In compliance with the amendments to the Securities and Exchange Act (hereinafter referred to as the Act) promulgated on June 28, 2023, and to enhance the proceedings of audit committee meetings and board of director meetings, the FSC proposed to amend some articles of the “Regulations Governing the Exercise of Powers by Audit Committees of Public Companies” and Articles 12 and 13 of the “Regulations Governing Procedure for Board of Directors Meetings of Public Companies.” The advance notice procedure for the draft amendments has been completed and the amended versions will be released and implemented soon, with the key amendments as follows: 
I.    “Regulations Governing the Exercise of Powers by Audit Committees of Public Companies:”
(I)        Announcement of amendments in compliance with Articles 14-4 and 14-5 of the Act:
1.        The procedures for selecting representatives when a company brings a lawsuit against a director and when a director engages in transactions with the company are stipulated: In compliance with paragraph 4, Article 14-4 of the Act, the previous regulation that the provisions of Articles 213, 214 and 223 of the Company Act concerning supervisors may apply mutatis mutandis to independent director members of the audit committee is deleted; the Article states that when a company brings a lawsuit against a director, and when a director engages in transactions, loans or other legal acts with the company for him/herself or others, it shall be carried out via a panel discussion of the audit committee in accordance with paragraph 3, Article 14-4, with the representatives selected by the audit committee; therefore, the procedures for the audit committee’s selection of the aforesaid representatives are stipulated (amendment to Article 5).
2.        Regarding the requirement for the independent directors to issue an opinion of “agree or not” on the financial report related items when an audit committee meeting cannot be held due to any legitimate reasons, the requirement is revised to an opinion of “agree” according to Article 14-5 of the Act (amendment to Article 8).
(II)        Enhancement of the convening and proceedings of audit committee meetings, with practical operations taken into consideration:
1.        The time and venue of the audit committee meeting should be based on the principles of convenience for the attendance of independent directors and appropriateness of the time and venue of the meeting, in order to ensure the audit committee members’ right to attend the meeting (amendment to Article 7).
2.        In order to avoid the audit committee’s inability to elect the convener or the convener’s unwillingness to convene an audit committee meeting which may affect the company’s business operations, it is stipulated the convener election method, as well as that the independent directors accounting for more than half of all members of the audit committee may convene a meeting on their own when the convener does not convene the meeting (amendment to Article 7).
3.        In order to enhance the proceedings of audit committee meetings, it is stipulated in the articles the requirements that the meeting should be postponed if only less than half of all the audit committee members are present, that the meeting proceeding should be temporarily suspended when the number of attendees is insufficient during the meeting and the method of proxy selection when the convener is unable to preside over the meeting or when the chairman announces meeting adjournment without following the regulations (amendments to Articles 8-1 and 8-2).
II.    “Regulations Governing Procedure for Board of Directors Meetings of Public Companies:”
(I)        In order to avoid disputes caused by the uncertainty regarding postponement of the starting time of the board meeting, it is stipulated that when the number of attendees is insufficient, the chairman may announce a postponement of the meeting, but the meeting must be held on the same day (amendment to Article 12).
(II)        Considering the fact that the chairman may not be able to continue presiding over a board meeting for any reason, the method of appointing the chairman’s proxy is stipulated in order to avoid affecting the operation of the board meeting. (amendment to Article 13).

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