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1、 UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549 FORM 20-F (Mark One)REGISTRATION STATEMENT PURSUANT TO SECTION 12(b)OR 12(g)OF THE SECURITIESEXCHANGE ACT OF 1934OR ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended Decemb

2、er 31,2021OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF1934OR SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES ACT OF 1934Commission file number:001-16125?(Exact name of Registrant as specified in its charter)ASE Technology Holding Co.,Ltd

3、.(Translation of Registrants name into English)REPUBLIC OF CHINA(Jurisdiction of incorporation or organization)26,Chin 3rd RoadNanzih DistrictKaohsiung,811,TaiwanRepublic of China(Address of principal executive offices)Joseph TungRoom 1901,No.333,Section 1 Keelung Rd.Taipei,Taiwan,110Republic of Chi

4、naTel:886-2-6636-5678Fax:882-2-2757-6121Email:(Name,Telephone,E-mail and/or Facsimile number and Address of Company Contact Person)Securities registered or to be registered pursuant to Section 12(b)of the Act:Title of Each Class TradingSymbol(s)Name of Each Exchangeon which RegisteredCommon Shares,p

5、ar value NT$10.00 each ASX The New York Stock Exchange*Traded in the form of American Depositary Receipts evidencing American Depositary Shares(the“ADSs”),each representing two common sharesof ASE Technology Holding Co.,Ltd.Securities registered or to be registered pursuant to Section 12(g)of the Ac

6、t:NoneSecurities for which there is a reporting obligation pursuant to Section 15(d)of the Act:None Indicate the number of outstanding shares of each of the issuers classes of capital or common stock as of the close of the period covered by the annualreport.As of December 31,2021,4,408,018,732 Commo

7、n Shares,par value NT$10 each were outstanding.*Indicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No If this report is an annual or transition report,indicate by check mark if the registrant is not required to file reports pursu

8、ant to Section 13 or 15(d)of theSecurities Exchange Act of 1934.Yes No Indicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934during the preceding 12 months(or for such shorter period that the registrant

9、was required to file such reports),and(2)has been subject to such filingrequirements for the past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 ofRegulation S-T(232.405 of this chapt

10、er)during the preceding 12 months(or for such shorter period that the registrant was required to submit suchfiles).Yes No Indicate by check mark whether the Registrant is a large accelerated filer,an accelerated filer,or a non-accelerated filer,or an emerging growthcompany.See definition of“large ac

11、celerated filer,”“accelerated filer,and“emerging growth company”in Rule 12b-2 of the Exchange Act.(Checkone):Large Accelerated Filer Accelerated Filer Non-accelerated Filer Emerging growth company If an emerging growth company that prepares its financial statements in accordance with U.S.GAAP,indica

12、te by check mark if the registrant has electednot to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a)ofthe Exchange Act.The term“new or revised financial accounting standard”refers to any update issued by the F

13、inancial Accounting Standards Board to its AccountingStandards Codification after April 5,2012.Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the effectiveness of its internalcontrol over financial reporting under Section 404(b)of

14、 the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accounting firm thatprepared or issued its audit report.Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:U.S.GAAP International Financial Reporting Sta

15、ndards as issued Other by the International Accounting Standards Board If“Other”has been checked in response to the previous question,indicate by check mark which financial statement item the registrant has elected tofollow.Item 17 Item 18If this is an annual report,indicate by check mark whether th

16、e registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes No *As a result of the exercise of employee stock options subsequent to December 31,2021,as of January 31,2022,we had 4,410,443,432 CommonShares outstanding.TABLE OF CONTENTS Page USE OF CERTAIN TERMS 1 SPECIAL NOTE RE

17、GARDING FORWARD-LOOKING STATEMENTS 5 PART I 6 Item 1.Identity of Directors,Senior Management and Advisers 6 Item 2.Offer Statistics and Expected Timetable 6 Item 3.Key Information 6 CAPITALIZATION AND INDEBTEDNESS 6 REASON FOR THE OFFER AND USE OF PROCEEDS 6 RISK FACTORS 6 Item 4.Information on the

18、Company 29 HISTORY AND DEVELOPMENT OF THE COMPANY 29 BUSINESS OVERVIEW 32 ORGANIZATIONAL STRUCTURE 55 PROPERTY,PLANTS AND EQUIPMENT 57 Item 4A.Unresolved Staff Comments 62 Item 5.Operating and Financial Review and Prospects 62 OPERATING RESULTS 62 LIQUIDITY AND CAPITAL RESOURCES 69 RESEARCH AND DEVE

19、LOPMENT 72 TREND INFORMATION 73 SAFE HARBOR 74 Item 6.Directors,Senior Management and Employees 74 DIRECTORS AND SENIOR MANAGEMENT 74 COMPENSATION 80 BOARD PRACTICES 82 EMPLOYEES 82 SHARE OWNERSHIP 83 Item 7.Major Shareholders and Related Party Transactions 83 MAJOR SHAREHOLDERS 83 RELATED PARTY TRA

20、NSACTIONS 85 INTERESTS OF EXPERTS AND COUNSEL 86 Item 8.Financial Information 86 CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION 86 SIGNIFICANT CHANGES 88 Item 9.The Offer and Listing 88 OFFER AND LISTING DETAILS 88 PLAN OF DISTRIBUTION 88 MARKETS 88 SELLING SHAREHOLDERS 88 DILUTION 89 EXPEN

21、SES OF THE ISSUE 89 Item 10.Additional Information 89 SHARE CAPITAL 89 ARTICLES OF INCORPORATION 89 MATERIAL CONTRACT 94 FOREIGN INVESTMENT IN THE R.O.C.96 EXCHANGE CONTROLS 98 TAXATION 98 DIVIDENDS AND PAYING AGENTS 102 STATEMENT BY EXPERTS 102 DOCUMENTS ON DISPLAY 102 SUBSIDIARY INFORMATION 102 It

22、em 11.Quantitative and Qualitative Disclosures about Market Risk 103 iItem 12.Description of Securities Other Than Equity Securities 106 DEBT SECURITIES 106 WARRANTS AND RIGHTS 106 OTHER SECURITIES 106 AMERICAN DEPOSITARY SHARES 106 PART II 108 Item 13.Defaults,Dividend Arrearages and Delinquencies

23、108 Item 14.Material Modifications to the Rights of Security Holders and Use of Proceeds 108 Item 15.Controls and Procedures 108 Item 16.Reserved 112 Item 16A.Audit Committee Financial Expert 112 Item 16B.Code of Ethics 112 Item 16C.Principal Accountant Fees and Services 112 Item 16D.Exemptions from

24、 the Listing Standards for Audit Committees 113 Item 16E.Purchases of Equity Securities by the Issuer and Affiliated Purchasers 113 Item 16F.Change in Registrants Certifying Accountant 114 Item 16G.Corporate Governance 114 Item 16H.Mine Safety Disclosure 118 Item 16I.Disclosure Regarding Foreign Jur

25、isdictions that Prevent Inspections 118 PART III 119 Item 17.Financial Statements 119 Item 18.Financial Statements 119 Item 19.Exhibits 119 iiUSE OF CERTAIN TERMSUnless the context otherwise requires,references in this annual report to:“Advanced Shanghai”are to ASE Advanced Semiconductor(Shanghai)Li

26、mited,a company incorporated under the laws of the P.R.C.thatspun off from ASESH AT in November 2020 and was disposed of in December 2021;“ASDI”are to ASDI Assistance Direction S.A.S.,a simplified limited liability company(societe par actions simplifiee)organized under thelaws of France;“ASE,”“ASE I

27、nc.”or“ASE Group”are to Advanced Semiconductor Engineering Inc.and,unless the context requires otherwise,itssubsidiaries;“ASE Chung Li”are to ASE(Chung Li)Inc.,a company previously incorporated under the laws of the R.O.C.that merged into ASE Inc.in2004;“ASE Electronics”are to ASE Electronics Inc.,a

28、 company incorporated under the laws of the R.O.C.;“ASE Japan”are to ASE Japan Co.Ltd.,a company incorporated under the laws of Japan;“ASE Korea”are to ASE(Korea)Inc.,a company incorporated under the laws of the Republic of Korea;“ASE Material”are to ASE Material Inc.,a company previously incorporat

29、ed under the laws of the R.O.C.that merged into ASE Inc.in2004;“ASE Shanghai”are to ASE(Shanghai)Inc.,a company incorporated under the laws of the P.R.C.;“ASE Test”are to ASE Test Limited,a company incorporated under the laws of Singapore;“ASE Malaysia”are to ASE Electronics(M)Sdn.Bhd.,a company inc

30、orporated under the laws of Malaysia;“ASE Test Taiwan”are to ASE Test,Inc.,a company incorporated under the laws of the R.O.C.;“ASEEE”are to ASE Embedded Electronics Inc.,a company incorporated under the laws of the R.O.C.that merged into ASE Inc.inFebruary 2020;“ASEH,”the“Company,”“ASE Technology H

31、olding,”“we,”“us”or“our”are to ASE Technology Holding Co.,Ltd.and,unless thecontext requires otherwise,its subsidiaries;“ASEKS”are to ASE(Kunshan)Inc.,a company incorporated under the laws of the P.R.C.and was disposed of in December 2021;“ASEN”are to Suzhou ASEN Semiconductors Co.,Ltd.,a company in

32、corporated under the laws of the P.R.C.and was disposed of inDecember 2021;“ASESH AT”are to ASE Assembly&Test(Shanghai)Limited,formerly known as Global Advanced Packaging Technology Limited,orGAPT,a company incorporated under the laws of the P.R.C.;“ASEWH”are to ASE(Weihai),Inc.,a company incorporat

33、ed under the laws of the P.R.C.and was disposed of in December 2021;“Deposit Agreement”are to the deposit agreement,dated April 30,2018,by and among ASE Technology Holding Co.,Ltd.,a companyorganized under the laws of the R.O.C.and previously known as“ASE Industrial Holding Co.,Ltd.,”Citibank,N.A.,a

34、s Depositary,and theHolders and Beneficial Owners of American Depositary Shares issued thereunder;1 “EEMS Test Singapore”are to EEMS Test Singapore Pte.Ltd.,a company incorporated under the laws of Singapore,which changed itsname to ASE Singapore II Pte.Ltd.and was subsequently merged into ASE Singa

