The JCSF is established to deal with securities firm defaults. It has two sources.
TWSE's contribution of NT$3 bn, which is a split between two funds, s NT$2bn goes to the First Special Clearing Fund and NT$ 1bn to the Second Special Clearing Fund.
Brokerage firms and securities dealers’ contribute NT 3.4bn to JCSF as calculated below.
The JCSF is shared by all securities firms, each of which contributes to the Fund according to the formula below:
Fixed Part: Each brokerage firm shall contribute NT$3.5mn, with an extra NT$0.5mn for each additional branch. Each securities dealers shall contribute NT$5mn.
Variable Part: This is the balance after the fixed part is subtracted from NT$3.4bn. The balance then is distributed among all the securities firms pro rata on the basis of the size of their net buy or net sell amount of the previous year.