15.8% and 14.93% for TWSE-listed and TPEx-listed stocks, respectively, indicating that the new measure has encouraged young people and small-cap investors to participate in the stock market.
(3) Objects for intraday odd lot trading.
Objects for intraday odd lot trading of TWSE-listed stocks were primarily focused on heavily-weighted stocks, stocks with high price, and financial stocks, with constituents of the Taiwan 50 Index accounting for 68% of the trading value. For objects of TPEx-listed stocks, the focuses were on biotech, medicine and technological stocks, which collectively accounted for 47.82% of the trading volume.
The FSC stated that intraday odd lot trading expanded the channels available for investors to trade odd lots during trading hours. It also achieved the goal of financial inclusion by facilitating young people and small-cap investors to make investment for effective capital allocation. The FSC also reminded investors to carefully evaluate trading costs and personal financial circumstances, understand the business and financial fundamentals of the companies, and be aware of relevant investment risks.
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2022-07-28