REQUEST FOR INFORMATION

Transcription

1 REQUEST FOR INFORMATION INVITATIONS TO COMPLETE A REQUEST FOR INFORMATION FOR: THE SUPPLY, IMPLEMENTATION AND SUPPORT OF A SYSTEM, OR SERVICES, FOR A CENTRAL COUNTERPARTY INSTITUTION TO FACILITATE TRANSACTIONS IN THE SRI LANKA CAPITAL MARKET AMONGST MARKET PARTICIPANTS Invitation The Colombo Stock Exchange (CSE) invites responses to a Request for Information (RFI) from eligible Suppliers to provide implementation and post live maintenance and support of a system, or outsourced services, for a Central Counterparty Organisation operating in the Sri Lankan Capital market. For this purpose, CSEClear Pvt Ltd. (hereinafter referred to as CSEClear ) will be established as a wholly owned subsidiary of CSE, located in Colombo. The RFI is available for download, free of charge, at the CSE s website Introduction The Colombo Stock Exchange (CSE) was formally established in 1985 and is licensed by the Securities & Exchange Commission of Sri Lanka (SEC). The CSE is a mutual exchange and has 15 full members and 13 Trading Members licensed to trade both equity and debt securities. In addition there are 8 trading member who are permitted to trade Corporate Debt Securities. The CSE offers an order-driven trading platform for securities trading, including shares, corporate debt securities. The CSE experienced a dramatic surge in trading activity in 2010 and 2011, following the conclusion of 30 years of war in The CSE uses modern automated trading and CSD systems and a number of initiatives are underway to upgrade brokers back offices and order management systems. A project is in place to enhance the legal and regulatory environment of the Securities Market in Sri Lanka. At present, the capital market institutions in Sri Lanka use an Automated Trading System(ATS) for trading, and the Central Depository System(CDS) as a depository and for clearing & settlement. A new CCP System or Service is required to bring new features to clearing and risk management and replace some features of the existing systems. The new system is expected to improve market integration and provide a solid platform to support CCP operations. Objectives of the RFI The objective of the request for Information (RFI) is to collect specific information from potential organisations that meet the Supplier Eligibility Criteria set out in the RFI, with a view to selecting a list of Suppliers who will receive a detailed Request for Proposal (RFP) for the supply, implementation and post-live maintenance and support of a CCP system or CCP Services, under an initial five-year contract with CSEClear. The procurement of CCP Systems or CCP Service Provision will be financed by CSEClear. Contents of the RFI The RFI document contains a description of Supplier eligibility criteria, the work to be done by an eligible Supplier, an outline of the specifications, the key contract conditions and the RFI response evaluation criteria that will be used by the CSE to pre-qualify a limited number of Suppliers to be included for the RFP stage. The RFI contains a series of requests for information that eligible Suppliers need to respond to. RFI Contact and Timetable Eligible Suppliers must respond using the procedures described in the RFI and should not contact individual management or staff at the CSE directly except via the following channels. Contact Postal Address: RFI Response deadline: CSEClear@CSE.lk Colombo Stock Exchange,#04-01, West Block World Trade Center, Echelon Square, Colombo 01, Sri Lanka 2 March 2016, 16:00 hrs. Sri Lanka Time PUBLIC

2 REQUEST FOR INFORMATION (RFI) FOR THE SUPPLY, IMPLEMENTATION AND SUPPORT OF A SYSTEM, OR SERVICES, FOR A CENTRAL COUNTERPARTY INSTITUTION TO FACILITATE TRANSACTIONS IN DOMESTIC FINANCIAL MARKETS AMONGST MARKET PARTICIPANTS Contact Postal Address: Website: Response submission by: CSEClear@CSE.lk Colombo Stock Exchange,#04-01, West Block World Trade Centre, Echelon Square, Colombo 01, Sri Lanka 2 March 2016, 16:00 hrs Sri Lanka Time Page 1 of 21

