Rulebooks: Contents

Rulebooks
Mainboard Rules
Catalist Rules
SGX-ST Rules
CDP Clearing Rules
DVP Rules
CDP Depository Rules
Futures Trading Rules
Chapter 1 General Matters
Chapter 2 Access and Membership
Chapter 3 Conduct of Members, Approved Traders and Representatives
Chapter 4 Listing and Trading of Contracts
Chapter 5 Physical Delivery
Chapter 6 Dispute Resolution and Arbitration
Chapter 7 Adverse Events, Rule Violations and Disciplinary Action
Chapter 8 Definitions and Interpretation
Chapter 9 Transitional Provisions
Regulatory Notices
Practice Notes
Practice Note 2.6.3(1)(c) — Pre-Execution Checks
Schedules
SGX-DC Clearing Rules
SIAC DT Arbitration Rules
SIAC DC Arbitration Rules
Rule Amendments

  Versions
(3 versions)
 

Practice Note 2.6.3(1)(c) — Pre-Execution Checks

Issue Date Cross Reference Enquiries
Added on
22 September 2006 and amended on 15 March 2013 and 14 November 2016.
Rule 2.6.3(1)(c) Please contact Member Supervision:

Facsimile No : 6538 8273
E-Mail Address: membersup@sgx.com

1. Introduction

1.1 This Practice Note provides further details on the pre-execution checks contemplated in Rule 2.6.3(1)(c).

2. Pre-Execution Checks

2.1 Rule 2.6.3(1)(c) requires Members to ensure that automated pre-execution risk management control checks are conducted on all orders, including credit control checks on all orders. The purpose of this is to prevent overtrading and for credit risk management. As such, the checks must be appropriately set to effectively limit the firm's risk exposure arising from all orders (including House orders) to prevent the taking on of excessive risk.
2.2 [Deleted]
2.3 Members who authorise Sponsored Access will be able to meet the requirement in Rule 2.6.3(1)(c) by using the appropriate Exchange-hosted pre-execution checks, or by directly setting and controlling the appropriate pre-determined automated limits in the Sponsored Access customer's system, having automated alerts whenever such limits are altered, and by conducting regular post-execution reviews of trades. Members should assess and continue to ensure that the pre-execution risk management control checks are robust on an ongoing basis.
2.4 Where a Trading Member has allowed its Clearing Member to directly set and control pre-determined automated limits in the Trading Member's system, the Trading Member should have the appropriate internal controls to prevent unauthorised modification of the limits set by the Clearing Member.

Amended on 15 March 2013 and 14 November 2016.