Recommendation 1 Recommendation 2 Recommendation 3 Recommendation 4

Recommendation 5 Recommendation 6 Recommendation 7 Recommendation 8

Market selection

Recommendation 4

Each market must have clear rules assuring investor protection by safeguarding participants from the financial risks of failed settlement and ensuring that listed companies are required to follow sound policies on corporate governance, transfer of economic benefits and shareholder rights.

1.	Does the depository or the market have securities lending and borrowing schemes in place, and are these open to all market participants and their settlement agents?	Yes. The securities lending and borrowing system is only for erroneous transactions correction or in case of potential defaults of participants or investors.
2.	Does the settlement system mark fail trades to market and collect margin from the failing counterparty to protect the innocent counterpart's interest?	Yes. Brokers (participants) have to complete settlement obligation.
3.	Does the market operate a guarantee fund or have an equivalent procedure to protect against the cost of failed transactions; and which sectors of the market does it cover?	Yes. Taiwan Stock Exchange has maintained a clearing and settlement fund to protect against failed transactions for central market.
4.	Are the stock transfer agents (share registrars) linked electronically to the depository?	No.
5.	Is there a legal maximum time period to complete ownership transfers in the books of the issuer? If so, does market practice adhere to the deadline?	No.
6.	Are investors entitled to all benefits arising on a security from the point of purchase; and how are any rules enforced?	Yes.
7.	Is proxy voting permissible in the market and can such proxies be lodged by post or other remote delivery method?	Yes, proxies are permissible and are normally be lodged by post.
8.	Are there binding rules in the market stating the minimum and maximum lapsed time between the announcement and completion of key events, including registration, the calling of shareholder meetings, the payment of dividends or interest, rights issues, tender offers and other voluntary corporate actions?	The Company Law will cover the announcement and completion of those key events.
9.	Are all voluntary corporate actions advised through a central mechanism assuring consistent information to all investors?	Yes. Public announcement and information is supplied by Taiwan Stock Exchange.
10.	Is information on corporate actions available electronically, and is the minimum lapsed time for responding to such actions sufficient to enable all domestic and foreign investors to respond in a timely and considered fashion?	Yes.