Rulebooks: Contents

Rulebooks
Mainboard Rules
Catalist Rules
SGX-ST Rules
CDP Clearing Rules
Rule 1 — Application and Definitions
Rule 2 — Administration
Rule 3 — Membership
Rule 4 — Appointment of Chief Executive Officers and Directors
Rule 5 — Financial/Capital Requirements
Rule 5A — Position Accounts
Rule 6 — Clearing and Settlement between Clearing Members and CDP
Rule 6A — Margin Requirements
Rule 6B — Collateral
Rule 6C — Payments
Rule 7 — Clearing Fund
Rule 8 — Default Rules
Rule 9 — Suspension or Restriction of Clearing
Rule 10 — Liabilities
Rule 11 — Supervisory Rules
Rule 12 — Foreign Market Links
Rule 13 — General
Rule 14 — Transitional Provisions
Appendices
Regulatory Notices to CDP Clearing Rules
Practice Notes
Schedules
CDP Settlement Rules
DVP Rules [Entire Rulebook has been deleted]
CDP Depository Rules
Futures Trading Rules
SGX-DC Clearing Rules
SIAC DT Arbitration Rules
SIAC DC Arbitration Rules
Archive
Rule Amendments

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  • CDP Clearing Rules

    • Rule 1 — Application and Definitions

      • 1.1 Application

        • 1.1.1

          These Clearing Rules apply to all Exchange Trades that are cleared or settled through CDP. The Clearing Rules operate as a binding contract between CDP and each Clearing Member, and between a Clearing Member and any other Clearing Member.

          Amended on 3 April 2008, 8 October 2018 and 3 June 2019.

        • 1.1.2

          These Clearing Rules shall come into effect on the Effective Date.

        • 1.1.3

          Except where CDP, SGX RegCo, or any person or entity referred to under Rule 1.1.7 otherwise expressly agrees with or expressly commit to any party, the benefit of any performance of obligations under these Clearing Rules and/or Clearing Directives is restricted only to Clearing Members. None of CDP, its related corporations, SGX RegCo, any person or entity referred to under Rule 1.1.7, or their respective directors, officers, employees, representatives or agents (the "Relevant Persons") shall be liable to any other party (including Trading Members). In particular, the Relevant Persons shall have no liability to any party affected or aggrieved by any alleged action or omission.

          Amended on 23 January 2009, 15 September 2017 and 3 June 2019.

        • 1.1.4

          All Clearing Members are to note the foregoing and ensure that they are taking on membership, and/or carrying on business, as Clearing Members, and that they transact and will transact by reference to CDP or upon information or action referable to CDP, only on the foregoing basis, and will also ensure that they will not open or allow the continued operation of any account for any person with respect to any transaction unless such person has been notified of the foregoing provisions and has satisfied itself that the same is acceptable and accepts the same.

        • 1.1.5

          CDP may waive the application of a rule (or part of a rule) to suit the circumstances of a particular case, unless the rule specifies that CDP shall not waive it. CDP may grant a waiver subject to such conditions as it considers appropriate. A waiver is only effective if the conditions are satisfied.

          CDP shall notify all Clearing Members of such waivers as soon as practicable.

        • 1.1.6

          The Clearing Rules may be amended or repealed by the Board in accordance with the SFA.

          Amended on 3 June 2019.

        • 1.1.7

          CDP may delegate, assign or grant authority to exercise any of its rights, powers, authorities and discretions under these Rules, including any right to enforce these Rules, to such person or entity as it may determine in its sole discretion, without consent from any Clearing Member.

          Where these Rules provide that any power, authority or discretion is to be exercised by the Board, the Board may delegate, assign or grant authority to exercise such power, authority or discretion to any person or entity. The Board may authorise a delegate to sub-delegate.

          Added on 15 September 2017.

        • 1.1.8

          SGX RegCo shall have the authority to exercise any rights, powers, authorities and discretions under these Rules, including the right to enforce these Rules. In the exercise of any such rights, powers, authorities and discretions under these Rules, SGX RegCo shall be bound to the same extent as CDP in respect of any obligations arising from the exercise of such rights, powers, authorities and discretions.

          Added on 15 September 2017.

      • 1.2 Definitions

        • 1.2.1

          In these Clearing Rules, unless the context otherwise requires:—

          Where a provision of these Clearing Rules refers to or has effect for the purposes of a particular provision of the SFA or the Companies Act (Cap. 50) or any subsidiary legislation promulgated under it ("the Companies Act") — the word or expression has in that provision of these Clearing Rules the same meaning as it has in that provision of the SFA or the Companies Act; in any other case, the word or expression has the same meaning in these Clearing Rules as it has in the SFA or the Companies Act.

          Unless the context requires otherwise, where the terms defined below are defined in relation to a holder of a Capital Markets Services Licence, such definitions shall, with the necessary modifications, apply to a Clearing Member as those definitions apply to a holder of a Capital Markets Services Licence whether or not that Clearing Member holds a Capital Markets Services Licence.

          A   B   C   D   E   F   G   H   I   J   K   L   M   N   O   P   Q   R   S   T   U   V   W   X   Y   Z

          Term Meaning
          A
          "acceptable government securities" means securities issued by a government with a Moody's Investors Service sovereign rating of at least Aaa, Standard & Poor's Corporation sovereign rating of at least AAA, Fitch, Inc sovereign rating of at least AAA or such other rating or such other government security, as may otherwise be prescribed by and acceptable to CDP from time to time
          "adjusted net head office funds" has the meaning ascribed to it in Regulation 2 of the SFR (Financial and Margin Requirements).
          "aggregate indebtedness" has the meaning ascribed to it in Regulation 2 of the SFR (Financial and Margin Requirements).
          "aggregate resources" when used in reference to:—
          (1) a Clearing Member incorporated in Singapore, means its financial resources and qualifying letters of credit referred to in Rule 5.1C less its total risk requirement; and
          (2) a Clearing Member incorporated outside Singapore, means its adjusted net head office funds and qualifying letters of credit referred to in Rule 5.1G less its total risk requirement.
          "Appeals Committee" means the committee appointed by the SGX RegCo Board to exercise the powers set out in Rule 11.
          "[Deleted]" "[Deleted]"
          "Authority" means the Monetary Authority of Singapore or such other body that shall be responsible for the administration of the SFA.
          "Average Aggregate Resources" means the average of the aggregate resources on the last day of each of the 3 months preceding the previous month.
          B
          "Bank Clearing Member" means a Clearing Member who has such rights and obligations as set out in Chapter 3. For the avoidance of doubt, a reference to a Bank Clearing Member incorporated outside Singapore shall refer to the branch located in Singapore, of a parent bank incorporated outside Singapore.
          "base capital" when used in reference to:—
          (a) a General Clearing Member, has the meaning ascribed to it in Regulation 2 of the SFR (Financial and Margin Requirements); and
          (b) a Bank Clearing Member, means its paid-up ordinary share capital and unappropriated profit or loss.
          "Board" means the Board of Directors for the time being of CDP or such of them as have authority to act for the Board.
          "business governed by this Clearing Rules" or "operations governed by this Clearing Rules" when used in reference to:—
          (1) a Bank Clearing Member incorporated in Singapore or a Bank Clearing Member incorporated outside Singapore which has satisfied Rule 3.1.3(10)(c), means its business or operations (whichever is applicable) involving all securities and derivatives contracts traded on any exchange and OTC Contracts novated to any clearing facility; and
          (2) a Bank Clearing Member incorporated outside Singapore which has satisfied Rule 3.1.3(10)(a) or (b), means its business or operations (whichever is applicable) involving securities and derivatives contracts traded on the Exchange and SGX-DT and OTC Contracts novated to CDP and SGX-DC.
          "buying-in market" means the market operated by SGX-ST for the sale and purchase of securities to be bought-in by CDP pursuant to these Clearing Rules.
          C
          "Capital Markets Services Licence" has the meaning ascribed to it in the SFA.
          “cash settle” in relation to an obligation to deliver securities or a right to receive securities means the replacing of that obligation or right with an obligation to pay or a right to receive a Cash Settlement Amount.
          “Cash Settlement Amount” means the monetary sum, as set out in Practice Note 6.5.1B(2), 6.6.2, 6.7.11, 8.4.1A, 8.5.2A and 8.6F.2, to be paid or received pursuant to a cash settlement under these Clearing Rules.
          "CDP" means The Central Depository (Pte) Limited.
          “CDP Settlement Facility” means the settlement facility operated by CDP for settlement pursuant to the CDP Settlement Rules.
          “CDP Settlement Rules” means the Settlement Rules of CDP as the same may be amended, modified, supplemented or replaced from time to time.
          “Chief Executive Officer” has the meaning ascribed to it in the SFA.
          [Deleted] [Deleted]
          "Circular" means a binding notice issued by CDP regarding regulatory and non-regulatory matters pertaining to Clearing Members.
          "Clearing Account" means, in relation to a Clearing Member, the Securities Account maintained by it for settlement purposes.
          "Clearing Directives" means any Directives, Regulatory Notices, Circulars, and terms and conditions governing the operations, facilities and services provided by CDP.
          "Clearing Fund" means the fund referred to in Rule 7.
          "Clearing House Examiner" means the person appointed as such under Rule 11.1.5.
          "Clearing House Inspector" means the person appointed as such under Rule 11.2.1.
          "Clearing Member" means the corporation granted or admitted to be a member of CDP for clearing, pursuant to these Clearing Rules and shall include a General Clearing Member and a Bank Clearing Member.
          "Clearing Member Maintenance Margins" means that component of the Clearing Member Required Margins, as determined by CDP, deposited by the Clearing Member with CDP for or in relation to all Novated Contracts carried in its books.
          "Clearing Member Required Margins" means the sum of Clearing Member Maintenance Margins and Clearing Member Variation Margins.
          "Clearing Member Variation Margins" means that component of Clearing Member Required Margins comprising the mark-to-market gains and losses, in relation to the price at which the Novated Contract was bought and sold, arising from CDP's daily valuation of positions. A net loss increases the Clearing Member Required Margins amount, and a net profit decreases the Clearing Member Required Margins amount.
          "Clearing Membership" means membership of CDP pursuant to this Clearing Rules.
          "Clearing Rules" means the CDP Clearing Rules, including the Directives, Regulatory Notices and Circulars, as the same may be amended, modified, supplemented or replaced from time to time.
          "Collateral" means all or any of the monies and assets deposited with, or otherwise provided to, CDP by or for a Clearing Member as margin, credit support and/or security as may be required under these Clearing Rules or as otherwise directed by CDP and shall not include the monies and assets of the Clearing Fund.
          "Common Banking Day" in relation to settlement in a foreign currency means a day on which CDP is open for business and both the central bank in Singapore and the central bank for that foreign currency are open for settlement.
          "Confirmation" has the meaning ascribed to it in Rule 6C.2.3.
          "Contract Specifications" means the commercial and technical terms of a Marginable Futures Contract, including the contract size, contract month, underlying security, Last Trading Day and settlement basis. Unless otherwise stated, Contract Specifications are not subject to the rule amendment procedures specified under the SFA.
          "Contribution" means the contribution made or required to be made by a Clearing Member to the Clearing Fund pursuant to Rule 7.
          "CPF Trade Settlement" means an Exchange Trade which is settled using the customer's CPF account as maintained by the CPF Agent Banks.
          "Customer", with respect to a Clearing Member, means:—
          (1) any person from whom, or on whose behalf, a Clearing Member has received or acquired or held moneys or securities for the account of such person and includes directors of the Clearing Member, their connected persons (as defined in section 2 of the SFA) and any other person with whom the Clearing Member has entered into a contract to sell or purchase securities or Futures Contracts; and
          (2) the Trading Members which are qualified by the Clearing Member but excludes:—
          (a) a person whose account is carried on the books of a Trading Member (where such person is not the Trading Member itself);
          (b) the Central Depository (Pte) Limited; and
          (c) [Deleted]
          (d) any other person approved by the Authority and which is established for the purpose of providing clearing and settlement facilities in respect of any dealing in securities or trade in Futures Contracts.
          "Customer Account" means, unless otherwise specified in these Clearing Rules, a trading account carried on the books of a Clearing Member for a Customer except where such Customer is:—
          (1) a director, officer, employee or representative of the Clearing Member; or
          (2) a related corporation of the Clearing Member with respect to accepted instructions to deal for an account belonging to, and maintained wholly for the benefit of, that related corporation.
          For the avoidance of doubt, a Clearing Member's own proprietary account is not a Customer Account.
          "Customer Asset Value" means the market value of the moneys and assets in a customer's account subject to such hair-cut as specified by CDP.
          "Customer Maintenance Margins" means that component of Customer Required Margins, as determined by CDP, which must be maintained in a customer's account subsequent to the deposit of Initial Margins for that customer's positions in Marginable Futures Contracts.
          "Customer Required Margins" means the sum of Customer Maintenance Margins and Customer Variation Margins.
          "Customer Variation Margins" means that component of Customer Required Margins arising from CDP's daily valuation of positions. It comprises the mark-to-market gains and losses, in relation to the price at which the Marginable Futures Contract was bought or sold. A net loss increases the Customer Variation Margins and Customer Required Margins amount, and a net profit decreases the Customer Variation Margins and Customer Required Margins amount.
          D
          "Default Amount" has the meaning ascribed to it in Rule 7.10.2.
          "Defaulting Clearing Member" has the meaning ascribed to it in Rule 8.1.2.
          "Depository Agent" has the meaning ascribed to it in the SFA.
          "Directive" means a binding notice directing Clearing Members to take corrective or other actions including actions in the interests of a safe and efficient clearing facility or in light of investor protection concerns.
          "Disciplinary Committee" means the committee appointed by the SGX RegCo Board to exercise the powers set out in Rule 11.
          E
          "Effective Date" means 1 December 2003.
          "Event of Default" means an event relating to a Clearing Member as referred to in Rule 8.1.
          "Excess Margin" means the amount of Customer Asset Value or deposited collateral value that is in excess of the sum of the Initial Margins and Customer Variation Margins.
          "Exchange" means SGX-ST or any other organised market or organisation (whether an exchange, association, body corporate or unincorporate or otherwise) the trades on which are cleared by, or novated to CDP.
          "Exchange Trade" means:—
          (1) a trade transacted on or through the Trading System pursuant to the SGX-ST Rules; or
          (2) a trade reported to SGX-ST pursuant to the SGX-ST Rules, including but not limited to Direct Business (as defined in the SGX-ST Rules); or
          (3) a trade reported by a Clearing Member to CDP, which CDP accepts for clearing; or
          (4) a trade transacted on such Exchange (other than SGX-ST) with which CDP may have direct or indirect clearing arrangements from time to time, or in relation to which trade CDP has clearing arrangements in place;

          with the exception of such trades as CDP may from time to time stipulate as not being "Exchange Trades" falling under these Clearing Rules.

          "Exempt Person" has the meaning ascribed to it in the SFA.
          F
          "Final Settlement Balance" has the meaning ascribed to it in Rule 6.3.2.
          "financial resources" has the meaning ascribed to it in Regulation 2 of the SFR (Financial and Margin Requirements).
          [Deleted] [Deleted]
          "futures contract" has the meaning ascribed to it in the SFA.
          G
          "General Clearing Member" means a Clearing Member who has such rights and obligations as set out in Chapter 3.
          H
          "House Account" means, unless otherwise specified in these Clearing Rules, a trading account carried on the books of a Clearing Member which is not a Customer Account.
          I
          "Initial Margin" means that minimum amount, as determined by CDP, required to be deposited for positions in Marginable Futures Contracts. This minimum amount is distinct from and in addition to Customer Variation Margins.
          “Intended Settlement Day” means, in relation to any Novated Contract, the day on which the Exchange Trade from which the Novated Contract arises is due for settlement, as provided in the SGX-ST Rules or the applicable rules or regulations of the relevant Exchange (as the case may be).
          [Deleted] [Deleted]
          "Irredeemable and Non-Cumulative Preference Share Capital" has the meaning ascribed to it in Regulations 2 of the SFR (Financial and Margin Requirements).
          L
          "Last Trading Day" means the last day on which a Marginable Futures Contract may be traded prior to its expiration.
          M
          "Marginable Futures Contract" means such futures contract, as CDP may prescribe, approved for listing on SGX-ST and which is subject to margin requirements.
          "Market Day" means in respect of any security or Futures Contract, a day on which the relevant Exchange is open for trading in the security or Futures Contract.
          N
          "net head office funds" has the meaning ascribed to it in Regulation 2 of the SFR (Financial and Margin Requirements).
          [Deleted] [Deleted]
          "New Purchase Contract" has the meaning ascribed to it in Rule 8.2.2(1).
          "New Sale Contract" has the meaning ascribed to it in Rule 8.2.2(2).
          "Novated Contract" means a contract between CDP and a Clearing Member arising as a result of the novation of an Exchange Trade referred to in Rule 6.2.1.
          O
          "On-Line Transmission" means the on-line transmission referred to in Rule 6.3.3.
          "Operational Risk Requirement" has the meaning ascribed to it in the Notice on Risk Based Capital Adequacy Requirements for Holders of Capital Markets Services Licences.
          "organised market" has the meaning ascribed to it in the SFA.
          "OTC Contracts" means contracts that are not listed or quoted for trading on any exchange, market or organisation (whether an exchange, association, corporation or otherwise) responsible for administering an organised market.
          "Other Payment Method" means any payment method other than Settlement Bank Payment.
          P
          "Payment Instruction" has the meaning ascribed to it in Rule 6C.2.2.
          "Position Account" means an account maintained by a Clearing Member with CDP in CDP's post-trade system, for carrying positions of trades to be cleared with CDP.
          "Practice Note" means a non-binding guideline that seeks to explain the application and interpretation of a Rule.
          "Proportion" means at any time and in respect of a Clearing Member, the proportion of such Clearing Member's Turnover to the Total Turnover.
          Q
          "Qualifying Letter of Credit" has the meaning ascribed to it in Regulation 2 of the SFR (Financial and Margin Requirements).
          "Qualifying Subordinated Loan" has the meaning ascribed to it in Regulation 2 of the SFR (Financial and Margin Requirements).
          R
          "Recognised Group A Securities Exchange" means an overseas securities exchange regulated by a financial services regulatory authority of a country or territory specified in Table 4 of Fourth Schedule of the SFR (Financial and Margin Requirements).
          “Regulatory Notice” means a binding notice issued by CDP on regulatory matters regarding the clearing facility operated by CDP, as the same may be amended, modified, supplemented or replaced from time to time.
          "Relevant Period" means a period of 1 year commencing from a specified day of a specified month (as determined by CDP) of any calendar year.
          "Relevant Regulatory Authority" means:
          (a) the authority(ies) or regulatory body(ies) that regulate(s) a Clearing Member's activities in the country where it is carrying on such activities and from which it has applied for Clearing Membership; and
          (b) where the Clearing Member are carrying on regulated activities in Singapore, the MAS.
          "related corporation" has the meaning ascribed to it in the SFA.
          "Resignation Notice" means the resignation notice referred to in Rule 3.10.1.
          "RRA Financial Requirement" means all applicable financial requirements (whether relating to capital, liquidity, risk or otherwise) imposed on a Clearing Member by its Relevant Regulatory Authority.
          S
          "securities" means:—
          (1) shares, units in a business trust, or any instrument conferring or representing a legal or beneficial ownership interest in a corporation, partnership, or limited liability partnership;
          (2) debentures;
          (3) units in a collective investment scheme;
          (4) derivative contracts (as defined in the SFA) that are not futures contracts and of which the underlying instrument or any of the underlying instruments are any of the instruments set out in (1), (2) or (3) or an index on any of those instruments; or
          (5) any other product or class of products as SGX-ST or CDP may prescribe;

          whether or not they are classified as "securities" under the Act, but excludes:

          (a) bills of exchange;
          (b) certificates of deposit issued by a bank or finance company, whether situated in Singapore or elsewhere; or
          (c) any product or class of products as SGX-ST or CDP may prescribe.

