Rules and Regulations SIX x-clear Ltd

Transcription

1 xcl-n-604 May 2015

2 Table of contents 1.0 Introduction Late settlement procedure Overview Procedure Buy-in procedure Overview Procedure Consequences of buy-in Buy-in schedule per market Appendices Appendix: Oslo Stock Exchange (OSE) Buy-in schedule for non-uk securities Securities lending and borrowing 6 xcl-n SK xcl-n-604-e.doc 2 7

3 1.0 Introduction To support the settlement process and fulfill the settlement obligations, SIX x-clear Ltd. (Norwegian Branch) ( x-clear ) may employ the following procedures: 1. Late settlement procedures consist of - Late settlement fee - Buy-Ins 2. Buy-in procedure A late settlement fee for all Trading Platforms offered is in place for x-clear. A clearing notice will always be issued in due time to announce any changes concerning the late settlement fee regime. A buy-in regime is in place for settlements related to all Trading Platforms. The buy-in periods and schedules may be changed and may vary from Trading Platform to Trading Platform. Any deviations from the schedule in this document are announced in due time via clearing notices. The chart below shows a generic overview of the schedule for these procedures. Buy-in procedure Trade Date Intended Settlement Date Buy-in Notification Date Buy-in Execution Date Buy-in Settlement Initiate Securities Lending & Borrowing if possible Late Settlement procedure Cash Settlement only if Buy-in was not successful A late settlement fee will be charged to the non-delivering x-clear member in question ( liable party, which may be the seller or buyer). There will be no compensation scheme in place to credit the non-liable party. If the seller has not delivered the securities on the Intended Settlement Date (ISD), a buy-in process will be started after a certain market-specific period of time. For non-delivery of instruments, x-clear, as the formal counterparty to the buyer, will acquire the missing securities in the market and pass on the costs incurred to the seller that has failed to fulfill the transaction. The aim of performing a buy-in process is to ensure liquidity in the market and to fulfill agreed trades in a reasonable timeframe. Therefore, buy-in rules currently regarded as market practice are presented in this document, and should be viewed alongside x-clear s market-specific user guides. If market standards change, x-clear may decide to align its processes with those of the market in order to offer an xcl-n SK xcl-n-604-e.doc 3 7

4 optimal service to clients. Any change to this document is announced in due time via clearing notices. 2.0 Late settlement procedure 2.1 Overview 2.2 Procedure Late settlement can be caused by the non-delivery of securities by the seller, failure by either party to match settlement instructions in the Approved Settlement System and non-delivery of cash by the buyer. x-clear will debit a late settlement fee (see Price list) to the liable party upon failed delivery on the ISD. In the event that a buy-in facility (see below) is not successful, the transaction that is not performed will be cancelled and replaced by a payment for compensation (cash compensation). If settlement is not carried out by the ISD, a late settlement fee will be charged to the defaulting member. There will be no compensation scheme in place to credit the non-liable party. Any third party fees will be passed onto the liable party. 3.0 Buy-in procedure 3.1 Overview 3.2 Procedure If the selling Member does not deliver securities after a certain market-specific amount of days beyond the ISD, a buy-in procedure will be started. The schedules detailing when a buy-in notification will be sent to the selling party and the execution of the buy-in will be started is market-specific as summarized in Clause 4.0: Buy-in schedule per market. x-clear is also entitled to charge the selling Member external and internal costs (expenses, commissions and other charges) where buy-ins are used. The payment obligations of the Member, based on the buy-in effected by x-clear, are due, performable and payable with immediate effect. In the event that the buy-in facility is not successful, the transaction that is not performed will be cancelled and replaced by a payment for compensation. A separate x-clear administration fee (see Price List) per buy-in will be charged to the defaulting Member. xcl-n SK xcl-n-604-e.doc 4 7

5 If the buy-in is not successful due to a lack of liquidity in the market, the buy-in will be repeated according to market-specific schedules. If the buy-in attempts of x-clear are not successful after a market-specific time, the Single Contracts in which there is a shortfall of securities, will be cancelled, i.e. the Single Contracts between the selling Member and x- clear, and x-clear and the buying Member with respect to the securities that undelivered, become void (closed out) and a cash compensation claim will be calculated and credited the selling Member as described below. The standard cash settlement process will be initiated ISD+20 in all markets. The cash compensation to be paid by the selling Member to x-clear will be 120 % of the last publicly available closing price for such an Eligible Instrument on the principal stock exchange where it is listed, and is forwarded in full to the buying Member(s), Co-CCPs or x- clear Client (as the case may be). Debiting of the cash compensation to the buying Member constitutes the full and final settlement of the Single Contract, and the buying Member shall have no further claims against x-clear in connection with the respective Single Contract. Consequently, after cancellation of the Single Contracts and the corresponding cancellation of the applicable settlement instructions, no delivery will be possible, whether in case of subsequent availability of the securities to which the Single Contracts related. Where settlement or a buy-in cannot take place because of a court, administrative or regulatory order, or because of an insolvency event affecting the issuer of the securities, the transactions in such securities will be cash settled immediately or with the standard cash settlement process at such a price as may be set at reasonable discretion and agreed between x-clear and the counterparty. Though it should be noted that in such circumstances the reference price may be nil. 3.3 Consequences of buy-in The payment obligations of the x-clear Member, arising from the buy-in effected by x-clear, shall be due and payable immediately upon notification of the same by x-clear. If the x-clear Member fails to satisfy such payment obligation, x-clear may at its discretion treat such failure as an Event of Default pursuant to clause 28.2a of the GTCB. 4.0 Buy-in schedule per market Market Intended Settlement Notification Execution (CET) Cash Settlement Date (ISD) Norway T+2 ISD+4 ISD ISD +20 T = Trade date ISD = Intended Settlement Date 5.0 Appendices The following appendices explain any special handling or special cases that differ from the standard procedures. Different platforms and/or asset classes may require different or additional processes and timings. xcl-n SK xcl-n-604-e.doc 5 7

6 Where there are deviations from the standard procedures as described above, those are noted as such in the applicable appendix and shall take precedence. 5.1 Appendix: Oslo Stock Exchange (OSE) Buy-in schedule for non-uk securities For all securities traded on the OSE, the Norwegian market buy-in schedule (see 4.0) applies Securities lending and borrowing In the Norwegian market, securities lending and borrowing by x-clear as CCP is not applied. In this context, SIX x-clear Ltd draws the Members attention to clauses 7.1 lit. f. and 25.3 General Terms and Conditions of SIX x-clear Ltd stipulating that the Member bears responsibility for the tax requirements and consequences of clearing with x-clear pursuant to the Applicable Law and that SIX x-clear Ltd assumes no liability for any charges or other negative consequences arising in conjunction with clearing through SIX x-clear Ltd. that are a result of tax laws or ordinances issued by tax authorities pursuant to the Applicable Law. xcl-n SK xcl-n-604-e.doc 6 7

7 SIX Securities Services Brandschenkestrasse 47 CH-8002 Zurich Mailing address: P.O. Box 1758 CH-8021 Zurich T F