35、pore Pte.Ltd.in 2011;“EMS”are to electronic manufacturing services;“EU”are to the European Union;“Exchange Act”are to the U.S.Securities Exchange Act of 1934,as amended;“FAFG”or“FAFG Group”are to Financiere AFG S.A.S.,a simplified limited liability company(societe par actions simplifiee)organizedund

36、er the laws of France and,unless the context requires otherwise,its subsidiaries;“FSC”are to the Financial Supervisory Commission of the Republic of China;“Hung Ching”are to Hung Ching Development&Construction Co.Ltd.,a company incorporated under the laws of the R.O.C.;“IFRS”are to International Fin

37、ancial Reporting Standards,International Accounting Standards and Interpretations as issued by theInternational Accounting Standards Board;“ISE Shanghai”are to ISE Labs,China,Ltd.,a company incorporated under the laws of the P.R.C.;“ISE Labs”are to ISE Labs,Inc.,a corporation incorporated under the

38、laws of the State of California;“Initial SPIL Tender Offer”are to ASEs offer to purchase 779,000,000 common shares(including common shares represented byoutstanding American depositary shares)of SPIL through concurrent tender offers in the R.O.C.and the U.S.,at a price of NT$45 per SPILcommon share

39、and NT$225 per SPIL American depositary share,commenced on August 24,2015 and expired on September 22,2015;“Joint Share Exchange Agreement”are to the joint share exchange agreement entered into between ASE and SPIL on June 30,2016;“Korea”or“South Korea”are to the Republic of Korea;“MOEAIC”are to the

40、 Investment Commission of the R.O.C.Ministry of Economic Affairs;“NYSE”are to New York Stock Exchange;“PCAOB”are to Public Company Accounting Oversight Board(United States);“PowerASE”are to PowerASE Technology Inc.,a company incorporated under the laws of the R.O.C.,which was merged into ASE Inc.in2

41、012;“PPA Effects”are the earnings effects from purchase price allocation(“PPA”).“PPA of SPIL Acquisition”is the allocation of ASEHspurchase price of SPIL into identifiable assets acquired and liabilities assumed from SPIL based on their fair values.The fair value write-upresults in earnings effects

42、over time which generates increased operating costs,operating expenses,other operating income and expenses andnon-operating expenses;“P.R.C.”are to the Peoples Republic of China,excluding Taiwan,Macau and Hong Kong;“P.R.C.Regulations”are to the Regulations Governing Securities Investment and Futures

43、 Trading in Taiwan by Mainland Area Investors;“QDII”are to qualified domestic institutional investors;2 “Republic of China,”the“R.O.C.”and“Taiwan”are to the Republic of China,including Taiwan and certain other possessions;“R.O.C.Trading Day”are to a day when TWSE is open for business;“SEC”are to the

44、 Securities and Exchange Commission of the U.S.;“Second SPIL Tender Offer”are to ASEs offer to purchase 770,000,000 common shares(including common shares represented byoutstanding American depositary shares)of SPIL through concurrent tender offers in the R.O.C.and the U.S.,at a price of NT$55 per SP

45、ILcommon share and NT$275 per SPIL American depositary share,commenced on December 29,2015 and expired on March 17,2016 due tofailure to obtain regulatory approval from the Taiwan Fair Trade Commission(“TFTC”)prior to the expiration of the Second SPIL TenderOffer;“Securities Act”are to the U.S.Secur

46、ities Act of 1933,as amended;“Share Exchange”is the statutory share exchange pursuant to the laws of the Republic of China,through which ASEH(i)acquired all issuedshares of ASE in exchange for shares of ASEH using the share exchange ratio and(ii)acquired all issued shares of SPIL using the cashconsi

47、deration;“SiP”are to system-in-package;“SPIL”or“SPIL Group”are to Siliconware Precision Industries Co.,Ltd.,and,unless the context requires otherwise,its subsidiaries;“SPIL Acquisition”are to ASEHs effort to effect an acquisition of 100%of the common shares and American depositary shares of SPILpurs

48、uant to the Joint Share Exchange Agreement;“SZ”are to Siliconware Technology(Suzhou)Limited,a company incorporated under the laws of the P.R.C.;“Taiwan-IFRS”are to the Regulations Governing the Preparation of Financial Reports by Securities Issuers,the IFRS as well as relatedguidance translated by A

49、ccounting Research and Development Foundation and endorsed by the FSC;“Tessera”are to Tessera Technologies,Inc.and its subsidiaries;“TWSE”are to Taiwan Stock Exchange;“UGJQ”are to Universal Global Technology(Shanghai)Co.,Ltd.,a company incorporated under the laws of the P.R.C.;“UGKS”are to Universal

50、 Global Technology(Kunshan)Co.Ltd.,a company incorporated under the laws of the P.R.C.;“USIPL”are to Universal Scientific Industrial Poland Sp.z o.o.,a company incorporated under the laws of Poland and former name wasChung Hong Electronics Poland Sp.z o.o.;“UGTW”are to Universal Global Scientific In

51、dustrial Co.Ltd.,a company incorporated under the laws of the R.O.C.;“Universal Scientific Industrial”or“USI”are to Universal Scientific Industrial Co.,Ltd.,a company incorporated under the laws of theR.O.C.;“USIFR”are to Universal Scientific Industrial(France),a simplified limited liability company

52、(societe par actions simplifiee)organizedunder the laws of France;“USI Shanghai”are to Universal Scientific Industrial(Shanghai)Co.,Ltd.,a company incorporated under the laws of the P.R.C.;3 “U.S.”refers to the United States of America;“U.S.GAAP”are to accounting principles generally accepted in the

53、 U.S.;“USI Group”are to USI Inc.and its subsidiaries;“USI Inc.”are to USI Inc.,a company incorporated under the laws of the R.O.C.;“USI Mexico”are to Universal Scientific Industrial de Mexico S.A.DE C.V.,a company incorporated under the laws of Mexico;“USISZ”are to USI Electronics(Shenzhen)Co.Ltd.,a

54、 company incorporated under the laws of the P.R.C.;and “Wuxi Tongzhi”are to Wuxi Tongzhi Microelectronics Co.,Ltd.,a company incorporated under the laws of the P.R.C.We publish our financial statements in New Taiwan dollars,the lawful currency of the R.O.C.In this annual report,references to“United

55、Statesdollars,”“U.S.dollars”and“US$”are to the currency of the United States;references to“New Taiwan dollars,”“NT dollars”and“NT$”are to thecurrency of the R.O.C.;references to“RMB”are to the currency of the P.R.C.;references to“JP”are to the currency of Japan;references to“MYR”are to the currency

56、of Malaysia;references to“SGD”are to the currency of the Republic of Singapore;references to“KRW”are to the currency of theRepublic of Korea;references to“EUR”are to the currency of the EU;and references to“PLN”are to the currency of the Poland.Unless otherwisenoted,all translations from NT dollars

57、to U.S.dollars were made at the exchange rate as set forth in the H.10 weekly statistical release of the FederalReserve System of the United States(the“Federal Reserve Board”)as of December 30,2021,which was NT$27.74=US$1.00,and all translations fromRMB to U.S.dollars were made at the exchange rate

58、as set forth in the H.10 weekly statistical release of the Federal Reserve Board as of December 31,2021,which was RMB6.3726=US$1.00.All amounts translated into U.S.dollars in this annual report are provided solely for your convenience and norepresentation is made that the NT dollar,RMB or U.S.dollar

59、 amounts referred to herein could have been or could be converted into U.S.dollars or NTdollars/RMB,as the case may be,at any particular rate or at all.On March 18,2022,the exchange rate between NT dollars and U.S.dollars as set forthin the H.10 weekly statistical release by the Federal Reserve Boar

60、d was NT$28.35=US$1.00.On March 18,2022,the exchange rate between RMB andU.S.dollars as set forth in the H.10 weekly statistical release by the Federal Reserve Board was RMB6.3609=US$1.00.4SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTSThis annual report on Form 20-F contains“forward-looking state

61、ments”within the meaning of Section 27A of the Securities Act and Section 21Eof the Exchange Act.Although these forward-looking statements,which may include statements regarding our future results of operations,financialcondition or business prospects,are based on our own information and information

62、 from other sources we believe to be reliable,you should not placeundue reliance on these forward-looking statements,which apply only as of the date of this annual report.The words“anticipate,”“believe,”“estimate,”“expect,”“intend,”“plan”and similar expressions,as they relate to us,are intended to i

63、dentify these forward-looking statements in this annual report.Our actual results of operations,financial condition or business prospects may differ materially from those expressed or implied in these forward-looking statements for a variety of reasons,including risks associated with cyclicality and

64、 market conditions in the semiconductor or electronicsindustry;changes in our regulatory environment,including our ability to comply with new or stricter environmental regulations and to resolveenvironmental liabilities;demand for the outsourced semiconductor packaging,testing and EMS we offer and f

65、or such outsourced services generally;the highly competitive semiconductor or manufacturing industry we are involved in;our ability to introduce new technologies in order to remaincompetitive;international business activities;our business strategy;our future expansion plans and capital expenditures;

66、the strained relationshipbetween the R.O.C.and the P.R.C.;general economic and political conditions;the recent global economic crisis;possible disruptions in commercialactivities caused by natural or human-induced disasters;fluctuations in foreign currency exchange rates;and other factors.For a disc

67、ussion of these risksand other factors,see“Item 3.Key InformationRisk Factors.”5PART IItem 1.Identity of Directors,Senior Management and AdvisersNot applicable.Item 2.Offer Statistics and Expected TimetableNot applicable.Item 3.Key InformationSELECTED FINANCIAL DATAReservedCAPITALIZATION AND INDEBTE

68、DNESSNot applicable.REASON FOR THE OFFER AND USE OF PROCEEDSNot applicable.RISK FACTORSBelow please find a summary of the principal risks we face,organized under relevant headings.Risks Relating to Our Business Since we are dependent on the highly cyclical semiconductor and electronics industries an

69、d conditions in the markets for the end-useapplications of our products,our revenues and net income may fluctuate significantly.A reversal or slowdown in the outsourcing trend for semiconductor packaging and testing services and EMS could adversely affect ourgrowth prospects and profitability.Inflat

