## Statute of Chunghwa Telecom Co., Ltd. 

The Executive Yuan, on February 26, 2008, proposed a motion for the abolishment of the Statute of Chunghwa Telecom Co., Ltd. for legislative approval. We cannot determine when this motion will be approved by the Legislative Yuan. Under Republic of China law, the Statute of Chunghwa Telecom Co., Ltd will continue in effect until the Legislative Yuan formally approves the motion and the President of the Republic of China pronounces the abolishment of the law. 

## Approval of Ministry of Transportation and Communications 

While the continued application of the Statute of Chunghwa Telecom Co., Ltd. remains unclear and it may be abolished in the near future, under that statute we are required to obtain approval of the Ministry of Transportation and Communications for: 

• the adoption of and any changes to our articles of incorporation and board of directors organization rules; 

## Employee Subscription Rights for New Issues of Our Common Shares 

• any changes to our authorized capital and any issuance of our common shares; 

• any changes to primary tariffs for Type I services; and 

• any changes to operational procedures of Type I services. 

In accordance with the Statute of Chunghwa Telecom Co., Ltd., our employees have rights to subscribe for not more than 10% of a new issuance of our common shares in accordance with subscription rules which were to be announced by the Ministry of Transportation and Communications. However, no such rules were ever announced. In addition, under the Republic of China Company Law, unless exempted by the relevant government authorities, a Republic of China company must give its employees pre-emptive rights to subscribe for between 10-15% of any new issue of shares by us. 

C. Organizational Structure 

Set forth below is a diagram indicating our organization structure as of March 31, 2011. 