          For the avoidance of doubt, "securities" include (but are not limited to) warrants, transferrable subscription rights, options to subscribe for stocks or shares, convertibles, depository receipts and exchange traded funds.

          "Securities Account" means, in relation to any person, an account maintained directly with CDP or through a Depository Agent or the CPF Board for holding securities for or on behalf of that person.
          "Security Deed" means the deed, in such form as prescribed by CDP, setting out the terms under which a Clearing Member's Collateral is provided to, and held by CDP.
          "Security Interest" means any mortgage, charge, assignment by way of security, pledge, encumbrance, lien, right of set-off, right of consolidation of accounts, retention of title, trust or flawed asset arrangement for the purpose of, or which has the effect of, granting security or credit support or other interests of any kind whatsoever over or in respect of Collateral.
          "Settlement Bank" means a bank approved by CDP to carry out Settlement Bank Payment.
          "Settlement Bank Payment" has the meaning ascribed to it in Rule 6C.2.1.
          "Settlement Day" means a day on which settlement occurs in CDP.
          "SFA" means the Securities and Futures Act (Cap. 289) and any subsidiary legislation promulgated under it or any statutory modification, amendment or re-enactment thereof for the time being in force, or any act or subsidiary legislation that replaces the Securities and Futures Act or any subsidiary legislation promulgated under it, and any reference to any provision of the SFA is to that provision as so modified, amended or re-enacted (or as contained in any replacement act or legislation.
          "[Deleted]" "[Deleted]"
          "SFR (Financial and Margin Requirements)" means the Securities and Futures (Financial and Margin Requirements for Holders of Capital Markets Services Licences) Regulations or any statutory modification, amendment or re-enactment thereof for the time being in force, or any regulations that replace the SFR (Financial and Margin Requirements), and any reference to any provision of the SFR (Financial and Margin Requirements) is to that provision as so modified, amended or re-enacted (or as contained in any replacement regulations).
          "SFR (Licensing and Conduct of Business)" means the Securities and Futures (Licensing and Conduct of Business) Regulations or any statutory modification, amendment or re-enactment thereof for the time being in force, or any regulations that may replace the SFR (Licensing and Conduct of Business), and any reference to any provision of the SFR (Licensing and Conduct of Business) is to that provision as so modified, amended or re-enacted (or as contained in any replacement regulations).
          "SGX" means Singapore Exchange Limited.
          "SGX-DC" means the Singapore Exchange Derivatives Clearing Limited.
          "SGX-DT" means the Singapore Exchange Derivatives Trading Limited.
          "SGX RegCo" means Singapore Exchange Regulation Pte. Ltd.
          "SGX RegCo Board" means the board of directors for the time being of SGX RegCo or such number of them as have authority to act for the SGX RegCo Board.
          "SGX-ST" means the Singapore Exchange Securities Trading Limited, an approved exchange under the SFA.
          "SGX-ST Directives" means the Directives of SGX-ST as the same may be varied, amended or supplemented from time to time.
          "SGX-ST Trading Member" refers to a "Trading Member" as defined in the SGX-ST Rules.
          "SGX-ST Rules" means the Rules of SGX-ST as the same may be varied, amended or supplemented from time to time.
          "Stock Account" means, in relation to a Clearing Member, the Securities Account maintained by it to house its proprietary securities.
          "$" means Singapore Dollar.
          T
          "Third Party" means any party other than CDP and a Clearing Member.
          "total risk requirement" has the meaning ascribed to it in Regulation 2 of the SFR (Financial and Margin Requirements).
          "Total Turnover" means at any time the aggregate of the Turnover of all Clearing Members at that time.
          "Trading Member" or "TM" means a person who is not a Clearing Member and whose Exchange Trades that has been qualified by a Clearing Member in accordance with Rule 3.10.
          "Trading System" means any electronic trading system for the automatic matching of orders designated and approved by SGX-ST for transactions on SGX-ST.
          "Turnover" means at any time and in respect of a Clearing Member, the volume of Exchange Trades cleared by such Clearing Member multiplied by the prices of the respective Exchange Trades for the immediately preceding 12 months and if such Clearing Member has traded for less than 12 months, the turnover of Exchange Trades cleared by such Clearing Member for its immediately preceding trading period calculated as aforesaid (adjusted to a 12-month period).
          V
          "Valuation Price" means the official price of Novated Contracts determined by CDP for the purpose of determining Customer Variation Margins or Clearing Member Variation Margins.

          Amended on 12 October 2005, 3 April 2008, 23 January 2009, 3 May 2011, 21 January 2013, 22 April 2013, 26 April 2013, 29 December 2014, 1 July 2016, 15 September 2017, 8 October 2018, 10 December 2018, 22 April 2019 and 3 June 2019.

      • 1.3 Regard to be had to Purpose or Object of the Clearing Rules

        • 1.3.1

          Unless expressly provided to the contrary, all questions concerning the interpretation or application of or any other matter in connection with these Clearing Rules (including, without limitation, CDP Directives) shall be determined by CDP, whose decision shall be final and binding on all parties.

        • 1.3.2

          In the interpretation of any provision of the Clearing Rules, a construction that would promote the purpose or object underlying the Clearing Rules (whether the purpose is expressly stated in the Clearing Rules or not) is to be preferred to a construction that would not promote that purpose or object.

      • 1.4 General Principles of Interpretation

        • 1.4.1

          Any word signifying any gender shall include all genders and the singular shall include the plural and vice versa.

        • 1.4.2

          Any reference to a particular rule in these Clearing Rules shall include the subsections of that rule.

        • 1.4.3

          A reference to any legislation or legislative provision includes any subordinate provisions made thereunder and any statutory modification, amendment or re-enactment thereof for the time being in force.

        • 1.4.4

          References to a person shall, where the context permits, include references to an individual, partnership, corporate entity, unincorporated association and/or statutory or governmental authority or division.

      • 1.5 Headings

        • 1.5.1

          Headings, titles and sub-titles are provided for ease of reference only and shall not affect the interpretation or construction of the provisions of these Clearing Rules.

      • 1.6 Examples

        • 1.6.1

          If these Clearing Rules include an example of the operation of a rule:—

          (1) the example is not taken to be exhaustive; and
          (2) if the example is inconsistent with the rule, the rule prevails.

      • 1.7 Rules to Prevail

        • 1.7.1

          If there is any conflict between any Clearing Rule and the Clearing Directives, unless specifically provided otherwise in the Clearing Directives, the Clearing Rules shall prevail.

      • 1.8 Clearing Directives

        • 1.8.1

          CDP may from time to time issue Clearing Directives which operate as a binding contract between CDP and each Clearing Member, and between a Clearing Member and any other Clearing Member.

        • 1.8.2

          CDP may, from time to time, issue Practice Notes (or amend existing Practice Notes) to provide guidance on the interpretation and application of any rule. A Practice Note does not bind CDP in the application of a rule.

      • 1.9 Transitional Provision

        • 1.9.1

          CDP may, from time to time, publish transitional arrangement in relation to any amended or new rule.

      • 1.10 Order of Precedence

        • 1.10.1

          The order of precedence of the following instruments applicable to the CDP and Clearing Members shall be (in descending order of precedence):

          (1) Legislation;
          (2) these Clearing Rules (excluding Directives, Regulatory Notices and Circulars);
          (3) Directives;
          (3A) Regulatory Notices;
          (4) Circulars;
          (5) terms and conditions governing the operations, facilities and services provided by CDP; and
          (6) Practice Notes.

          Amended on 26 April 2013 and 10 December 2018.

        • 1.10.2

          Subject to Rule 1.7.1, in the event of any conflict between the provisions of the aforesaid instruments, the provisions in an instrument with a higher level of precedence shall prevail over the provisions in an instrument with a lower level of precedence.

          Added on 26 April 2013

    • Rule 2 — Administration

      • 2.1 Registers

        • 2.1.1

          CDP shall maintain the following registers:—

          (1) Register of Clearing Members;
          (2) Register of Chief Executive Officers; and
          (3) such other register as CDP may determine from time to time.

          Amended on 3 June 2019.

    • Rule 3 — Membership

      • 3.1 Clearing Member

        • 3.1.1

          Clearing Membership in CDP shall comprise such classes of membership(s) as may from time to time be provided in this Clearing Rules. All memberships to CDP are granted pursuant, and subject, to this Clearing Rules and such other terms and conditions as may be prescribed at CDP's discretion.

          Added on 1 July 2008 and 10 December 2018.

        • 3.1.2 Eligibility Criteria for General Clearing Member

          Unless otherwise prescribed by CDP, to be eligible for Clearing Membership as a General Clearing Member, an applicant must satisfy CDP that:—

          (1) it is a corporation with the requisite financial and business standing and repute and is or will upon admission be carrying on the business in Singapore;
          (a) it has a base capital of not less than S$5,000,000; or
          (b) in the case of an applicant admitted as a clearing member of CDP and SGX-DC, it has a base capital of not less than S$8,000,000;
          or such other amount as may be prescribed by CDP hereafter and from time to time;
          (2) upon admission, it shall register one (1) person as a Chief Executive Officer pursuant to Rule 4;
          (3) unless exempt under the SFA, it holds a Capital Markets Services Licence to engage in the relevant regulated activities;
          (4) it has, and upon admission, will maintain, minimum capital and financial requirements pursuant to Rules 5.1.1 or 5.1D.1 (whichever is applicable) and 5.4;
          (4A) it has, and upon admission will maintain, a special reserve fund pursuant to Rule 5.5;
          (5) its managerial or executive staff have a high standard of integrity and a level of knowledge (as may be deemed acceptable by CDP) on the nature, risks and obligations in respect of the organised market or trades that it wishes to clear;
          (6) it must have in place sufficient resources and establish and maintain adequate systems for preserving a sound liquidity and financial position at all times including the maintaining of adequate staff and facilities for monitoring its cashflow and funding requirements and maintaining sufficient liquidity for its day to day operations;
          (7) it must maintain segregated and adequate back-office functions; and
          (8) it satisfies any and all other requirements and criteria for such Clearing Membership, which CDP may from time to time hereafter prescribe.

          Amended on 3 April 2008, 1 July 2008, 8 October 2018, 10 December 2018 and 3 June 2019.

        • 3.1.3 Eligibility Criteria for Bank Clearing Members

          Unless otherwise prescribed by CDP, to be eligible for Clearing Membership as a Bank Clearing Member, an applicant must satisfy CDP that:—

          (1) it is authorized to conduct banking business in Singapore pursuant to section 4 of the Banking Act (Chapter 19) ;
          (2) it or its parent bank has obtained a credit rating that indicates, at least, adequate intrinsic safety and soundness, excluding external credit support, and a limited ability to withstand adverse business or economic conditions from any rating agency registered with an appropriate authority;
          (3) upon admission, it shall register one (1) person as a Chief Executive Officer pursuant to Rule 4;
          (4) it has, and upon admission will maintain, minimum capital and financial requirements pursuant to Rules 5.1.1A or 5.1D.2 (whichever is applicable) and 5.4;
          (5) its managerial or executive staff have a high standard of integrity and a level of knowledge (as may be deemed acceptable by CDP) on the nature, risks and obligations in respect of the organised market or trades that it wishes to clear;
          (6) it must have in place sufficient resources and establish and maintain adequate systems for preserving a sound liquidity and financial position at all times including the maintaining of adequate staff and facilities for monitoring its cashflow and funding requirements and maintaining sufficient liquidity for its day to day operations governed by this Clearing Rules;
          (7) it must maintain segregated and adequate back-office functions in respect of its operations governed by this Clearing Rules;
          (8) it satisfies any and all other requirements and criteria for such Clearing Membership, which CDP may from time to time hereafter prescribe; and
          (9) [deleted]
          (10) [deleted]

          Added on 1 July 2008. Amended on 26 April 2013 and 22 April 2019.

        • 3.1.3A

          Upon admission as a Bank Clearing Member, if there is any downgrade in the rating of the Bank Clearing Member or its parent bank such that it falls below the minimum prescribed rating, CDP may, at its absolute discretion, impose additional conditions as it deems fit, for permitting the Bank Clearing Member to continue to clear contracts through CDP.

          Added on 1 July 2008.

      • 3.2 The Application

        • 3.2.1

          To become a Clearing Member, an applicant shall apply to CDP in the form CDP prescribes.

        • 3.2.2

          CDP may, in its absolute discretion, approve or reject an application for clearing membership. CDP is not obliged to give any reasons.

        • 3.2.3

          Without derogating from Rule 3.2.2, CDP may reject an application for clearing membership if:—

          (1) the applicant does not provide CDP with information relating to the application as CDP requires;
          (1A) any information or document that is furnished by the applicant to CDP is false or misleading;
          (2) the applicant, its substantial shareholder or head office is in the course of being wound up, or a resolution to do so is passed by the shareholders, or a court order is made, to wind it up, whether in or out of Singapore;
          (3) execution against the applicant, its substantial shareholder or head office in respect of a judgment debt has been returned unsatisfied in whole or in part, whether in or out of Singapore;
          (4) the applicant, its substantial shareholder or head office has entered into an arrangement or composition with its creditors that is still in operation, whether in or out of Singapore;
          (5) a receiver, a receiver and manager, judicial manager or such other person having similar powers and duties, has been appointed, whether in or out of Singapore, in relation to any property of the applicant, its substantial shareholders or head office;
          (6) CDP is not satisfied with the financial standing of the applicant, its substantial shareholders or head office;
          (7) CDP is not satisfied with the manner in which the applicant's business is to be conducted;
          (8) the applicant, any of its officers, substantial shareholders or head office breaches any provision involving fraud or dishonesty, whether in or out of Singapore;
          (9) the applicant, any of its officers, substantial shareholders or head office has been convicted of an offence under the SFA;
          (10) the applicant, any of its officers, substantial shareholders or head office is the subject of an investigation involving an allegation of fraud or dishonesty, whether in or out of Singapore;
          (11) CDP is not satisfied as to the educational or other qualification or experience of the officers of the applicant;
          (12) CDP is not satisfied with the applicant's record of past performance;
          (13) CDP is not satisfied that the applicant, any of its officers, substantial shareholders or head office is a fit and proper person;
          (14) CDP has reason to believe that the applicant or any of its officers or employees may not perform the functions efficiently, honestly and fairly;
          (15) CDP has reason to believe that the applicant may not act in the best interests of its customers; or
          (16) In CDP's opinion, it would be contrary to the interests of the public to admit the applicant as a Clearing Member.

          Amended on 12 October 2005.

      • 3.3 Appeals

        • 3.3.1

          If CDP rejects an application to be a Clearing Member, the applicant may, within 14 days after it is notified of CDP's decision, appeal in writing to the SGX RegCo Board whose decision shall be final.

          Amended on 15 September 2017.

      • 3.4 Clearing Member's Rights

        • 3.4.1 Clearing Right

          A Clearing Member shall have the right to clear and settle its own Exchange Trades transacted by it or its own customers or the Exchange Trades of 1 or more Trading Members qualified by it subject to the Clearing Rules and the Clearing Directives.

        • 3.4.2 No Distributive Right to Assets

          A Clearing Member shall have no right to participate in the assets or profits of CDP.

        • 3.4.3 No Voting Right

          A Clearing Member shall have no right to receive notice of any general meeting of CDP or to attend and vote thereat.