70、ion could adversely affect our business,financial condition,results of operations and cash flows.If we are unable to compete favorably in the highly competitive markets of semiconductor packaging and testing and EMS,our revenuesand net income may decrease.Our profitability depends on our ability to

71、respond to rapid technological changes in the semiconductor industry.Our operating results are subject to significant fluctuations,which could adversely affect the market value of your investment.If we are unable to manage our expansion or investments effectively,our growth prospects may be limited

72、and our future profitability andcore business operations may be adversely affected.The packaging and testing businesses are capital intensive.If we cannot obtain additional capital when we need it,our growth prospects andfuture profitability may be adversely affected.System security risks,data prote

73、ction breaches or unexpected system outage or failures could harm our business,financial condition andresults of operations.A cybersecurity breach could interfere with our business operations,compromise confidential information,adversely impact our reputationand operating results and potentially lea

74、d to litigation and other liabilities.6 Any impairment charges may have a material adverse effect on our income.Any attempt by the U.S.government to withdraw from or materially modify existing international trade agreements or take further actionsagainst certain P.R.C.technology companies could adve

75、rsely affect our business,financial condition and results of operations.Risks Relating to the SPIL Acquisition There may be risks associated with the impacts of the SPIL Acquisition on our subgroups and our holding company structure.Risks Relating to Taiwan,R.O.C.Strained relations between the R.O.C

76、.and the P.R.C.and disruptions in Taiwans political environment caused by domestic political eventscould negatively affect our business and the market value of your investment.As a substantial portion of our business and operations is located in Taiwan,we are vulnerable to natural disasters includin

77、g earthquakes,typhoons,drought,as well as power outages and other industrial incidents,which could severely disrupt the normal operation of ourbusiness and adversely affect our results of operations.Risks Relating to Ownership of Our Common Shares and the ADSs The market for our common shares and th

78、e ADSs may not be liquid.If a non-R.O.C.holder of ADSs withdraws and holds common shares,such holder of ADSs will be required to appoint a tax guarantor,localagent and custodian in the R.O.C.and register with the TWSE or the Taipei Exchange in order to buy and sell securities on the TWSE.We may not

79、continue to declare cash dividends in any particular amount.Holders of common shares and ADSs may experience dilution if we issue stock bonuses,stock options and restricted stocks to employees orsell additional equity or equity-linked securities.Below please find the detailed analysis of the princip

80、al risks we face.Risks Relating to Our BusinessSince we are dependent on the highly cyclical semiconductor and electronics industries and conditions in the markets for the end-useapplications of our products,our revenues and net income may fluctuate significantly.Our business is affected by market c

81、onditions in the highly cyclical semiconductor and electronics industries.Most of our customers operate inthis industry,and variations in order levels from our customers and service fee rates may result in volatility in our revenues and net income.From timeto time,the semiconductor and electronics i

82、ndustries have experienced significant,and sometimes prolonged,downturns.As our business is,and willcontinue to be,dependent on the requirements for independent packaging,testing and EMS,any future downturn in the industry would reduce demandfor our services.If we cannot reduce our costs or adjust o

83、ur product mix to sufficiently offset any decline in sales volumes,our profitability will suffer,and we may incur losses.Market conditions in the semiconductor and electronics industries depend to a large degree on conditions in the markets for the end-useapplications of various products,such as com

84、munications,computing and consumer electronics products.Any deterioration of conditions in the marketsfor the end-use applications would reduce demand for our services,and would likely have a material adverse effect on our financial condition and resultsof operations.In 2021,approximately 50.1%,14.9

85、%and 35.0%of our operating revenues from packaging and testing were attributed to the packagingand testing of semiconductors used in communications,computing and consumer electronics/industrial/automotive/other applications,respectively.Inthe same year,approximately 38.4%,8.8%,33.6%,13.0%and 6.2%of

86、our operating revenues from EMS were attributed to the communications,computing,consumer electronics applications,industrial,and automotive applications and other,respectively.Across end-use applications,ourcustomers face intense competition and significant shifts in demand,which could put pricing p

87、ressure on our services and may adversely affect ourrevenues and net income.7A reversal or slowdown in the outsourcing trend for semiconductor packaging and testing services and EMS could adversely affect our growthprospects and profitability.Semiconductor manufacturers that have their own in-house

88、packaging and testing capabilities,known as integrated device manufacturers andoriginal equipment manufacturers,have increasingly outsourced stages of the production process,including packaging,testing,electronic manufacturingand assembly,to independent companies in order to reduce costs,eliminate p

89、roduct complexity and meet fast-to-market requirements.In addition,theavailability of advanced independent semiconductor manufacturing services has also enabled the growth of so-called“fabless”semiconductorcompanies that focus exclusively on design and marketing and outsource their manufacturing,pac

90、kaging and testing requirements to independentcompanies.We cannot assure you that these manufacturers and companies will continue to outsource their packaging,testing and manufacturingrequirements to third parties like us.Furthermore,during an economic downturn,these integrated device manufacturers

91、typically rely more on their ownin-house packaging and testing capabilities,therefore decreasing their need to outsource.A reversal of,or a slowdown in,this outsourcing trend couldresult in reduced demand for our services and adversely affect our growth prospects and profitability.Any global economi

92、c downturn could adversely affect the demand for our products and services,and a protracted global economic crisis wouldhave a material adverse effect on us.The global financial markets experienced significant disruptions in 2008 and the U.S.,Europe and other economies went into a recession.Therecov

93、ery from the lows of 2008 and 2009 was uneven and it was facing new challenges,including a European sovereign debt crisis that began in 2011,the withdrawal of the United Kingdom from the EU,or the Brexit,and continuing high unemployment rates in much of the world.It is unclear what thelong-term impa

94、ct of the European sovereign debt crisis will be and uncertainty remains over the long-term effects of the expansionary monetary andfiscal policies that have been adopted by the central banks and financial authorities of some of the worlds leading economies.It remains unclear howBrexit will affect t

95、he fiscal,monetary and regulatory landscape of the United Kingdom,the EU and the rest of the world.Any economic downturn orcrisis may cause our customers to cancel or reduce planned expenditures for our products and services.Any uncertainty or significant volatility in globaleconomic conditions,incl

96、uding the continuing global supply chain crisis,economic sanctions and restrictive measures in response to the Russia-Ukraineconflict and tight monetary policy in the U.S.due to inflation,may negatively affect our business,results of operations,and financial condition.Inflation could adversely affec

97、t our business,financial condition,results of operations and cash flows.We are exposed to economic and political conditions in the countries and regions where we operate.Like other companies with wide operations,we are exposed to risks from fluctuations in inflation.We are also affected by governmen

98、tal policies regarding spending and investment,exchangecontrols,regulatory and taxation changes,and other adverse political,economic or social developments of the countries and regions in which weoperate.In particular,high inflation rates may adversely affect our business by increasing the cost of t

99、he raw materials,energy,labor and transportation.Current or future efforts by government to stimulate the economy may increase the risk of significant inflation.In the event of an increase in inflation,we may seek to increase the sales prices of our services in order to maintain satisfactory profits

100、,however such increases may not be accepted by ourcustomers,may not be sufficient to compensate for the negative impact of inflation.On the other hand,at a global level,inflation might reducehouseholds disposable income and erode the value of peoples savings,which may decrease the demand discretiona

101、ry items,and thus negatively impactthe sales of our customers products and their demand for our manufacturing services.If we are not able to fully offset the effects of increased inflation,it could have a material adverse effect on our business,financial condition,results of operations and cash flow

102、s.If we are unable to compete favorably in the highly competitive markets of semiconductor packaging and testing and EMS,our revenues and netincome may decrease.The markets of semiconductor packaging and testing and EMS are very competitive.We face competition from a number of sources,includingother

103、 independent semiconductor packaging and testing companies,integrated device manufacturers,and other EMS providers with large-scalemanufacturing capabilities who can quickly react to market changes.In addition,some foundry players have actively invested and expanded theiradvanced packaging capacity,

104、and have gained some customer tractions of their services and solutions.8We believe that the principal competitive factors in our industry are:technological expertise;ability to provide total solutions to our customers,including integrated design,manufacturing,packaging and testing and EMS;ability t

105、o offer interconnect technologies at an optimal scale for our businesses;range of package types and testing platforms available;ability to work closely with our customers at the product development stage;responsiveness and flexibility;fast-to-market product development;capacity;diversity in facility

106、 locations;production yield;and prices.We face increasing competition,as most of our customers obtain services from more than one source.Rapid technological advancements andaggressive pricing strategies by our competitors may continue to increase competition.Our ability to compete depends on factors

107、 both within andoutside of our control and may be constrained by the distinct characteristics and production requirements of individual products.We cannot assure youthat we will be able to continue to improve production efficiency and maintain reasonable profit for all of our products.In addition,so

108、me of our competitors may have superior financial,marketing,manufacturing,research and development and technologicalresources than we do.For example,the central government of the P.R.C.,as well as provincial and municipal governments have provided variousincentives to domestic companies in the semic

109、onductor industry,including major semiconductor testing and packaging providers,such as JiangsuChangjiang Electronics Technology Co.,Ltd.Similarly,our customers may face competition from their competitors in the P.R.C.,and such competitorsmay also receive significant subsidies from the P.R.C.governm

110、ent.As we are upstream providers,the impact of such government policies oncompetition and price pressure of our customers may negatively impact our own business.Increasing competition may lead to declines in product pricesand profitability and could have a material adverse effect on our business,fin

111、ancial condition,results of operations and future prospects.Our profitability depends on our ability to respond to rapid technological changes in the semiconductor industry.The semiconductor industry is characterized by rapid increases in the diversity and complexity of semiconductors.As a result,we

112、 expect that wewill need to constantly offer more sophisticated packaging and testing technologies and processes in order to respond to competitive industry conditionsand customer requirements.We have successfully combined our packaging,testing and materials technologies with the expertise of EMS at

113、 the systemslevel to develop our SiP business.We also entered into multiple technology license agreements with DECA Technologies Inc.to advance our fan-outtechnology.There is,however,no assurance that our development efforts for our SiP business or the use of licensed technology to further advance o

114、urfan-out technology will be successful.We continue to develop new products in anticipation of future demand.However,there is no assurance that the launch of any new product will besuccessful or that we will be able to produce sufficient quantities of these products to meet market demand.If we fail

