1. The issuer shall open a depository account of the pledgee and the pledgor and a pledge account under the issuer's depository account.
2. The issuer shall transfer pledgor's stocks from the "registration account" to the pledgor's depository account.
3. The issuer shall execute online transactions in accordance with applications filled out by the pledgor and the pledgee to transfer the pledgor's stocks to "pledge depository account" and hand the single-entry passbook with seals affixed to the pledgee for retention.
4. The transfer agent shall ask the pledgee to apply for the "Online Account Information Inquiry Registration." Once the registration and pledge creation are completed, it shall ask the pledgee to login in the centralized securities depository enterprise website and obtain the "certification number" so that the pledgee can proceed with pledge-related operation later.

Both the pledgor and the pledgee shall open securities accounts. The pledgor shall bring his/her securities passbook along with the original seal/signature and fill out the "Pledge Creation on Securities by Book-entry Application." Both the pledgor's and the pledgee's seal shall be affixed on the form for application with the securities firm.

With regard to securities purchased by the investor, the book-entry delivery of pledged securities can only be applied for on the business date following the book-entry transfer of the securities (i.e. the third business day after the purchase transaction). During the pledge period, the pledgor cannot apply for the withdrawal, sale transfer between accounts, or wire transfer of the pledged securities.

For dividend withdrawal of investors' pledged securities in TDCC, the TDCC would notify the issuing company issuer of the names of the pledgor and pledgee, the number of securities pledged, and dividend-related agreements for registration. The issuing company or its shareholder services agent would distribute dividends in accordance with the "Pledge Creation on Securities by Book-entry Application" filled by the pledgor and the pledgee. If the pledgor is entitled to the dividends, they would be directly transferred to pledgor’s bank account or securities account If the pledgee is entitled to the dividends, the issuing company's shareholder services agent would retain the dividends in the issuing company's account. When the pledgor intends to withdraw the dividends of a particular year, he/she shall contact the pledgee to file an application to the participant for the participant to inform TDCC. TDCC would then inform the issuing company or its shareholder services agent of the change in dividend recipient for them to handle follow-up matters.

The pledgee may enforce his/her rights by the following methods if he/she has outstanding claims upon maturity; and once the applications received by the pledgee's participant are verified, the participant shall notify the TDCC of relevant information as well as submit those applications to the TDCC for verification before book-entry transfer can be performed:

(1) Compulsory execution by the court: When the pledgee applies to the court for compulsory execution, the court would issue execution order to the pledgee's participant. The participant would then, by the court's order, detain or transfer the pledged securities to an account designated by the court for auction or deliver them to the court-designated person.

(2) Self-auction: After the pledgee has filled out relevant applications and the sales order form, provided his/her passbook and a legal attest letter, an attestation letter from the court or an affidavit indicating the pledgor has been informed, as well as documents that the pledgor has been or cannot be notified of, and made sales application to the securities firm, he/she can apply to the participant with the proof of sale and aforementioned auction documents for a transfer of the pledged securities to the pledgee's central depository account.

(3) Acquisition of ownership: The pledgee may, upon approval from the pledgor, acquire the ownership of the pledge. Where the pledgee applies for a transfer of ownership, he/she shall fill up relevant applications and provide his/her passbook, a proof that the securities transaction tax has been paid and an agreement where the pledgor has consented for the pledgee to acquire the ownership of the pledge when applying to the participant for a transfer of pledged securities to the pledgee's central depository account. However, the above procedures apply to the following securities only: 1. Listed securities not exceeding one trading unit of the given securities and two consecutive transfers are at least three months apart; and 2. Unlisted securities.

(4) Auctions conducted by an impartial third party: Where the financial institutions and asset management firms engage an impartial third party to auction pledged securities not listed in the Taiwan Stock Exchange nor the Taipei Exchange, they shall fill up relevant applications and provide documents including an auction award certificate issued by the impartial third party endorsed by competent authority, a proof issued by a notary public stipulated in Article 28 of the Enforcement Act of the Part of Obligations of the Civil Code, a notification issued by the pledgee to remove the pledge, and a proof that the securities transaction tax has been paid when applying to the participant for a transfer of pledged securities to the auction winner's account with a securities depository enterprise.

According to Article 19 of the Enforcement Act of the Part of Rights in Rem of the Civil Code, unless a court has been petitioned to conduct the auction, the pledgee's auction may be effected by selling the pledged items at market price, which shall be certified by a notary public or a commercial association. After the pledgor has created pledge on stocks listed at the emerging stock board, if the pledgee intents to enforce his/her rights via self-conducted auction at the emerging stock market, as the emerging stock market adopts the price negotiation system and the transaction price is determined by both the investor and the recommending securities firm, the pledgee shall provide market price certification issued by a notary public or a commercial association where the selling price is concerned in accordance with the above provision. Only then can the TDCC process the enforcement of pledge rights regarding stocks listed at the emerging stock board via the pledgee's self-auction.

1. When the pledgee and pledgor have agreed for the pledgee to receive the pledged stocks' dividends, pledgee can fill out the "Application for Transfer of Pledged Stocks' Dividends at the Registration Account (Substitute for Debit Voucher)" with the seal-of-record of central depository account affixed and present it along with the seal verification certificate to the issuer's transfer agent for application.
2. The transfer agent would examine whether the information on the "Application for Transfer of Pledged Stocks' Dividends at the Registration Account (Substitute for Debit Voucher)" is correct; execute the "Pledge Delivery Data Inquiry" transaction (transaction code 366) to print the "Pledge Delivery Data Inquiry Form" and confirm the agreement between pledgor and pledgee concerning pledged stocks' dividends; and verify the amount applied to be transferred.
3. The transfer agent would execute the "Notice for Transfer of Pledged Stocks' Dividends at the Registration Account" transaction (transaction code A47) to transfer the pledged stocks' dividends in the registration account's "Details of Securities Held in Custody" into the "pledge account" of pledgee's participant.