Amendments to the Clearing Conditions of Eurex Clearing AG – Consultation

1. Introduction

This circular contains information with respect to the service offering of Eurex Clearing AG (Eurex Clearing) and introduces amendments to the Clearing Conditions of Eurex Clearing AG (Clearing Conditions) regarding the following topic: 

Harmonisation of the Order of Priority of the Realisation of the Default Fund for ISA Direct Clearing Members

The amendments to the Clearing Conditions are subject to a consultation process (Consultation). The Consultation will end with the expiry of 24 October 2024 (Consultation Period). The planned effective date of these amendments is 18 November 2024, depending on the outcome of the Consultation which will be communicated in a separate Eurex Clearing circular. 

2. Required action

Clearing Members, ISA Direct Clearing Members, Disclosed Direct Clients, FCM Clearing Members, vendors and other affected contractual parties should take the amendments to the Clearing Conditions into consideration.

Eurex Clearing herewith invites all Affected Customers to submit comments on the proposed changes and amendments within the Consultation Period. 

3. Details

The ISA Direct model was introduced with additional incentives for the Clearing Agent to diligently select their ISA Direct Clearing Members. In the event of a default of the ISA Direct Member, their Clearing Agent is liable to two assessments on the default fund contribution of the ISA Direct Member prior to the Dedicated Amount of Eurex Clearing in the Order of Priority of the Realisation of the Default Fund, thereby tripling the Clearing Agents’ Default Fund payment prior to resources of other Default Fund contributors.

Since direct clearing access for regulated buy-side firms and the ISA Direct clearing model have become well established, a harmonisation with the standard waterfall and equal treatment of comparable risk is appropriate. The admission requirements for ISA Direct equal those for other direct Clearing Members.

Default Fund assessments of the Clearing Agent specifically relating to ISA Direct Clearing Members prior to Dedicated Amount of Eurex Clearing in the Order of Priority of the Realisation of the Default Fund will be removed. 

Consultation with respect to the proposed amendments to the Clearing Conditions

Pursuant to Chapter I Part 1 Number 17 of the Clearing Conditions, the proposed changes and amendments to the Clearing Conditions and the Default Management Committee Rules regarding topics A. and B. are subject to a Consultation which will end with the expiry of 24 October 2024.

Eurex Clearing herewith invites all Affected Customers to submit comments on the proposed changes and amendments within the Consultation Period.

During the Consultation Period, comments on proposed changes or amendments shall be only submitted through a web-based commenting service for which a registration form is available on the Eurex Clearing website under the following link:

Find > Forms: Consultation Form

The form has to be duly signed and returned to Eurex Clearing via e-mail to SpecialProvisions@eurex.com, in order to obtain a User ID and Password together with a link for accessing the web-based commenting service.

To the extent that Eurex Clearing decides to implement any comments received during the Consultation, the so-amended version of the Clearing Conditions will be published after the Consultation.

The currently envisaged effective date of the changes is 18 November 2024. However, after the Consultation Period, Eurex Clearing will issue a separate circular to announce the concrete date on which the proposed changes (as the case may be, implementing comments received during the Consultation) will come into effect. 

This announcement will be made with at least 15 Business Days’ notice (Regular Notification Period). However, if Eurex Clearing AG should receive a request for a Prolonged Notification Period from more than two Affected Customers during the Consultation Period, a Prolonged Notification Period as set out in the Clearing Conditions will be applied and Eurex Clearing will notify all affected parties accordingly.

Publication of amendments

As of the effective date, the full version of the amended Clearing Conditions will be available for download on the Eurex Clearing website www.eurex.com/ec-en/ under the following link:

Rules & Regs > Eurex Clearing Rules and Regulations > 1. Clearing Conditions

The amendments to the legal framework of Eurex Clearing AG published by this circular are deemed accepted by each affected contractual party of Eurex Clearing AG, unless the respective contractual party objects by written notice to Eurex Clearing AG prior to the relevant effective date(s) as stipulated in this circular. In case of an objection by the respective contractual party pursuant the preceding sentence, Eurex Clearing AG is entitled to terminate the respective contract (including a Clearing Agreement, if applicable). Instead of submitting an objection, the respective contractual party may submit in writing to Eurex Clearing AG comments to any amendments of the legal framework of Eurex Clearing AG within the first 10 Business Days after the publication of the amendments. Eurex Clearing AG shall assess whether these comments prevent the published amendments from becoming effective taking into account the interests of Eurex Clearing AG and all contractual parties.

Unless the context requires otherwise, terms used and not otherwise defined in this circular shall have the meaning ascribed to them in the Clearing Conditions or FCM Clearing Conditions of Eurex Clearing AG, as applicable.

Attachment: 

• Amended sections of the Clearing Conditions of Eurex Clearing AG, effective 18 November 2024 (subject to the Consultation)

Further information