115、to develop,or obtain access to,advances in packaging or testing technologies or processes,we may become less competitive and less profitable.In addition,advances in technologytypically lead to declining average selling prices for semiconductors packaged or tested with older technologies or processes

116、.As a result,if we cannotreduce the costs associated with our services,the profitability of a given service and our overall profitability may decrease over time.9Our operating results are subject to significant fluctuations,which could adversely affect the market value of your investment.Our operati

117、ng results have varied significantly from period to period and may continue to vary in the future.Downward fluctuations in ouroperating results may result in decreases in the market price of our common shares and the ADSs.Among the more important factors affecting ourquarterly and annual operating r

118、esults are the following:changes in general economic and business conditions,particularly the cyclical nature of the semiconductor and electronics industries and themarkets served by our customers;our ability to quickly adjust to unanticipated declines or shortfalls in demand and market prices;chang

119、es in prices for our products or services;volume of orders relative to our packaging,testing and manufacturing capacity;changes in costs and availability of raw materials,equipment and labor;our ability to obtain or develop substitute raw materials with lower cost;our ability to successfully develop

120、 or market new products or services;our ability to successfully manage product mix in response to changes in market demand and differences in margin associated with differentproducts;timing of capital expenditures in anticipation of future orders;our ability to acquire or design and produce cost-com

121、petitive interconnect materials,and provide integrated solutions for EMS;fluctuations in the exchange rate;fluctuations in interest rates,including the potential impact of the phase-out of LIBOR on our variable rate borrowings;and typhoons,earthquakes,droughts,epidemics,tsunamis and other natural di

122、sasters,as well as industrial and other incidents such as fires andpower outages.Due to the factors listed above,our future operating results or growth rates may be below the expectations of research analysts and investors.If so,the market price of our common shares and the ADSs,and thus the market

123、value of your investment,may fall.Due to our high percentage of fixed costs,we may be unable to maintain our gross margin at past levels if we are unable to achieve relativelyhigh capacity utilization rates.Our operations,in particular our testing operations,are characterized by relatively high fixe

124、d costs.We expect to continue to incur substantialdepreciation and other expenses in connection with our acquisitions of equipment and facilities.Our profitability depends not only on the pricing levelsfor our services or products,but also on utilization rates for our machinery and equipment,commonl

125、y referred to as“capacity utilization rates.”Inparticular,increases or decreases in our capacity utilization rates can significantly affect gross margins since the unit cost generally decreases as fixedcosts are allocated over a larger number of units.In periods of low demand,we experience relativel

126、y low capacity utilization rates in our operations,which lead to reduced margins.We cannot assure you that we will be able to maintain or surpass our past gross margin levels if we cannot consistentlyachieve or maintain relatively high capacity utilization rates.10If we are unable to manage our expa

127、nsion or investments effectively,our growth prospects may be limited and our future profitability and corebusiness operations may be adversely affected.We have significantly expanded our operations through acquisitions and joint ventures in recent years.For our expansion or investments,see“Item 4.In

128、formation on the Company Business OverviewStrategyStrategically Expand and Streamline Production Capacity.”While we expect that we will continue to expand our operations in the future to broaden our product offerings,rapid expansion may strain ourmanagerial,technical,financial,operational and other

129、resources.As a result of our expansion,we have implemented and will continue to implementadditional operational and financial controls and hire and train additional personnel.Any failure to manage our growth effectively could lead toinefficiencies and redundancies and result in reduced growth prospe

130、cts and profitability.In addition,we have made several investments in the real estate development businesses in China.The P.R.C.property market is volatile and mayexperience undersupply or oversupply and property price fluctuations.The central and local governments frequently adjust monetary and oth

131、er fiscalpolicies to prevent and curtail the overheating of the economy.Such policies may lead to changes in market conditions,including price instability andimbalance of supply and demand in respect of office,residential,retail,entertainment,cultural and intellectual properties.Our exposure to risk

132、s relatedto real estate development may also increase over time as a result of our expansion into such a business.We may continue to make investments in thisarea in the future and our diversification in this industry may put pressure on our managerial,financial,operational and other resources.There

133、can be noassurance that our investments in such a business will yield the anticipated returns and that our expansion into such a business,including the resultingdiversion of managements attention,will not adversely affect our core business operations.The financial performance of our equity method in

134、vestments could adversely affect our results of operations.As part of our business strategy,we have and may continue to pursue acquisitions of businesses and assets,strategic alliances and joint ventures.We currently have equity investments in certain entities and the accounting treatment applied fo

135、r these investments varies depending on a number offactors,including,but not limited to,our percentage ownership,our percentage of membership of investees board and the level of influence we haveover the relevant entity.Any losses experienced by these entities could adversely affect our results of o

136、perations and the value of our investment.Inaddition,if these entities were to fail and cease operations,we may lose the entire value of our investment and the stream of any shared profits.There can be no assurance that we will be able to maintain or enhance the value or performance of our investee

137、companies or that we will achievethe returns or benefits sought from such investments.If our interests differ from those of other investors in our investee companies,we may not be ableto enjoy synergies with the investee and it may adversely affect our financial results or financial condition.We rec

138、ognized impairment charges of NT$400.2 million in 2019 and nil in both 2020 and 2021 in our investments under the equity method.The packaging and testing businesses are capital intensive.If we cannot obtain additional capital when we need it,our growth prospects andfuture profitability may be advers

139、ely affected.The packaging and testing business is capital intensive.We will need capital to fund the expansion of our facilities as well as fund our researchand development activities in order to remain competitive.We believe that our existing cash,marketable securities,expected cash flow from oper

140、ationsand existing credit lines under our loan facilities will be sufficient to meet our capital expenditures,working capital,cash obligations under our existingdebt and lease arrangements,and other requirements for at least the next 12 months.However,future capacity expansions or market or otherdev

141、elopments may cause us to require additional funds.Our ability to obtain external financing in the future is subject to a variety of uncertainties,including:our future financial condition,results of operations and cash flows;general market conditions for financing activities by semiconductor or elec

142、tronics companies;and economic,political and other conditions in Taiwan and elsewhere.11If we are unable to obtain funding in a timely manner or on acceptable terms,our results of operations and financial conditions may be materiallyand adversely affected.Restrictive covenants and broad default prov

143、isions in our existing debt agreements may materially restrict our operations as well as adverselyaffect our liquidity,financial condition and results of operations.We are a party to numerous loans and other agreements relating to the incurrence of debt,which may include restrictive covenants and br

144、oaddefault provisions.In general,covenants in the agreements governing our existing debt,and debt we may incur in the future,may materially restrict ouroperations,including our ability to incur debt,pay dividends,make certain investments and payments,other than in connection with restructurings ofco

145、nsolidated entities,and encumber or dispose of assets.In addition,any global economic deterioration or ineffective expansion may cause us to incursignificant net losses or force us to assume considerable liabilities.We cannot assure you that we will be able to remain in compliance with our financial

146、covenants,which,as a result,may lead to a default.This may thereby restrict our ability to access unutilized credit facilities or the global capital marketsto meet our liquidity needs.Furthermore,a default under any agreement by us or our subsidiaries may trigger cross-defaults under our other agree

147、ments.In the event of default,we may not be able to cure the default or obtain a waiver on a timely basis.An event of default under any agreement timelygoverning our existing or future debt,if not cured or waived,could have a material adverse effect on our liquidity,financial condition and results o

148、foperations.We have on occasion failed to comply with certain financial covenants in some of our loan agreements.Such non-compliance may also have,through broadly worded cross-default provisions,resulted in default under some of the agreements governing our other existing debt.If we are unable totim

149、ely rectify any possible non-compliance under such loan agreements or obtain applicable waivers or amendments,we would breach our financialcovenants and our financial condition would be adversely affected.As of December 31,2021,we were not in breach of any of the financial covenantsunder our existin

150、g loan agreements,although we cannot provide any assurance that we will not breach any of such financial covenants in the future.We depend on select personnel and could be affected by the loss of their services.We depend on the continued service of our executive officers and skilled technical person

151、nel.Our business could suffer if we lose the services ofany of these personnel and cannot adequately replace them.Although some of these management personnel have entered into employment agreementswith us,they may nevertheless leave before the expiration of these agreements.We are not insured agains

152、t the loss of the services of any of ourpersonnel.In addition,these proceedings may divert these and other employees attention from our business operations.We may be required to increase substantially the number of these employees in connection with our expansion plans,and there is intensecompetitio

153、n for their services in this industry.We may not be able to either retain our present personnel or attract additional qualified personnel as andwhen needed.In addition,we may need to increase employee compensation levels in order to attract and retain our existing officers and employees andthe addit

154、ional personnel that we expect to require.Recently,some companies have accelerated efforts to maliciously poach talented Taiwansemiconductor experts by offering a high position with handsome pay.If such malicious acts involving technology theft growing worse,Taiwanssemiconductor industry would be se

155、riously affected and our business would be adversely jeopardized.Furthermore,a portion of the workforce at our facilities in Taiwan is foreign workers employed under work permits,which are subject togovernment regulations on renewal and other terms.Consequently,our business could also suffer if the

156、Taiwan regulations relating to the employmentof foreign workers were to become significantly more restrictive or if we are otherwise unable to attract or retain these workers at a reasonable cost.12The ongoing proceeding involving Dr.Tien Wu may have an adverse impact on our business and cause our c

157、ommon shares and ADS price todecline.Dr.Tien Wu,our director and chief operating officer,was involved in a criminal proceeding brought by the Taiwan Kaohsiung District ProsecutorsOffice.The indictment alleged that Dr.Tien Wu violated Article 157-1 of the R.O.C.Securities and Exchange Act for insider

158、 trading activities involvingSPILs common shares conducted during the Initial SPIL Tender Offer,the Second SPIL Tender Offer and negotiations of the memorandum ofunderstanding in connection with the SPIL Acquisition.Dr.Tien Wu was accused of tipping off a friend about the aforementioned tender offer

159、s andnegotiation ahead of the public announcements.After an investigation that spanned over two years,the Taiwan Kaohsiung District Court,on February 5,2020,found Dr.Tien Wu NOT guilty.On March 20,2020,the Taiwan Kaohsiung District Prosecutors Office filed an appeal against the February 5,2020 judgm