3 1 Background 1.1 Introduction The Colombo Stock Exchange (CSE) was formally established in 1985 and is licensed by the Securities & Exchange Commission of Sri Lanka (SEC). The CSE is a mutual exchange and has 15 full members and 13 Trading Members licensed to trade both equity and debt securities. In addition there are 8 trading member who are permitted to trade Corporate Debt Securities. The Exchange offers an orderdriven trading platform for securities trading - including shares and corporate debt securities. The CSE experienced a dramatic surge in trading activity in 2010 and 2011, following the conclusion of 30 years of civil war in The Exchange uses modern automated trading and CSD systems and a number of initiatives are underway to upgrade brokers back offices and order management systems. A project is in place to enhance the legal and regulatory environment of the Securities Market. At present, the capital market institutions in Sri Lanka use an Automated Trading System(ATS) for trading, and the Central Depository System(CDS) as a depository and for clearing & settlement. A new CCP System or Service is required to bring new features in clearing and risk management and replace some features of the existing systems. The new system is expected to improve integration and provide a solid platform to support CCP operations. An overview of the current Sri Lankan equities trading, clearing, settlement and depository market structure is shown below. 1.2 Request for Information The Colombo Stock Exchange (CSE) invites responses to a Request for Information (RFI) from eligible Suppliers to provide implementation and post live maintenance and support of a system, or outsourced services, for a Central Counterparty Organisation operating in the Sri Lankan Capital market. The CSEClear Pvt Ltd. (hereinafter referred to as CSEClear ) will be established as a wholly owned subsidiary of CSE, located in Colombo. CSEClear aims to ensure efficient clearing and settlement of all trades performed through the CSE and to reduce counterparty and operational risks in compliance with international standards, as far as possible. 1.3 Funding The procurement of CCP Systems or CCP Service Provision will be financed by CSEClear. Page 2 of 21

4 1.4 Objective of this RFI The objective of this request for Information (RFI) is to collect specific information from potential organisations that meet the eligibility criteria set out in 1.5 below, with a view of selecting a list of suppliers who will receive a detailed Request for Proposal (RFP) for the supply, implementation and post live maintenance and support of a CCP system or CCP Services, under an initial five-year contract with CSEClear. 1.5 Eligibility Criteria Suppliers who meet the following criteria may respond to the RFI: a) Supplier credibility: A CCP System Vendor that provides packaged software and systems integration solutions specifically for clearing houses or Central Counterparty organisations, and/or: A Clearing House Institution that can provide CCP Services to third party Clearing Houses and/or their clearing member participants. The services may be provided remotely or via a locally hosted solution in Sri Lanka, and/or: A reputable systems integration company acting: within a consortium, part of a joint venture partner or as a prime contractor in association with one or more of the above CCP Systems Vendors or Clearing House Suppliers. b) Supplier capability: The Supplier must have adequate experience and technological, staffing and financial resource capability to provide, implement and support the CCP solution for CSEClear in Sri Lanka. The Supplier must have one or more directly relevant and comparable reference sites for CCP system implementations other than the host country or CCP service provision Ineligibility criteria include: A Supplier offering a predominantly development approach to providing a CCP solution A Supplier claiming to be in consortia with at least one credible CCP System Vendor or Clearing House but without agreement from the other party(s). Any Supplier, or individual staff of the Supplier, blacklisted in Sri Lanka or by the World Bank. 1.6 Overview & Outline Specifications Overview By launching CSEClear, the Sri Lankan market aims to be compliant with international requirements from the G20 to migrate all markets to a centrally cleared environment. The specific design will be compliant with CPMI/IOSCO Principles for Financial Markets Infrastructures (PFMIs) and relevant risk Management Standards for Clearing Houses. CSEClear will act as a central counterparty towards the Clearing Members that are entities approved to clear and settle trades through CSEClear. At present, the capital market institutions in Sri Lanka use an Automated Trading System(ATS) for trading, and the Central Depository System(CDS) as a depository and for clearing & settlement. The new CCP System will bring new features in clearing and risk management and replace some features of the existing systems. An overview of the overall target infrastructure for the new CCP environment is shown below. Page 3 of 21

