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[Law Basis]
[Print]
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1.These Directions are prescribed by the Central Bank of the Republic of China
(Taiwan) ("Central Bank") for the purpose of managing the conversion of central
government bonds in certificate form ("physical bonds") into bookentry central
government bonds ("book-entry bonds").
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2.Operations related to the conversion of physical bonds to book-entry bonds shall
be governed by these Directions except where relevant provisions of the
Operational Directions for Central Book-Entry bonds and Directions for the
Central Government Bond Payment and Stop Payment System or other rules and
regulations apply.
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3.As regards the headquarters of the clearing bank ("the head office") and its
branch units; those branch institutions ("bank branch(es)") that have been
approved by the Central Bank to conduct book-entry bond operations and are in
possession of the specimen certificates and their attendant anti-counterfeiting
marks shall administer bond conversion in accordance with the provisions of
these Directions.
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4.Holders of already-issued physical bonds that have yet to reach maturity may
apply for conversion to book-entry bonds per public announcement by the Ministry
of Finance. Where physical bonds have been converted into book-entry bonds,
reapplication may not be filed to convert them back into physical bonds.
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5.When applying for conversion, in addition to opening a government bond account
and a demand deposit account with the bank branch, a bondholder shall also file
an "Application for the Conversion of Physical Bonds to Book-Entry Bonds" (Form
1), and shall endorse each bond by affixing his or her seal to the back. The
signature seal impression on the application form and on the backs of the bond
certificates shall be identical to that used to open the government bond account
, provided that when the bond bearer is unable to appear in person to conduct
the conversion, he or she shall provide a proxy statement authorizing another
person to conduct the conversion.
When application is made to convert a bond, the bond certificate shall be
converted together with all interest coupons attached to it, including those
that have yet to reach maturity.
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6.Following acceptance of a conversion application, procedures for handling shall
be as follows:
(1) Bank branches, after examining the government bond coupons and their
attendant anti-counterfeiting marks and confirming that the signature seals
on the backs of the bond certificates and conversion application match that
used for the government bond account, shall enter the name of the bond
certificate, the coupon numbers, face value, serial number, number of bond
certificates, the Taiwan Securities Central Depository Company's certified
vault-deposit bar code ("bar code") and other information into the Central
Government Bonds Settlement System. After double-checking to ensure the
absence of errors, the information shall be submitted to the Central Bank
for processing.
(2) Where the Central Bank verifies that the physical bond information is in
compliance with the terms of conversion and that there are no stop payments,
no requests for assistance in locating lost bonds, and no duplicate bond
serial numbers, the physical bonds shall then be immediately converted into
book-entry bonds and a message shall be sent back notifying the bank branch
[of the conversion].
(3) Following receipt of confirmation fromthe Central Bank, the bank branch shall
immediately enter the verified information into its accounts and print the
relevant information into the bond account passbook for delivery to the
applicant.
(4) After conducting the conversion to book-entry bonds, the bank branch shall
immediately stamp the back of each bond coupon to indicate the conversion
(including the name of the bank branch and the date of conversion) and
perforate each coupon to indicate cancellation. The bank branch shall take
care to ensure that the certificate number and bar code remain intact when
perforating the coupons.
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7.Where the bank branch finds that the physical bonds have been altered or forged,
that there have been associated filings for stop payment or lost bond location
assistance, or that there are serial number duplications, the matter shall be
handled in accordance with the provisions of Point 3 and Point 4 of the Central
Bank's Directions for the Central Government Bond Payment and Stop Payment System.
When the serial number(s) and bar code identification numbers do not match, the
Central Bank's Treasury Department ("Treasury Department") shall be consulted.
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8.For the conversion of inscribed bonds, the applicant shall affix to the back of
each bond certificate the signature seal matching the original signature seal,
which shall then be examined for authenticity by the bank that originally
conducted the registration ("the original registering bank").
Upon verification, the original registering bank shall affix its official seal
to the back of each bond certificate in confirmation of authenticity, whereupon
the certificates shall be presented to the bank branch for completion of book-
entry registration. The name of the bond account holder conducting registration
shall be the same as that of the original registered bondholder.
