Chapter 2 Public-Endowed Foundation
A public-endowed foundation shall have a Board. The Board shall consist of 5 to 25 directors provided there shall always be an odd-number of directors; one of them shall serve as the chairperson of Board, and another may serve as the vice chairperson. If warranted by special needs and upon the competent authority’s approval, the total number of directors may exceed 25 persons.
A public-endowed foundation may have supervisors which shall not exceed one-third of the numbers of directors.
The directors and supervisors under the preceding two paragraphs shall not be remunerated; provided that the chairperson may be remunerated pursuant to a resolution adopted by the Board if the chairperson works full-time.
The tenure of a public-endowed foundation’s directors shall not exceed 4 years, and they may be re-appointed; provided that the number of such re-appointed directors shall not exceed four-fifths of the total number of directors to be appointed at the same time.
Directors concurrently served by public servants whose office changes following the change of their official posts shall not be included in the calculation of the number of re-appointed directors and the total directors to be appointed under the preceding paragraph.
If the appointment is not timely completed on the expiry of the directors’ tenure under the first paragraph, the directors shall continue to perform their duties until the newly appointed directors take office. Notwithstanding the foregoing, the competent authority may order the directors to be appointed within a specified time period; and, failing which, the directors shall be ipso facto removed from office on expiry of the specified time period.
A vacancy created by the removal of a director due to resignation, death or being no longer able to exercise duties for other causes prior to expiry of the director’s tenure may be filled by appointment of another director who shall serve until the end of the removed director’s tenure.
No more than one-third of a public-endowed foundation’s directors shall be spouses or related by blood or marriage within the third degree of each other unless otherwise approved by the competent authority given the public-endowed foundation’s special nature.
A public-endowed foundation shall have at least one-fifth of its directors with expertise or work experience relevant to the establishment purpose.
A supervisor shall not be the spouse or related by blood or marriage within the third degree of another supervisor or a director unless otherwise approved by the competent authority given the public-endowed foundation’s special nature.
No person with any of the following circumstances shall be appointed as the chairperson, alternate chairperson or a supervisor of a public-endowed foundation, and, if appointed, the person shall be ipso facto removed from office by the competent authority with notice to the court for relevant registration:
(1) Having been rendered with a final judgment of guilty for committing an offence under the Statute for Prevention of Organizational Crimes, the sentence as result thereof is not yet served or fully served, or it is less than 2 years after the sentence is fully served or pardoned; provided that this shall not apply to a person who receives a sentence of probation;
(2) Having been rendered with a final judgement of guilty with sentence of an imprisonment term of 1 year or more for committing fraud, breach of trust, misappropriation or corruption, the sentence is not yet served or fully served, or it is less than 2 years after the sentence is fully served or pardoned; provided that this shall not apply to a person who receives a sentence of probation;
(3) Having been denied service by the bills clearing house and the denial status has not yet been removed;
(4) Having been adjudicated bankrupt or ordered to begin the liquidation procedure in accordance with the Consumer Debt Clearance Act, and rights and privileges have not been reinstated; or
(5) Having been placed under guardianship or assistance by the court, and the status has not yet been removed.
A person with the circumstance set out in subparagraph (5) of the preceding paragraph shall not be a director of a public-endowed foundation; if appointed, the person shall be ipso facto removed from office by the competent authority with notice to the court for relevant registration.
The chairperson of the Board shall internally preside the Board meeting and shall externally represent the public-endowed foundation. If the chairperson is on leave or absent or unable to exercise the duties and powers for any cause, the vice chairperson shall act on the chairperson’s behalf. If there is no vice chairperson, or the vice chairperson is also on leave or absent or unable to exercise the duties and powers for any cause, the chairperson shall designate one of the directors to act on the chairperson’s behalf. In the absence of such a designation, the directors shall be elected from among themselves an acting chairperson.
The chairperson shall convene a Board meeting at least once every half year. Directors shall attend the Board meeting in person, and, if a director is unable to attend in person, such director may designate another director to attend as a proxy unless it is not allowed under the charter of endowment.
A director may accept the designation to act as the proxy under the preceding paragraph of one other director only, and the directors who act as the proxy shall not exceed one-third of the total number of directors.
If a Board meeting is proceeded via video conferencing, the directors taking part in such video conference meeting shall be deemed to have attended the meeting in person.
