TSMC Board of Directors Approves Plan to Buy Back Shares from Open Market

Hsinchu, Taiwan, R.O.C., November 13, 2007 –TSMC’s Board of Directors today held a Board of Directors meeting, at which the Board approved a share buyback plan to repurchase up to US$1.5 billion, (approximately NT$48.5 billion) or no more than 800 million of the Company’s common shares from the open market. TSMC plans to buy back shares at a price in the range of NT$43.2 to NT$94.2 per share from November 14, 2007 to January 13, 2008. The repurchased shares will be cancelled.

TSMC and Philips agreed to a multi-phased plan to facilitate an orderly exit by Philips from its current shareholding in TSMC in March. TSMC and Philips have completed the first two phases of this plan, selling approximately US$1.75 billion in shares to long-term investors in Taiwan in March, and selling another US$2.56 billion in TSMC ordinary shares in the form of American Depositary Shares in May.

“This buyback, the third phase of the multi-phase plan, is open to all shareholders and Philips intends to sell up to US$1.5 billion of its shareholding in TSMC in the open market during this period,” said TSMC Spokesperson and Vice President Ms. Lora Ho. Philips currently holds an 8 percent stake in TSMC.

Ms. Ho pointed out that the fourth phase of the plan remains unchanged: TSMC intends to conduct additional share repurchase programs over the next three years, subject to at least maintaining its current annual cash dividend per share, and cancel the repurchased shares. Philips intends to continue participating in these share repurchase programs. Philips will also consider other sales to long-term financial investors mutually agreeable to Philips and TSMC.

“Other than as part of the agreed multi-phased plan, Philips does not intend to sell TSMC shares in the open market,” said Ms. Ho.