Internal Control System and Integrity

According to the Commercial Port Law, the planning, construction, management, operation, security, and pollution prevention of international commercial ports are the responsibility of state-operated enterprises established by the MOTC, while domestic commercial ports are managed by the Maritime Port Bureau or designated agencies. The Company operates and manages 7 international commercial ports and is entrusted to operate 2 domestic commercial ports, executing related matters in accordance with the law.

If operators or public groups are found violating relevant provisions of the Commercial Port Law, the Company will preserve evidence and refer the case to the Maritime Port Bureau, MOTC which will handle penalties according to its authority to ensure lawful administration and clear accountability. The Company implements compliance mechanisms through its internal control system to strengthen operational integrity and protect the public interest. During the reporting period, there were no records of political donations nor any violations or penalties related to product or service health and safety. The 2024 violation incidents of TIPC are as follows. Detailed information is provided in the "Company Sanctions Information" section under " Sustainability Information Disclosure-Corporate Governance Information" on the TIPC ESG Sustainability website.

Internal Control System

TIPC established Risk Management and Internal Control System in accordance with the "Operating Principles for Risk Management and Crisis Handling of the Executive Yuan and its Affiliated Agencies", "Handbook for Risk Management and Crisis Handling of the Executive Yuan and Affiliated Agencies" and "Highlights of the Government Internal Control and Surveillance Operations". Regarding the company's vision, key operational objectives, and overall as well as operation -level goals, all units review the importance and risks of their controlled business areas, conduct risk identification and assessment, analyze the impact and probability of risks, and formulate various risk evaluation items and internal control procedures each year. To ensure the continuous and effective operation of TIPC's risk management and internal control, a self-supervision mechanism is implemented through routine monitoring, self-assessment, and internal audits.

Risk Management and Internal Control System

To strengthen corporate governance and risk control mechanisms, the Company annually updates key internal controls and operating procedures based on the previous year's self-assessment results. Each department conducts self-assessments based on their execution effectiveness, and aft er super visor approval, the internal control statement is jointly signed by the Chairman, President, and Auditor General.

The Auditing Office conducts at least two audit operations annually for the headquarter and every branch, review the implementation of high-risk internal control items and track improvement progress. Audit results are compiled into internal audit reports, disclosing audit findings, improvement suggestions, and the status of previous recommendations. These reports are reviewed quarterly by the Chairman and submitted to the Board of Directors to ensure the effective operation of the internal control system and to respond to board recommendations.

Key Internal Controls and Operating Procedures of TIPC

In 2024, Auditing Office audited a total of 49 internal control items, of which 37 were high-risk internal control items, which were selected in accordance with the definition of high-risk operations listed in the "Risk Management and Internal Control System", approved by the headquarter and every branch after ongoing reviews.

The categories mainly included operating revenues and receipt cycle, port and warehouse operation cycle, procurement and payment cycle, information security cycle, investment cycle, and the other management system cycles. The audit results complied with the key requirements of internal control.

Ethics and Integrity

Upholding the four core values of "integrity and legal compliance", "transparency", "inclusiveness and Mutual Prosperity", and "fairness and justice", the company actively promotes various integrity initiatives such as the Procurement Integrity Platform. Internal codes of conduct are in place, strictly requiring employees to comply with relevant laws and regulations and to uphold professional ethics with loyalty when performing their duties.

Integrity Risk Management

For integrity risk-related operations, the Company has implemented seven internal control mechanisms: procurement supervision, risky business audit, public servants' property declaration, Ethics Guidelines for Civil Servants cases, receiving and reporting corruption and profanity cases, early warning behavior and re-corruption prevention mechanism. The Civil Service Ethics Department executes risk control and implements internal control mechanisms based on risk assessment results. Evaluations, audits, and improvements are conducted following the company's risk management and internal control systems. Specific business activities have performance evaluation systems and hold an annual integrity meeting once to review the year's integrity efforts.

To manage corruption risks, TIPC has established eight operational sites designated for corruption risk assessment. Subsidiaries have also set up dedicated integrity units and personnel.