The Board meeting shall be held within the R.O.C. territory, and any meeting held outside the R.O.C. territory shall be approved by the competent authority.
If the chairperson does not duly convene the Board meeting, upon a written request setting forth the meeting purpose and convention reasons from one-third or more of the current directors to convene the Board meeting, the chairperson shall convene the Board meeting within 10 days after receiving such request. If the chairperson does not give notice to convene the Board meeting within the specified time period, the requesting directors may report to the competent authority and convene the meeting upon obtaining the approval.
Unless the law provides otherwise, the Board shall have the following duties and powers:
(1) Fund raising and administration and management of property;
(2) Appointment and removal of directors unless the charter of endowment provides otherwise;
(3) Appointment and removal of the chairperson of the Board;
(4) Establishment and administration of internal organization;
(5) Development and promotion of work plans;
(6) Review of annual budget and final accounts;
(7) Proposal of amendments to the charter of endowment;
(8) Proposal of disposal of or creation of encumbrance on real property;
(9) Proposal of merger or consolidation; and
(10) Other proposals or decisions to be made according to the charter of endowment.
There are two types of the Board resolutions:
(1) Ordinary resolution: a resolution adopted by a majority of the attending directors at a Board meeting attended by a majority of all directors.
(2) Special resolution: a resolution adopted by a majority of the attending directors at a Board meeting attended by two-thirds of all directors provided that the higher threshold set out in this Act or the charter of endowment, if any, shall apply.
The following essential matters shall be adopted by a special resolution of the Board and submitted to the competent authority for approval:
(1) Proposal of any amendment to the charter of endowment;
(2) Use of the fund provided that this shall not apply to the use by a foundation under subparagraph (3) of the fourth paragraph of Article 19 in accordance with its charter of endowment;
(3) Use of the fund to make up the deficit;
(4) Disposal of or creation of encumbrances on real properties;
(5) Appointment and removal of directors unless it may be passed by an ordinary resolution of the Board in accordance with the charter of endowment; and
(6) Other matters designated by the competent authority.
The essential matters set out in the preceding paragraph and the proposals set out in the first paragraph of Article 34, shall be notified to all directors and the competent authority at least 10 days before the Board meeting and shall not be proposed by an extempore motion.
If a public-endowed foundation may not complete the appointment of directors in accordance with subparagraph (5) of the second paragraph, upon expiry of the directors’ tenure, upon approval of the competent authority, the appointment may be done by an ordinary resolution adopted by the Board unless this is not allowed under the charter of endowment.
Unless the law provides otherwise, a public-endowed foundation’s supervisors, if any, shall have the following duties and powers:
(1) Oversee the operation and financial status;
(2) Audit financial statements, documents and property information; and
(3) Oversee the operation to be carried out in accordance with laws and the charter of endowment.
If a public-endowed foundation’s Board fails to or cannot exercise its duties and powers, the competent authority may order the foundation to make a correction within a specified time period and take such other necessary measure.
If a public-endowed foundation’s Board fails to or cannot exercise its duties and powers and thus it is likely to result in damages to the foundation, the court, upon an application filed by the competent authority, prosecutor or interested party, may appoint one or more interim directors and designate one of them to act as an interim chairperson and exercise the duties and powers on behalf of the Board and the chairperson; provided that the interim chairperson shall not act in any manner adverse to the foundation.
The term of the interim directors and chairperson to exercise duties and power on behalf of the Board and the chairperson under the preceding paragraph shall not exceed 1 year; when necessary, the interim directors or chairperson may apply with the court for an extension of not more than 1 year.
Before the expiry of the acting period under the preceding paragraph, the interim directors shall reorganize the Board in accordance with the charter of endowment. The directors re-appointed accordingly shall apply with the court for registration.
The interim directors shall be ipso facto removed from office upon the first Board meeting convened by the Board reorganized in accordance with the preceding paragraph.
If warranted by the facts that any interim director is not competent, the court may remove such director from office upon the application by the person entitled to do so under the second paragraph.
The court may order the public-endowed foundation to adequately remunerate interim directors by taking into account the nature and complexity of the acting duties, financial status of such foundation and other circumstances. The amount shall be determined by the court after consulting the competent authority, prosecutor or interested party.
The court shall order the registrar to make relevant registration for its appointment and removal of any interim director.