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FAQs

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1. Corporate structure and governance

 

What is Eurex Clearing’s ownership structure?

Please click here to find comprehensive information.

What is Eurex Clearing's governance structure?

Please click here to find comprehensive information.

Does Eurex Clearing inter-operate with other clearing houses?

No.

 
 
 

2. Treasury

 

Does Eurex Clearing have access to Central Bank funding if needed to maintain intraday liquidity?

Eurex Clearing has access to the intraday credit facility of the Deutsche Bundesbank.

Is there a liquidity facility in place to deal with a settlement failure? If yes, what is the arrangement?

Yes. Eurex Clearing has adequate credit facilities with a number of investment grade rated banks in place which, together with other liquidity sources, cover Eurex Clearing's intraday and overnight financing needs.

 
 
 

3. Regulation

 

What is Eurex Clearing’s legal status, what licenses does it hold and what are the details of the regulatory oversight?

On 10 April 2014, Eurex Clearing received a permission from the German Federal Financial Supervisory Authority to perform clearing services pursuant to Article 17 of Regulation (EU) No 648/2012 of the European Parliament and of the Council of 4 July 2012 on OTC derivatives, central counterparties and trade repositories (European Market Infrastructure Regulation, EMIR). The authorisation as EMIR-compliant CCP also determines Eurex Clearing as a qualifying CCP under Capital Requirements Regulation (CRR). 

Eurex Clearing is also a credit institution under the German Banking Act and fulfils the requirements under the European legislation, in particular Capital Requirements Regulation (CRR) / Capital Requirements Directive (CRD IV). 

Eurex Clearing is registered with the Commodity Futures Trading Commission (CFTC) as a Derivatives Clearing Organisation (DCO) for clearing OTC interest rate swaps for US Clearing Members in accordance with the Commodity Exchange Act.

Eurex Clearing AG has been recognized by the Swiss Financial Market Supervisory Authority FINMA as a foreign central counterparty  and is considered by the Swiss National Bank as a systemically important financial market infrastructure for the stability of the Swiss financial system.

As a consequence, the list of the relevant authorities can be found below:

BaFin
Marie-Curie-Str. 24-28
60439 Frankfurt

Deutsche Bundesbank
(Central Administrations Center Frankfurt / Main)
Taunusanlage 5
60313 Frankfurt am Main

Deutsche Bundesbank
(Head Office) Wilhelm-Eppstein-Str. 14
60431 Frankfurt am Main

Swiss National Bank (SNB)
Börsenstr. 15
CH-8022 Zürich

Swiss Financial Market Supervisory Authority FINMA
Laupenstr. 27
CH-3003 Bern

Financial Conduct Authority (FCA)
25 The North Colonade, Canary Wharf
London E14 5HS

Does Eurex Clearing provide any reporting to regulators?

Yes, Eurex Clearing provides reporting to regulators due to different regulatory prescriptions and in different time periods.

Eurex Clearing reports to the following public authorities

  • the Federal Financial Supervisory Authority (BaFin),
  • the German Central Bank (Deutsche Bundesbank),
  • the Swiss Financial Markets Authority (FINMA),
  • Commodity Futures Trading Commission (CFTC),
  • the Swiss National Bank (SNB).

For further information, please contact our regulatory section.

 
 
 

4. Compliance

 

By which external auditor is Eurex Clearing audited?

Eurex Clearing AG is audited by an external auditor. The auditor is KPMG and the audit takes place on a yearly basis.

How often are Clearing Conditions of Eurex Clearing AG updated and how is the process therefore?

Eurex Clearing AG rules are stipulated in the Clearing Conditions which are part of the general terms and conditions. Eurex Clearing AG reserves the right to amend the Clearing Conditions at any time; those amendments and additions shall be announced via electronic circular to the Clearing Members and Non-Clearing Members at least fifteen (15) business days (Regular Notification Period) prior their effective date fixed in the relevant notice.

