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Chapter Ⅰ General Principles
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1.These Directions are specially prescribed by the Central
Bank of the Republic of China（Taiwan） (hereafter called
“the Bank”) for the sale and buyback of treasury bills.
Except where otherwise provided by law, sale and buyback
of treasury bills will be performed electronically or through
paper tender submission; Directions for electronic bidding
procedures will be regulated separately.
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2.The specifics of issue and buyback of treasury bills, such as
the issue code, form, method, date, amount, date of repayment,
and the time and place of auctions shall be handled in the manner
publicly announced by the Ministry of Finance.
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Chapter Ⅱ Sale of Treasury Bills
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3.Bidding in treasury bills auctions shall be limited to banks,
Chunghwa Post Co., Ltd., bills finance companies, securities firms,
and insurance enterprises only; natural persons and other juristic
persons shall submit bids through bills houses under bills houses’
names.
The Bank may limit any bidders mentioned in the preceding paragraph
from participating in bidding, where the bidders are placed under
conservatorship or receivership by the central competent authority.
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4.Treasury bills auction adopts single interest rate bidding, whether
in competitive or non- competitive form. Competitive bidding may be
used in combination with non-competitive bidding or may be adopted
as the sole method.
（1）Competitive bids: Bid rates shall be expressed as discount rates.
Bids with rates lower than the minimum acceptable rate shall be
accepted successively in ascending order; Where interest rates of
successful bids are equal and the remaining amount of the issue
is insufficient for full allocation, a pro-rata allocation will
be made based on the bid amounts. Amounts payable by successful
bidders shall be calculated at an issue price resulting from
conversion at the highest rate of all the successful bids.
（2）Non-competitive bids: Amounts payable will be calculated at the
issue price set forth in the preceding paragraph. Where the total
subscription amount of non-competitive bids exceeds the non-competitive
public offering amount, a pro-rata allocation will be made based on
subscription amounts.
NT$1 million shall be the incremental unit in allocations made pursuant
to the preceding paragraph.
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5.For each auction, each bidder shall submit only one tender
（Form 1）with no more than ten bids, and shall use the
tender prescribed by the Department of the Treasury of the Bank
(hereafter called “Department of the Treasury”) in a sealed envelope.
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6.Tenders shall be filled out in accordance with the following
provisions:
（1）The government uniform invoice number of a profit-seeking
enterprise shall be listed correctly.
（2）The minimum bid amount for each bid shall be NT$5 million;
amounts in excess of that figure shall be in increments of
NT$1 million. The maximum amount of a bid shall not exceed
the amount publicly announced by the Ministry of Finance.
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7.Any of the following circumstances will result in invalidation
of a tender:
（1）Not using the tender prescribed by the Department of the Treasury.
（2）Not submitted in a sealed envelope.
（3）No official stamp affixed.
（4）Submitting more than one tender.
（5）Other violations of bidding regulations.
Under any of the following circumstances, a bid submitted on the
tender will be void:
（1）A bid rate not written in Arabic numerals, altered, or illegible.
（2）A bid amount not written in Arabic numerals, altered, or illegible
（3）The minimum bid amount lower than the prescribed amount.
（4）Any other entries on the tender not conformed to bidding regulations.
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8.Auctions and auction awards will be carried out by the Bank
and the Ministry of Finance; auction awards will be announced
by the Bank.
Where an auction is uncovered, the unsold balance may be sold
by placement at a non-competitive bid price or at a price
publicly announced by the Ministry of Finance, or be re-auctioned
at another chosen date.
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9.On the next business day following the auction, each bidder
shall dispatch a staff member to the Department of the
Treasury to collect the notice of successful, losing, and
invalidated bids.
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10.Successful bidders shall carry out settlement on the issue date
of the treasury bills.
Settlement for book-entry treasury bills shall be performed
according to the applicable provisions of the Directions for
the Operation of Book-Entry Central Government Securities.
For settlement for treasury bills in the form of certificates,
the dealer shall draw a check with the Bank’s Department of
Banking (hereafter called “Department of Banking”) as the
drawee or a promissory note with the Department of Banking as
the payment agent (with the treasury bills’ issue date as
maturity date), or shall transfer funds into the Department
of the Treasury’s account with the Department of Banking
through the CBC Interbank Funds Transfer and Settlement System,
and collect the certificated treasury bills from the Bank.
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11.Where a successful bidder fails to fully settle or only partially
settles the treasury bills awarded by the prescribed date, the bidder
shall pay a penalty that amounts to ten percent (10%) of the unsettled
portion and may not participate in bidding for treasury bills for a
period of three years from the issue date of the underlying issue.
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Chapter Ⅲ Buyback of Treasury Bills
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12.Offering in treasury bills buybacks shall be limited to banks,
Chunghwa Post Co., Ltd., bills finance companies, and insurance
enterprises only; natural persons and other juristic persons
shall submit offers through bills houses under bills houses’ names.）
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13.Treasury bill buyback auction adopts single interest rate formats
with rates expressed as yields. Successful offers will be those
with yields higher than the minimum acceptable yield and the
buyback yield shall be the lowest yield of all accepted offers.
Where offer yields are equal and the remaining amount needed to
fill the announced buyback amount is insufficient, a pro-rata
allocation will be made based on the offer amounts. Amounts
receivable by successful submitters shall be calculated at the
buyback yields.
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14.Submitters shall use the sellback tender （form 2） prescribed
by the Department of the Treasury and submit offers in
accordance with Direction 5.
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15.The sellback tenders shall be filled out in accordance with
Direction 6, except that the minimum offer amount shall be
NT$1 million.
Invalidation of sellback tenders shall apply mutatis mutandis
to Direction 7.
The time and place for auctions, and the handling of auctions
and determination of accepted offers shall be carried out in
accordance with Direction 2, first paragraph of Direction 8,
and Direction 9.
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16.Successful submitters shall carry out settlement on the date
of buyback of treasury bills.
Settlements for buyback of book-entry treasury bills shall be
performed in accordance with applicable provisions of the
Directions for the Operation of Book-Entry Central Government
Securities.
Where a successful submitter fails to fully settle or only
partially settles the treasury bills offered by the prescribed
date, the submitter shall pay a penalty that amounts to ten
percent (10%) of the par amount of the unsettled portion and
may not participate in buyback auctions for a period of three
years from the buyback date of the underlying issue.
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