Search Result

Article Content

 
Article 1     These Rules are adopted pursuant to Article 118 of the Operating Rules of the Taiwan Stock Exchange Corporation (TWSE).
Article 2     Securities brokers and securities dealers (“securities firms”) shall make deposits into the clearing and settlement fund with the TWSE in accordance with the standards provided by the Financial Supervisory Commission (“the Competent Authority”), Executive Yuan.
    Deposits into the clearing and settlement fund shall be limited to cash only. If a deposit has been made by any method other than cash prior to the announcement and implementation of these Rules, it shall be changed to a cash deposit within 30 days after the announcement and implementation of these Rules.
    If a securities firm fails to make a deposit to the clearing and settlement fund on time, or fails to make any supplementary deposit on time whenever it may be notified to do so, the TWSE will immediately halt its participation in market trading.
    The securities firm may not assign or create a pledge on its deposited clearing and settlement funds.
Article 3     The TWSE shall set up a dedicated account for custody of the clearing and settlement fund it collects. It shall utilize the fund in the following manners in accordance with the Securities and Exchange Act:
  1. Purchase of government bonds.
  2. Deposit in banks, or savings deposits with the postal administration.
  3. Other manners of utilization reported to and approved by the Competent Authority.
    With respect to interest accrued from utilization by the TWSE of the clearing and settlement fund, the TWSE shall settle accounts on a half-yearly basis and reimburse any remaining interest, after deducting applicable fees and taxes, to the securities firms.
Article 4     In securities trades conducted by securities firms on the exchange of the TWSE, if either the buyer or the seller fails to fulfill its settlement obligations, the TWSE shall designate another securities firms to perform settlement on its behalf. If no other securities firm is able to perform settlement on its behalf, the TWSE shall utilize the clearing and settlement fund to proceed to make payment. For any resulting price difference and expenses incurred, the TWSE shall utilize the clearing and settlement fund to pay compensation on behalf of the defaulting securities firm, and shall without exception pursue recovery from the defaulting securities firm.
    The TWSE may sign a credit line contract with a bank. When it becomes necessary to utilize the clearing and settlement fund under the preceding paragraph, the TWSE may use such fund assets to obtain a loan from the bank to meet the requirements thereunder. The interest on the loan shall be deducted from the clearing and settlement fund, and the TWSE shall then pursue its recovery from the defaulting securities firm.
Article 5     If the clearing and settlement funds deposited by a securities firm are under compulsory execution by a court or are utilized for any other reason, and the securities firm fails to make a supplemental deposit as required, the TWSE may notify the firm to make the supplemental deposit within a prescribed time limit. the firm fails to make the deposit within the time limit, the TWSE will thereupon halt its market trading.
Article 6     A securities firm that terminates its market usage contract must close out its trades on the exchange of the TWSE, and further clear all accounts before applying to the TWSE for reimbursement of the clearing and settlement fund.
Article 7     The TWSE shall, within 10 days from the end of each month, report by letter to the Competent Authority the status of receipts and expenditures, and uses, of the clearing and settlement fund, and also submit the information by letter to the Taiwan Securities Association.
Article 8     These Rules, and any amendments hereto, shall be implemented by public announcement of the TWSE following submission to and approval by the Competent Authority.