5 In the above diagram, the ATS is the automated trading system and CSD is the Central Depository System currently in operation. An overview of the Sri Lankan Stock Market and proposed CSEClear requirements are presented below. These requirements are non-exhaustive and more details will be provided in the Request for Proposal (RFP) sent to the Suppliers shortlisted during the RFI stage Volumetrics The Sri Lankan market has grown over the past 10 years as evidenced by the transaction volumes below. The following types of participants current operate in the Sri Lankan market relevant to the future CCP environment. 37 CSE Members/Trading Member firms 16 Custodian Banks Page 4 of 21

6 In the next 5 years, the CSEClear system should be able to handle up to 50 clearing member firms and up to 110 users within those firms and internally at CSEClear. The system will process at least the following number of settlement accounts: CDS (beneficiary accounts) 1,750,000 The CSEClear system must be able to process around 1000 different instruments concurrently Systems Requirements Where a Supplier offers a System rather than a Clearing House Service; the CSEClear system should be an open, client-server, modular, scalable and multi-layered architecture providing key functionality in the areas of: Collateral management Risk management Administration Reporting Billing/fee computation Other key functional groups/modules The CSE will act as a system operator for CSEClear system and currently operates a primary site in Colombo and a warm standby site nearby. Outline Functional requirements The main functional requirements are outlined below and more detailed information will be available at the RFP stage. 1.7 Pre-Trade Arrangements Clearing Members (CM) will clear and settle trades directly with CSEClear. Trading Participants who do not have clearing rights must nominate a single Professional Clearing Member (PCM) under a Clearing and Settlement Agreement to clear and settle trades with CSEClear. Clearing Members must maintain cash accounts, directly with a Qualified Settlement Bank which offers commercial bank money settlement. In the alternative settlement of funds may take place via central bank money settlement through the Central Bank's RTGS (Real Time Gross Settlement System). Clearing members will provide CSEClear with the details of their cash accounts for the purpose of funds transfer between CSEClear and the Clearing Members, including direct debit capabilities where applicable. 1.8 Trading Orders and trades are entered by the Trading Participants into the CSE's Automated Trading System (ATS) for matching including details of the beneficial owners in the CSD (Central Securities Depository) account. Matched trades are submitted to the CSEClear System, together with the standard settlement instructions in real time for novation and further processing. The CSEClear System will need to be integrated to the ATS via the ATS's FIX Application Programming Interface (FIX version 5.0 service pack 2). The CSE may implement an Over the Counter (OTC) market in the future. 1.9 Clearing Trade Capture The ATS will transmit matched trades directly into the CSEClear System in real time. All trade transactions received by CSEClear will be allocated a fixed settlement date based on a set of rules. Page 5 of 21

7 1.9.2 Novation In the first phase CSEClear will act as the Central Counterparty to all trades in the equities and corporate debt market segments. These trades will be novated upon receipt of the trade for clearing and settlement by CSEClear. The system will be multi-currency. In the future, other asset classes such as government securities, derivatives, commodities, money market instruments and foreign exchange should be able to be novated and cleared by CSEClear Netting For equities and corporate debt, the cash obligations are netted at the Clearing Member level but there is no netting of securities obligations Trade Cancellation Before settlement date, where the CSE cancels trades under emergency situations, such cancellations will result in the cancellation of the relevant novated transactions of the Clearing Members. The open positions of the relevant Clearing Members will be adjusted to reflect the cancellation of the novated transactions following the cancellation Custodian Trade Rejections Custodians are able to reject trades for settlement. In these cases, the obligation to settle such rejected trades shall fall on the Clearing Member of the executing broker Settlement Before Settlement Batch Run After the close of trading on Settlement Date minus 1, CSEClear will give instructions to CDS to lock the quantity of securities required for settlement of each selling investors accounts at beneficial owner level and not at Clearing Member level; In the event of a securities shortfall discovered by a Clearing Member or their brokerage client, after end of day T, brokers may submit a voluntary buy order to the buy-in board on ATS on relevant accounts after trade day; In the event of a securities shortfall, CSEClear will conduct mandatory buy-in on the relevant accounts end of day T+2, by inserting a buy order on a new buy-in board on the ATS; In the event that the mandatory buy-in is not successful, the trade with insufficient securities will not be settled on the due settlement date, but will be rolled over for settlement in the following settlement day; and At the end of Settlement Date minus 1, CSEClear will re-compute the net funds obligation of the Clearing Members taking into account the trades that will be settled after adjusting for the buyin trades and trades that will be rolled over. CSEClear will advise each Clearing Members of the revised net cash obligations Default Settlement Date The CSEClear system will attach the default settlement date to each trade based on the Board that a trade was conducted on the ATS, or other rule At Settlement Time CSEClear will send the settlement file to the Qualified Settlement Bank and/or RTGS for making and receiving payments between CSEClear and the Clearing Members; Receive funds from the Clearing Members that have net debit obligations to CSEClear; Make payments to the Clearing Members that have net credit obligations from CSEClear Transfer the fees arising on the above transactions to the relevant fee accounts; and Instruct CDS to debit the securities of the selling investors and credit the securities into the buying investors accounts at the beneficial owner level Page 6 of 21