For inscribed bonds that have already been converted as described in the
preceding paragraph, the bank branch shall also confirm by telephone that the
original registering bank has confirmed the authenticity of the signature seals
before carrying out the conversion.
Following the book-entry registration of physical bonds, the Central bank's
Treasury Department shall deliver monthly reports to bank head offices directing
them to instruct the original registering banks to cancel physical bonds that
have been registered. The Treasury Department shall also notify the Ministry of
Finance.
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9.The bank branch shall handle physical bonds that have already been converted in
the following manner:
(1) At the end of each business day, an "Itemized Statement of the Conversion of
Physical Bonds to Book-Entry Bonds" (form 2) shall be printed out, checked
for accuracy against the physical bond certificates that have already been
converted, and filed for recordation.
(2) At the end of each ten-day period, physical bond certificates that have
already been converted shall be sorted according to bond name, type, serial
number and face value, and gathered in bound volumes to be submitted together
with the "Statement of the Conversion of Physical Bonds to Book-Entry Bonds
for Deposit" (form 3) to the bank head office for archiving.
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10.The head office shall handle physical bonds that have already been converted in
the following manner:
(1) At the end of each business day, after ensuring consistency with information
in the Central Bank's central archives, a "Aggregate Statement of the
Conversion ofPhysical Bonds toBook-Entry Bonds" (form 4) shall be printed
out and filed for recordation.
(2) Physical bonds submitted by each bank branch every 10 days shall be examined
for consistency and stored separately from those bonds that have already
been redeemed, and at the end of each month, following examination for
consistency with the Central Bank's archived information, a "Monthly
Statement of the Conversion of Physical Bonds to Book-Entry Bonds" (form 5)
shall be filed for recordation.
(3) Each year at the end of June and the end of December, the "Semi-Annual
Statement of Conversion of Physical Bonds to Book-Entry Bonds" (form 6)
shall be compiled and, following the auditing unit's examination for
accuracy, shall be submitted within 45 days to the Central Bank, with a
copy also submitted to the Ministry of Finance, for recordation.
The compilation and organization, custody, cancellation, approval for
destruction, and allocation of the relevant processing fees with regard
to the handling of converted bonds as described in the preceding
paragraph shall be conducted in accordance with the provisions of the
Regulations Governing the Management of Central Government Bonds.
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11.The Treasury Department shall conduct the handling of all archived information
submitted to theCentral Bank by each bank branch as follows:
(1) At the end of each business day, a "Aggregate Daily Statement of the
Conversion of Physical Bonds to Book-Entry Bonds" (form 7) shall be
compiled, printed and used as the basis for account entries.
(2) Each month, a "Aggregate Monthly Statement of the Conversion of Physical
Bonds to Book-Entry Bonds" (form 8) shall be compiled, and every six months
two copies each compiled of the "Aggregate Semi-Annual Report of the
Conversion of Physical Bonds to Book-Entry Bonds" (form 9) and "
Comprehensive Details of the Conversion of Physical Bonds to Book-Entry
Bonds " (form 10), with one copy each submitted to the Ministry of Finance
and the other filed for recordation [by the Treasury Department].
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12.When the computer system fails at a bank branch or communications are disrupted,
the problem shall be promptly resolved. If it is determined that the problem
cannot be resolved within a short period of time, the reasons for the problem
shall be explained to the applicant, who shall be assisted in locating another
bank branch where they can complete the application process.
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13.When the head office's computer server system fails or communications are
disrupted, the head office shall immediately notify the Central Bank's
Information Systems Office and Treasury Department to request assistance in
handling the problem.
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14.When the Central Bank's computer server system fails or communications are
disrupted, resulting in complete inability to conduct online operations, the
CentralBank's Information SystemsOffice shallimmediately notify the Treasury
Department and each bank head office to temporarily suspend acceptance [of
conversion applications] until systems have been restored.
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15.When the Central Bank's computer server system is restored to normal operations
, bank branches shall resume handling of applications that had been in process
but were disrupted due to the system failure, and shall first check all
information in the system to Directions for the Conversion of Physical Central
Government Bonds to Book-Entry Central Government Bonds ensure that it conforms
with the original certificates, make any necessary corrections and additions,
and then complete processing of the applications.
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