LSOC

Porting under LSOC

Client porting process overview

In case of the occurrence of a Termination Event with respect to a FCM Clearing Member

In case of  the occurrence of a Termination Event with respect to a FCM Clearing Member, Eurex Clearing is entitled  to (i) either issue an FCM Client Declaration of Termination with respect to the relevant FCM Client Netting Set and to calculate the Difference Claim with respect to such FCM Client Netting Set, or (ii) to use all reasonable efforts to transfer all FCM Client Transactions (including Eligible Margin Assets) under the relevant FCM Client Netting Set to a Replacement FCM Clearing Members by initiating a porting process with respect to all FCM Clients of the FCM Clearing Member. 

The porting process starts with Eurex Clearing informing all other FCM Clearing Members, all FCM Clients of the relevant FCM Clearing Member and all Non-FCM Clearing Members of the occurrence of the Termination Event with respect to the FCM Clearing Member and the initiation of the porting process with respect to the FCM Client Transactions (the "Replacement Notice"), including providing information on the Replacement Cut-Off Time stating until when all FCM Clearing Member Replacement Requirements need to be fulfilled to ensure a valid porting. 

In case of an Insolvency of the FCM Clearing Member

In case of the occurrence of an Insolvency Termination Event with respect to the FCM Clearing Member, the insolvent FCM Clearing Member will be subject to U.S. insolvency proceedings.  Depending on the regulatory status of the FCM Clearing Member in the U.S. either a bankruptcy case under Chapter 7 Subpart IV of the U.S. Bankruptcy Code and Part 190 of the CFTC Rules or proceedings under the U.S. Securities Investors Protection Act (SIPA Proceedings) will be initiated with respect to the relevant FCM Clearing Member including the appointment of either a bankruptcy trustee or SIPA trustee. 

In deviation from the porting process Eurex Clearing AG applies in case of the occurrence of a Termination Event, the porting process which applies in case of the occurrence of an Insolvency Termination Event will be determined in close cooperation with the relevant bankruptcy trustee or SIPA trustee of the insolvent FCM Clearing Member and the CFTC. 

Eurex Clearing AG will seek to coordinate any action to be taken to transfer FCM Client Transactions and Eligible Margin Assets to a Replacement FCM Clearing Member with the relevant trustee and the CFTC. To comply with applicable U.S. insolvency law or instructions or orders by the CFTC or the competent U.S. bankruptcy court, Eurex Clearing AG is entitled to deviate from the porting process described in the FCM Regulations.