8 Failure of Cash Settlement In the event a Clearing Member fails to make payment to CSEClear, CSEClear will invoke its default procedures. As part of its default procedures, CSEClear will ensure that all the Clearing Members that have delivered securities will receive the corresponding funds. CSEClear will deliver securities to the other Clearing Members that have fulfil their cash payment obligation fully. CSEClear will not transfer securities to the defaulting clients of the defaulting Clearing Member but instead retain the securities in a holding account in the name of CSEClear in CDS. CSEClear will utilise defaulting Clearing Member margins, contribution to the guarantee fund, and other resources of the guarantee fund as per its default procedures Risk Management The risk management mechanisms that will be used by CSEClear are outlined below: Locking of Securities - As part of the settlement process, CSEClear will lock the securities on settlement date minus one after close of normal trading and after the closure of the buy-in board. The locking of securities ensures that securities are available for settlements and confirms the amount of securities shortfall; Securities Failure Management - When there are insufficient securities available in the settlement accounts, the tools available to CSEClear to manage fail securities deliveries include buy-in, roll-over and compulsory cash settlement; Delivery versus Payment - The DvP settlement mechanism ensures that CSEClear holds securities, settles funds between itself and Clearing Members and finally transfers securities; Margin - The two components of margin are initial margin and variation margin. Initial Margin calculation will be made against the outstanding positions of Clearing Members as an automated end-of-day process and will be supplemented by intraday margin calculations on an hourly basis; Collateralisation - CSEClear will accept collateral from the Clearing Members for the purpose of margin requirements and as contribution to the guarantee fund. Collateral will include cash, bank guarantees, certain corporate securities and Government Securities held in LankaSecure, the Central Bank's CSD; Settlement in Central Bank Money - CSEClear aspires to meet the PFMI standards of Central Bank Money (CeBM) DVP and will plan to maintain an account with CBSL (Central bank of Sri Lanka) and payment of cash with the Clearing Members will be conducted through the RTGS. By settling cash in central bank money, CSEClear plans to avoid the credit risk associated with the settling of cash in commercial bank money; Settlement in Commercial Bank Money - CSEClear will maintain accounts with Qualified Settlement Banks and Clearing Members will be able to open clearing accounts with such banks; Selling Out Securities - Through the DvP mechanism, the risk of the Clearing Members has been reduced to that of replacement cost risk. The ability of CSEClear to sell out securities fully reflects the characteristics of DvP. Netting of Obligations The system needs to be capable of netting both cash and securities obligations on a multilateral basis, but the launch model will be BIS DVP2, gross securities at beneficial owner level and net cash at the Clearing Member level. In multilateral cash netting, a Clearing Member s obligations are netted with all other Clearing Members resulting in one settlement only for each Clearing Member. 2 RFI Response Section 2.1 Instructions to Suppliers This section contains the questions to Suppliers and spaces for answers from the Supplier Where a consortium of Suppliers is responding to this RFI each company must complete a separate RFI response (unless part of the same legal holding group) but should submit their responses under a single cover note and indicate the lead organisation and Single Point of contact details Please use a copy of this entire section for you RFI response, using the tables, headings and spaces for you responses, as shown in this section. Page 7 of 21

