The Financial Supervisory Commission yesterday approved plans to ease listing requirements for foreign firms to cut their fund-raising costs and invigorate the local capital market.
The deregulation, to become operational on Jan. 1, will free foreign firms seeking to trade shares in Taiwan from meeting the requirement of setting the face value of their stock at NT$10 per share.
Currently, all domestic and foreign firms have to comply with the requirement whether their shares are traded in the Taiwan Stock Exchange or in over-the-counter markets.
As most bourses do not place such a restriction on foreign firms, the regulator said it decided to follow suit to make the local capital market more competitive.
The policy change came after the TAIEX tumbled 27 percent this year, while turnover fell to close to the trough seen during the global financial crisis in 2009.
To meet the face-value requirement, many firms had to go through equity reorganization in a third country before applying to list in Taiwan, a procedure that has incurred extra burdens, the commission said in a statement.
The regulator said it would use other thresholds — such as no cumulative losses — when screening companies’ capital standing.
Foreign firms would be assigned distinctive stock codes so investors could differentiate them from local companies, the commission said.