On January 4, 2016, the FSC announced the “Regulations Governing the Establishment of Special Committee for Merger by Public Companies and Relevant Matters”. Highlights include: (1) a public company shall establish bylaws for the organization of a special committee; (2) where a public company has already established an audit committee, the functions of the special committee shall be performed by the audit committee; (3) the special committee shall be composed of independent directors (if any) or members selected by the board of directors. All members of the special committee shall have the requisite professional qualifications and independence; (4) the special committee shall appoint independent experts to provide assistance and professional consultation; (5) a resolution of the special committee shall be approved by one-half or more of all the special committee members. All members shall be present in person and no proxy vote is allowed. Members attending the meeting shall clearly state whether he/she approves or objects to the proposed resolution and no abstention is allowed. The result of the discussion, together with views for or against the resolution, shall be reported to the board of directors; (6) the special committee may invite independent experts, managers from relevant departments, internal auditors, CPAs, attorneys or other personnel to attend the meeting to provide relevant information if so required; and (7) the company shall record the entirety of the special committee’s proceedings on video or in audio format, and shall keep such recordings for no less than 5 years.