9 The RFI response document should be provided in MS Word and optionally in PDF format. Additional information may be provided in MS Word, Excel or pdf, as needed. All material should be in English and should not be password protected. 2.2 Supplier Corporate Profile Request for Information 1. Name of Company responding to RFI 2. Single Point of Contact (SPOC) / Bid Manager Name Title Mailing addresses Telephone 3. Chief Executive Officer Name Name of Company Mailing address Telephone 4. Date of Company Incorporation 5. Country of incorporation 6. Company Number 7. For how many years has the Supplier been engaged in supplying and installing post-trade systems or in providing Clearing House Services to third parties? 8. Business Overview and Fields of Specialisation (1 page maximum) 9. Summary Income Statement (P&L) for the latest available 3 years (converted to USD, Euro or GBP) Year-End Supplier Income Statement (Profit & Loss) (Currency Insert ) 000 Date Date Date Page 8 of 21

10 10. Summary Statement of Financial Position (Balance Sheet) for the latest available 3 years (converted to USD, Euro or GBP) Year-End Supplier Statement of Financial Position ( Balance Sheet) (Currency Insert) 000 Date Date Date 11. Provide your most recent Audited Annual Accounts as a separate pdf attachment to your response. 2.3 Type of Supplier Request for Information If your firm is a CCP System Vendor or Clearing House Service Provider : Please state which category your company falls under If available at this stage, please state the names and locations of companies with which your organisation may choose to enter consortium arrangements, should it be selected to respond to the RFP (e.g. for Local Hardware provision etc.) If your firm is not a CCP System Vendor or Clearing House Service Provider: Please provide the name, title, and telephone number of your main contact at the CCP System Vendor or Clearing House service provider in your joint venture or consortium. CSE may wish to make contact with this person. Page 9 of 21

11 2.4 System / Service Profile Request for Information 1. The name and version number of the Supplier s latest relevant CCP system(s) 2. Which BIS settlement models can the system or service support (1,2,3) 3. State whether you currently support the provision of securities settlement instructions at Beneficial Owner level or not. 4. Please identify any functions in the outline specification, in sections 1.1 to 1.6 of this RFI, which your CCP system or Service does not currently offer and would require significant customisation effort. 5. Please provide an overall description of your system or service (10 pages maximum or attach pdfs) containing: Overview Functionality IT Architecture 6. Please describe your future roadmap for system or service development, including new instruments and markets to be processed (1 page maximum). 7. Please provide your product brochures and/or or relevant whitepapers, as separate pdf attachments to your response. 2.5 Supplier Experience, Constraints and Potential Liabilities The Supplier should describe its general experience in successfully delivering Clearing House / CCP projects with reference to live implementations in 3 rd party sites or in operating Clearing House Services for markets and participants outside its home market. (1 page maximum) Page 10 of 21

12 The Supplier should state its policy on CCP system or Service customisations and mention any general potential obstacles for CSEClear or its participants to use its Clearing Services. Request for Information The supplier should state whether it is prepared to consider customising its Clearing system or Clearing Services to meet specific CSEClear requirements. The Supplier should state any general policy or technical restrictions on customising its clearing systems or services for CSEClear. A Clearing House Service Provider should state any potential regulatory or other barriers or conditions for CSEClear, or its participants, to use its Clearing Services. 2.6 Supplier Reference Sites The Supplier should complete up to three of the following tables for 3rd Party reference sites. The sites may be for systems implementations or receiving clearing services and may be: live, work in progress or at the contract agreement stage. The preference is for live CCP sites that have features comparable to the Sri Lankan market as shown in section 1 of this RFI. Suppliers that are Clearing House Service Provider should also complete table 4 to describe clearing arrangements in its own market. Page 11 of 21