        • 3.4.4 Transferability

          A Clearing Member may not assign, transfer or otherwise dispose of any of its membership rights or other rights conferred under the Clearing Rules and the Clearing Directives.

      • 3.5 General Obligations of a Clearing Member

        • 3.5.1

          Each Clearing Member undertakes and agrees to:—

          (1) comply at all times with the applicable eligibility criteria set out in this Chapter 3;
          (2) clear and settle any Exchange Trade transacted by it through CDP in accordance with this Clearing Rules and the Clearing Directives (where applicable);
          (3) clear and settle any Exchange Trade transacted by a Trading Member qualified by it as a principal obligor and not merely as a guarantor through CDP in accordance with this Clearing Rules and the Clearing Directives (where applicable);
          (4) comply with this Clearing Rules and the Clearing Directives (where applicable);
          (5) grant CDP all rights and remedies as set forth in this Clearing Rules and the Clearing Directives (where applicable);
          (6) pay CDP all fees, charges, costs, compensation and other sums as provided in this Clearing Rules and the Clearing Directives (where applicable);
          (7) make such contributions or payments to the Clearing Fund as may be required in this Clearing Rules;
          (8) generally take or refrain from taking such action as may be required in relation to the Clearing Fund;
          (9) exercise reasonable supervision over its employees and agents with a view to preventing any violation of SFA (where applicable), this Clearing Rules and Clearing Directives (where applicable). For this purpose, a Clearing Member shall be deemed to have complied with this Rule 3.5.1(9) if:—
          (a) it has established and maintained proper procedures and systems for its business, and in the case of a Bank Clearing Member, its business governed by this Clearing Rules, to prevent any such violations by its directors, officers, employees and agents;
          (b) it has in place sufficient resources and established and maintained adequate internal control and risk management systems for its business, and in the case of a Bank Clearing Member, its business governed by this Clearing Rules; and
          (c) the Clearing Member's employees or agents, have reasonably discharged their duties and obligations in enforcing the procedures and systems for its business, and in the case of a Bank Clearing Member, its business governed by this Clearing Rules;
          (10) comply with the clearing limits as CDP may prescribe from time to time;
          (11) maintain bank accounts in the currencies as necessary, and with banks acceptable to CDP, to facilitate payments and/or settlement as may be required under these Clearing Rules;
          (12) ensure that its Memorandum and Articles of Association or its constitution shall at all times conform to this Clearing Rules and the Clearing Directives (where applicable) so as to enable it to observe and perform fully the covenants, terms, stipulations, conditions and other provisions of this Clearing Rules and the Clearing Directives (where applicable); and
          (13) take such steps, including without limitation procedural steps (whether of a technical or non-technical nature or otherwise), as CDP may require to ensure the orderly clearing and settlement of Exchange Trades qualified by the Clearing Member.

          Amended on 1 July 2008, 1 July 2016 and 10 December 2018.

        • 3.5.2 Provision of Information

          (1) A Clearing Member shall promptly submit to CDP and/or such party as directed by CDP such information, electronic records, returns or documents as and when such information, electronic records, returns or documents are required by CDP, provided that any information, electronic records, returns or documents shall be deemed not to have been duly submitted if it contains materially untrue statements or omits material statements or is otherwise misleading. Where any information, electronic records, returns or documents are deemed not to have been duly submitted, the Clearing Member shall promptly resubmit the same upon notice from CDP. For the avoidance of doubt, reference to "information, electronic records, returns or documents" in relation to a Bank Clearing Member, shall refer to such information, electronic records, returns or documents falling within the Bank Clearing Member's business governed by this Clearing Rules.
          (2) CDP may impose such fine on the Clearing Member as prescribed from time to time in the Clearing Directives for late submission of any information, electronic records, returns or documents that are required by CDP pursuant to Rule 3.5.2(1).

          Amended on 1 July 2008.

        • 3.5.3

          A Clearing Member must:—

          (1) maintain complete and accurate records, or in the case of a Bank Clearing Member, records in relation to the Bank Clearing Member's business governed by this Clearing Rules, in accordance with the SFA, SFR, this Clearing Rules and the Clearing Directives (where applicable);
          (2) not make, or cause to be made, a false or misleading entry, in hardcopy or electronic form, in any books, records, reports, slips, documents, statements relating to the business, affairs, transactions, conditions, assets or accounts ("the Documents") of a Clearing Member's business, or in the case of a Bank Clearing Member, its business governed by this Clearing Rules;
          (3) make all material entries in any of the Documents; and
          (4) not alter or destroy any of the Documents without a valid reason.

          Amended on 1 July 2008.

        • 3.5.4 Business Continuity Requirements

          (1) a Clearing Member must assess its business and operational risks and maintain adequate business continuity arrangements.
          (2) a Clearing Member must document its business continuity arrangements in a business continuity plan.
          (3) a Clearing Member's senior management shall be responsible for the Clearing Member's business continuity plan. Sufficient awareness of the risks, mitigating measures and state of readiness must be demonstrated by way of an attestation to the Clearing Member's Board of Directors.
          (4) a Clearing Member must review and test its business continuity plan regularly.
          (5) a Clearing Member must appoint emergency contact persons, and furnish the contact information of such persons to CDP. The Clearing Member's emergency contact persons must be contactable at all times, and must immediately notify CDP in the event of emergencies.

          Refer to Practice Note 3.5.4.

          Added on 22 January 2009

        • 3.5.5 Records of Customer Monies and Assets in Relation to Trades Cleared or Settled through CDP

          In relation to monies and assets received from its Customers, a Clearing Member must:

          (1) maintain complete and accurate records, which enable it to identify at all times, specific amounts of such monies and assets deposited with it by each Customer in connection with such Customer's trades which are, or are to be, cleared or settled through CDP; and
          (2) provide the records referred to in Rule 3.5.5(1) to CDP by such time as CDP may require.

          Amended on 22 April 2013 and 10 December 2018.

      • 3.6 Clearing Members to Act as Principals

        Each Clearing Member shall be responsible and liable to CDP as principal and not as agent in respect of the clearing and settlement of any Exchange Trade and in respect of its obligations to CDP under these Clearing Rules.

      • 3.7 Responsibility of Clearing Members for the Exchange Trades of Trading Members

        • 3.7.1

          Notwithstanding anything to the contrary in the SGX-ST Rules or the Clearing Rules, a Clearing Member shall be responsible and liable to CDP as a principal and not merely as a guarantor for the clearing and settlement of all Exchange Trades transacted by a Trading Member qualified by it. Trading Members shall have no right to clear and settle their Exchange Trades through CDP.

        • 3.7.2

          Notwithstanding any notice to the contrary, CDP shall be entitled to deem and treat the Exchange Trades transacted by a Trading Member qualified by a Clearing Member as the Exchange Trades of the qualifying Clearing Member for all purposes, including the purposes of these Clearing Rules and the Clearing Directives.

        • 3.7.3

          In these Clearing Rules, unless the context otherwise requires, a reference to the Exchange Trade of a Clearing Member shall include a reference to the Exchange Trade of any Trading Member qualified by the Clearing Member.

      • 3.7A Relationship Between Clearing Member and Trading Member

        • 3.7A.1 Settlement Timelines

          Unless the Trading Member has in place arrangements to settle Exchange Trades with its Clearing Member on a delivery-versus-payment basis through the CDP Settlement Facility, the Clearing Member must make payment (whether of sale proceeds, Cash Settlement Amounts, corporate action entitlements or compensation for corporate action entitlements) or deliver securities to a Trading Member in respect of any Exchange Trade, by such time as to enable payment or delivery by the Trading Member to the Trading Member's customers within any timelines specified in the SGX-ST Rules, save that a Clearing Member may:

          (1) withhold payment of sale proceeds to a selling Trading Member until the selling Trading Member has made delivery of securities; and
          (2) withhold delivery of securities or the payment of any Cash Settlement Amount, corporate action entitlements or compensation for corporate action entitlements to a buying Trading Member until payment by the buying Trading Member has been received.

          Added on 10 December 2018.

        • 3.7A.2 Force Sale

          Subject to Rules 3.7A.3 and 3.7A.4, if a buying Trading Member fails to meet any of the timelines set out in the SGX-ST Rules for payment to its Clearing Member, the Clearing Member shall force-sell the securities of the buying Trading Member on the following Market Day.

          Added on 10 December 2018.

        • 3.7A.3

          Rule 3.7A.2 does not apply if the Clearing Member has allowed the buying Trading Member to effect a corresponding sale position after the purchase but not later than the Intended Settlement Day of the Exchange Trade for such purchase.

          Added on 10 December 2018.

        • 3.7A.4

          If the Clearing Member reasonably expects full payment from the buying Trading Member, the Clearing Member may defer force-sale for up to two Market Days.

          Added on 10 December 2018.

        • 3.7A.5

          A Clearing Member exercising its discretion under Rule 3.7A.4 must not engage in imprudent credit practices.

          Added on 10 December 2018.

        • 3.7A.6

          The following rules apply to all force-sales by a Clearing Member:

          (1) The Clearing Member has discretion as to the price and volume put up for sale, at any time;
          (2) The Clearing Member need not give notice of the force-sale to the Trading Member;
          (3) The Clearing Member is not liable to the Trading Member for any loss or damage arising out of the exercise of its discretion; and
          (4) The Clearing Member may recover the losses and expenses incurred in the force-sale from the Trading Member.

          Added on 10 December 2018.

        • 3.7A.7

          A Clearing Member shall, if informed by CDP that a right to receive securities pursuant to an Exchange Trade is to be cash settled, immediately inform the relevant buying Trading Member.

          Added on 10 December 2018.

      • 3.8 Reporting Requirements

        A Clearing Member shall notify CDP in writing upon or where practicable, pre-notify CDP of, the happening of all or any of the following events and supply full particulars thereof together with such further information as CDP may require:—

        (1) when the Clearing Member, any of its directors, Chief Executive Officer, officers, employees or agents has violated any provision of the SFA, the SFR, this Clearing Rules, Clearing Directives (where applicable) or relevant law or regulation which governs that Clearing Member's other business activities, or the rules of any exchange or clearing house of which the Clearing Member is a participant or member or otherwise engaged in conduct which is detrimental to the financial integrity, reputation or interests of CDP, or clearing facilities established or operated by CDP;
        (2) when the Clearing Member, or any of its directors, Chief Executive Officer, officers, employees or agents is investigated, arrested, charged, convicted, suspended or pleads guilty to any criminal offence involving fraud or dishonesty, whether in or out of Singapore;
        (3) when the Clearing Member, any of its directors, Chief Executive Officer, officers, employees or agents, is the subject of any written complaint involving an allegation of theft or misappropriation, or of forgery, or of any offence involving fraud or dishonesty, whether in or out of Singapore, and such complaint or allegation may have an impact, or in the case of a Bank Clearing Member, material impact, on the financial position on such Clearing Member or of the other Clearing Members;
        (4) when any of its directors, Chief Executive Officer, officers, employees or agents is the subject of any investigations, disciplinary proceeding or action taken by the Clearing Member involving suspension, termination, withholding of commissions, fines or any other significant limitation of activities;
        (4A) when the Clearing Member, or any of its directors, Chief Executive Officer, officers, employees or agents engages in conduct, that has the effect of circumventing the SFA, SFR, this Clearing Rules or Clearing Directives (where applicable), or which is inconsistent with the principles of good business practice;
        (4B) when the Clearing Member is insolvent, or is engaged in bankruptcy or winding up proceedings;
        (4C) when the Clearing Member is experiencing an emergency or potentially debilitating situation that threatens its operations (e.g. a cyber threat or terrorist attack);
        (5) when there are any changes to its corporate or business name as registered with CDP;
        (6) when there is any change that may have the effect of altering control in the Clearing Member;
        (7) for any transaction that will result in a change in the legal or beneficial ownership of 20% or more of the Clearing Member's share capital, and any subsequent increase of 5% or more of the Clearing Member's share capital;
        (8) when there is any change in the composition of its board of directors or of any director, or in the case of a Bank Clearing Member, any change in the composition of its board of directors or of any director, who are/is resident in Singapore and/or responsible for its business governed by this Clearing Rules, due to the appointment, removal or resignation of any of its directors. For the purpose of this Rule 3.8(8), a change of director includes a change in the director's appointment from a non-executive director to an executive director;
        (9) when there is any change or amendment to its Memorandum or Articles of Association or constitutive documents except in the case of a Bank Clearing Member, notification will be furnished to CDP by such times that a Bank Clearing Member has to notify MAS under the Banking Act, or any regulation or directive issued thereunder;
        (10) when there is any death or bankruptcy of any of its directors or in the case of a Bank Clearing Member, its directors who are resident in Singapore and/or responsible for its business governed by this Clearing Rules;
        (11) when there is any engagement or involvement or proposed engagement or involvement in any new business or any change in any of the Clearing Member's business(es) or in the case of a Bank Clearing Member, its business governed by this Clearing Rules. For the purpose of this Rule 3.8(11), examples of such new business or change in business include, without limitation, market making and securities financing activities;
        (12) when there is any change in the Clearing Member's senior management, or in the case of a Bank Clearing Member, its senior management responsible for the Bank Clearing Member's business governed by this Clearing Rules; and
        (13) when there is any breach of directors' duties.

        Amended on 3 April 2008, 1 July 2008, 10 December 2018 and 3 June 2019.

      • 3.9 Qualification of Trading Members

        • 3.9.1 Qualification Procedures

          In order to qualify a Trading Member, a Clearing Member shall:—

          (1) inform CDP of such qualification of the Trading Member, and if CDP requests, such details of the Trading Member as CDP may from time to time specify;
          (2) pay such administrative fee as CDP may from time to time levy for the processing of such applications;
          (3) satisfy CDP that it has in place adequate internal control measures and risk management systems, including automated pre-execution credit control checks, to monitor the Trading Member's Exchange Trades and manage its risk exposure to such Exchange Trades;
          (4) enter into a written agreement with the Trading Member setting out the terms and conditions governing their relationship, which shall include without limitation, risk management provisions such as the right to impose trading limits on the Trading Member; and
          (5) undertake to inform CDP if it has knowledge or has reasons to believe that a Trading Member qualified by it has defaulted or may default in any of its obligations under the Exchange Trades transacted by the Trading Member; and
          (6) have processes in place to minimise and manage any conflicts of interest, including but not limited to separating its front office and back office functions.

          Amended on 18 September 2012.

        • 3.9.2 Procedures to Cease Qualifying a Trading Member

          If a Clearing Member wishes to cease qualifying its Trading Member, it shall:—

          (1) give not less than 30 days' written notice (or such shorter period as CDP may from time to time deem acceptable) to CDP of its intention to cease qualifying that Trading Member and the proposed date of cessation, provided always that CDP may waive such notice requirement at any time with respect to any Clearing Member;
          (2) satisfy CDP that it has taken before the proposed date of cessation proper steps to disable the Trading Member from entering into Exchange Trades to be qualified by the Clearing Member;
          (3) satisfy CDP that it has taken, or will take, proper steps for the orderly clearing and settlement of the Trading Member's Exchange Trades;
          (4) comply with any reasonable direction of CDP in relation to the orderly cessation of the qualification of the Trading Member's Exchange Trades; and
          (5) take such steps including without limitation, procedural steps (whether of a technical or non-technical nature or otherwise) as CDP may deem appropriate to ensure that none of the Trading Member's Exchange Trade will be cleared and settled through the Clearing Member by the proposed date of cessation.

          Amended on 11 January 2011

        • 3.9.2A Procedures to Suspend Qualification of a Trading Member

          (1) If a Clearing Member wishes to suspend its qualification of a Trading Member, it shall:—
          (a) notify CDP of its decision to suspend its qualification of that Trading Member; and
          (b) comply with any reasonable direction of CDP in relation to the suspension of the qualification of the Trading Member's Exchange Trades.
          (2) A Clearing Member may suspend its qualification of a Trading Member for not more than 30 days. Before the end of the 30-day period, the Clearing Member must notify CDP in writing of its intention to either resume qualification or cease qualification of the Trading Member. Where the Clearing Member intends to cease qualification of the Trading Member, Rule 3.9.2 shall apply.

          Added on 11 January 2011

        • 3.9.3

          Notwithstanding the cessation or suspension of the qualification, the Clearing Member shall clear and settle all the Exchange Trades of the Trading Member which are done right up to the point when the Trading Member has been disabled from entering Exchange Trades to be qualified by the Clearing Member.

          Amended on 11 January 2011

      • 3.10 Resignation by Clearing Member

        • 3.10.1 Procedure

          Subject to Rule 7.11, if a Clearing Member wishes to resign it shall satisfy CDP that it has fulfilled or is able to fulfil its obligations to CDP and such obligations to Trading Members as CDP specifies. In addition, it shall:—

          (1) give not less than 30 days' written notice (the "resignation notice") to CDP of its intention to resign and the effective date of resignation; CDP may vary or waive the resignation notice; and
          (2) for avoidance of doubt, a Clearing Member shall continue to comply with the Clearing Rules, and any Clearing Directives as may be imposed by CDP until resignation.

        • 3.10.2 Acceptance of Resignation by CDP

          CDP need not accept the resignation of a Clearing Member if it is:—

          (1) conducting an investigation under this Clearing Rules, investigating a complaint, or has initiated disciplinary proceedings against the Clearing Member; or
          (2) not satisfied that the Clearing Member has fulfilled or is able to fulfil:—
          (a) its obligations to CDP; and
          (b) its obligation to its customers, or in the case of a Bank Clearing Member, its customers in relation to its business governed by this Clearing Rules, as CDP may specify.

          Amended on 1 July 2008.