160、ent,and the appeal was rejected by the Taiwan High Court Kaohsiung Branch Court on June 9,2021.On July 2,2021,the KaohsiungBranch,Taiwan High Prosecutors Office filed another appeal against the June 9 judgment.The Supreme Court of the R.O.C.reversed the June 9judgment and remanded this case to the T

161、aiwan High Court Kaohsiung Branch Court on January 6,2022.This matter is now being tried by the TaiwanHigh Court Kaohsiung Branch Court.We have strengthened internal control measures after this incident,and no other director of us is expected tobecome a party to any current or future litigation in c

162、onnection with Dr.Tien Wu.On October 26,2018,the R.O.C.Securities and Futures Investors Protection Center(“SFIPC”)filed a civil lawsuit against Dr.Tien Wu andASEH,requesting the court to remove Dr.Tien Wu from ASEHs board of directors based on Article 10-1 of the R.O.C.Securities Investor and Future

163、sTrader Protection Act(the“Director Removal Case”).On August 25,2020,the Taiwan Ciaotou District Court ruled in favor of Dr.Tien Wu.SFIPC filedan appeal against the August 25,2020 judgment and the appeal was rejected by the Taiwan High Court Kaohsiung Branch Court on September 29,2021.On October 20,

164、2021,SFIPC filed another appeal against the September 29 judgment.This matter is now being tried by the Supreme Court of theR.O.C.In addition to the Director Removal Case,on July 8,2021,SFIPC filed an additional class action to request Dr.Tien Wu and other threedefendants of the aforementioned crimi

165、nal proceeding of insider trading to be jointly liable for the damages caused by the alleging insider tradingactivities.This matter is now being tried by the Intellectual Property and Commercial Court of the R.O.C.The proceedings in connection with thisincident,or potential regulatory scrutiny might

166、 attract further media attentions.Any negative publicity in connection with the legal proceedings mayadversely affect our brand and reputation,which might result in a material adverse impact on our business operations and prospects.As we depend onthe continuing service of our directors and executive

167、 officers,and we are not insured against the loss of service of any of our personnel,our businessoperations could suffer from the loses of services of any director or executive officer,including Dr.Tien Wu.There is no assurance that we will be ableto replace the director or executive officer with su

168、itable candidate in time.If we are unable to obtain new or additional land or land use rights,additional packaging and testing equipment or facilities in a timely mannerand at a reasonable cost,our competitiveness and future profitability may be adversely affected.In order to meet customer demand,we

169、 need to expand existing facilities or obtain suitable land.Expansion of existing facilities and constructionof facilities are currently underway,or being contemplated.Such expansion or construction requires us to obtain land use or development rights.If weare unable to obtain new or additional land

170、 or use rights in a timely manner,we could experience significant fulfillment delays in our customers orders,resulting in negative impacts on our results of operations.In addition,the semiconductor packaging and testing businesses are capital intensive andrequire significant investment in expensive

171、equipment manufactured by a limited number of suppliers.The market for semiconductor packaging andtesting equipment is characterized,from time to time,by intense demand,limited supply and long delivery cycles.Our operations and expansion plansdepend on our ability to obtain a significant amount of s

172、uch equipment from a limited number of suppliers.From time to time we have also leasedcertain equipment.We have no binding supply agreements with any of our suppliers and acquire our packaging and testing equipment on a purchaseorder basis,which exposes us to changing market conditions and other sub

173、stantial risks.For example,shortages of capital equipment could result in anincrease in the price of equipment and longer delivery times.Semiconductor packaging and testing also require us to operate sizeable facilities.If we areunable to obtain equipment or facilities in a timely manner,we may be u

174、nable to fulfill our customers orders,which could adversely affect our growthprospects as well as financial condition and results of operations.See“Item 4.Information on the CompanyBusiness OverviewEquipment.”13Fluctuations in exchange rates could result in foreign exchange losses.The majority of ou

175、r revenues are denominated in U.S.dollars,with a portion denominated in NT dollars and Japanese yen.Our operating costsand operating expenses,on the other hand,are incurred in several currencies,primarily NT dollars,U.S.dollars,RMB,Japanese yen,Korean won,aswell as,to a lesser extent,Singapore dolla

176、rs and Malaysian ringgit,Polish zloty and EUR.In addition,a substantial portion of our capital expenditures,primarily for the purchase of packaging and testing equipment,has been,and is expected to continue to be,denominated in U.S.dollars,with theremainder in Japanese yen.Fluctuations in exchange r

177、ates,primarily among the U.S.dollar and Japanese yen against the NT dollar,RMB and EUR,willaffect our costs and operating margins.In addition,these fluctuations could result in exchange losses and increased costs in NT dollar and other localcurrency terms.Despite hedging and mitigating techniques im

178、plemented by us,fluctuations in exchange rates have affected,and may continue to affect,our financial condition and results of operations.We recorded net foreign exchange gains of NT$1,125.7 million,NT$1,005.4 million andNT$1,395.1 million(US$50.3 million)in 2019,2020 and 2021,respectively.We cannot

179、 assure you that we will achieve foreign exchange gains in thefuture.See“Item 11.Quantitative and Qualitative Disclosures about Market Risk Market RiskForeign Currency Exchange Rate Risk.”The loss of a large customer or disruption of our strategic alliance or other commercial arrangements with semic

180、onductor foundries andproviders of other complementary semiconductor manufacturing services may result in a decline in our revenues and profitability.Although we have a large customer base,we have derived and expect to continue to derive a large portion of our revenues from a small group ofcustomers

181、 during any particular period due in part to the concentration of market share in the semiconductor and electronics industries.Our five largestcustomers together accounted for approximately 51.1%,54.5%and 49.6%of our operating revenues in 2019,2020 and 2021,respectively.Two of ourcustomers individua

182、lly accounted for more than 10.0%of our operating revenues in 2019,and one customer accounted for more than 10.0%of ouroperating revenues in 2020 and 2021.The demand for our services from a customer is directly dependent upon that customers level of business activity,which could vary significantly f

183、rom year to year.Our key customers typically operate in the cyclical semiconductor and electronic business and,in thepast,have varied,and may vary in the future,order levels significantly from period to period.Some of these companies are relatively small,have limitedoperating histories and financial

184、 resources,and are highly exposed to the cyclicality of the industry.We cannot assure you that these customers or anyother customers will continue to place orders with us in the future at the same levels as in past periods.The loss of one or more of our significantcustomers,or reduced orders by any

185、one of them,and our inability to replace these customers or make up for such orders,could adversely affect ourrevenues and profitability.In addition,we have in the past reduced,and may in the future be requested to reduce,our prices to limit the level of ordercancellations.Any price reduction would

186、likely reduce our margins and profitability.Since 1997,we have maintained a strategic alliance with Taiwan Semiconductor Manufacturing Company Limited,or TSMC,one of the worldslargest dedicated semiconductor foundries.TSMC designates us as its nonexclusive preferred provider of packaging and testing

187、 services forsemiconductors manufactured by TSMC.Such strategic alliances,as well as our other commercial arrangements with providers of other complementarysemiconductor manufacturing services,enable us to offer total semiconductor manufacturing solutions to our customers.These strategic alliances a

188、ndother commercial arrangements may not achieve their anticipated commercial benefits and may be terminated at any time.Any failure in successfullymaintaining such alliances,any termination of such alliances or our failure to enter into substantially similar strategic alliances or commercialarrangem

189、ents may adversely affect our competitiveness and our revenues and profitability.We rely on a limited number of key customers in certain products for our revenues,and our results of operations may be adversely affected by areduction of business from our key customers.Our results of operations also d

190、epend on the performance and business of our key customers.Accordingly,risks that could seriously harm our keycustomers could harm us as well,including:loss of market share for our key customers products;recession in our key customers markets;failure of their products to gain widespread commercial a

191、cceptance;and our key customers inability to manage their operations efficiently and effectively.14The launch and market acceptance of our individual key customers products could significantly impact our product and customer mix,resultingin significant volatility in the demand for the solutions we o

192、ffer and our results of operations.It is also possible that a key customers market share withrespect to its product may decline as its competitors introduce new products,which could adversely affect our results of operations,particularly if we areunable to sell our solutions to such competitors.Furt

193、hermore,sales of our key customers products are subject to seasonal fluctuation.Our revenues and profitability may decline if we are unable to obtain adequate supplies of raw materials in a timely manner and at a reasonableprice.Our operations,such as packaging operations,substrate operations and EM

194、S,require that we obtain adequate supplies of raw materials on a timelybasis.Shortages in the supply of raw materials have in the past resulted in occasional price increases and delivery delays.In addition,the operations ofsome of our suppliers are vulnerable to natural disasters,such as earthquakes

195、 and typhoons,the occurrences of which may deteriorate and prolong theshortage or increase the uncertainty of the supply of raw materials.We experienced a disruption to the supply of raw materials from Japan for aboutthree to four weeks due to the fear of radiation contamination and the reduction or

196、 postponement in production by some of our Japanese suppliers.Although the purchase of supplies from Japan has been restored to the previous level,we cannot assure you that we will not suffer in the long term fromthe impact of the earthquake and the tsunami.In addition,further earthquakes,aftershock

197、s thereof or other disasters in Japan or other regions in whichwe operate may cause a decline in our sales.Any of the above events or developments may have a material adverse effect on our business,results ofoperations and financial condition.Raw materials such as IC substrates are prone to supply s

198、hortages since such materials are produced by a limited number of suppliers,such asKinsus Interconnect Technology Corporation,Nan Ya Printed Circuit Board Corporation,LG Innotek Co.,Ltd.,Samsung Electro-Mechanics Co.Ltd.and Unimicron Technology Corporation.Our operations conducted through our wholly

199、 owned subsidiaries ASE Electronics and ASE Shanghai haveimproved our ability to obtain IC substrates on a timely basis and at a reasonable cost.In 2021,our interconnect materials operations suppliedapproximately 10.6%of our consolidated substrate requirements by value.We do not expect that our inte

200、rnal interconnect materials operations will beable to meet all of our interconnect materials requirements.Consequently,we will remain dependent on market supply and demand for our rawmaterials.In addition,recent fluctuations in prices of precious metals,such as gold,have also affected the price at w

201、hich we have been able to purchasethe principal raw materials we use in our packaging processes.We cannot guarantee that we will not experience shortages in the near future or that wewill be able to obtain adequate supplies of raw materials in a timely manner or at a reasonable price.Our revenues an

