TWSE's foreign listings strategy

Published by: Wen-Lin SHIH, Senior Vice President of Foreign Listing Department, Taiwan Stock Exchange (TWSE) Dec 2019

Founded in 1961, the TWSE represents an established and strong capital market. By offering a friendly and flexible refinancing environment and solid stock liquidity, Taiwan's capital market creates a market suitable for SMEs in the growth stage of their businesses. Foreign investors account for 30% of trading on TWSE, or 40% by market cap. It highlights that TWSE is a global trading platform and a favourable listing choice for foreign companies. Cross-border listing is quite common today. With Taiwanese businesses starting to reap the fruits of their efforts after several decades of developing their businesses overseas, the TWSE has demonstrated the advantages of Taiwan's capital market and attracted those businesses to seek listing in Taiwan. There are 75 foreign companies listed in Taiwan at present. The campaign to attract foreign listing applicants currently follows the practices below:

1. Hold overseas campaigns to promote foreign listing on TWSE 
The TWSE has been working actively and holding investor information sessions in major hubs around the world. These sessions target overseas Taiwanese businesses and demonstrate the benefits of listing in Taiwan such as financing, upgrading and transformation. Furthermore, an opportunity is created to link with Taiwan and bring new connectivity to Taiwan's economy by setting up subsidiaries or branches in Taiwan in order to expand their businesses, create R&D teams, and establish service centres and business headquarters. The main regions for these sessions are the following:

  • ASEAN: This region has been a major contributor to global economic growth in recent years. It is also an emerging market into which Taiwanese businessmen are making an increasing amount of investment. The TWSE, following the government's New Southbound Policy, has hosted investor information sessions in countries including Singapore, Vietnam, Malaysia, and Thailand. A total of eight companies from the region have listed in Taiwan. The number is expected to keep growing in the future.
  • The U.S. and Japan: Taiwan is technology intensive. Close to 40% of the listed companies are in the information and communications technology (ICT) industry, effectively creating a cluster effect. It makes Taiwan an attractive listing choice for American and Japanese companies in related industries.
  • Other regions: The TWSE continues to highlight the advantages of Taiwan's capital market in other regions with a large number of Taiwanese owned businesses, such as those operating in Mainland China. The TWSE promotes these companies to return to become listed in Taiwan and enhance Taiwan's capital market.

2. Expand the base of potential foreign listing applicants by encouraging overseas subsidiaries of TWSE listed companies to list in Taiwan 
Taiwanese businesses have been active participants in many foreign markets for years. Many overseas subsidiaries of TWSE listed companies have grown to a certain size, and the TWSE intends to secure this group of potential listing applicants. The goal is to showcase the advantages of listing in Taiwan such as equity restructuring, organisational transformation, and sustainable development.

3. Strengthen partnerships with intermediaries and support overseas businesses returning to be listed in Taiwan 
Overseas Taiwanese businesses face the need to upgrade and transform as they reach a certain size. To help them bring their businesses to the next level, the TWSE has enhanced its connectivity with accountants and underwriters as well as related service providers, such as industry research institutions or overseas branches of financial institutions. The goal is to provide all-in-one services for overseas Taiwanese businesses and help them augment their businesses while contributing to Taiwan's capital market momentum.