萬國法律事務所

Financial Supervisory Commission R.O.C (Taiwan) (FUC) made an advance announcement of the draft of regulations governing the use of proxies for the attendance of shareholders meeting of an issuer will increase three articles.

First of all, provided that a financial holding enterprise has mandated another party to act as proxy solicitor, any subordinate company thereof shall not act as proxy solicitor. The purpose of the regulation is to avoid complex relationships of proxy solicitation. The violator would be deprived of his proxy voting right and fined NTD$ 240,000 to 2400,000 in addition.

Secondly, it shall compile a report on solicitors and place and staff of those handling proxy solicitation matters on its behalf, and present the report to a centralized securities depositary enterprise. If violated, the solicitor and those handling proxy solicitation matters on its behalf would be forbidden to act as proxy solicitor within a year. If there is any purchasing behavior being discovered, the violator would be banned from acting as proxy solicitor within three years, deprived of his proxy voting right and fined.

Thirdly, every proxy shall bear the seal of the solicitor and those proxies without seal would be eliminated, which would contribute to the trace and check of those problematical proxies.

The last is the amendment of the accuser reward. Securities and Futures Bureau of FSC has its own regulation governing accuser reward at present. It adopts 5% of the fine, so the accuser reward is low. In the future, the accuser reward will be established by a centralized securities depositary enterprise. It is said that it might be up to NTD$ 200,000 to 300,000, which aims at deterring proxy purchase by means of handsome reward for accuser.

The aforesaid four reform measures will apply to approximately 500 enterprises listed on Taiwan Stock Exchange or Gretai Securities Market when re-electing the shareholders meeting on June, this year.