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According to Article 197-1 of the Company Act, if a director of a public reporting company pledges over 50% of his/her shares in the company after his/her election, the director will not have voting rights for the shares exceeding such 50%.
In this connection, pursuant to a ruling issued by the Ministry of Economic Affairs (MOEA) on 29 December 2011, the number of the pledged shares subject to such a restriction should mean that of the pledged shares recorded on the shareholders roster as of the day immediately preceding the day on which the suspension period for share transfer commences for a shareholders meeting ("Record Date"). The MOEA further issued another ruling on 25 April 2013 stating that the said number of the pledged shares should mean the total number of the shares of the director being pledged as recorded on the company's shareholder roster on the Record Date, regardless of whether the shares are recorded as being pledged by the director in the capacity of a director or in the capacity of a shareholder.