If Special Provisions are to be changed or amended, Eurex Clearing AG will carry out a Consultation and invite all Affected Customers to submit comments to the proposed changes and amendments and/or to express their desire for the application of a Prolonged Notification Period within one month after the publication of the relevant invitation. In case three or more Affected Customers request the application of a prolonged notification period, the notification period will be extended to three (3) months (“Prolonged Notification Period”).

Each affected Customer accepts each amendment and addition to the Clearing Conditions, unless it objects by written notice to Eurex Clearing AG within the Regular Notification Period or the Prolonged Notification Period, Unless otherwise provided in the Clearing Conditions, all information to be published according to these Clearing Conditions shall be displayed for at least three business days, available here.

How does Eurex Clearing ensure client confidentiality? Do employees and any other contingent staff sign a data confidentiality agreement with regards to operation of client account and information?

Every employee and external service provider of Deutsche Börse Group is obliged to adhere to the “Guideline for Keeping Professional and Banking Secrecy”. Professional Secrecy is the obligation for any employee to treat information obtained pursuant to professional activities confidential. Banking Secrecy is derived from this by adding specific provisions while limiting its application to employees of regulated entities. All information received within the conduct of professional activities must therefore be treated in the strictest confidence by employees and external service providers and must not be disclosed to any unauthorized party.

The adherence of client confidentiality is ensured by the implementation of diverse control systems like the Internal Control System (ICS), Group Compliance and Internal Auditing.

For further information please see also our annual report.

 
 
 

5. Services, membership and admission

 

What asset classes does Eurex Clearing clear, in what markets does it operate and what services does it offer?

Please click here to find comprehensive information.

What are different types of Clearing memberships?

Membership comes in two categories at Eurex Clearing - General Clearing Membership and Direct Clearing Membership.

  • ­A General Clearing Member (GCM) may clear its own transactions, those of its customers, as well as those of trading participants that do not hold a clearing license (known as Non-Clearing Member - NCM).
  • ­A Direct Clearing Member (DCM) is entitled to clear only its own transactions, those of its customers, and those of its corporate affiliated NCMs. Only a Clearing Member - GCM or DCM - may be a counterparty of Eurex Clearing in a transaction.

As a result, legal relationships are essentially concluded between Eurex Clearing and a given Clearing Member, and in turn between that Clearing Member and the respective NCM.

What is required to become a Clearing Member of Eurex Clearing, specifically which application forms are needed?

Applicants must be authorized and entitled by their respective regulatory authorities to operate in the custody and loan business as well as to accept receipt of margins in the form of cash and/or securities. In addition, Clearing Members must show evidence of a certain minimum level of own funds and must pay a contribution to Eurex Clearing’s Clearing Fund. Both the level of contribution to the Clearing Fund and the level of own funds depend on the status of the Clearing Member (GCM or DCM).


Own fund requirements, in EUR mn

Contribution to Clearing Fund, in EUR mn

*Initial margin corresponds to the sum of futures spread margin and additional margin.

Additional admission requirements for all our Clearing Members include different accounts that they need to set up. Every member must hold accounts at a central securities depository for the deposit of collateral and execution of settlement related payments. Further, we require evidence of cash accounts for clearing related payments, e.g. premiums.

With our fee model, we encourage our members to conduct business at Eurex Clearing in multiple markets by taking advantage of economies of scale. For a first membership, applicants are charged a one-off admission fee as well as an annual membership fee. If a company wishes to become a Clearing Member for additional markets that we clear, no additional admission or membership fees are levied. In line with the markets that we serve, companies may apply for one or more of the following clearing licenses:

  • ­ Eurex Exchanges
  • ­ Eurex Repo
  • ­ Frankfurt Stock Exchange
  • ­­ Irish Stock Exchange
  • ­ EurexOTC Clear
  •  Securities Lending

For further information, please also consult our webpage. Click here.

