Subject to testing and regulatory approval, Nasdaq Commodities is announcing changes to its Clearing Rules, effective January 2, 2018.
This is to inform you of upcoming amendments to the Clearing Rules of the Nasdaq Commodity Markets (the “Clearing Rules”).
This notice includes information about amendments made in relation to the implementation of the requirements under MiFID II with respect to indirect clearing.
The amendments made in relation to indirect clearing and the Commission Delegated Regulation (EU) 2017/2154 of 22 September 2017 supplementing Regulation EU No 600/2014 of the European Parliament and of the Council with regard to regulatory technical standards on indirect clearing arrangements and the Commission Delegated Regulation (EU) 2017/2155 of 22 September 2017 amending Delegated Regulation (EU) No 149/2013 with regard to regulatory technical standards on indirect clearing arrangements (“Indirect Clearing RTSs”) are made following the publication of the Indirect Clearing RTSs in the Official Journal on November 21, 2017.
Defined terms have the meaning set out in the Clearing Rules.
Unless stated otherwise, amendments will come into effect on January 2, 2018.
Please note that minor and editorial changes may not be mentioned herein but can be found in the full text versions which are provided separately.
Indirect Clearing – Commodity Clearing Rules General Terms
A new Section 3.14 has been added to the Clearing Rules which sets out additional requirements with respect to indirect clearing. Clients of Clearing Members are permitted to facilitate Indirect Clearing Arrangements, provided that they are an authorized credit institution, investment firm or an equivalent third country credit institution or investment firm, and meet the requirements under the Indirect Clearing RTSs (to the extent applicable to the relevant Client).
New Sections 3.3.15, 3.3.16 and 3.3.17 have been added to the Clearing Rules which implements the Indirect Clearing RTSs. At the request of a Clearing Member, the Clearinghouse shall open and maintain any of the following types of Indirect Clearing Accounts: Net Omnibus Segregated Account (NOSA) or Gross Omnibus Segregated Account (GOSA).
The relevant Clearing Member shall ensure that the Indirect Clients’ margin and positions are segregated on separate Indirect Clearing Accounts from the relevant Client’s margin and positions.
When the collateral and positions of several Indirect Clients are held by the Clearing Member in a Gross Omnibus Segregated Account, the Clearing Member shall ensure that the Clearinghouse has all the necessary information to allow the Clearinghouse to identify the positions held for the account of each Indirect Client on a daily basis. The Clearing Member shall also provide information to the Clearinghouse with respect to Net Omnibus Segregated Account when requested to do so. Such requests may also include information with respect to Indirect Clients, Second Indirect Clients or Third Indirect Clients further down the chain, which the Clearing Member shall provide on a best effort basis.
Where the collateral and positions of several Indirect Clients are held by the Clearinghouse in a Gross Omnibus Segregated Account, the Clearinghouse shall keep separate records of the positions of each Indirect Client, calculate the Margin Requirement in respect of each Indirect Client and collect the collateral sum on a gross basis.
Where the collateral and positions of several Indirect Clients are held by the Clearinghouse in a Gross Omnibus Segregated Account, the Clearing Member shall ensure that the positions of an Indirect Client do not offset the positions of another Indirect Client.
Defined terms - Commodity Clearing Rules Joint Appendix 1 Definition
The Definitions have been updated with the following defined terms that are relevant in relation to an Indirect Clearing Arrangement: Gross Omnibus Segregated Account (GOSA), Indirect Clearing Account, Indirect Clearing Arrangement, Indirect Clearing RTSs, Indirect Client, Longer Chains, Net Omnibus Segregated Account (NOSA), Single-client Account Second Indirect Client and Third Indirect Client.
Compliance and Supervision of the Clearing Rules
Section 3.11.5 and 3.11.6 of the Clearing Rules have been clarified such that the Clearing House shall be entitled to request information regarding participants’ legal entity identifier (LEI) code. A provision has also been included specifying that the Clearinghouse shall be entitled to request information with respect to Indirect Clearing Arrangements as further set out in Section 3.3.15.
For updated rulebooks and appendices please see:
http://www.nasdaqomx.com/commodities/Marketaccess/legalframework/upcoming-changes-to-rules
For further information, please contact Nasdaq Commodities:
Mette Steinsland, AVP Head of Legal Nasdaq Commodities, phone +47 6752 8071, mette.steinsland@nasdaq.com
Erica Brown, AVP Head of International Affairs at Nasdaq Clearing, phone +46 4684056131, erica.brown@nasdaq.com
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About Nasdaq Commodities
Nasdaq Commodities is the brand name for the worldwide suite of commodity related products and services offered by Nasdaq. The Nasdaq Commodities offerings include power, natural gas and carbon emission markets, tanker and dry cargo freight, fuel oil, seafood derivatives, iron ore, electricity certificates and clearing services.
Nasdaq Oslo ASA is the commodity derivatives exchange authorized by the Norwegian Ministry of Finance and supervised by the Norwegian Financial Supervisory Authority. All trades with Nasdaq Oslo ASA are subject to clearing with Nasdaq Clearing.
About Nasdaq Clearing
Nasdaq Clearing is the trade name of Nasdaq Clearing AB which is authorized and supervised as a multi-asset clearinghouse by the Swedish Financial Supervisory Authority in Sweden as well as authorized to conduct clearing operation in Norway by the Norwegian Ministry of Finance.
For more information, visit www.nasdaqomx.com/commodities
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