202、d net income could decline if weare unable to obtain adequate supplies of high quality raw materials in a timely manner or if there are significant increases in the costs of raw materialsthat we cannot pass on to our customers.Regulations related to conflict minerals could adversely affect our busin

203、ess,financial condition and results of operations.The Dodd-Frank Wall Street Reform and Consumer Protection Act contains provisions to improve transparency and accountability concerning thesupply of certain minerals,known as conflict minerals,which are defined as cassiterite,columbite-tantalite,gold

204、,wolframite or their derivatives andother minerals determined by the U.S.government to be financing conflict in the Democratic Republic of Congo and adjoining countries.As a result,inAugust 2012 the SEC adopted annual disclosure and reporting requirements for those companies who use conflict mineral

205、s in their products.These rulesrequire companies that manufacture or contract to manufacture products for which conflict minerals are necessary to the functionality or production tobegin scrutinizing the origin of conflict minerals in their products starting from January 1,2013,and file a new form,F

206、orm SD,containing the conflictminerals disclosure by May 31 for the prior calendar year,beginning May 31,2014.We filed a specialized disclosure report on Form SD since thereporting period of 2013 and we have retained an independent auditing firm to conduct audits on our due diligence framework to pr

207、ovide a private sectorreport for our specialized disclosure report on Form SD since the reporting period of 2014.As a result,there will be costs associated with complyingwith these disclosure requirements,including costs for diligence to determine the sources of conflict minerals used in our product

208、s and other potentialchanges to products,processes or sources of supply as a consequence of such verification activities.The implementation of these rules could adverselyaffect the sourcing,supply and pricing of materials used in our products.15As there may be only a limited number of suppliers offe

209、ring“conflict free”minerals,we cannot be sure that we will be able to obtain necessary“conflict free”minerals from such suppliers in sufficient quantities or at competitive prices.Also,we may face adverse effects to our reputation if wedetermine that certain of our products contain minerals not dete

210、rmined to be conflict free or if we are unable to sufficiently verify the origins for allconflict minerals used in our products through the procedures we may implement.System security risks,data protection breaches or unexpected system outage or failures could harm our business,financial condition a

211、nd resultsof operations.We rely on the efficient and uninterrupted operation of complex information technology applications,systems and networks to operate ourbusiness.Our systems are vulnerable to damage or interruption from earthquakes,terrorist attacks,floods,fires,power loss,telecommunicationsfa

212、ilures,cyberattacks,computer viruses,computer denial of service attacks or other attempts to harm our system,and similar events.In recent years,therisks that we face from cyberattacks have increased significantly.Some of these attacks may originate from well-organized,highly skilled organizations.Al

213、though there have not been reported major cyberattacks against our systems in recent years,any such attack or system or network disruption couldresult in a loss of our intellectual property,the release of commercially sensitive information,customer or employee personal data.Failures to protect thepr

214、ivacy of customer and employee confidential data against breaches of network security could result in damage to our reputation.Furthermore,some of our data centers are located in areas with a high risk of major earthquakes.Our data centers are also subject to break-ins,sabotage and intentional acts

215、of vandalism,and to potential disruptions if the operators of these facilities have financial difficulties.Some of our systemsare not fully redundant,and our disaster recovery planning cannot account for all eventualities.The occurrence of a natural disaster,a decision to close afacility we are usin

216、g without adequate notice for financial reasons or other unanticipated problems at our data centers could result in loss of productioncapabilities and lengthy interruptions in our service.Any damage to or failure of our systems could result in interruptions in our service.Interruptions inour service

217、 could materially and adversely affect our business,financial condition and results of operations.A cybersecurity breach could interfere with our business operations,compromise confidential information,adversely impact our reputation andoperating results and potentially lead to litigation and other

218、liabilities.Cybersecurity threats continue to expand and evolve globally.The Information Security Management Committee established by our CorporateSustainability Committee(the“CSC”)is responsible for overall information security across all subsidiaries.It dedicated to enhancing informationsecurity,p

219、reventing and mitigating information security threats and risks by developing strategic plans for information security,establishing benchmarksfor information security maturity assessments,promoting information security risk management in our subsidiaries,and coordinating internal andexternal technol

220、ogies,resources and information.Our chief information security officer is responsible for regular reviews of all our subsidiariesinformation security management and incident response plans,and submits the information security governance report to the board of directors in thefourth quarter of each y

221、ear.In 2020,initiated by the Information Security Management Committee of the CSC,to work together information securitycommittees of our subsidiaries to integrate and strengthen the information security protection of each subsidiary.They also set up an informationsecurity risk alert system,through w

222、hich we could conduct on-site operational inspections to minimize information security risks by hiring third partyexperts.In addition,our major subsidiaries have obtained ISO 27001 certification(for information security management system)and ISO 22301certification to strengthen crisis management and

223、 disaster response.We also have established management procedures for the reporting and handling ofinformation security incidents which allow employees to report any security incidents to ensure prompt handling,followed by efficient responses thatwill mitigate information security risks.In addition,

224、we conduct an annual disaster recovery drill to mitigate the risk of service disruptions caused byimpacts from major crisis events to our information systems.All employees participate in our annual proprietary information protection training courses,which include training on information security pol

225、icy,management framework,and control measures.16Furthermore,we employ certain third-party auditor to conduct an annual audit and review of our information security performance.In the event ofa sudden external cyberattack,our on-site safety teams immediately hold a meeting to share information,discus

226、s responses and countermeasures;external experts would be invited to join the meeting to conduct reviews and analyses if necessary.While we actively take measures to manageinformation technology security risks,there can be no assurance that these measures will be sufficient to mitigate all potential

227、 risks to our system,networks and data.Although we protect our trade secrets and customer data through strict enforcement and protection protocols,a failure or breach in security couldexpose us and our customers,dealers and suppliers to risks of unauthorized access to information technology systems,

228、misuse and compromise ofconfidential information,manipulation and destruction of data,which could potentially result in disruption of our business operations and adverselyaffect our reputation,competitive position,financial condition and results of operations.Security breaches could also result in l

229、itigation with thirdparties,regulatory actions and higher costs of implementing additional data protection measures.Negative publicity may adversely affect our brand and reputation,which may result in a material adverse impact on our business,results ofoperations and business prospects and cause flu

230、ctuations in the price of our common shares and ADSs.Any negative publicity may damage our brand and reputation,harm our ability to attract and retain customers and have a material adverse impacton our results of operations as well as cause fluctuations in the trading price of our common shares and

231、ADSs.In addition,any change in policy or thedirection in which we carry out our corporate social responsibility or corporate sustainability activities may also have an adverse effect on our businessreputation.In recent years,we have experienced and may continue to experience negative publicity in co

232、nnection with administrative penalties andcriminal charges related to alleged violations of environmental regulations and laws.For further details,see“Item 4.Information on the CompanyBusiness OverviewEnvironmental Matters,”and“Item 8.Financial InformationConsolidated Statements and Other Financial

233、InformationLegalProceedings.”Any environmental claims or failure to comply with any present or future environmental regulations,as well as any fire or other industrialaccident,may require us to spend additional funds and may materially and adversely affect our financial condition and results of oper

234、ations.We are subject to various laws and regulations relating to the use,storage,discharge and disposal of chemical by-products of,and water used in,our packaging and interconnect materials production processes,and the emission of volatile organic compounds and the discharge and disposal of solidin

235、dustrial wastes from EMS operations.In recent years,we have been subject to environmental administrative actions and judicial proceedings related tocertain wastewater discharge incidents that occurred at our facilities.As a result of these proceedings,we have been subject to monetary fines as well a

236、ssanctions,including orders to suspend or limit our operations and criminal charges against us.For further details,see“Item 4.Information on theCompanyBusiness OverviewEnvironmental Matters,”and“Item 8.Financial InformationConsolidated Statements and Other FinancialInformationLegal Proceedings.”Clim

237、ate change,water shortage and other environmental concerns could negatively affect our business and financial planning.There is concern that without substantial remediation,increasing anthropogenic greenhouse gas emissions could adversely affect the globaleconomy irreversibly.A modest change in aver

238、age global temperatures would result in increased coastal flooding,altered precipitation patterns andincreased risk of biodiversity loss for the vulnerable species.Extreme weather conditions,such as heat,droughts and floods,which occur due to climatechange can also impact our business operations and

239、 financial performance.For example,since our business operations depend on adequate supplies ofwater,an extended drought may affect our ability to obtain sufficient amounts of water and threaten our production capability.We believe that we should play our part in the mitigation of man-made climate c

240、hange.For instance,we have incorporated green design standardsand building concepts into the construction of our facilities.Since 2012,we have transformed existing facilities and built new facilities and offices thatcomply with international low carbon building standards.Through quantifying and anal

241、yzing the entire lifecycle of building carbon emissions,carbonreduction was driven from the design stage and promoted along the value chain to build sustainable factories.Public expectations for reductions in greenhouse gas emissions could result in increased energy,transportation and raw material c

242、osts.Scientificexamination of,political attention to and rules and regulations on issues surrounding the existence and extent of man-made climate change may result inan increase in the cost of production due to increase in the prices of energy and introduction of energy or carbon tax.Various regulat

243、ory developmentshave been introduced that focus on restricting or managing emissions of greenhouse gases.Enterprises may need to purchase at higher costs emissioncredits,new equipment or raw materials with lower carbon footprints.These developments and further legislation that is likely to be enacte

244、d couldnegatively affect our operations and financial performance.Also,changes in environmental regulations,such as those that concern the use ofperfluorinated compounds(commonly known as the PFCs),could increase our production costs,which may adversely affect our results of operation andfinancial r

245、esults.17Stable water supply of sufficient amounts of good quality freshwater plays a critical role for ASEH.Taiwan is also susceptible to typhoons anddroughts,which may cause damage and business interruptions to facilities.Since our business operations depend on adequate supplies of water,anextende

246、d drought may affect our ability to obtain sufficient water and threaten our production capability.Although we have not been directly affected bydroughts,we are dependent upon water for our packaging and substrates operations and a drought could interrupt such operations.Not only freshwatersupply is

247、 key to our business operations,we also have established a sustainable water recycling system and implemented water management strategies toidentify and prevent water shortage related risks.We operate one of the industrys largest water recycling facility in Taiwan,allowing us to reuse eachdrop of wa