        • 3.10.3 Deletion from Register

          If CDP accepts a Clearing Member's resignation, the Clearing Member's name shall be deleted from the Register of Clearing Members upon the effective date of resignation.

        • 3.10.4 Notification of Resignation

          (1) CDP shall, upon confirmation of the resignation date, notify all Clearing Members of the Clearing Member's resignation and the effective date.
          (2) Notwithstanding the resignation, the Clearing Member shall remain liable for all outstanding liabilities incurred under the Clearing Rules and Clearing Directives as at the effective date of resignation. CDP shall have the right to exercise any of its powers (including without limitation, its powers under Rule 11) under these Clearing Rules at any time before or after such date of resignation in respect of any act or omission by the Clearing Member before such date of resignation.

        • 3.10.5 Cessation of Clearing Rights

          (1) A Clearing Member's right to clear and settle its Exchange Trades (including Exchange Trades of any Trading Member qualified by the Clearing Member) shall cease on the tenth Settlement Day (or such other Settlement Day as CDP may from time to time prescribe, either generally or in any particular case) from the date of the resignation notice. The Clearing Member shall therefore not transact nor accept for clearing and settlement from the Trading Members qualified by it, any Exchange Trade that is due for settlement after the tenth Settlement Day from the date of the resignation notice.
          (2) Notwithstanding the aforesaid, CDP may, prior to the date of cessation of the Clearing Member's right to clear and settle its Exchange Trades, impose such restrictions on the clearing rights and other rights of the Clearing Member, or in the case of a Bank Clearing Member, the clearing rights and other rights conferred under this Clearing Rules, as CDP may, in its absolute discretion, deem fit.

          Amended on 1 July 2008.

    • Rule 4 — Appointment of Chief Executive Officers and Directors

      Amended on 3 June 2019.

      • 4.1 Appointment and Registration

        • 4.1.1

          (1) A Clearing Member shall appoint one (1) person as a Chief Executive Officer and register that person with CDP as its Chief Executive Officer.
          (2) The Chief Executive Officer of a General Clearing Member shall be approved by the Authority as a Chief Executive Officer in accordance with the SFA.
          (3) A Chief Executive Officer entered into the register of Chief Executive Officers shall comply with this Clearing Rules and any Clearing Directives (where applicable), and shall be responsible for ensuring that the Clearing Member complies with this Clearing Rules, and any Clearing Directives (where applicable).
          (4) The Clearing Member shall notify CDP at least seven (7) days prior to the appointment of a Chief Executive Officer.

          Amended on 1 July 2008 and 3 June 2019.

        • 4.1.2

          Upon registration, a Chief Executive Officer is deemed to have agreed to be bound by this Clearing Rules, or any Clearing Directives (where applicable).

          Amended on 1 July 2008 and 3 June 2019.

      • 4.2 Obligations

        • 4.2.1 Compliance

          A Chief Executive Officer shall comply with the Clearing Rules, and any Clearing Directives CDP prescribes.

          Amended on 3 June 2019.

        • 4.2.2 Payment of Fees

          A Chief Executive Officer shall pay CDP all fees, levies and charges as CDP prescribes. CDP may reduce or waive any fee, levy or charge.

          Amended on 3 June 2019.

        • 4.2.3 Other Businesses

          (1) A Chief Executive Officer shall inform CDP in writing at least fourteen (14) days before he or she engages in, or holds any substantial shareholding in, any other business that might potentially conflict with being a Chief Executive Officer. The Chief Executive Officer shall ensure that the proposed engagement or shareholding is agreed to by his or her Clearing Member.
          (2) The engagement (and any actions taken under it) or shareholding shall not breach the SFA, SFR, this Clearing Rules, Clearing Directives (where applicable), or any relevant law or regulation.
          (3) A Chief Executive Officer shall supply CDP with any information it requires regarding the engagement or acquisition of shareholding.
          (4) If CDP objects to the engagement or acquisition of shareholding, a Chief Executive Officer shall not proceed with it. CDP may extend the period specified in Rule 4.2.3(1). If extended, the Chief Executive Officer shall not proceed with the engagement or acquisition of shareholding before the expiry of the extended period.
          (5) If an engagement or shareholding, in CDP's opinion, is detrimental to the financial integrity, reputation or interests of CDP, the Clearing Member or its customers, or in the case of a Bank Clearing Member, the Bank Clearing Member's customers in relation to its business governed by this Clearing Rules, CDP may require the Chief Executive Officer to end it.
          (6) If CDP objects to the engagement or acquisition or shareholding or requires a Chief Executive Officer to end it, the Chief Executive Officer may, within fourteen (14) days after it is notified of CDP's decision, appeal in writing to the SGX RegCo Board whose decision shall be final.

          Amended on 1 July 2008, 15 September 2017 and 3 June 2019.

      • 4.3 Automatic De-Registration

        A Chief Executive Officer shall automatically cease to be registered as a Chief Executive Officer, and the Clearing Member shall immediately notify CDP, if he or she:—

        (1) becomes of unsound mind;
        (2) is made bankrupt, whether in or out of Singapore;
        (3) is disqualified from holding office as a director under the SFA or the Companies Act (Chapter 50), or in the case of a Bank Clearing Member, if he or she is no longer in the direct employment of, or acting for or by arrangement with, the Bank Clearing Member or is no longer principally responsible for the management and conduct of the Bank Clearing Member's business;
        (4) ceases to be a Chief Executive Officer of the Clearing Member;
        (5) is subject to a compromise or scheme of arrangement with his or her creditors, whether in or out of Singapore;
        (6) has execution in respect of a judgment debt returned unsatisfied in whole or in part; or;
        (7) is convicted of an offence involving fraud or dishonesty or is found by a court of law to have acted fraudulently or dishonestly, in each case whether in or out of Singapore.

        Amended on 1 July 2008 and 3 June 2019.

      • 4.4 Deletion from Register

        A Chief Executive Officer who ceases to hold office shall have his or her name deleted from the Register of Chief Executive Officers upon the effective date of cessation.

        Amended on 3 June 2019.

      • 4.5 [Rule has been deleted.]

        Deleted on 3 June 2019.

      • 4.6 Obligations of a Former Chief Executive Officer

        A former Chief Executive Officer remains liable to CDP for any liabilities incurred under the Clearing Rules or Clearing Directives during the period of his or her registration. The former Chief Executive Officer also remains subject to disciplinary actions for any offence committed during the period of his or her registration.

        Amended on 3 June 2019.

    • Rule 5 — Financial/Capital Requirements

      • 5.1 Minimum Capital and Financial Requirements of Clearing Members Incorporated in Singapore

        • 5.1.1

          Each General Clearing Member incorporated in Singapore shall at all times:—

          (1) Base Capital Requirement
          (a) maintain a base capital of not less than S$5,000,000; or
          (b) in the case of a General Clearing Member who is also a clearing member of SGX-DC, maintain a base capital of not less than S$8,000,000;
          (2) Financial Resources Requirement not cause or permit its financial resources to fall below its total risk requirement;
          (3) Aggregate Indebtedness Requirement not cause or permit its aggregate indebtedness to exceed 1,200% of its aggregate resources; and
          (4) Other Requirements comply with the accounting, reporting, book-keeping and any other financial and operational requirements prescribed by CDP.

          Amended on 1 July 2008.

        • 5.1.1A

          Each Bank Clearing Member incorporated in Singapore shall at all times:—

          (1) Base Capital Requirement
          (a) maintain a base capital of not less than S$5,000,000; or
          (b) in the case of a Bank Clearing Member who is also a clearing member of SGX-DC, maintain a base capital of not less than S$8,000,000;
          (2) RRA Financial Requirement
          comply with all applicable RRA Financial Requirements; and
          (3) Other Requirements
          comply with the accounting, reporting, book-keeping and any other financial and operational requirements prescribed by CDP in relation to the Bank Clearing Member's business governed by this Clearing Rules.

          Added on 1 July 2008. and amended on 22 April 2019.

        • 5.1.1B

          A Clearing Member shall immediately notify CDP if it fails to comply with the minimum capital and financial requirements prescribed in the preceding paragraphs or becomes aware that it will fail to comply with such requirements.

          Added on 1 July 2008.

        • 5.1.1C

          If CDP is notified by a Clearing Member under Rule 5.1.1B or becomes aware (whether or not there has been any notification by the Clearing Member under Rule 5.1.1B) that such Clearing Member has failed to comply with the minimum capital and financial requirements prescribed in the preceding paragraphs, CDP may direct the Clearing Member to do one (1) or more of the following actions:—

          (1) liquidate or cease any increase in positions for any account carried by the Clearing Member;
          (2) liquidate or transfer all or part of any customer's positions, securities margins, collateral, assets and accounts to one (1) or more other Clearing Members. For the avoidance of doubt, reference to "customer's positions, securities margins, collateral, assets and accounts" in relation to a Bank Clearing Member, shall refer to customer's positions, securities margins, collateral, assets and accounts falling within the Bank Clearing Member's business governed by this Clearing Rules;
          (3) operate its business or in the case of a Bank Clearing Member, its business governed by this Clearing Rules, in such manner and on such conditions as CDP may impose.

      • 5.1A Early Warning Financial Requirements of Clearing Members Incorporated in Singapore

        • 5.1A.1

          Each General Clearing Member incorporated in Singapore shall immediately notify CDP:—

          (1) if its financial resources fall below 120% of its total risk requirement; or
          (2) if its aggregate indebtedness exceeds 600% of its aggregate resources.

          Added on 1 July 2008 and amended on 22 April 2019.

        • 5.1A.2

          If CDP is notified by a Clearing Member under Rule 5.1A.1(1) or becomes aware (whether or not there has been any notification by the Clearing Member under Rule 5.1A.1(1)) that such Clearing Member's financial resources have fallen below 120% of its total risk requirement, CDP may direct such Clearing Member to comply with one (1) or more of the directions prescribed under Regulation 7(3) of the SFR (Financial and Margin Requirements).

          Added on 1 July 2008 and amended on 22 April 2019.

        • 5.1A.3

          If CDP is notified by a Clearing Member under Rule 5.1A.1(2) or becomes aware (whether or not there has been any notification by such Clearing Member under Rule 5.1A.1(2)) that such Clearing Member's aggregate indebtedness has exceeded 600% of its aggregate resources, CDP may direct such Clearing Member to comply with one (1) or more of the directions prescribed under Regulation 17(2) of the SFR (Financial and Margin Requirements).

          Added on 1 July 2008 and amended on 22 April 2019.

      • 5.1B Notification Requirements of Clearing Members Incorporated in Singapore

        • 5.1B.1

          Each Clearing Member incorporated in Singapore shall:

          (a) In the case of a General Clearing Member, immediately notify CDP if its financial resources fall below 150% of its total risk requirement.
          (b) In the case of a Bank Clearing Member, immediately notify the Clearing House of any event in relation to its regulatory capital and liquidity ratios that is required to be reported to its Relevant Regulatory Authority.

          Added on 1 July 2008 and amended on 22 April 2019.

        • 5.1B.2

          CDP may from time to time prescribe other notification requirements and conditions for exemptions or exceptions therefrom on all or any of the Clearing Members.

          Added on 1 July 2008.

        • 5.1B.3

          If CDP is notified by a Clearing Member under Rule 5.1B.1 or becomes aware (whether or not there has been any notification by the Clearing Member under Rule 5.1B.1) that such Clearing Member's financial resources have fallen below 150% of its total risk requirement or that a reportable event in relation to its regulatory capital and liquidity ratios has occurred, CDP may direct such Clearing Member to do one (1) or more of the following actions:—

          (1) submit (where applicable), the statements of assets and liabilities, financial resources, total risk requirement, aggregate indebtedness, and such other statements as required by CDP at such interval and for such time frame as determined by CDP;
          (2) operate its business, or in the case of a Bank Clearing Member, its business governed by this Clearing Rules, in such manner and on such conditions as CDP may impose.

          Added on 1 July 2008 and amended on 22 April 2019.

      • 5.1C Qualifying Letter of Credit

        • 5.1C.1

          For the purpose of Rules 5.1 and 5.1A, a Clearing Member may include one (1) or more Qualifying Letter(s) of Credit deposited with CDP or SGX-DC in its calculation of aggregate resources, subject to the total amount payable under the Qualifying Letter(s) of Credit or 50% of its total risk requirement, whichever is lower. In the case of a Clearing Member admitted as a clearing member of CDP and SGX-DC, and which has deposited such Qualifying Letter(s) of Credit with SGX-DC, pursuant to the corresponding provision in the SGX-DC Clearing Rules, it need not deposit another Qualifying Letter(s) of Credit with CDP.

          Added on 1 July 2008 and amended on 25 August 2009 and 29 December 2014.

        • 5.1C.2

          For the purpose of Rule 5.1C.1, a qualifying letter of credit is a legally enforceable and irrevocable letter of credit that:—

          (1) is made in favour of CDP;
          (2) is issued by a bank approved by, and in a form acceptable to CDP; and
          (3) does not include any letters of credit provided by the Clearing Member to satisfy any other requirement imposed by CDP.

          Added on 1 July 2008.

        • 5.1C.3

          CDP reserves the right to call on any of the qualifying letters of credit furnished pursuant to this Clearing Rules and apply the proceeds thereof in respect of the Clearing Member's default to CDP. In the case of a Clearing Member admitted as a clearing member of CDP and SGX-DC, CDP shall have the discretion to apportion in any manner, the use of the proceeds between CDP and SGX-DC. In deciding on the apportionment, CDP may, in consultation with SGX-DC, take into account factors, including but not limited to, the amount owed by the Clearing Member to CDP and SGX-DC respectively.

          Added on 1 July 2008.

      • 5.1D Minimum Capital and Financial Requirements of Clearing Members Incorporated Outside Singapore

        • 5.1D.1

          Each General Clearing Member incorporated outside Singapore shall at all times:—

          (1) Base Capital Requirement
          (a) maintain net head office funds of not less than S$5,000,000; or
          (b) in the case of a General Clearing Member who is also a clearing member of SGX-DC, maintain net head office funds of not less than S$8,000,000;
          (2) Adjusted Net Head Office Funds Requirement

          not cause or permit its adjusted net head office funds to fall below its total risk requirement;
          (3) Aggregate Indebtedness

          not cause or permit its aggregate indebtedness to exceed 1,200% of its aggregate resources; and
          (4) Other Requirements

          comply with the accounting, reporting, book-keeping and any other financial and operational requirements prescribed by CDP.

          Added on 1 July 2008.

        • 5.1D.2

          Each Bank Clearing Member incorporated outside Singapore shall at all times:—

          (1) Base Capital Requirement
          (a) maintain a base capital of not less than S$5,000,000; or
          (b) in the case of a Bank Clearing Member who is also a clearing member of SGX-DC, maintain a base capital of not less than S$8,000,000;
          (2) RRA Financial Requirement

          comply with all applicable RRA Financial Requirements; and
          (3) Other Requirements

          comply with the accounting, reporting, book-keeping and any other financial and operational requirements prescribed by CDP in relation to the Bank Clearing Member's business governed by this Clearing Rules.

          Added on 1 July 2008 and amended on 25 August 2009 and 22 April 2019.

        • 5.1D.3

          A Clearing Member shall immediately notify CDP if it fails to meet the minimum capital and financial requirements prescribed in the preceding paragraphs or becomes aware that it will fail to comply with such requirements.

          Added on 1 July 2008.

        • 5.1D.4

          If CDP is notified by a Clearing Member under Rule 5.1D.3 or becomes aware (whether or not there has been any notification by the Clearing Member under Rule 5.1D.3) that such Clearing Member has failed to comply with the minimum capital and financial requirements prescribed in the preceding paragraphs, CDP may direct the Clearing Member to do one (1) or more of the following actions:—

          (1) liquidate or cease any increase in positions for any account carried by the Clearing Member;
          (2) liquidate or transfer all or part of any customer's positions, securities margins, collateral, assets and accounts to one (1) or more other Clearing Members. For the avoidance of doubt, reference to "customer's positions, securities margins, collateral, assets and accounts" in relation to a Bank Clearing Member, shall refer to customer's positions, securities margins, collateral, assets and accounts falling within the Bank Clearing Member's business governed by this Clearing Rules;
          (3) operate its business or in the case of a Bank Clearing Member, its business governed by this Clearing Rules, in such manner and on such conditions as CDP may impose.

          Added on 1 July 2008.

      • 5.1DA Liquidity Resource Requirement

        Each Bank Clearing Member incorporated outside Singapore shall deposit liquidity resources with CDP upon CDP's request, if CDP determines that any conditions exist which may threaten the ability of the Bank Clearing Member to satisfy its obligations to CDP and/or SGX-DC under this Clearing Rules and the SGX-DC Clearing Rules respectively. Such liquidity resources shall be an amount up to S$5,000,000, or S$8,000,000 in the case of a Bank Clearing Member who is also a clearing member of SGX-DC, and shall be paid in cash and/or acceptable government securities within such time as determined by CDP.

        Added on 22 April 2019.

      • 5.1E Early Warning Financial Requirements of Clearing Members Incorporated Outside Singapore

        • 5.1E.1

          Each General Clearing Member incorporated outside Singapore shall immediately notify CDP:—

          (1) if its adjusted net head office funds fall below 120% of its total risk requirement; or
          (2) if its aggregate indebtedness exceeds 600% of its aggregate resources.

          Added on 1 July 2008 and amended on 25 August 2009 and 22 April 2019.

        • 5.1E.2

          If CDP is notified by a Clearing Member under Rule 5.1E.1(1) or becomes aware (whether or not there has been any notification by the Clearing Member under Rule 5.1E.1(1)) that such Clearing Member's adjusted net head office funds have fallen below 120% of its total risk requirement, CDP may direct such Clearing Member to comply with one (1) or more of the directions prescribed under Regulation 7(3) of the SFR (Financial and Margin Requirements).