13 Supplier s Reference Site 1 Request for Information Reference Site / Client Details 1. Name of Reference Site Institution 2. Type of institution(s) (Clearing House, CCP, Stock Exchange, Clearing member, Central Bank etc.) 3. Instruments processed (Equities, Fixed Income, Derivatives, Commodities, FX etc.) 4. Approximate total number of CCP transactions per annum (Projected / latest actual) 5. Contact details at reference sites Name Title Telephone Visiting address Project details 6. System components supplied (Clearing & Settlement. Risk Management, Collateral Management etc.) 7. Project services supplied 8. Current status of project at reference site (contract signed, work started, live, further enhancements etc.) 9. Date project started (MM/YY) 10. Date project ended / expected to end (MM/YY) 11. Total contract value for the Supplier or Service Fee schedules Page 12 of 21

14 Supplier s Reference Site 2 Request for Information Reference Site / Client Details 1. Name of Reference Site Institution 2. Type of institution(s) (Clearing House, CCP, Stock Exchange, Clearing member, Central Bank etc.) 3. Instruments processed (Equities, Fixed Income, Derivatives, Commodities etc.) 4. Approximate total number of CCP transactions per annum (Projected / latest actual) 5. Contact details at reference sites Name Title Telephone Visiting address Project details 6. System components supplied (Clearing & Settlement. Risk Management, Collateral Management etc.) 7. Project services supplied 8. Current status of project at reference site (contract signed, work started, live, further enhancements etc.) 9. Date project started (MM/YY) 10. Date project ended / expected to end (MM/YY) 11. Total contract value for the Supplier Total Contract value for the Supplier or Service Fee schedules Page 13 of 21

15 Supplier s Reference Site 3 Request for Information Reference Site / Client Details 1. Name of Reference Site Institution 2. Type of institution(s) (Clearing House, CCP, Stock Exchange, Clearing member, Central Bank etc.) 3. Instruments processed (Equities, Fixed Income, Derivatives, Commodities etc.) 4. Approximate total number of CCP transactions per annum (Projected / latest actual) 5. Contact details at reference sites Name Title Telephone Visiting address Project details 6. System components supplied (Clearing & Settlement. Risk Management, Collateral Management etc.) 7. Project services supplied 8. Current status of project at reference site (contract signed, work started, live, further enhancements etc.) 9. Date project started (MM/YY) 10. Date project ended / expected to end (MM/YY) 11. Total contract value for the Supplier or Service Fee schedules Page 14 of 21

16 Clearing House Service Provider Home Market (In addition to other reference site info.) Request for Information Home Market Details 1. Name of Reference Site Institution 2. Type of institution(s) (Clearing House, CCP, Stock Exchange, Clearing Member, Central Bank etc.) 3. Instruments processed (Equities, Fixed Income, Derivatives, Commodities etc.) 4. Total number of CCP transactions per annum (Projected / latest actual) 5. Contact details at reference sites Name Title Telephone Visiting address Project details 6. System components supplied (Clearing & Settlement. Risk Management, Collateral Management etc.) 7. Project services supplied 8. Current status of project at reference site (contract signed, work started, live, further enhancements etc.) 9. Date project started (MM/YY) 10. Date project ended / expected to end (MM/YY) 11. Current Market Transaction Fee Structure (describe or attach pdf document) 2.7 Supplier Project Staffing Profile 1. Please describe the estimated number of key staff resources and overall project structure that would be used for the CSEClear project or has been used for a comparable CCP project elsewhere. This should include the Supplier s project organisation chart and the names of potential key staff members together with their project titles and contribution/experience to similar CCP projects. Page 15 of 21

17 2. How many management and staff do you have with knowledge relevant to the post trade / CCP area from a business, IT and operational perspective? Staff should not be double counted. Supplier Staff Role / Expertise Supplier Staff Number 2.8 Project Duration CSEClear s aim is to achieve a project duration from the start of contract negotiation to Central System / Service acceptance within 9-12 months, for a customised system/service. 1. Project Duration without customisations The Supplier should provide non-binding, indicative, elapsed periods for CCP system or service implementation from contract signature to the end of the Customer s Central Acceptance test, assuming no system customisations, based on experience from other project, in the table below: Supplier Project Duration Estimates Contract negotiations and signature Detailed system / service specification (assuming that a detailed business and IT specification is provided by CSEClear) Implementation and delivery of Central System / Services to CSEClear (Assuming no customisations) Period for Central Customer Acceptance test by CSEClear and bug fixes by the Supplier Duration (months) Approximate Minimum Approximate Maximum 2. Duration of Customisations Duration (months) Supplier Project Duration Estimates The supplier should give a non-binding indication, based on experience from other projects, on a range of additional project durations required for system customisations (compared to uncustomised estimates). Approximate Additional Minimum Approximate Additional Maximum Page 16 of 21

