Enforcement Rules of the Income Basic Tax Act Article 6

With respect to the securities transaction income received by a profit- seeking enterprise from the selling of the shares (stocks) of companies not listed on the Taiwan Stock Exchange (TSE), and/or not traded through Over-the-Counter (“ OTC ” )securities market, and/or the shares (stocks) of emerging companies traded through Over-the-Counter (“ OTC ” )securities market pursuant to Subparagraph 1, Paragraph 1, Article 7 of the Act, if the selling price thereof is obviously lower than the current price of such stocks at the time of transaction, the current price shall be taken as the selling price of such stocks, unless a due cause and the evidentiary document/certificate of such low selling price have been submitted by the said profit-seeking enterprise and have been duly verified by the competent authority concerned.The current price referred to in the preceding paragraph shall be determined by making reference to the transaction prices of such stocks sold at the same time and to a corresponding number of such stocks; but if such reference transaction price is not available, then the net value of each share as calculated based on the net assets value of the issuing company on the transaction day shall be taken as the current price of such stocks.The same period as set forth in the preceding paragraph shall refer to the period of 30 days prior to the transaction date of such stocks; and the corresponding numbers of stocks sold shall be ranging from 50 percent to 150 percent of the total number of such stocks actually sold. When there is more than one reference for current price(s), the average amount of such current price(s) shall be adopted.