          Added on 1 July 2008 and amended on 25 August 2009 and 22 April 2019.

        • 5.1E.3

          If CDP is notified by a Clearing Member under Rule 5.1E.1(2) or becomes aware (whether or not there has been any notification by such Clearing Member under Rule 5.1E.1(2)) that such Clearing Member's aggregate indebtedness has exceeded 600% of its aggregate resources, CDP may direct such Clearing Member to comply with one (1) or more of the directions prescribed under Regulation 17(2) of the SFR (Financial and Margin Requirements).

          Added on 1 July 2008 and amended on 22 April 2019.

      • 5.1F Notification Requirements of Clearing Members Incorporated Outside Singapore

        • 5.1F.1

          Each Clearing Member incorporated outside Singapore shall:

          (a) In the case of a General Clearing Member, immediately notify CDP if its adjusted net head office funds fall below 150% of its total risk requirement; and
          (b) In the case of a Bank Clearing Member, immediately notify CDP of any event in relation to its regulatory capital and liquidity ratios that is required to be reported to its Relevant Regulatory Authority.

          Added on 1 July 2008 and amended on 25 August 2009 and 22 April 2019.

        • 5.1F.2

          CDP may from time to time prescribe other notification requirements and conditions for exemptions or exceptions therefrom on all or any of the Clearing Members.

          Added on 1 July 2008.

        • 5.1F.3

          If CDP is notified by a Clearing Member under Rule 5.1F.1 or becomes aware (whether or not there has been any notification by the Clearing Member under Rule 5.1F.1) that such Clearing Member's adjusted net head office funds have fallen below 150% of its total risk requirement, or that a reportable event in relation to its regulatory capital and liquidity ratios has occurred, CDP may direct such Clearing Member to do one (1) or more of the following actions:—

          (1) submit (where applicable), the statements of assets and liabilities, adjusted net head office funds, cash and/or acceptable government securities deposited with CDP or SGX-DC, aggregate indebtedness, total risk requirement, and such other statements as required by CDP at such interval and for such time frame as may be determined by CDP; and
          (2) operate its business, or in the case of a Bank Clearing Member, its business governed by this Clearing Rules, in such manner and on such conditions as CDP may impose.

          Added on 1 July 2008 and amended on 25 August 2009 and 22 April 2019.

      • 5.1G Qualifying Letter of Credit

        • 5.1G.1

          For the purpose of Rules 5.1D and 5.1E, a Clearing Member may include one (1) or more Qualifying Letter(s) of Credit deposited with CDP or SGX-DC in its calculation of aggregate resources subject to the total amount payable under the Qualifying Letter(s) of Credit or 50% of its total risk requirement, whichever is lower. In the case of a Clearing Member admitted as a clearing member of CDP and SGX-DC, and which has deposited such Qualifying Letter(s) of Credit with SGX-DC, pursuant to the corresponding provision in the SGX-DC Clearing Rules, it need not deposit another Qualifying Letter(s) of Credit with CDP.

          Amended on 1 July 2008, 25 August 2009 and 29 December 2014.

        • 5.1G.2

          For the purpose of Rule 5.1G.1, a qualifying letter of credit is a legally enforceable and irrevocable letter of credit that:—

          (1) is made in favour of CDP;
          (2) is issued by a bank approved by, and in a form acceptable to CDP; and
          (3) does not include any letters of credit provided by the Clearing Member to satisfy any other requirement imposed by CDP.

          Amended on 1 July 2008.

        • 5.1G.3

          CDP reserves the right to call on any of the Qualifying Letter of Credit furnished pursuant to this Clearing Rules and apply the proceeds thereof in respect of the Clearing Member's default to CDP. In the case of a Clearing Member admitted as a clearing member of CDP and SGX-DC, CDP shall have the discretion to apportion in any manner, the use of the proceeds between CDP and SGX-DC. In deciding on the apportionment, CDP may, in consultation with SGX-DC, take into account factors, including but not limited to, the amount owed by the Clearing Member to CDP and SGX-DC respectively.

          Amended on 1 July 2008 and 29 December 2014.

      • 5.1H [Rule has been deleted.]

        Deleted on 29 December 2014.

      • 5.1I Total Risk Requirement

        • 5.1I.1

          (1) Total risk requirement shall be calculated in the same manner as prescribed in the Notice on Risk Based Capital Adequacy Requirements for Holders of Capital Markets Services Licences.
          (2) For the purposes of calculating total risk requirement under rule 5.1I.1(1):
          (a) structured warrants must be treated according to their classification under the SFA;
          (b) "margin deficiency" referred to in the Notice on Risk Based Capital Adequacy Requirements for Holders of Capital Markets Services Licences is the amount required for the Customer Asset Value to meet the Variation Margin and Maintenance Margin, and in the case where Customer Asset Value is not sufficient to meet Variation Margin, the margin deficiency is the amount of Maintenance Margin; and
          (c)"negative equity" referred to in the Notice on Risk Based Capital Adequacy Requirements for Holders of Capital Markets Services Licences is the amount required for the Customer Asset Value to meet the Variation Margin.

          Amended on 3 April 2008, 1 July 2008, 23 January 2009 and 29 December 2014.

      • 5.1J Notification of Reduction in Capital

        • 5.1J

          Every Clearing Member shall:—

          5.1J.1 except in the case of a Bank Clearing Member, report to CDP within 48 hours of occurrence of any reduction in excess of 20% in its financial resources or adjusted net head office funds, as the case may be, from the previously submitted financial statement; or
          5.1J.2 in the case of a Bank Clearing Member, report to CDP within 48 hours of occurrence of any reduction in excess of 20% in its regulatory capital from the previously submitted financial statement.

          Added on 22 April 2019.

      • 5.1.2 [Rule has been deleted.]

        Deleted on 1 July 2008.

      • 5.1.3 [Rule has been deleted.]

        Deleted on 1 July 2008.

      • 5.1.4 [Rule has been deleted.]

        Deleted on 1 July 2008.

      • 5.2 [Rule has been deleted.]

        Amended on 3 April 2008 and deleted on 1 July 2008.

      • 5.3 [Rule has been deleted.]

        Deleted on 1 July 2008.

      • 5.4 Powers to Impose Other Requirements

        • 5.4.1

          If CDP is notified by the Clearing Member or becomes aware that the Clearing Member has failed to comply with the minimum capital and financial requirements prescribed in these Rules, CDP may exercise any of the powers described in Rules 6A.9A and 6.10.

          Added on 23 January 2009 and amended on 21 January 2013.

        • 5.4.2

          CDP may prescribe for 1 or more Clearing Members, capital, financial and other requirements in excess of the minimum prescribed under Rule 5 herein on the basis of volume, risk exposure of positions carried, risk concentration, margin policies, nature of business conducted or to be conducted or its membership in any exchange or market and such other criteria as deemed necessary by CDP.

          Amended on 23 January 2009.

      • 5.5 Reserve Fund Requirement

        • 5.5.1

          A General Clearing Member shall maintain a reserve fund to which a sum of not less than 30% of the audited net profits of each year shall be transferred out of its net profits after due provision has been made for taxation, so long as:—

          (1) where it is incorporated in Singapore, the base capital less unappropriated profits in its latest audited accounts; or
          (2) where it is incorporated outside Singapore, its net head office funds, is less than S$15,000,000.

          Amended on 1 July 2008.

        • 5.5.2

          The reserve fund shall not be available for declaration of dividends without the prior approval of CDP.

      • 5.6 Exposure to Single Customer

        • 5.6.1

          A General Clearing Member shall immediately notify CDP if the General Clearing Member's exposure to a single customer exceeds 20% of its average aggregate resources. To reduce the General Clearing Member's risk exposure to a single customer, CDP shall have the right to impose on the General Clearing Member such risk management measures as it deems necessary.

          Amended on 1 July 2008.

        • 5.6.2

          For the purpose of Rule 5.6.1, the full amount of the letter(s) of credit or any part thereof deposited pursuant to Rules 5.1C or 5.1G may be taken into account for the calculation of aggregate resources.

          Amended on 1 July 2008.

        • 5.6.3

          In Rule 5.6.1, "exposure to a single customer" means:—

          (1) in the case of securities positions carried in a customer's account (other than a margin financing account) carried on the books of the General Clearing Member:—
          (a) for purchase contracts that remain unpaid:—
          (i) where the securities purchased have not been delivered to the customer, the excess of the contracted price of the securities purchased by the single customer over the aggregate market value of the securities purchased and such other collateral held by the General Clearing Member less any amount due and payable by the General Clearing Member to him; and
          (ii) where the securities purchased have been delivered to the customer, the excess of the contracted price of the securities purchased by the single customer over the aggregate market value of all his collateral held by the General Clearing Member less any amount due and payable by the General Clearing Member to him;
          (b) for sale contracts for which delivery has not been made, the excess of the amount of the market value of the securities sold by the single customer over the aggregate of the market value of any of his collateral held by the General Clearing Member and the contracted sale price less any amount due and payable by the General Clearing Member to him;
          (c) where the contracts referred to in Rule 5.6.3(1)(a) or (b) have been offset by a contra transaction on or before the due date, the exposure shall not include those amounts specified in Rule 5.6.3(1)(a) or (b) in respect of such contracts but shall instead include the amount of the contra loss, if any, on the date on which the contra transaction takes effect; and
          (d) where the contracts referred to in Rule 5.6.3 (1)(a) or (b) have been offset by a force-sale after the due date or buying-in transaction on or after the due date, the exposure shall not include those amounts specified in Rule 5.6.3(1)(a) or (b) in respect of such contracts but shall instead include the amount of the loss, if any, arising from the force-sale or buying-in transaction, on the date on which the transaction takes effect;
          (1A) for the purposes of Rule 5.6.3(1) "securities" includes structured warrants listed on foreign exchanges;
          (2) the amount of margin deficiency in the single customer's margin financing account carried on the books of the General Clearing Member as determined in accordance with the margin financing requirements specified by SGX-ST;
          (3) the amount of deficiency in relation to margins required in any account carried on the books of the General Clearing Member of the single customer as determined in accordance with the margin requirements prescribed by the relevant exchange, clearing house or such other relevant financial institution;
          (4) the excess of the amount owed by the single customer in his options trading account carried on the books of the General Clearing Member over the market value of options held;
          (5) the amount of any unsecured interest owed by the single customer;
          (6) the amount of any unsecured loan, advance and credit facility granted to the single customer;
          (7) where the General Clearing Member has lent securities to the single customer or is acting as guarantor for the return of securities lent to the single customer, the excess of the amount of the market value of the securities lent to the single customer over the amount of the market value of collateral and cash deposited by the single customer; and
          (8) where the General Clearing Member has deposited collateral with the single customer in respect of securities lent by the single customer or is acting as guarantor for the return of collateral deposited with the single customer in respect of any securities lent by him, the excess of the amount of the market value of collateral and cash deposited with the single customer over the amount of the market value of securities lent by him.

          Amended on 3 April 2008, 1 July 2008, 23 January 2009, 20 November 2009 and 1 July 2016.

        • 5.6.4

          For the purposes of Rule 5.6.3, a security or futures contract is deemed to be carried in a customer's account (other than a margin financing account) carried on the books of the General Clearing Member on the contract date specified in the contract note in respect of the transaction in that security or futures contract or on the exercise date specified in the exercise notice in respect of an option in that security which has been exercised.

          Amended on 1 July 2008, 23 January 2009 and 1 July 2016.

        • 5.6.5

          In Rule 5.6, "single customer" means, in relation to a customer who is:—

          (1) a person, that person and such group of persons whom the first-mentioned person is able to control or influence;
          (2) a corporation, that corporation and any other corporation or group of corporations which is or are deemed to be related to the first-mentioned corporation pursuant to section 4(1) of the Companies Act; or
          (3) a person, that person
          (a) and any corporation whose issued share capital is 50% or more owned by those persons mentioned in Rule 5.6.5(1) or those corporations mentioned in Rule 5.6.5(2); or
          (b) and any corporation whose composition of board of directors is controlled by those persons mentioned in Rule 5.6.5(1); and for this purpose the composition of the board of directors shall be deemed to be controlled by those persons, if they, by the exercise of some power exercisable by them without the consent or concurrence or any other person, can appoint or remove all or a majority of the directors of that corporation,

          but shall not include the General Clearing Member itself.

          Provided always that a single customer of a General Clearing Member shall not include the end customers of any Trading Member who is qualified by the General Clearing Member.

          Amended on 1 July 2008.

      • 5.7 Exposure to Single Security

        • 5.7.1

          A General Clearing Member shall immediately notify CDP if the General Clearing Member's exposure to a single security (including in respect of any Exchange Trade of any Trading Member qualified by the General Clearing Member) exceeds:—

          (1) in the case where the security is quoted on SGX-ST or any recognised group A securities exchange specified in the SFR (Financial and Margin Requirements), 300% of its average aggregate resources;
          (2) in all where the security is quoted other than as specified in Rule 5.7.1(1), 100% of its average aggregate resources;
          (3) in the case where the security is approved for quotation on SGX-ST or any recognised group A securities exchange but has not, as yet, been so quoted:—
          (a) 100% of the average aggregate resources of the General Clearing Member if its aggregate resources is less than $75 million; or
          (b) 150% of the average aggregate resources of the General Clearing Member if its aggregate resources is $75 million or more,
          provided that the exposure under Rule 5.7.1(3) together with the exposure, if any, to securities already quoted, shall not exceed the limit specified in Rule 5.7.1(1); and
          (4) 10% of its average aggregate resources if the security is unquoted, but shall not include any security issued by:—
          (a) any subsidiary of the General Clearing Member which is established solely for the purpose of providing research, nominee, custodian or trustee services; or
          (b) any other company which CDP may approve.

          Amended on 1 July 2008.

        • 5.7.2

          To reduce the General Clearing Member's risk exposure to a single security, CDP shall have the right to impose on the General Clearing Member such risk management measures as it deems necessary.

          Amended on 1 July 2008.

        • 5.7.3

          For the purpose of Rule 5.7.1, the full amount of the letter(s) of credit or any part thereof deposited pursuant to Rules 5.1C or 5.1G may be taken into account for the calculation of aggregate resources.

          Amended on 1 July 2008.

        • 5.7.4

          For the purpose of Rule 5.7.1, "exposure to a single security" means:—

          (1) the amount of the single security underwritten or sub-underwritten by or placed with the General Clearing Member, after deducting the amount which the General Clearing Member has sub-underwritten or placed with:—
          (a) a bank licensed under the Banking Act (Chapter 19);
          (b) a merchant bank approved as a financial institution under the Monetary Authority of Singapore Act (Chapter 186);
          (c) a finance company licensed under the Finance Companies Act (Chapter 108);
          (d) a company or society registered under the Insurance Act (Chapter 142) to carry on insurance business as an insurer;
          (e) the holder of a Capital Markets Services Licence under the SFA for dealing in capital markets products or for fund management;
          (f) a financial institution outside Singapore which is licensed or regulated by a financial services regulatory authority in the country in which it is domiciled, and has a long-term credit rating of investment grade; and
          (g) any other person, provided that:—
          (i) full payment has been received by the General Clearing Member for the sub-underwritten, placed, sold or allotted amount; or
          (ii) the sub-underwritten, placed, sold or allotted amount can be offset against collateral received by the General Clearing Member under a netting agreement.
          (2) the book value of the single security carried long or the market value of the single security carried short in the General Clearing Member's own account carried on its books;
          (3) for outstanding options in the single security carried in the General Clearing Member's own options trading account carried on its books:—
          (a) the book value of options bought for the account;
          (b) the excess of the market value of the underlying security over the exercise price of uncovered call options written for the account; and
          (c) the excess of the exercise price of put options written for the account over the market value of the underlying security;
          (4) in relation to the single security carried in a customer's cash accounts carried on the books of the General Clearing Member, the contract value of the single security to the extent that such amounts have not been paid for, or the market value of the single security to the extent that such securities have not been delivered, whichever is the higher;
          (5) for outstanding options in the single security carried in the customer's options trading accounts carried on the books of the General Clearing Member:—
          (a) the contract value of the options bought by the customer to the extent that such amounts have not been paid for;
          (b) the excess of the market value of the underlying security over the exercise price of uncovered call options written by the customer; and
          (c) the excess of the exercise price of put options written by the customer over the market value of the underlying security;
          (6) the net amount of the single security borrowed or lent, as the case may be, by the General Clearing Member;
          (7) in relation to a single security bought or carried, or deposited as collateral in the margin financing accounts carried on the books of the General Clearing Member, the margin exposure of the General Clearing Member to the single security as determined in accordance with the margin financing requirements prescribed by SGX-ST;
          (8) the amount of interest receivable secured by the single security;
          (9) the amount of loans and advances secured by the single security; and
          (10) the amount under subscription by the General Clearing Member for its own account carried on its books in relation to a single security which is approved for quotation on SGX-ST or any recognised group A securities exchange but has not, as yet, been so quoted.

          Amended on 1 July 2008, 23 January 2009, 1 July 2016 and 8 October 2018.

        • 5.7.5

          For the purpose of Rule 5.7.4, a security is deemed to be carried in a customer's cash account or a General Clearing Member's own account (such account being an account carried on the books of the General Clearing Member) on the contract date specified in the contract note in respect of the transaction in that security or on the exercise date specified in the exercise notice in respect of an option in that security which has been exercised.

          Amended on 1 July 2008 and 1 July 2016.