The evaluation criteria for major corruption risks identified through risk assessment are based on factors such as the timing of incidents, the current position of the individuals involved, referrals for judicial investigation, inquiries by legislators, impeachment or corrective actions by the Control Yuan, accountability for administrative responsibilities, or job reassignment/suspension. If a case is assessed to have both a high likelihood of occurrence and a severe impact, it is classified as a significant corruption risk. In 2024, the Civil Service Ethics Department completed the Corruption Risk Assessment Report, which identified a total of 38 risk incidents. The categories of these incidents are as follows:

Chart of Risk Event Statistics-TIPC

Communication and Training on Anti-Corruption Policies and Procedures

Adhering to the principle of integrity management, TIPC places great emphasis on the implementation and communication of anti-corruption policies while promoting various operational activities. Each year, the Civil Service Ethics Department formulates an integrity work plan to carry out a series of integrity training sessions, anti-corruption activities, and discussion meetings. Through subtle and continuous efforts, it strengthens employees' anti-corruption awareness, promotes honest governance and corporate culture, and timely expands corporate integrity and anticorruption information to the public through social participation activities, actively seeking consensus and policy support from external stakeholders. Meanwhile, the company has established the Work Rules and Integrity-Related Regulations Notice, which regulate the conduct of employees and business partners to ensure all operations are conducted legally and compliantly.

TIPC Anti-Corruption Code of Conduct

• Internal Stakeholders:

Article 34 of the Work Rules — Employees of the Company shall not, due to their duties or in violation of their duties, accept improper entertainment, gifts, kickbacks, or other illegal benefits, nor shall they engage in improper places.

• External Stakeholders:

“Notification of Integrity Regulations for Contracted Vendors" ensures that vendors understand and voluntarily commit to not engaging in any conduct that violates the public servant ethics regulations or laws in dealings with the Company or its subsidiaries’ employees, and are willing to provide appropriate protection to whistleblowers.

Implementation of Anti-Corruption Initiatives Over the Past Three Years

In 2024, no corruption incidents occurred. If a corruption incident arises, the Company's Civil Service Ethics Department will be responsible for collecting relevant integrity information, analyzing whether there are potential indicators of corruption, and determining the subsequent investigation direction. If the incident widely affects business operations, a special inspection plan will be formulated to conduct comprehensive or random audits by reviewing relevant case files and materials. The inspection results will be compiled and summarized to analyze the overall operation of the affected business area, identify irregular cases, and discover hidden problems or risks. Relevant recommendations will be provided for business units to consider and improve. Additionally, if the investigation confirms that employees are involved in corruption or other illegal acts, the case will be submitted to the Performance Evaluation Committee for administrative responsibility and referred to judicial authorities for investigation.

Procedure for Handling Complaints and Reports of Corruption Cases

To strengthen public service and enhance administrative transparency, the Company has established the "Guidelines for Handling Public Petitions" in accordance with Article 7 of the Administrative Procedure Act and relevant regulations of the Executive Yuan, standardizing the procedures for handling public petitions with principles of legality, reasonableness, timeliness, and accuracy.

The Secretariat has designated a dedicated unit, using the official document management system and the "Case Monitoring Management System" to register, assign, and expedite the handling of various complaint cases. It closely coordinates with the MOTC's Citizen Service Center to continuously track the processing progress until case closure. Pending cases are compiled and published monthly on the internal website, with reminders sent to responsible personnel two days before the deadline to accelerate processing. In 2024, the company received a total of 338 cases through the public opinion mailbox, all related to rights protection, and all were handled according to procedures. Additionally, in compliance with the " Guidelines for Handling Public Petitions by the Executive Yuan and Its Subordinate Agencies", the Company conducts online and phone-based satisfaction surveys to assess case handling in terms of efficiency, attitude, and professionalism. The survey results serve as a reference for improving service quality and ensuring integrity-based governance and impartial service delivery.

The Company provides multiple reporting channels and has designated dedicated personnel in the Civil Service Ethics Department responsible for handling whistleblowing reports from employees and the public regarding illegal activities. A clear and standardized procedure has been established under the Company's internal control system for the handling of corruption-related complaints and whistleblower cases.

The company has also established the "Taiwan International Ports Corporation Confidentiality Regulations for Whistleblowers' Identity" along with handling procedures. In the event of a confirmed illegal incident, rewards and penalties will be promptly implemented in accordance with the company's "Employee Performance Assessment Guidelines" and "Principles for Handling Reward and Disciplinary Actions" following prescribed procedures. In 2024, the Civil Service Ethics Department of the Company received a total of 18 public whistleblowing and complaint cases, involving 1 case related to Environmental (E) matters, 4 cases related to Social (S) Responsibility, and 13 cases related to Corporate Governance (G), all handled in accordance with relevant regulations.

TIPC uncovered fraud (prosecution) channel