18 2.9 Supplier Price Indications CCP System Vendor Prices A CCP Systems vendor should supply a non-binding, indication of the price range for implementing its solution, based on the summary information contained in this RFI and the following assumptions: Approximate software and related prices: o Including licence fee and implementation prices, but excluding customisations o Including Sri Lankan taxes o Including travel and onsite expenses for the project periods stated earlier Approximate hardware and related prices: o Based on an a basic configuration for the volumes in this RFI o Central hardware at primary and warm standby backup site Approximate annual support & maintenance prices: o Software o Hardware CCP System Vendor Prices USD 000 Approximate Prices Software & related Minimum Hardware & associated Annual Support & Maintenance Service - Software Annual Support & Maintenance Service - Hardware Estimated 5 year Total Cost of Ownership (TCO) Estimated Minimum Estimated Maximum Clearing House Service Provider Prices A Clearing House Service Provider should supply a non-binding, indication of the price range for implementing its solution, based on the summary information contained in this RFI and the following assumptions: Approximate initial & periodic prices, if any o Initial set up prices excluding customisations o Periodic fixed prices o Including Sri Lankan taxes, if any o Including travel and onsite expenses for the project periods stated earlier Approximate hardware and related cost if any Transaction based charges o Based on 1,858,000 matched trades of per annum (the average of the past 10 years of the CSE s transactions) Clearing House Service Provider Costs USD 000 Approximate Costs Initial set up cost Other periodic prices per year Transaction based charges per year Estimated 5 year Total Cost of Ownership (TCO) Estimated Minimum Estimated Maximum Page 17 of 21

19 The Clearing House Service Provider should describe the basis for its transaction based charges for providing Clearing Services, including a comparison with the fee rates charged in its home market and any discount bands for volumes Other Pricing Approaches Suppliers may also propose and describe, other potential pricing mechanisms for CSEClear to consider for inclusion at the RFP stage CSEClear Basic Contract Terms CSEClear may use its own contracts for agreement negotiations with the CCP system or service provision and for support and maintenance. The supply contract will include, but not be restricted to, the following basic terms. Page 18 of 21

20 Outline Supply Contract Clause A bid security, which may be in the form of a bank guarantee, will be required from Suppliers that respond to the RFP, which will be released once a successful Supplier has been announced. The supplier s RFP response will form an integral part of the final, agreed contract. Suppliers must observe the highest standard of ethics during the procurement and execution of such contracts and will be required sign a statement to that effect if selected, and agreed to participate in the RFP process. If the Supplier is a joint venture, consortium, or association, all of the parties shall be jointly and severally liable to the Purchaser for the fulfilment of the provisions of the Contract and shall designate one party to act as a leader with authority to bind the joint venture, consortium, or association. The Supplier commits to providing the staff named in any future RFP response, for the relevant periods of the assignment. CSEClear will reserve the right to approve changes to key Supplier staff identified during the contract negotiations. The Supplier s proposal shall include quotations for hardware and associated prices as part of their solution. All goods and services supplied under the contract shall comply with applicable standards from the Sri Lanka or other internationally accepted standards, such as International Standards Organisation (ISO) or British Standards (BS). Prices from Suppliers must be in USD and Payments will be in USD unless otherwise agreed for specific exclusions. A payment schedule will be agreed, with any initial payments subject to an advance payment bond from the Supplier. The Supplier shall responsible for all required Sri Lankan taxes and duties in the gross price in its RFP financial response including; Nation Building tax, Royalty, VAT, withholding tax and any other taxes or licences relevant to the contract. CSEClear will not be liable for any remittance taxes (withholding taxes). The Supplier shall provide a performance bond of ten percent (10%) of the Contract Price for the performance of the Contract and returned within an agreed period after contract completion. No variation in or modification of the terms of the Contract shall be made except by written amendment signed by the parties. The supplier shall be required to provide proof of tests. The language of the contract will be in English. Confidentiality conditions will be apply. Warranty conditions will apply. Termination clauses will apply. Restrictions on assignment of whole or part of the contract will apply. Force Majeure clauses will apply. Contracts between the Supplier and its subcontractors are to be disclosed. Inclusion agreed subject to final contract wording Page 19 of 21