        • 5.7.6

          For the purposes of Rule 5.7, in calculating exposure in any particular security, all outstanding options exercisable into that security shall be included in such computation.

        • 5.7.6A

          For the purposes of Rule 5.7.4(2) and Rule 5.7.4(4), in calculating exposure in any particular security, all futures contracts listed on any exchange with that security as an underlying shall be included in such computation.

          Added on 3 April 2008.

        • 5.7.7

          Rule 5.7 shall not apply to:—

          (1) securities issued by the Singapore Government or any public authority in Singapore and
          (2) the General Clearing Member's arbitrage transactions.

          Amended on 1 July 2008.

        • 5.7.8

          For the purpose of Rule 5.7, where a security quoted on SGX-ST or any recognised group A securities exchange has been suspended for more than thirty (30) consecutive days, a General Clearing Member shall not permit its exposure to the security to increase in monetary value above the level subsisting on the 30th consecutive day of suspension until such time that the suspension has been lifted.

          Amended on 1 July 2008.

        • 5.7.9

          In Rule 5.7, "single security" includes ordinary and preference shares, loan stocks, company warrants, structured warrants, transferable subscription rights, bonds, debentures, depository receipts, options and any other debt instruments or equity securities.

          Amended on 3 April 2008.

      • 5.8 Monthly Returns

        • 5.8.1

          Each Clearing Member must make and keep as a record formal computations of its capital and financial requirements pursuant to:—

          (1) in the case of a General Clearing Member, Rules 5.1, 5.1A, 5.1B, 5.1C, 5.1D, 5.1E, 5.1F, 5.1G, 5.4, 5.5, 5.6 and 5.7; or
          (2) in the case of a Bank Clearing Member, Rules 5.1, 5.1B, 5.1D, 5.1F, and 5.4,

          as of the close of business each month, or in the case of capital adequacy report of Bank Clearing Members, quarterly. The computations must be in such form as CDP may prescribe and submitted to CDP within fourteen (14) calendar days after the end of each month, or such time frame as CDP may prescribe.

          Amended on 1 July 2008 and 29 December 2014 and 22 April 2019.

        • 5.8.2

          Where the Clearing Member fails to submit the statements required in Rule 5.8.1 within the prescribed time, there shall be imposed upon the Clearing Member a late fee of $100 for each day that the statements are not submitted in the prescribed time, unless an extension of time has been granted.

        • 5.8.3

          Requests for extension of time shall be submitted to CDP at least 3 Market Days prior to the due date for submission of the statements.

        • 5.8.4

          The Clearing Member shall be required to resubmit the statements and documents prescribed under Rule 5.8.1 and take such other steps as CDP may require upon CDP's notification that the statements and documents are inaccurate or incomplete.

      • 5.9 Appointment of Auditors and Audit Requirements

        • 5.9.1

          A Clearing Member, except for a Bank Clearing Member, shall seek the approval of CDP prior to any appointment of new auditors.

          Amended on 1 July 2008.

        • 5.9.1A

          A Bank Clearing Member shall inform CDP of the appointment of any new auditors within seven (7) days of such appointment.

          Added on 1 July 2008.

        • 5.9.2 Statutory Audit Report For General Clearing Members

          Without prejudice to such audit and/or reporting requirements as may be imposed by CDP from time to time, a General Clearing Member shall furnish to CDP, within five (5) months of the end of its financial year or within such longer period as may be permitted in writing by CDP, the relevant forms which a General Clearing Member is required to lodge in the prescribed format under Regulation 27(9) of the SFR (Financial and Margin Requirements), the annual accounts duly audited by, and the certificate of, its auditor or auditors who shall be a public accountant or a firm of public accountants approved by CDP. The certificate shall pertain to the audit conducted by such auditor or auditors in respect of the financial year aforesaid and shall be in such form prescribed by the Relevant Regulatory Authority.

          Amended on 12 October 2005 and 1 July 2008 and 22 April 2019.

        • 5.9.3

          Where, in the performance of his or their duties, the General Clearing Member's auditor or auditors becomes or become aware:—

          (1) of any matter which in his or their opinion adversely affects or may adversely affect the financial position of the General Clearing Member to a material extent,
          (2) of any matter which in his or their opinion constitutes or may constitute a contravention of any provision of the SFA or this Clearing Rules, or an offence involving fraud or dishonesty,
          (3) of any irregularity that has or may have a material effect upon the accounts, including irregularities that jeopardise the moneys or other assets of any Customer of the General Clearing Member; or
          (4) that the accounting system, internal accounting control and procedures for safeguarding moneys or other assets are inadequate and the inadequacies have a material effect on the accounts,

          the auditor or auditors shall immediately report the matter to CDP.

          Amended on 1 July 2008.

        • 5.9.4

          (1) Where a Clearing Member fails to submit the documents pursuant to Rule 5.9.2 within the specified time, there may be imposed upon that Clearing Member a fee of $200 for each day that the statements are not submitted within the prescribed time, unless an extension of time has been granted.
          (2) Requests for extension of time shall be submitted to CDP at least 3 Market Days prior to the due date.

        • 5.9.5 Audit Report For Bank Clearing Members

          Without prejudice to such audit and/or reporting requirements as may be imposed by CDP from time to time, a Bank Clearing Member shall furnish to CDP within five (5) months of the end of its financial year or within such longer period as may be permitted in writing by CDP, the annual accounts duly audited by, and the certificate of its auditor or auditors. The certificate shall pertain to the audit conducted by such auditor or auditors in respect of the financial year aforesaid and shall be in such form prescribed by the Relevant Regulatory Authority.

          Added on 1 July 2008 and amended on 22 April 2019.

        • 5.9.6

          Where, in the performance of his or their duties, the Bank Clearing Member's auditor or auditors becomes or become aware:—

          (1) of any matter in relation to the Bank Clearing Member's business governed by this Clearing Rules, which in his or their opinion adversely affects or may adversely affect the financial position of the Bank Clearing Member to a material extent,
          (2) of any matter which in his or their opinion constitutes or may constitute a contravention of any applicable provision of the SFA or this Clearing Rules or an offence involving fraud or dishonesty in relation to the Bank Clearing Member's business governed by this Clearing Rules,
          (3) of any irregularity in the Bank Clearing Member's business governed by this Clearing Rules, that has or may have a material effect upon the accounts, including irregularities that jeopardise the moneys or other assets of any customer of the Bank Clearing Member, or
          (4) that the accounting system, internal accounting control and procedures for safeguarding moneys or other assets, in relation to the Bank Clearing Member's business governed by this Clearing Rules, are inadequate and the inadequacies have a material effect on the accounts,

          the auditor or auditors shall immediately report the matter to CDP.

          Added on 1 July 2008.

      • 5.10 [Rule has been deleted.]

        Amended on 20 June 2005 and 1 July 2008.

      • 5.11 Other Financial Requirements

        • 5.11.1 Reduction in Paid-Up Ordinary Share Capital or Paid-Up Irredeemable and Non-Cumulative Preference Share Capital

          Each General Clearing Member incorporated in Singapore shall not reduce its paid-up ordinary share capital or paid-up irredeemable and non-cumulative preference share capital without the prior written approval of CDP.

          Amended on 1 July 2008 and 29 December 2014.

        • 5.11.2 Preference Shares

          (1) Each General Clearing Member incorporated in Singapore shall notify CDP prior to the date of issue of any preference share.
          (2) A General Clearing Member incorporated in Singapore shall not repay the principal of any preference share (other than any paid-up irredeemable and non-cumulative preference share capital) that is computed as part of its financial resources, through repurchase or redemption:—
          (a) unless the General Clearing Member notifies CDP within such time before the proposed date of repurchase or redemption as prescribed by the SFR (Financial and Margin Requirements);
          (b) if at the date of repurchase or redemption:—
          (i) its financial resources is less than 150% of its total risk requirement; or
          (ii) its aggregate indebtedness exceeds 600% of its aggregate resources;
          (c) if such repurchase or redemption will cause an event in Rule 5.11.2(2)(b) to occur; or
          (d) if CDP has prohibited in writing such a repurchase or redemption.

          Amended on 1 July 2008 and 29 December 2014.

        • 5.11.3 Qualifying Subordinated Loan

          (1) A General Clearing Member shall obtain the prior approval of CDP if it enters a subordinated loan agreement in a format other than the format prescribed by CDP from time to time.
          (2) Each General Clearing Member incorporated in Singapore, shall immediately notify CDP when it draws down a qualifying subordinated loan, no later than the date of draw down.
          (3) A General Clearing Member incorporated in Singapore:—
          (a) shall not repay, whether in part or in full, any subordinated loan principal before the maturity date without the prior approval of CDP;
          (b) shall not repay, whether in part or in full, any subordinated loan principal that has matured:—
          (i) unless the Clearing Member notifies CDP at least one (1) Market Day before the date of repayment;
          (ii) if the financial resources of the Clearing Member, are less than 150% of its total risk requirement;
          (iii) in the case of a General Clearing Member, if its aggregate indebtedness exceeds 600% of its aggregate resources;
          (iv) if such a repayment will cause an event in Rules 5.11.3 (2)(b)(ii) or (iii) to occur; or
          (v) if CDP has prohibited in writing such a repayment.

          Amended on 1 July 2008, 29 December 2014 and 22 April 2019.

        • 5.11.4 Making of Unsecured Loan or Advance, Payment of Dividend or Director's Fees or Increase in Director's Remuneration by General Clearing Member

          Each General Clearing Member shall not, without the prior written approval of CDP, make any unsecured loan or advance, pay any dividend or director's fees or increase any director's remuneration if:—

          (1) in the case where the General Clearing Member is incorporated in Singapore:—
          (a) the base capital of the General Clearing Member is less than the base capital requirement as prescribed in Rules 5.1.1(1) and 5.4;
          (b) the financial resources of the General Clearing Member are less than 150% of its total risk requirement;
          (c) the aggregate indebtedness of the General Clearing Member exceeds 600% of its aggregate resources; or
          (d) such a loan, advance, payment or increase will cause an event in Rule 5.11.4(1)(a), (b) or (c) to occur; or
          (2) in the case where the General Clearing Member is incorporated outside Singapore:—
          (a) the net head office funds of the General Clearing Member are less than the net head office funds requirement as prescribed in Rules 5.1D.1(1) and 5.4;
          (b) the adjusted net head office funds of the General Clearing Member are less than 150% of its total risk requirement;
          (c) the aggregate indebtedness of the General Clearing Member exceeds 600% of its aggregate resources; or
          (d) such a loan, advance, payment or increase will cause an event in Rules 5.11.4(2)(a), (b) or (c) to occur.

          Amended on 1 July 2008 and 29 December 2014.

        • 5.11.5 Credit Facilities

          Each Clearing Member shall submit to CDP, in the manner as prescribed from time to time:

          (1) a report on all its credit facilities with its financial institutions at such frequency as CDP shall require; and
          (2) any change to its credit facilities, including variation of credit limits and addition or termination of credit facilities, immediately upon such change.

          Added on 23 January 2009.

      • 5.12 Register of Connected Persons

        Each Clearing Member shall keep a register of its directors and their connected persons.

        For the purpose of this Rule, a "connected person" has the meaning ascribed to it in Section 2 of the SFA.

      • 5.13 Exemption for SGXlink Pte Ltd

        Subject to the conditions specified in writing by the Authority, Rule 5 shall not apply to SGXLink Pte Ltd.

    • Rule 5A — Position Accounts

      • 5A.1 — Separate Position Accounts and Position Account Designation

        • 5A.1.1

          A Clearing Member must maintain separate Position Accounts for each Customer or each group of joint Customers whose account is carried on the books of the Clearing Member.

          Added on 1 July 2016.

        • 5A.1.2

          Each Position Account must be identified and designated, by the full name of the Customer(s) whose account is carried on the books of the Clearing Member and by a unique account code.

          Added on 1 July 2016.

      • 5A.2 — Reporting Requirements for Position Account

        • 5A.2.1

          Each Clearing Member shall report to CDP such information as CDP may require for each Position Account opened with CDP as soon as practicable, and in any event, no later than such time as may be required for timely and orderly settlement of the first trade cleared by the Clearing Member for the holder of such Position Account into the intended Securities Account.

          Refer to Practice Note 5A.2.1, 5A.2.2.

          Added on 1 July 2016.

        • 5A.2.2

          Each Clearing Member shall report to CDP any change in information previously reported to CDP for any Position Account as soon as practicable.

          Refer to Practice Note 5A.2.1, 5A.2.2.

          Added on 1 July 2016.

      • 5A.3 — Allocation of trades to Position Accounts

        • 5A.3.1

          Each Clearing Member shall allocate the position of each trade cleared by the Clearing Member for a Customer to that Customer's Position Account or in accordance with that Customer's instructions, as soon as practicable, and in any event no later than such time as may be required for timely and orderly settlement of such trade into the intended Securities Account.

          Refer to Practice Note 5A.3.1, 5A.3.4.

          Added on 1 July 2016.

        • 5A.3.2

          A Customer's Position Account must only be used for that Customer's positions. However, a Clearing Member may sub-allocate a position carried in a Customer's Position Account (the "originating Position Account") to another Position Account (the "destination Position Account"), provided that:

          (a)(i) such sub-allocation is in accordance with the instructions of both the account holders of the originating Position Account and destination Position Account (or person(s) authorized to instruct on their behalf); and (ii) the Clearing Member receives the booking instruction only after the position has been allocated to the originating Position Account; or
          (b) such sub-allocation is made to remedy an error.

          Added on 1 July 2016.

        • 5A.3.3

          A Position Account may be used to hold positions for different Customers, provided that such positions are allocated out in accordance with the requirements provided in Rules 5A.3.1 and 5A.3.2.

          Added on 1 July 2016.

        • 5A.3.4

          For cases in which an SGX-ST Trading Member is warehousing its customer's trades, the Clearing Member shall ensure that no trades are warehoused for more than one Market Day, unless under exceptional circumstances. In such cases, the Clearing Member must document the reasons for the extension of time.

          Refer to Practice Note 5A.3.1, 5A.3.4

          Amended on 1 July 2016 and 10 December 2018.

      • 5A.4 — Authorisation of SGX-ST Trading Member to Maintain Position Accounts

        Amended on 10 December 2018.

        • 5A.4.1

          For third-party clearing arrangements, a Clearing Member may authorise an SGX-ST Trading Member it qualifies (referred to in this Rule 5A.4. as the "Authorised Trading Member") to:

          (a) open and maintain Position Accounts for; or
          (b) open, maintain and allocate positions to the Position Accounts of,

          the SGX-ST Trading Member and/or the SGX-ST Trading Member's customers (such Position Accounts referred to in this Rule 5A.4 as the "Authorised Accounts"), in accordance with such procedures as CDP may require.

          Amended on 1 July 2016 and 10 December 2018.

        • 5A.4.2

          Where a Clearing Member authorises an Authorised Trading Member to open and maintain Authorised Accounts under Rule 5A.4.1(a), Rules 5A.1and 5A.2 shall, with the necessary modifications, apply to an Authorised Trading Member in respect of each Authorised Account, as those provisions apply to a Clearing Member. The Clearing Member who authorises the Authorised Trading Member under Rule 5A.4.1(a) shall ensure that the Authorised Trading Member performs the obligations under Rules 5A.1 and 5A.2, as they apply to the Authorised Trading Member in respect of each Authorised Account.

          Refer to Practice Note 5A.4.2, 5A.4.3.

          Amended on 1 July 2016 and 10 December 2018.

        • 5A.4.3

          Where a Clearing Member authorises an Authorised Trading Member to open, maintain and allocate positions to the Authorised Accounts under Rule 5A.4.1(b), Rules 5A.1, 5A.2, 5A.3 and 5A.6 shall, with the necessary modifications, apply to an Authorised Trading Member in respect of each Authorised Account, as those provisions apply to a Clearing Member. The Clearing Member who authorises the Authorised Trading Member under Rule 5A.4.1(b) shall ensure that the Authorised Trading Member performs the obligations under Rules 5A.1, 5A.2, 5A.3 and 5A.6, as they apply to the Authorised Trading Member in respect of each Authorised Account.

          Refer to Practice Note 5A.4.2, 5A.4.3.

          Amended on 1 July 2016 and 10 December 2018.

        • 5A.4.4

          If a Clearing Member wishes to cease authorising an Authorised Trading Member, it shall:-

          (a) give not less than 30 days' written notice (or such shorter period as CDP may from time to time deem acceptable) to CDP of its intention to cease authorising that Authorised Trading Member and the proposed date of cessation, provided always that CDP may waive such notice requirement at any time with respect to any Clearing Member;
          (b) satisfy CDP that it has taken, or will take, proper steps for the orderly clearing and settlement of the Authorised Trading Member's Exchange Trades; and
          (c) comply with any reasonable direction of CDP in relation to the orderly cessation of the authorization of the Authorised Trading Member.

          Added on 1 July 2016 and amended on 10 December 2018.

      • 5A.5 — Position Accounts carrying positions for more than one beneficial owner

        • 5A.5.1

          Subject to Rule 5A.5.2, a Clearing Member shall identify the beneficial owner(s) and/or controlling party(ies) of any Position Account to CDP upon request by CDP within such time as CDP may require.

          Amended on 1 July 2016 and 10 December 2018.

        • 5A.5.2

          If the Position Account holder does not want the identity of any underlying beneficial owner and/or any controlling party of such account to be disclosed to its carrying Clearing Member, the Position Account holder may apply to the CDP, through its carrying Clearing Member, to provide such information as CDP may require directly to CDP.

          Added on 1 July 2016.

