Supervisory Body

Financial Supervisory Commission (FSC) – Securities and Futures Bureau (SFB)

Name of Clearing & Settlement Organization

1. GreTai Securities Market (GTSM) is in charge of clearing;

2. The operation of cash settlement is carried out by the Central Bank of the Republic of China (Taiwan);

3. Taiwan Depository & Clearing Corporation (TDCC) is entrusted by the GTSM to handle securities settlement, for all securities except for Government Bonds.

4. GreTai Securities Market (GTSM) is in charge of settlement for Government Bonds.

Settlement Cycle

T + 2

Name of Central Securities Depository

Taiwan Depository & Clearing Corporation, for all securities except for Government Bonds.

Central Government Securities Settlement System (CGSS), for Government Bonds.

Government bonds are issued in dematerialized form. The general ledger of clients of all clearing banks is registered through the CGSS of the Central Bank. The itemized records of all government bond owners are registered in each clearing bank.

Commissions on Transactions levied by Exchange

GTSM levies 0.00585% on the trading value of brokers for handing fee.

As for the transaction tax, 0.3% levied from the sale of shares; and 0.1% levied from the sales of warrants, DR, beneficiary certificates, and ETF; in the case of cash settlement of warrants, 0.1% of market price levied from the holders; in the case of securities settlement of warrants, 0.3% of exercise price levied from the issuers, no transaction taxes levied on the holders.

GTSM levies at most 0.0005% on the trading value of Government Bonds of brokers trading through the Electronic Bond Trading System (EBTS).

Taxes on Dividends, Interests

As for residents, dividends are included in the consolidated income for taxation.

As for non-residents, 30% of withholding tax for individuals; 25% for corporate beneficiary; 20% for obtained approval in accordance with the Statute for Investment by Overseas Chinese or the Statute for Investment by Foreign Nationals.

As for resident bond investors, 10% withholding tax for interests.

As for non-resident bond investors, 15% withholding tax for interests.

2011 Share ownership thresholds (%)

N/A

Short selling (Yes / No)

Yes

Short selling conditions (if any)

Short selling of ETFs is exempted from the local up-tick rule, which requires short sales to take place at no lower than the previous day’s closing price. Investors should check their brokers to see whether there is any quota available before conducting short selling.

As for short selling of Government Bonds, please refer to GreTai Securities Market Rules Governing the Electronic Bond Trading System, article 9.