248、ter more than three times and avoid disruptions caused by water shortages.Our eight main facilities in Taiwan are also tapping on scientificdata from the World Resources Institute to conduct climate risk assessments and develop robust water risk management strategies.These actions willenable the com

249、pany to respond effectively to climate change in the next decade.We may be subject to intellectual property rights disputes,which could adversely affect our business.Our ability to compete successfully and achieve future growth depends,in part,on our ability to develop and protect our proprietary te

250、chnologiesand to secure on commercially acceptable terms certain technologies that we do not own.We cannot assure you that we will be able to independentlydevelop,obtain patents for,protect or secure from any third party,the technologies required.Our failure to successfully obtain such technology ma

251、yseriously harm our competitive position.Our ability to compete successfully also depends,in part,on our ability to operate without infringing the proprietary rights of others.We have nomeans of knowing what patent applications have been filed in the U.S.or elsewhere until they are granted or publis

252、hed.In particular,the semiconductorand electronics industries are characterized by frequent litigation regarding patent and other intellectual property rights.It is common for patent ownersto assert their patents against semiconductor manufacturers.We have received from time to time communication fr

253、om third parties asserting patents thatcover certain of our technologies and alleging infringement of intellectual property rights of others,and we may continue receiving such communicationin the future.In the event that any third party makes a valid claim against us or against our customers,we coul

254、d be required to:seek to acquire licenses to the infringed technology which may not be available on commercially reasonable terms,if at all;discontinue using certain process technologies,which could cause us to stop manufacturing certain semiconductors;pay substantial monetary damages;and/or seek to

255、 develop non-infringing technologies,which may not be feasible.Any one of these developments could place substantial financial and administrative burden on us and hinder our business.For example,inconnection to the 2016 patent dispute between Broadcom and Tessera,we recognized settlement amount of U

256、S$5.0 million in our consolidated financialstatements for the year ended December 31,2019,which fully settled in February 2020 between SPIL and Broadcom.See“Item 8.FinancialInformationConsolidated Statements and Other Financial InformationLegal Proceedings”for more information about the Broadcom Pat

257、ent Dispute.Any litigation,whether as plaintiff or defendant and regardless of the outcome,is costly and diverts company resources.Any of the foregoingcould harm our competitive position and render us unable to provide some of our services operations.18Our major shareholders may take actions that ar

258、e not in,or may conflict with,our public shareholders best interest.Members of the Chang family own,directly or indirectly,a significant interest in our outstanding common shares.See“Item 7.MajorShareholders and Related Party Transactions Major Shareholders.”Accordingly,these shareholders will conti

259、nue to have the ability to exercise asignificant influence over our business,including matters relating to:our operation,management and policies;the timing and distribution of dividends;and the election of our directors.Members of the Chang family may take actions that you may not agree with or that

260、 are not in our or our public shareholders best interests.We are an R.O.C.company and,because the rights of shareholders under R.O.C.law differ from those under U.S.law and the laws of certainother countries,you may have difficulty protecting your shareholder rights.Our corporate affairs are governe

261、d by our Articles of Incorporation and by the laws governing corporations incorporated in the R.O.C.The rightsof shareholders and the responsibilities of management and the members of the board of directors under R.O.C.law are different from those applicableto a corporation incorporated in the U.S.a

262、nd certain other countries.As a result,public shareholders of R.O.C.companies may have more difficulty inprotecting their interests in connection with actions taken by management or members of the board of directors than they would as public shareholdersof a corporation in the U.S.or certain other c

263、ountries.We have made investments in,and are exploring the possibility of expanding our businesses and operations to,or making additional investmentsin,the P.R.C.,which may expose us to additional political,regulatory,economic and foreign investment risks.We currently maintain packaging and testing

264、facilities and EMS sites in the P.R.C.We also made substantial investments in P.R.C.real estatedevelopment through our subsidiaries in the P.R.C.Under P.R.C.laws and regulations,foreign investment projects,such as our subsidiaries,must obtaincertain approvals from the relevant governmental authoriti

265、es in the provinces or special economic zones in which they are located and,in somecircumstances,from the relevant authorities in the P.R.C.central government.Foreign investment projects must also comply with certain regulatoryrequirements.However,P.R.C.laws and regulations are often subject to vary

266、ing interpretations and means of enforcement,and additional approvalsfrom the relevant governmental authorities may be required for the operations of our P.R.C.subsidiaries.If required,we cannot assure you that we willbe able to obtain these approvals in a timely manner,if at all.Because the P.R.C.g

267、overnment holds significant discretion in determining matters relatingto foreign investment,we cannot assure you that the relevant governmental authorities will not take action that is materially adverse to our P.R.C.operations.In addition,the P.R.C.stock market is subject to extreme price and volum

268、e fluctuations.We are the controlling shareholder of USI Shanghai,which is an entity currently listed on the Shanghai Stock Exchange.The P.R.C.securities markets have recently experienced,and may experience in thefuture,significant volatility.Any volatility may have a significant effect on USI Shang

269、hais share price and may indirectly affect the market price of ourcommon shares and ADSs.Our global manufacturing and sales activities subject us to risks associated with legal,political,economic or other conditions or developments invarious jurisdictions,including in particular the R.O.C.and the P.

270、R.C.,which could negatively affect our business and financial status andtherefore the market value of your investment.Our principal executive office and our principal production facilities are located in the R.O.C.,and a substantial majority of our net revenues arederived from our operations in the

271、R.O.C.and the P.R.C.In addition,we have operations worldwide and a significant percentage of our revenue comesfrom sales to locations outside the R.O.C.or the P.R.C.Operating in the R.O.C.,P.R.C.and other overseas locations exposes us to changes in policiesand laws,including environmental regulation

272、s,as well as the general political and economic conditions,security risks,health conditions and possibledisruptions in transportation networks,in the various countries in which we operate,which could result in an adverse effect on our business operationsin such countries.If any of our global operati

273、ons are affected by the legal,political,economic or other conditions in the jurisdiction we operate,ourresults of operations as well as market price and the liquidity of our ADSs and common shares may be materially and adversely affected.19Any impairment charges may have a material adverse effect on

274、 our net income.Under IFRS,we are required to evaluate our assets,such as property,plant and equipment,investment properties,intangible assets,includinggoodwill,and investments in financial instruments,for possible impairment at least annually or whenever there is an indication of impairment.If cert

275、aincriteria are met,we are required to record an impairment charge.With respect to assets,we recognized impairment charges of NT$601.2 million,NT$992.3 million and NT$126.8 million(US$4.6 million)in2019,2020 and 2021,respectively,primarily as a result of impairment charges related to property,plant

276、and equipment and investments under the equitymethod.We are unable to estimate the extent and timing of any impairment charges for future years and we cannot give any assurance that impairmentcharges will not be required in periods subsequent to December 31,2021.Any impairment charge could have a ma

277、terial adverse effect on our netincome.The determination of an impairment charge at any given time is based significantly on our expected results of operations over a number of yearsin the future.As a result,an impairment charge is more likely to occur during a period in which our operating results

278、and outlook are otherwise alreadydepressed.Any failure to achieve and maintain effective internal controls could have a material adverse effect on our business and results of operations.We are subject to reporting obligations under the U.S.securities laws.The SEC as required by Section 404 of the Sa

279、rbanes-Oxley Act of 2002adopted rules requiring every public company to include a management report on the effectiveness of such companys internal control over financialreporting in its annual report.In addition,an independent registered public accounting firm must report on such companys internal c

280、ontrol overfinancial reporting.As effective internal control over financial reporting is necessary for us to produce reliable financial reports and is important to help prevent fraud,any failure to maintain effective internal control over financial reporting could harm our business and result in a l

281、oss of investor confidence in thereliability of our financial statements,which in turn could negatively impact the trading price of our common shares and ADSs.Furthermore,we mayneed to incur additional costs and use additional management and other resources in an effort to comply with Section 404 of

282、 the Sarbanes-Oxley Act andother requirements going forward.Please refer to“Item 15.Controls and Procedures”for details on our internal control over financial reporting.Our insurance coverage may be inadequate to cover all of our business risks.Although we seek to obtain insurance for some of our ma

283、in operational risks,the amount of our insurance coverage may not be adequate to coverall potential claims or liabilities,and we may be forced to bear substantial costs resulting from risks and uncertainties of our business.There is also noguarantee that we will be able to obtain insurance coverage

284、when desired or that insurance will be available on commercially attractive terms.Anyfailure to obtain adequate insurance coverage on terms favorable to us,or at all,could have a material adverse effect on our business,financial conditionand results of operations.We could potentially face tax uncert

285、ainties arising from the decisions,activities and operations undertaken by us.There are many business activities that may give rise to tax issues in our daily operations,ranging from procurement,research and developmentactivities,manufacturing to product storage and distribution,among other activiti

286、es.Additional tax liabilities such as double taxation,inapplicability oftax incentives,tax adjustment and related interest and penalties may arise if all these tax issues are not dealt with properly.The development andevolution of tax laws and regulations present considerable uncertainties in interp

287、retation and enforcement,which could call for more onerouscompliance measures and tax audits in the jurisdictions in which we operate.Failure to comply with any change in tax laws could result in unfavorabletax consequences to us and have an adverse impact on our business,financial condition and res

288、ults of operations.For instance,we were subject to anestimated tax penalty of US$843 due to delay on the tax installment for the fourth quarter of 2021.We made remediation by applying for deferment andmade the tax payment within the deferment period.We are not aware of any further penalties or enfor

289、cement actions as of the date of this annual report.20We have business operations in multiple countries and our worldwide operations are taxed under the laws of the jurisdictions in which we operate.However,the integrated nature of our worldwide operations can produce conflicting claims from revenue

290、 authorities in different countries as to theprofits to be taxed in the individual countries.Recently,tax authorities around the world have heightened their scrutiny of company tax filings and haveadopted a more rigid regulatory posture.As part of this shift,the Organization for Economic Co-operatio

291、n and Development has proposed a number oftax law changes under its Base Erosion and Profit Shifting Action Plans to address issues of transparency,coherence and substance.The EU list ofnon-cooperative jurisdictions for tax purposes is part of the EUs external strategy for taxation and aims to contr