      • 5A.6 — Position Reconciliation

        • 5A.6.1

          Each Clearing Member shall ensure that positions in each Position Account maintained with CDP are accurate. If any discrepancy between CDP's and the Clearing Member's records is noted, the Clearing Member must inform CDP and if required rectify the discrepancy immediately.

          Amended on 1 July 2016 and 10 December 2018.

      • 5A.7 — Disclosure of information

        • 5A.7.1

          Each Clearing Member irrevocably authorises CDP to disclose the contents of any information reported to CDP under this Rule 5A to any Exchange in so far as such information relates to trades executed on that Exchange or to any Position Account carrying such trades.

          Added on 1 July 2016 and amended 10 December 2018.

    • Rule 6 — Clearing and Settlement between Clearing Members and CDP

      Amended on 10 December 2018.

      • 6.1 Clearing of Exchange Trades

        • 6.1.1

          All Exchange Trades shall be cleared and settled with CDP in accordance with these Clearing Rules.

          Amended on 23 January 2009 and 10 December 2018.

        • 6.1.2

          Only Clearing Members shall be permitted to clear and settle Exchange Trades with CDP.

          Amended on 10 December 2018.

        • 6.1.3 [Rule has been deleted.]

          Deleted on 10 December 2018.

        • 6.1.4 [Rule has been deleted.]

          Deleted on 10 December 2018.

      • 6.2 Clearing and Novation

        Amended on 10 December 2018.

        • 6.2.1

          Subject to Rule 6.2.1A, when a transaction between 2 SGX-ST Trading Members is matched on the Trading System, or is reported to SGX-ST pursuant to the SGX-ST Rules on "Direct Business", or is otherwise accepted for clearing by the CDP, the following occurs:—

          (1) Where the 2 SGX-ST Trading Members are both Clearing Members, the transaction shall be novated to CDP and Rules 6.2.2, 6.2.3 and 6.2.4 will apply.
          (2) Where 1 of the 2 SGX-ST Trading Members is a Trading only Member, the Clearing Member who has qualified the Trading Member shall, as against the Trading Member, assume the rights, duties and obligations of the counterparty SGX-ST Trading Member to the transaction; i.e. the Clearing Member who has qualified the Trading Member shall become the buyer or seller, as the case may be, to the Trading Member. As against the counterparty SGX-ST Trading Member, the Clearing Member who has qualified the Trading Member shall assume the rights, duties and obligations of the Trading Member and the transaction shall thereupon be novated to CDP and Rules 6.2.2, 6.2.3 and 6.2.4 shall apply. Thus, for example:— A, a Trading Member, contracts to buy 1,000 shares and the trade is matched on the Trading System with B, a Clearing Member. The Clearing Member who has qualified A is C. Immediately upon the matching of the trade on the Trading System, the following occurs:—
          (a) A's obligation to pay the purchase consideration for 1,000 shares to B is replaced by A's obligation to pay the purchase consideration for 1,000 shares to C and A's right to receive 1,000 shares from B is replaced by A's right to receive 1,000 shares from C.
          (b) B's obligation to deliver 1,000 shares to A is replaced by B's obligation to deliver 1,000 shares to C and B's right to receive the purchase consideration for 1000 shares from A is replaced by B's right to receive the purchase consideration for 1,000 shares from C.
          (c) C assumes A's obligation to pay the purchase consideration for 1,000 shares to B and acquires the corresponding right to receive 1,000 shares from B.
          Thereafter, the transaction between C and B is novated to CDP so that:—
          (d) C's obligation to pay the purchase consideration for 1,000 shares to B is replaced by C's obligation to pay the same to CDP; and the corresponding right of C to receive the 1,000 shares from B is replaced by the right of C to receive the 1,000 shares from CDP; and
          (e) B's obligation to deliver 1,000 shares to C is replaced by B's obligation to deliver the same to CDP; and the corresponding right of B to receive the purchase consideration for the 1,000 shares from C is replaced by the right of B to receive the purchase consideration from CDP.
          (3) Where the 2 SGX-ST Trading Members are Trading only Members, the Clearing Members who have qualified the Trading Members respectively shall assume the rights, duties and obligations of the Trading Members to each other and as against the Trading Member which they have respectively qualified, they shall assume the rights, duties and obligations of the counterparty SGX-ST Trading Member to the transaction. Thereafter the transaction shall be novated to CDP and Rules 6.2.2, 6.2.3 and 6.2.4 will apply. Thus, for example:—

          A, a Trading only Member, contracts to buy 1,000 shares and the trade is matched on the Trading System with B, a Trading only Member. The Clearing Member who has qualified A is C. The Clearing Member who has qualified B is D. Immediately upon the matching of the trade on the Trading System, the following occurs:—
          (a) A's obligation to pay the purchase consideration for 1,000 shares to B is replaced by A's obligation to pay the purchase consideration for 1,000 shares to C and A's right to receive 1,000 shares from B is replaced by A's right to receive 1,000 shares from C.
          (b) B's obligation to deliver 1,000 shares to A is replaced by B's obligation to deliver 1,000 shares to D and B's right to receive the purchase consideration for 1,000 shares from A is replaced by B's right to receive the purchase consideration for 1,000 shares from D.
          (c) C assumes A's obligation to pay the purchase consideration for 1,000 shares to D and acquires the corresponding right to receive 1,000 shares from D.
          (d) D assumes B's obligation to deliver 1,000 shares to C and acquires the corresponding right to receive the purchase consideration for 1,000 shares from C.
          Thereafter, the transactions between C and D are novated to CDP so that:—
          (e) C's obligation to pay the purchase consideration for 1,000 shares to D is replaced by C's obligation to pay the same to CDP; and the corresponding right of C to receive 1,000 shares from D is replaced by the right of C to receive 1,000 shares from CDP; and
          (f) D's obligation to deliver 1,000 shares to C is replaced by D's obligation to deliver the same to CDP; and the corresponding right of D to receive the purchase consideration for 1,000 shares from C is replaced by the right of D to receive the purchase consideration for 1,000 shares from CDP.

          Amended on 3 April 2008, 23 January 2009 and 10 December 2018 .

        • 6.2.1A

          For transactions in Marginable Futures Contracts between 2 SGX-ST Trading Members which are reported to SGX-ST pursuant to the SGX-ST Rules on "Direct Business", novation under Rules 6.2.1(1)–(3) shall take place only upon:

          (a) where both Clearing Members receive margin call pursuant to the first margin cycle run following the reporting of the trade, the later in time Confirmation by the Clearing Members' Settlement Bank(s) of the Payment Instructions in respect of the margin calls; or
          (b) where only one Clearing Member receives margin call pursuant to the first margin cycle run following the reporting of the trade, Confirmation by that Clearing Member's Settlement Bank of the Payment Instruction in respect of that margin call; or
          (c) where neither Clearing Member receives margin call pursuant to the first margin cycle run following the reporting of the trade, the end of that margin cycle.

          Added on 23 January 2009. Amended on 26 April 2013.

        • 6.2.2

          Upon novation of an Exchange Trade to CDP:—

          (1)
          (a) the obligation of the buying Clearing Member to pay the purchase consideration to the selling Clearing Member is replaced by the obligation of the buying Clearing Member to pay the purchase consideration to CDP; and
          (b) the right of the buying Clearing Member to receive the securities from the selling Clearing Member is replaced by the right of the buying Clearing Member to receive the securities from CDP; and
          (2)
          (a) the obligation of the selling Clearing Member to deliver the securities to the buying Clearing Member is replaced by the obligation of the selling Clearing Member to deliver the securities to CDP; and
          (b) the right of the selling Clearing Member to receive the sale consideration from the buying Clearing Member is replaced by the right of the selling Clearing Member to receive the sale consideration from CDP.

        • 6.2.3

          The obligations and rights in respect of the Novated Contracts:—

          (1) between the buying Clearing Member and CDP; and
          (2) between the selling Clearing Member and CDP,

          are owed by and to the parties as principals to each other notwithstanding that the buying and selling Clearing Members may have acted as agents for their respective customers in executing or clearing and settling the relevant Exchange Trade.

          Amended on 23 January 2009 and 10 December 2018.

        • 6.2.4

          Subject as otherwise provided in these Clearing Rules the terms of the Novated Contracts shall be on the same terms as the relevant Exchange Trade replaced by such Novated Contracts.

          Amended on 23 January 2009.

      • 6.2A Obligations under Novated Contracts

        • 6.2A.1

          The obligations under a Novated Contract are due for settlement on the Intended Settlement Day of the Novated Contract and on each Settlement Day thereafter until they are fully settled, save that the obligation to make payment for securities is not due until:

          (1) those securities have been made available for delivery pursuant to Rule 6.5.2A; or
          (2) the right to receive those securities has been cash settled pursuant to these Clearing Rules.

          Added on 10 December 2018.

      • 6.3 Set-Off of Payment Obligations in respect of Novated Contracts and Determination of Payment Obligations between CDP and Clearing Members

        Amended on 10 December 2018.

        • 6.3.1

          A Clearing Member's obligation to make payment to and right to receive payment from CDP in respect of Novated Contracts (including any obligation or right to pay or receive a Cash Settlement Amount or to make or receive compensation of corporate action entitlements as provided in these Clearing Rules) shall be settled by net payment in accordance with these Clearing Rules.

          Amended on 23 January 2009 and 10 December 2018.

        • 6.3.2

          A Clearing Member's obligation to make payment and its entitlement to receive payment in respect of Novated Contracts on any Settlement Day shall be set off for each settlement currency.

          The resultant net amount shall be known as the "Final Settlement Balance" for that Settlement Day and currency.

          Amended on 23 January 2009, 25 February 2011, 26 April 2013 and 10 December 2018.

        • 6.3.2A

          (1) On each Settlement Day, CDP shall make available to each Clearing Member, a record of the Novated Contracts to be settled with CDP (including any obligation or right to pay or receive a Cash Settlement Amount or to make or receive compensation for corporate action entitlements as provided in these Clearing Rules), the Clearing Member's Final Settlement Balance(s), and the status of settlement.

          (2) Save for manifest error, the record shall be binding and conclusive on the Clearing Member as to the Novated Contracts to be settled between the Clearing Member and CDP, the details of such Novated Contracts, the Clearing Member's Final Settlement Balance(s) and the status of settlement.

          (3) Notwithstanding any manifest error in the record or any dispute as to the contents stated in the record, payment of each Final Settlement Balance shall be made by or to a Clearing Member in accordance with Rule 6.4. Any moneys to be refunded or deducted shall be refunded or deducted free of interest as soon as practicable after the dispute is resolved.

          Added on 10 December 2018.

        • 6.3.3 [Rule has been deleted.]

          Deleted on 10 December 2018.

      • 6.4 Settlement of Payment Obligations Between Clearing Members and CDP

        • 6.4.1

          (1) Unless otherwise notified by CDP to the Clearing Members, settlement of the Final Settlement Balance for each Settlement Day between a Clearing Member and CDP shall, subject to (2), be effected and final upon the execution of all settlement instructions submitted by CDP under the CDP Settlement Rules for settlement between CDP and that Clearing Member in respect of Novated Contracts, in that settlement currency, and which are due to settle on that Settlement Day.

          (2) A settlement instruction, if not executed only by reason of there being insufficient securities available, shall not be taken into account for the purposes of (1).

          (3) Failure by a Clearing Member to settle a Final Settlement Balance for a Settlement Day, on that Settlement Day, shall constitute a breach by the Clearing Member of these Clearing Rules.

          Amended on 25 February 2011, 26 April 2013 and 10 December 2018.

        • 6.4.1A [Rule has been deleted.]

          Deleted on 10 December 2018.

        • 6.4.2

          Save for manifest error, for each Settlement Day, the Daily Settlement of Account with CDP statement shall be deemed binding and conclusive on each Clearing Member as to the Net Inter-Broker Settlement Balance for that Settlement Day and the On-Line Transmission shall be deemed binding and conclusive on each Clearing Member as to the Final Settlement Balance for that Settlement Day.

          Amended on 26 April 2013.

        • 6.4.3 [Rule has been deleted.]

          Deleted on 10 December 2018.

        • 6.4.4

          CDP shall be entitled to charge interest on any amount owing to CDP which is not settled when due, at such rate as may be determined by CDP.

          Amended on 25 February 2011 and 10 December 2018.

        • 6.4.5

          Settlement of transactions between Clearing Members and CDP shall be in the currency as determined by CDP.

          Added on 10 December 2018.

      • 6.5 Settlement of Securities in respect of Novated Contracts

        Amended on 10 December 2018.

        • 6.5.1

          Settlement of a Clearing Member's right on any Settlement Day to receive securities in respect of Novated Contracts (including any right to receive securities as compensation for corporate action entitlements as provided in these Clearing Rules) shall be effected and final upon CDP crediting such securities into the Clearing Member's Clearing Account.

          Amended on 3 April 2008, 1 July 2008, 23 January 2009, 26 April 2013 and 10 December 2018.

        • 6.5.1A [Rule has been deleted.]

          Deleted on 10 December 2018.

        • 6.5.1B

          On any Settlement Day, if and to the extent that the securities available to CDP are insufficient for CDP to settle its delivery obligations in respect of Novated Contracts that are due for settlement on that Settlement Day, CDP may:

          (1) defer any of those delivery obligations, in whole or in part, for settlement on the next Settlement Day; or
          (2) cash settle any of those delivery obligations, in whole or in part.

          Added on 10 December 2018.

        • 6.5.2

          (1) Settlement of a Clearing Member's obligation on any Settlement Day to deliver securities in respect of Novated Contracts (including any obligation to deliver securities as compensation for corporate action entitlements as provided in these Clearing Rules) shall be effected and final upon CDP debiting such securities from the Clearing Member's Clearing Account.

          (2) Failure by a Clearing Member to deliver securities when due shall subject the Clearing Member to Rule 6.7A.

          Amended on 3 April 2008, 23 January 2009, 20 November 2009,26 April 2013 and 10 December 2018.

        • 6.5.2A

          A Clearing Member shall ensure that the securities required to meet its delivery obligation in respect of Novated Contracts are made available in such manner and by such time as provided in the CDP Settlement Rules to enable the delivery of those securities on the Settlement Day that the obligation is due. Failure by a Clearing Member to comply with this Rule 6.5.2A shall subject the Clearing Member to Rule 6.7.

          Added on 20 November 2009 and amended on 26 April 2013 and 10 December 2018.

        • 6.5.2B [Rule has been deleted.]

          Deleted on 10 December 2018.

        • 6.5.2C [Rule has been deleted.]

          Deleted on 10 December 2018.

        • 6.5.3 [Rule has been deleted.]

          Deleted on 10 December 2018.

        • 6.5.4

          Subject to Rule 6.5.5:

          (1) A Clearing Member that is due to, but does not, deliver securities in respect of Novated Contracts is liable to compensate CDP for corporate action entitlements that accrue on those securities and that a recipient of those securities would have been entitled to receive but for the delivery failure.
          (2) A Clearing Member that is due to, but does not receive securities in respect of Novated Contracts is entitled to be compensated by CDP for corporate action entitlements that accrue on those securities and that a recipient of those securities would have been entitled to receive but for the delivery failure.

          Added on 10 December 2018.

        • 6.5.5

          Rule 6.5.4 applies only to such types of corporate action entitlements that CDP shall from time to time notify.

          Refer to Regulatory Notice 6.5.

          Added on 10 December 2018.

        • 6.5.6

          (1) Any compensation under Rule 6.5.4 shall be made in such form and value, and be due by such time, as CDP shall specify.
          (2) Where CDP requires any action by a Clearing Member to effect such compensation, the Clearing Member shall do so, and shall obtain all necessary authorisation from its Customer to enable it to do so, by such time as CDP shall specify.

          Refer to Regulatory Notice 6.5.

          Added on 10 December 2018.

      • 6.6 CDP'S Obligations in respect of Novated Contracts

        Amended on 10 December 2018.

        • 6.6.1

          If and to the extent that the funds or assets available to CDP are insufficient, either in aggregate or in respect of in any settlement currency, to meet CDP's obligations to Clearing Members in respect of Novated Contracts, CDP may upon notice to the relevant Clearing Members defer any of those obligations, in whole or in part, for settlement at such later time as CDP may determine.

          Amended on 23 January 2009, 22 April 2013 and 10 December 2018.

        • 6.6.2

          Without prejudice to Rule 6.5.1B, if and to the extent that CDP determines that it is not or may not be possible or reasonably practicable to deliver securities in respect of a Novated Contract, CDP may cash settle its obligation to deliver securities, in whole or in part.

          Refer to Practice Note 6.5.1B(2), 6.6.2, 6.7.11, 8.4.1A, 8.5.2A and 8.6F.2.

          Amended on 23 January 2009, 22 April 2013 and 10 December 2018.

        • 6.6.3

          Without prejudice to Rule 8, CDP will be under no obligation to deliver securities to a Clearing Member in respect of any Novated Contract if the Clearing Member fails to settle any Final Settlement Balance in full, save that where partial payment of the Final Settlement Balance is made, CDP may, but is not obliged to, deliver some of the securities that it would otherwise have been obliged to deliver but for the Clearing Member's failure.

          Added on 22 April 2013 and amended on 10 December 2018.

        • 6.6.4

          Where CDP deems it necessary or desirable for ensuring a fair and orderly market or for ensuring a safe and efficient clearing and/or settlement facility, or for ensuring the integrity of the market or for proper management of systemic risk in the market, CDP may replace an obligation to pay a Final Settlement Balance for a currency with an obligation to pay the Final Settlement Balance in a different currency, at such rate as CDP may determine.

          Added on 10 December 2018.

      • 6.6A [Rule has been deleted.]

        Deleted on 21 January 2013.

      • 6.7 Buying-In, Procurement and Cash Settlement

        Amended on 20 November 2009 and 10 December 2018.

