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In order to protect workers against mass redundancies, the Council
of Labor Affairs (CLA) has introduced an early warning reporting system for mass
layoffs.
In future, the Securities and Futures Bureau of the Financial Supervisory
Commission will send an early warning report to the CLA if it discovers that any
of the following situations applies to a company: (a) its shares have been placed
under restricted trading, or suspended from trading; (b) its net worth per share
is below NT$10, and it has posted losses for three successive years after being
OTC listed; (c) its net worth per share is below NT$10, its debt ratio above 60%,
and its current ratio less than 1 (except for financial services and insurance enterprises);
(d) its net worth per share is below NT$10, and its net cash flow over the last
two years has been negative; (e) 90% or more of the total shareholdings of its directors,
supervisors, and major shareholders are the subject of pledges; (f) its outstanding
loans of funds are equal to 30% or more of its net worth; (g) outstanding guarantees
endorsed by it are equal to 150% or more of its net worth; or (h) the shareholdings
of its directors or supervisors have been below the prescribed minimum levels for
three successive months.
The Ministry of Finance will also provide information
within a defined scope on companies' cash, liquid assets, and tax status, as well
as the names of enterprises listed as dishonored accounts by the Taiwan Clearing
House. The Investigation Bureau of
the Ministry of Justice will provide intelligence on major movements overseas of
enterprises' funds or equipment. Meanwhile,
trade union organizations will compile lists of companies suffering severe losses.