292、ibute to ongoing efforts to promote taxgood governance worldwide.If the countries where our operations are based be added into EU list of non-cooperative jurisdictions for tax purposescould adversely affect our operations.We face risks related to public health epidemics,including the recent novel co

293、ronavirus outbreaks.Our financial condition and results of operations may be adversely affected if a public health epidemic interferes with our ability,or that of ouremployees,suppliers,customers and other business partners to perform our and their respective responsibilities and obligations related

294、 to the conduct ofour business.Since November 2019,a novel strain of coronavirus,or COVID-19,has spread across the world.On March 11,2020,the World HealthOrganization declared COVID-19 a global pandemic.To date,COVID-19 outbreak has caused significant disruption to the financial markets andinternati

295、onal supply chains,which can substantially depress global business activities,restrict access to capital and result in a long-term economicdownturn that would negatively affect our operating results.Any interruption to our supply chain can cause shortages in materials and labor supplies thatare key

296、to our commercial operations and negatively impact our business results.COVID-19-related factors,including facility shutdowns mandated bynational,regional and local governments,could also prevent our sites from operating at full capacity and adversely affect our financial position.Thepotential impac

297、t brought by and the duration of the COVID-19 outbreak is difficult to assess or predict and the full impact of the virus on our operationswill depend on many factors beyond our control,including the extent of resurgences of the disease and its variants,vaccine distribution and other actionsin respo

298、nse to the virus or to contain its impact.To combat the impact of COVID-19,we continually update our preventative policies for our manufacturing facilities and provide constantmonitoring of our operations.We go beyond just adopting control measures to comply with local government health and safety r

299、egulations.Forexample,we have implemented enhanced health and safety protocols across our sites,including temperature screening,mandatory and self-quarantineprotocols,suspension of non-critical overseas business travel,remote work arrangements and social distancing guidelines in our employee cafeter

300、ia,changing rooms,conference rooms as well as other public common areas to reduce the risk of disease exposure.We built a class 100K clean roomfacility to manufacture high-quality surgical face masks and provide them free of charge to employees in Taiwan to help prevent transmission.While wehave lev

301、eraged corporate resources across our business platform and manufacturing sites to mitigate the potential impact that COVID-19 might have onour operations and there have been intensifying efforts to contain the spread of COVID-19 by the governments of the countries and territories affected,the exten

302、t to which COVID-19 impacts our results remains highly uncertain and depends on future developments,such as the variants of COVID-19.We face uncertainties relating to the phasing-out of LIBOR.On July 27,2017,the United Kingdoms Financial Conduct Authority,which regulates London Interbank Offered Rat

303、e,or the LIBOR,announcedthat it intends to phase out LIBOR by the end of 2021.It is unclear if LIBOR will cease to exist at that time or if new methods of calculating LIBORwill be established such that it continues to exist after 2021.On November 30,2020,ICE Benchmark Administration,or the IBA,the a

304、dministrator ofLIBOR,with the support of the United States Federal Reserve and the United Kingdoms Financial Conduct Authority,announced plans to consult onceasing publication of USD LIBOR on December 31,2021 for only the one week and two month USD LIBOR tenors,and on June 30,2023 for all otherUSD L

305、IBOR tenors.While this announcement extends the transition period to June 2023,the United States Federal Reserve concurrently issued astatement advising banks to stop new USD LIBOR issuances by the end of 2021.In light of these recent announcements,the future of LIBOR at thistime is uncertain and an

306、y changes in the methods by which LIBOR is determined or regulatory activity related to LIBORs phase-out could causeLIBOR to perform differently than in the past or cease to exist.Discontinuation of LIBOR and uncertainty as to the nature of such potential changes,alternative reference rates or other

307、 reforms may impact the amounts of interest we pay under our debt arrangements and to the extent that the impact onour operation due to such transition remains uncertain.21Escalation of tensions between South Korea and North Korea could have an adverse effect on our operations in South Korea and the

308、 marketvalue of our shares.The political relationship between South Korea and North Korea has been tense throughout Koreas modern history.The level of tension betweenthe two countries has heightened and may increase abruptly as a result of current and future events.In recent years,there have been in

309、creasing securityconcerns stemming from North Koreas nuclear weapons and ballistic missile programs and uncertainty regarding North Koreas actions and possibleresponses from the international community.Although we do not derive any revenue from,nor sell any products in,North Korea,any further increa

310、se intension between North and South Korea,for example,if North Korea experiences a leadership crisis,high-level contacts between South Korea andNorth Korea break down or military hostilities occur,could have a material adverse effect on our South Korea subsidiary,our business,financialcondition,res

311、ults of operations and the market value of our common stock.Any attempt by the U.S.government to withdraw from or materially modify existing international trade agreements or take further actionsagainst certain P.R.C.technology companies could adversely affect our business,financial condition and re

312、sults of operations.The political changes in the U.S.have created uncertainty regarding future U.S.trade policies.The U.S.government has made certain commentsthat suggest the U.S.is not supportive of certain existing international trade agreements,such as the North America Free Trade Agreement.The U

313、.S.government has also issued executive orders to withdraw the U.S.from the Trans-Pacific Partnership.The U.S.government has shown inclinations towithdraw the U.S.from the World Trade Organization,which can lead to greater economic instability.If the U.S.were to withdraw from or materiallymodify cer

314、tain international trade agreements to which it is a party,or if tariffs continue to be raised on foreign-sourced goods imported to the U.S.,ourU.S.customers may seek new suppliers in the U.S.or other countries,and our business,financial condition and results of operations could be adverselyaffected

315、.In addition,the U.S.government has also escalated disputes with certain P.R.C.technology companies,some of which are our customers,overissues in cybersecurity.Since mid-2018,political tension has increased between the U.S.and the P.R.C.and has escalated into a tariff war.OnJanuary 15,2020,the U.S.a

316、nd the P.R.C.signed the Phase One trade deal,which officially agreed to the rollback of tariffs,expansion of tradepurchases,and renewed commitments on intellectual property,technology transfer,and currency practices.The progress of trade talks between Chinaand the United States faces uncertainties,a

317、nd there can be no assurance as to whether the United States will maintain or reduce tariffs or imposeadditional tariffs on Chinese products in the near future.Furthermore,there was no Phase Two trade deal implemented to date and most of the tariffsimposed remain in place.Any future re-adoption or e

318、xpansion of the U.S.trade restrictions and tariffs,quotas and embargoes,or further escalation of theU.S.and the P.R.C.trade war can adversely impact our business operations.On the other hand,U.S.trade restrictions against the P.R.C.could further accelerate the P.R.C.s move on self-sufficiency and ef

319、forts in reducingthe reliance on foreign suppliers,leading to uncertainty of our business related to the P.R.C.supply chain.We may not be successful in pursuing mergers and acquisitions.Any mergers or acquisitions we make may lead to a diversion of managementresources.Our future success may depend o

320、n acquiring businesses and technologies,making investments or forming joint ventures that complement,enhance or expand our current product offerings or otherwise offer us growth opportunities.In pursuing such acquisitions,we may face competitionfrom other companies in the semiconductor industry.Our

321、ability to acquire or invest in suitable targets may be limited by applicable laws andregulations in the R.O.C.,P.R.C.,the United States,European countries and other jurisdictions where we do business.Even if we are successful inmaking such acquisitions or investments,we may have to expend substanti

322、al amounts of cash,incur debt,assume loss-making divisions and incur othertypes of expenses.We may also face challenges in successfully integrating any acquired companies into our existing organization or in creating theanticipated synergistic benefits.Each of these risks could have a material adver

323、se effect on our business,financial condition and results of operations.22Risks Relating to the SPIL AcquisitionThere may be risks associated with the impacts of the SPIL Acquisition on our subgroups and our holding company structure.ASE entered into a Joint Share Exchange Agreement with SPIL in Jun

324、e 2016,pursuant to which ASEH,a holding company in Taiwan,holds100%of the equity interests in both ASE and SPIL such that ASE and SPIL became wholly owned subsidiaries of ASEH.The common shares of ASEand SPIL were delisted from the TWSE.The ADSs of ASE and SPIL were delisted from NYSE and NASDAQ,res

325、pectively,and became eligible forderegistration under the Exchange Act.Subsequently,the common shares of ASEH were listed on the TWSE,and the ADSs of ASEH were listed on theNYSE.The implementation of such corporate structure restructuring plan led to two subgroups,ASE Group and SPIL Group,of our hol

326、ding companystructure,and each subgroup may experience difficulties in creating strategic and operational synergies with each other and may further result incontingent risks,including increase in tax liabilities or trading discounts relating to a holding company discount that may become apparent in

327、the future.For details about the Joint Share Exchange Agreement,see“Item 10.Additional Information Material Contract.”Risks Relating to Taiwan,R.O.C.Strained relations between the R.O.C.and the P.R.C.and disruptions in Taiwans political environment caused by domestic political events couldnegatively

328、 affect our business and the market value of your investment.Our principal executive offices and our principal facilities are located in Taiwan and approximately 58.7%,56.3%and 57.0%of our operatingrevenues in 2019,2020 and 2021,respectively,were derived from our operations in Taiwan.Accordingly,our

329、 business and financial condition may beaffected by changes in local governmental policies and political and social instability.The R.O.C.has a unique international political status.The government of the P.R.C.asserts sovereignty over all of China,including Taiwan,anddoes not recognize the legitimac

330、y of the R.O.C.government.Although significant economic and cultural relations have been established in recent yearsbetween the R.O.C.and the P.R.C.,relations have often been strained.Any major change in the Taiwanese political environment,including the outcomeof presidential or municipal elections,

331、or potential shifts in government policy,may affect the direction of economic and political developments andnegatively impact the economic and political environment in Taiwan.Past developments related to the interaction between the R.O.C.and the P.R.C.,domestic political events or election results h

332、ave on occasion depressed the market prices of the securities of Taiwanese or Taiwan-related companies,including our own.Relations between the R.O.C.and the P.R.C.and other factors affecting the political or economic conditions in Taiwan could have amaterial adverse effect on our financial condition

333、 and results of operations,as well as the market price and the liquidity of our common shares andADSs.We manufacture interconnect materials in the P.R.C.through our wholly owned subsidiary,ASE Shanghai.We also provide packaging and testingservices in the P.R.C.through some of our subsidiaries.In addition,we engage in the P.R.C.in real estate development and the manufacture of computerperipherals a