All forms necessary for the registration to the various Eurex Clearing service offerings can be found on our webpage under here.

Is there a Clearing membership fee?

We charge applicants a one-off admission fee of EUR 50,000 to become a Clearing Member, as well as an annual membership fee of EUR 25,000. We designed our fee model to encourage Members to take advantage of all the markets that we serve. For this reason, if you wish to become a Clearing Member for any of the other markets we clear we do not charge any additional admission or membership fees.

How much does it cost to technically connect to the Eurex Clearing system environment (CCP)?

Additional fees with regard to different connection components and transaction volumes can be found on the Eurex Clearing Price List.

Which firms are admitted as Clearing Members at Eurex Clearing?

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Which cash and settlement accounts does a Clearing Member need and do they have to be in the Clearing Members own name?

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6. Risk

 

Which risk management model does Eurex Clearing use to calculate margin requirements?

  • What model is used to calculate initial margin?

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  • How is the default fund calculated for each member?

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  • Are there any intra-day calculations and if so is this called for?

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  • ­Are there any offsets against other products?

Eurex Clearing Prisma calculates combined risks across all markets cleared by Eurex Clearing. Cleared products that share similar risk characteristics are assigned to the same so-called Liquidation Group, which results in more comprehensive risk calculations enabling cross margining across positions within any Liquidation Group. Our margining method and default management process are closely aligned.

Please click here to find comprehensive information about liquidation group setup.


 
 
 

7. Collateral

 

What types of margin collateral does Eurex Clearing accept?

Cash collateral:

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Securities collateral:

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How can a Clearing Member manage its collateral?

Collateral deposit

The Clearing Member delivers the securities to the relevant account directly within the system of the chosen (I)CSD i.e. Clearstream Banking Frankfurt (CBF), Clearstream Banking Luxembourg (CBL) or SIX SIS. All deposits are reflected near-time within the collateral management system of Eurex Clearing® C7. If a deposited ISIN cannot be accepted (due to ineligibility of the security or breach of concentration limit), Eurex Clearing instructs a near-time transfer back to the member's redelivery account.

In case a tri-party collateral management system is used, the Clearing Member needs to instruct an increase of a Collateral Claim.

Collateral withdrawal

Securities withdrawal instructions are entered using the “Collateral Transaction Entry” window of the Eurex Clearing® C7 system. Once confirmed by Eurex Clearing Operations that the margin requirement is still covered without the securities requested, the securities are transferred from the respective collateral account into the member's redelivery account. If a withdrawal request leads to an under-collateralization in the member’s account, the transfer of the requested securities is optionally postponed until the next business day or intraday until the appropriate amount of funds is in the account to fully cover the margin requirements.

Collateral Claim decreases need to be instructed via the tri-party collateral management system of the respective depository. Once confirmed by Eurex Clearing Operations that the margin requirement is still covered with the reduced claim amount, the tri-party collateral management system will move securities with a value up to the free amount to the respective source account.

Information about collateral

The Clearing Member may manage collateral on several windows on the Eurex Clearing® C7 GUI.