21 Outline Supply Contract Clause A percentage of the total contract price will be retained and paid as mutually agreed A number of Appendices will be attached to the supply contract that will define key aspects of the project and Supplier and CSEClear roles and responsibilities and will include, but not be restricted to: Project Management and methodology, system and vendor documentation, training, testing and acceptance criteria, quality assurance. Maintenance and support level arrangements will be agreed. Service obligations will be agreed where a Clearing House Service Provider arrangement is contracted. The Contract shall be governed by the laws of Sri Lanka. If the CSEClear decides to use the Supplier s contract during negotiations it reserves the right to make amendments and include essential terms defined by CSEClear including, but not restricted to, the key terms defined here. Inclusion agreed subject to final contract wording Any bid and performance bonds and bank guarantees from the Supplier should be issued by a licensed commercial bank operating in Sri Lanka 3 RFI Response & Evaluation Process 3.1 Key RFI evaluation Criteria The results of the RFP evaluation will lead to the pre-qualification of some Suppliers or Consortium of Suppliers, who will then be invited to respond to a full RFP. The minimum evaluation criteria used for the RFI are as follows: The capability of and resources available for the prospective suppliers to perform the particular contract satisfactorily, taking into account their experience and past performance on similar contract, resources available the financial resources at their disposal. It will be important for suppliers to have a successful implementation of their systems or services in terms of third party Reference Sites / Client Details. All Suppliers will be evaluated equally. 3.2 Notifications This RFI contains only the principal provisions of the assignment and the contents are not exhaustive. Information supplied by the CSE in this RFI should not be construed as final and accurate for any subsequent RFP from the CSE or CSEClear or contract negotiations with CSEClear, The Information provided by Suppliers will be held in the strictest confidence. Clarification requests on this RFI, from potential Suppliers, will be handled through the address provided by the CSE. The CSE reserves the right to distribute such clarifications to all potential Suppliers. The pre-qualification of parties to be included in the detailed Request for Proposal (RFP) stage of this project, will be based on information contained in the RFI responses received from Suppliers. The CSE is not obliged to disclose the details of its evaluation of RFI responses. The CSE is not obligated to issue an RFP following this RFI nor to select particular vendor(s) to receive an RFP. The Supplier bears all of its own costs for supplying its RFI response. Information provided by the Suppliers will be deleted, or disposed of, upon the Supplier s written request. Page 20 of 21

22 The Supplier s staff, its agents and partners must not make direct contact with the CSE, its consultants or CSEClear, other than through the official channels and format specified in this document, or requested to do so by the CSE. Failure to adhere to this process may disqualify the party from future involvement in this procurement process. CSE may request additional information from a Supplier or make direct contact following the RFI response submission. This contact request will be made formally and does not negate any other provisions stated in this RFI. CSE may request hardcopies of RFI submissions from selected Suppliers after the submission date shown in the table below. Suppliers selected from the RFI stage, and eligible to take part in the RFP stage, will receive further detailed information to respond to. 3.3 RFI Timetable Submission Deadline Date & Time Communication Availability of Advertisement and RFI Deadline for any questions to CSE on this RFI 16:00 hrs Sri Lanka Time 10/2/ :00 hrs Sri Lanka Time 24/2/2016 Public website to: CSEClear@CSE.lk Submit RFI Response by with any other pdf documents attached 16:00 hrs Sri Lanka Time 2/3/2016 to: CSEClear@CSE.lk Page 21 of 21