For the price difference and all other fees arising from and in connection with the TWSE’s handling of any default of settlement obligations by a securities firm, the TWSE shall first make deductions from the portion of the Fund deposited by the defaulting securities firm and the interest thereupon. When that is insufficient, compensation on behalf of the securities firm shall be made from the following in the following order of priority:
When the special settlement fund allocated by the TWSE has been utilized by the TWSE pursuant to paragraph 1, subparagraph 1, the utilized portion will not be made up.
- The special settlement fund allocated by the TWSE pursuant to Article 3, paragraph 3.
- The Clearing and Settlement Fund deposited by securities firms pursuant to Article 3, paragraph 1, and the special settlement fund allocated by the TWSE pursuant to Article 3, paragraph 2, shared pro-rata to the amounts of their allocations.
Amounts shared pro-rata under paragraph 1, subparagraph 2 shall be made up by the securities firms and the TWSE within a prescribed deadline. Any funds recovered from the defaulting securities firm shall be reimbursed pro-rata to the securities firms and the TWSE for any compensation that they made on behalf of the defaulting securities firm for the price difference and fees under paragraph 1.