  • Collateral Transaction Input / Collateral Transaction - Mass Input
    The Collateral Transaction Input window is used for collateral withdrawals and deposits by a member and by Clearing Operations on behalf of a member. Members may withdraw securities or deposit/withdraw cash through this window. The Collateral Transaction – Mass Input window allows a fast entry of cash deposits or withdrawals for multiple pools at the same time.
  • Four Eyes Principal – Collateral
    The Four Eyes Principal window for the collateral management allows the approval or rejection of
    - transaction input/cancellation
    - Permanent Cash Balance amendments.
    The member can define on user level whether the four eyes principal feature is to be used.
  • Collateral Transaction Overview
    The Collateral Transaction Overview window provides a variety of filter options to search for all or specific transactions that have been entered for a pool. Transactions generated out of the Mass Input can as well be found here. After settlement/cancellation any transaction can be historically enquired for approx. 60 days.
  • Collateral Transaction Details
    The Collateral Transaction Details window provides detailed status information for a single collateral transaction including its entire history (status updates). After settlement/cancellation transaction details can be historically enquired for approx. 60 days.
  • Collateral Position Details
    The Collateral Position Details window provides a variety of filter options to search for all or specific collateral positions (in cash, securities or claims) that are held in a pool.
  • Collateral Pool Status Overview 
    The Collateral Pool Status Overview window provides an overview of the overall values of cash, securities or claims in a pool and its current excess/shortfall.
  • Permanent Cash Balance (PCB) Maintenance
    The PCB Maintenance window allows the member to define a minimum cash balance per currency that shall remain as cash collateral and hence will not be swept out in the end of day processing.
  • CSD Account Maintenance
    The CSD Account Maintenance window allows the member to inquire all accounts that are setup for a respective pool.

Does Eurex Clearing offer to segregate client’s collateral and how is it managed?

­Please click here to find comprehensive information.

 
 
 

8. Clearing operations

 

Does Eurex Clearing maintain position limits? How are these monitored and enforced?

At Eurex, position limits exist according to § 14.7 of the Exchange Rules of Eurex Deutschland. The size of the respective limits can be learned from the product specifications on the Eurex Exchange website.

Trading Surveillance Eurex Deutschland is monitoring the adherence of the position limits intraday and is informing the Börsenaufsichtsbehörde Hessen as well as the Executive Board of Eurex in case of breach of the Exchange Rules. They then decide on whether to forward the statement of affairs to the sanction committee of Eurex Deutschland. In succession, the sanction committee is able to impose sanctions up to an amount of EUR 250.000 and/or to impose a temporary or definite expulsion from trade.

 
 
 

9. Technology

 

Which technology is used for the Eurex® system environment (CCP)?

Please click here to find comprehensive information.

 
 
 

10. Disaster recovery/ IT-security

 

Does Eurex Clearing have a formal crisis management process?

Yes, Deutsche Börse Group has implemented a formal crisis management process with defined responsibilities. The process applies Group-wide for all activities and organizational or legal entities, including Eurex Clearing AG.

What structure does the crisis management team have and what are its responsibilities?

­The Crisis Management Team is composed of the Incident and Crisis Managers from the different divisions of Deutsche Börse Group. It is their role to ensure a coordinated incident response, including internal and external communication.

Does Eurex Clearing’s program cover all risks and scenarios that may cause disruption to its business? If so, what has Eurex Clearing done to mitigate the risks that could disrupt the supply chain that supports its services to its clients?

Yes, the BCM plans address the unavailability of systems, workspace, staff and suppliers. Supplier unavailability preparedness is regularly reviewed and generally addressed by service level agreements or multiple vendor arrangements.

Does Eurex Clearing have a disaster recovery back up site? If yes, does this site have fully functional operations to support Eurex Clearing’s business and how long does it take for this site to be fully operational?

All Systems but Xetra® and Xetra® International Market are set up with an automatic fail-over process which makes the take over immediate. Xetra® and Xetra® International Market are set up fault tolerant, but disaster recovery requires a restart of the system at the back up site, which typically should be done within an hour. However, the general recovery time objective of Deutsche Börse Group in case of a disaster is 2 hours.

 
 
 

11. Business continuity

 

How/at what point are Clearing Members informed if there is a technical emergency case?

In case of technical issues emergency information is provided via the following media:

  • System Newsboard
  • SMS Service
  • E-mail

Information on technical issues is distributed immediately if impact on members of Eurex has been recognized.

What are Eurex Clearing’s responsibilities in an outage scenario?

The responsibilities of Eurex and Eurex Clearing in an outage scenario are described within Section 12 on “Technical Problems” of the Technical Implementation Regulations of Eurex Deutschland and Eurex Zürich Concerning Technical Equipment.

 
 
 
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