        • 6.7.1 Terminology

          For clarity under Rules 6.7 and 6.7A:—

          "short Clearing Member" refers to the Clearing Member who fails to comply with the obligation set out in Rule 6.5.2A; and

          "selling Clearing Member" refers to the Clearing Member who has sold securities in the buying-in market.

          Amended on 3 April 2008, 20 November 2009 and 10 December 2018.

        • 6.7.2 Buying in

          (1) If a short Clearing Member fails, on the Intended Settlement Day of a Novated Contract, to make securities available in accordance with Rule 6.5.2A, CDP shall have the discretion but not the obligation to commence buying-in, on the buying-in market, of those securities, on the Clearing Member's behalf, without prior notice to the short Clearing Member.
          (1A) Subject to Rule 6.7.12(1), such buying-in will commence on the Intended Settlement Day of the Novated Contract.
          (2) [Deleted]
          (3) [Deleted]
          (4) The costs of the buying-in shall be paid by the short Clearing Member.

          Amended on 3 April 2008, 20 November 2009 and 10 December 2018.

        • 6.7.3 Notification of Buying-in

          (1) CDP shall inform each short Clearing Member of each and every security that will be bought in on behalf of the short Clearing Member.
          (2) Buying-in against the short Clearing Member may proceed according to this information and in accordance with Rule 6.7.4.

          Amended on 27 March 2007; 20 November 2009 and 10 December 2018.

        • 6.7.4 Buying-In Procedures

          (1) CDP shall schedule a time for commencement of buying-in and inform Clearing Members of the scheduled time via circular. On the day of buying-in, CDP shall, as far as practicable, by the scheduled time for commencement of buying-in, notify Clearing Members of the securities for buying-in via the SGX website or through such other medium as CDP may consider appropriate. CDP shall, at least 3 working days before changing the scheduled time for commencement of buying-in, inform Clearing Members of the details of such change via circular.
          (1A) If CDP is of the opinion that, due to an emergency on a particular day, buying-in is unlikely to commence at the scheduled time, CDP shall, via circulars or such other medium as CDP may consider appropriate, inform Clearing Members of the following matters:
          (a) that buying-in will not commence at the scheduled time; and
          (b) when it can be determined, the estimated time at which the delayed buying-in will commence.
          In any case where the commencement of buying-in is delayed, the delayed buying-in shall only commence at least 15 minutes after the original scheduled time.
          (2) [Rule has been deleted.]
          (3) [Rule has been deleted.]
          (4) [Rule has been deleted.]
          (5) The buying-in bid price, as determined by CDP, will be 2 minimum bids above the highest of the following:
          (a) the closing price of the previous day;
          (b) the reference transacted price,
          (c) the reference bid price; and
          (d) in respect of a trade in the buying-in market on the previous Market Day for which delivery failed, the transacted price of that trade.
          For the purpose of this Rule, the reference transacted price and the reference bid price will be any of the last transacted prices and bid prices within the 1 hour preceding the commencement of buying-in, as determined by CDP.
          (5A) Where necessary, CDP shall have the discretion to make adjustments to any of the prices described in 6.7.4(5) to cater for corporate actions on the particular security.
          (6) [Rule has been deleted.]
          (7) If the securities are not obtained after the commencement of buying-in, CDP shall have absolute discretion to raise the buying-in price bid by 2 minimum bids, as determined by SGX-ST, from the following, in order to facilitate the successful buying-in of the securities:
          (a) the prevailing buying-in bid price;
          (b) the transacted price in the ready market; or
          (c) the bid price in the ready market,
          at such time as determined by CDP, from time to time throughout the buying-in session until the securities are bought-in.
          (8) Subject to Rule 6.7.12(1), if the securities to be bought-in are not bought-in on the first day scheduled for buying-in and unless the securities are withdrawn from buying-in or the short Clearing Member makes the securities available for delivery to CDP by such time as specified by CDP on the following Market Day, the buying-in shall continue on the following Market Day with the buying-in bid price at the commencement of buying-in determined in accordance with 6.7.4(5) and 6.7.4(5A), and CDP shall have absolute discretion to raise the buying-in bid price after the commencement of buying-in in accordance with 6.7.4(7).

          See Practice Note 6.7.2(1A), 6.7.4(8), 6.7.7A and 6.7.11.
          (8A) [deleted]
          (9) [Rule has been deleted.]
          (10) [Rule has been deleted.]
          (11) [Rule has been deleted.]
          (12) [Rule has been deleted.]

          Amended on 27 March 2007, 3 April 2008, 20 November 2009, 15 June 2011, 22 April 2013 and 10 December 2018.

        • 6.7.5 [Rule has been deleted.]

          Deleted on 22 April 2013.

        • 6.7.6 Suspension of Buying-In

          (1) Buying-in shall not apply whenever SGX-ST suspends trading of a security. CDP may then require the short Clearing Member to procure the securities within the time stipulated by CDP.
          (1A) Buying-in shall not apply whenever trading of a security is halted. CDP may:
          (a) commence buying-in when trading in that security resumes. The buying-in bid price of that security will be determined as described in 6.7.4(5), 6.7.4(5A) and 6.7.4(7); or
          (b) require the short Clearing Member to procure the securities within the time stipulated by CDP.
          (2) Notwithstanding Rule 6.7.6(1), CDP may suspend either indefinitely or for such time as it thinks fit the buying-in of any securities when circumstances appear to make such suspension desirable. CDP may from time to time, either during the continuance or after the termination of any such suspension, remove, renew or re-impose such suspension.

          Amended on 22 April 2013.

        • 6.7.7 Commission for Buying-In Trades

          Buying-in commission, at a rate to be advised by CDP from time to time, shall be charged and borne by the short Clearing Member.

          Amended on 10 December 2018.

        • 6.7.7A Procurement

          Subject to Rule 6.7.12(1), if securities to be bought-in are not bought-in by the second day scheduled for buying-in, the short Clearing Member shall procure the securities, whether by transacting on the ready market or otherwise, to discharge its delivery obligation.

          See Practice Note 6.7.2(1A), 6.7.4(8), 6.7.7A and 6.7.11.

          Added on 10 December 2018.

        • 6.7.8

          CDP shall have the discretion to require a short Clearing Member to furnish reports and confirmations that the delivery requirements have been complied with in respect of all sale contracts.

        • 6.7.9

          CDP reserves the right to institute buying-in against or require procurement in respect of open sale positions although the net delivery position of the short Clearing Member with CDP is not a short position.

          Amended on 10 December 2018.

        • 6.7.10 [Rule has been deleted.]

          Deleted on 20 November 2009.

        • 6.7.11 Cash Settlement

          If a Clearing Member's obligation to deliver securities in respect of a Novated Contract remains outstanding on the fifth (5th) Settlement Day (or such other number of Settlement Days as CDP may specify) after the Intended Settlement Day of the Novated Contract, CDP shall, on the next Settlement Day, cash settle the Clearing Member's delivery obligation.

          Refer to Practice Note 6.5.1B(2), 6.6.2, 6.7.11, 8.4.1A, 8.5.2A and 8.6F.2 and Practice Note 6.7.2(1A), 6.7.4(8), 6.7.7A and 6.7.11.

          Added on 10 December 2018.

        • 6.7.12

          CDP reserves the right to:

          (1) dispense with, or vary the commencement, duration, or any other timelines specified for, any buying-in or procurement to be conducted under this Rule 6.7; and/or
          (2) cash settle an outstanding delivery obligation notwithstanding that buying-in and/or procurement has not been conducted.

          Added on 10 December 2018.

      • 6.7A Penalties and Disciplinary Action for the Non-Delivery of Securities

        Amended on 10 December 2018.

        • 6.7A.1

          (1) If a Clearing Member fails to deliver, in accordance with Rule 6.5.2, securities in respect of a Novated Contract when due, CDP may impose upon the short Clearing Member a fine of:
          (a) $1,000 or 5% of the contract value of the undelivered securities (whichever is higher); or
          (b) if the securities are to settle a Novated Contract arising from a trade on the buying-in market, $5,000 or 10% of the contract value of the undelivered securities (whichever is higher).
          (2) Nothing in the foregoing prevents CDP from waiving the fine under Rule 6.7A.1 for:
          (a) market makers of cross-listed exchange traded funds; or
          (b) such participants and such class of market participants that CDP may deem appropriate from time to time.

          Added on 20 November 2009 and amended on 15 September 2017 and 10 December 2018.

        • 6.7A.2

          If a Clearing Member's obligation to deliver securities in respect of a Novated Contract remains outstanding on the fifth (5th) Settlement Day after delivery is due, CDP may impose a further penalty of $5,000.

          Added on 20 November 2009 and amended on 10 December 2018.

        • 6.7A.3

          CDP may refer a Clearing Member to the Disciplinary Committee where CDP is satisfied that the Clearing Member has frequently failed to deliver securities when due.

          Added on 20 November 2009 and amended on 10 December 2018.

        • 6.7A.4

          (1) CDP may refer a Clearing Member to the Disciplinary Committee where:
          (a) the Clearing Member fails to procure securities as directed by CDP, pursuant to these Rules; or
          (b) the Clearing Member fails to deliver securities in the buying-in market in accordance with the buying-in procedures as prescribed by CDP.
          (2) If the Disciplinary Committee is satisfied that CDP has proved on a balance of probabilities that the Clearing Member has committed the conduct described in the charge, the Disciplinary Committee:
          (a) shall impose a penalty, pursuant to its power under Rule 11.5.4, not lower than $20,000; and
          (b) may choose to impose, in addition to the penalty in subsection (a), any one or more of the sanction(s) as set out in Rule 11.5.4.

          Added on 20 November 2009 and amended on 21 January 2013 and 10 December 2018.

      • 6.8 [Rule has been deleted.]

        Deleted on 26 April 2013.

      • 6.9 [Rule has been deleted.]

        Deleted on 21 January 2013.

      • 6.10 Emergency Powers

        • 6.10.1

          In relation to Novated Contracts, where CDP deems it necessary or desirable for ensuring a fair and orderly market or for ensuring a safe and efficient clearing facility, or for ensuring the integrity of the market or for proper management of systemic risk in the market, CDP may, whether in relation to 1 or more Clearing Members or otherwise:

          (1) require that margins (whether additional or otherwise) be deposited with CDP during the next banking hour after demand or at such time as may be specified by CDP;
          (2) require that a portion of the positions carried in any account(s) on the books of such Clearing Member be transferred to the books of 1 or more Clearing Members;
          (3) require such Clearing Member to liquidate any of the positions carried in any account(s) on its books;
          (4) modify any term in any Contract Specifications, which may include bringing forward the Last Trading Day, or modifying settlement obligations and due dates;
          (5) require such Clearing Member to close any accounts;
          (6) require such Clearing Member to deposit additional funds with CDP by such time as it shall specify and in the amount it deems necessary to meet settlements obligations;
          (7) impose such additional capital requirements on such Clearing Member as CDP deems necessary or desirable;
          (8) impose such limits and/or conditions to control the activities of such Clearing Member as CDP deems necessary or desirable; and/or
          (9) take such action or require the Clearing Member to take such action as CDP deems necessary or desirable.

          Added on 23 January 2009 and amended on 10 December 2018 and 3 June 2019.

        • 6.10.2

          CDP shall, as soon as practicable, notify the Authority of any action taken by CDP pursuant to Rule 6.10.1.

          Added on 23 January 2009.

        • 6.10.3

          Without prejudice to the generality of Rule 1 or Rule 10, CDP shall not be liable to any Clearing Member or any Third Party in respect of any damage, loss, cost or expense of whatsoever nature (whether direct, indirect, special or consequential, including without limitation any loss of business, revenue, goodwill, bargain or profit), suffered or incurred by such Clearing Member or Third Party, arising out of or in connection with the exercise or non-exercise by CDP of its powers under Rule 6.10.1 or the determination by CDP of the satisfaction or non-satisfaction of any condition for the exercise of such powers.

          Added on 26 April 2013.

      • 6.11 Market Disorders, Impossibility of Performance, Emergency Situations

        • 6.11.1

          Without prejudice to Rule 1.1.3, if CDP determines that 1 of the following conditions is satisfied, namely:—

          (1) a state of war or emergency exists or is imminent or threatened and is likely to affect or has affected the normal course of business, including, but not limited to, performance under any Novated Contract or New Purchase Contract or New Sale Contract;
          (2) the government of any nation, state or territory or any institution or agency thereof has proclaimed or given notice of its intention to exercise, vary or revoke controls which appear likely to affect the normal course of business, including, but not limited to, performance under any Novated Contract or New Purchase Contract or New Sale Contract;
          (3) any international organisation, or any institution or agency thereof, has introduced, varied, terminated or allowed to lapse any provision so as to be likely to affect the normal course of business, including, but not limited to, performance under any Novated Contract or New Purchase Contract or New Sale Contract, or has given notice of its intention to do so or appears to be about to do so;
          (4) CDP determines that excessive positions or unwarranted speculation or any other undesirable situation or practice is developing or has developed which is affecting or capable of affecting a market in any Marginable Futures Contract or its underlying;

          CDP shall be entitled to exercise the powers under Rules 6A.9A and 6.10.

          Added on 23 January 2009 and amended on 21 January 2013 and 26 April 2013.

    • Rule 6A — Margin Requirements

      • 6A.1 Applicability

        • 6A.1.1

          This Chapter shall be applicable to the margin requirements imposed by CDP for Novated Contracts, the conduct of accounts and other related matters.

          Added on 23 January 2009.

      • 6A.2 Clearing Member to Procure Customer Margins for Marginable Futures Contract

        Amended on 21 January 2013.

        • 6A.2.1

          A Clearing Member must procure Initial Margins from its customers and must require that its customers meet the Customer Required Margins for the purpose of meeting margin requirements of Marginable Futures Contracts.

          Added on 23 January 2009.

        • 6A.2.2

          A Clearing Member must comply with such requirements on the computation and monitoring of a customer's margins as CDP may prescribe.

          Added on 23 January 2009.

        • 6A.2.3

          A Clearing Member may allow Excess Margins to be withdrawn provided such withdrawal will not cause the deposited collateral to be less than zero.

          Added on 23 January 2009.

        • 6A.2.4

          Except in respect of Marginable Futures Contracts, nothing in this Clearing Rules shall be construed as requiring a Clearing Member to procure margins from its customers for any other Novated Contract.

          Added on 21 January 2013.

      • 6A.3 Margin Management for Clearing Members In Respect of Margins from Customers for Marginable Futures Contracts

        Amended on 21 January 2013.

        • 6A.3.1

          Except for trades which reduce Customer Required Margins, a Clearing Member must not accept new orders or new trades in Marginable Futures Contracts for clearing from any customer unless:—

          (1) the minimum Initial Margins for the new trade are deposited or the Clearing Member has reason to believe that the minimum Initial Margins will be deposited within two Market Days from the trade date (T+2); and
          (2) the Customer Asset Value complies with the Customer Required Margins, or the Clearing Member has reason to believe that the additional margins to be deposited pursuant to Rule 6A.3.2 will be deposited within two Market Days from the trade date (T+2).

          Added on 23 January 2009 and amended on 21 January 2013.

        • 6A.3.2

          If the Customer Asset Value falls below the Customer Required Margins, the Clearing Member must call for additional margins from the customer to bring the Customer Asset Value to no less than the sum of Initial Margins and Customer Variation Margins within two Market Days from the date the Customer Asset Value falls below the Customer Required Margins.

          Added on 23 January 2009.

        • 6A.3.3 [Rule has been deleted.]

          Deleted on 21 January 2013.

        • 6A.3.4 [Rule has been deleted.]

          Deleted on 21 January 2013.

        • 6A.3.5 [Rule has been deleted.]

          Deleted on 21 January 2013.

        • 6A.3.6

          In respect of Marginable Futures Contracts, Clearing Members must not set margin requirements that are less stringent than those prescribed by CDP.

          Added on 23 January 2009 and amended on 21 January 2013.

      • 6A.4 Acceptable Collateral for Clearing Members In Respect of Margins from Customers for Marginable Futures Contract

        Amended on 21 January 2013.

        • 6A.4.1

          Initial Margins and Customer Required Margins collected by the Clearing Member pursuant to Rule 6A.2.1 must be met in the form of collateral as prescribed by CDP from time to time. Such collateral must be in the form of cash, government securities, selected common stocks, bank certificates of deposit, gold bars, gold certificates or such other instruments as CDP permits. Valuation of such collateral must be in accordance with the hair-cut rates specified by CDP.

          Added on 23 January 2009 and amended on 21 January 2013.

        • 6A.4.2

          Currency and financial instruments denominated in currencies which are subject to exchange controls such that they are illegal tender outside the currency's home country, or are restricted by any form of capital controls are not acceptable forms of collateral for the purpose of meeting margin requirements of Marginable Futures Contracts.

          Added on 23 January 2009.

      • 6A.4A Margin Management for Clearing Members In Respect of Any Margins from Customers

        • 6A.4A.1

          Where a Clearing Member collects margins from customer in connection with any Exchange Trade, regardless of whether it is required to under the Clearing Rules, the following shall apply:

          (1) subject to Rule 6A.3.6, nothing in these Clearing Rules prohibits a Clearing Member from imposing margin requirements, hair-cut rates, payment periods for customers to deposit collateral, valuations of positions and collateral, and making calls for additional margins, as it sees fit;
          (2) if a Clearing Member is unable to contact a customer to call for margins in respect of a Novated Contract, a written notice sent to the customer at the most recent address furnished by the customer to the Clearing Member shall be deemed sufficient; and
          (3) where a customer fails to meet such margin that the Clearing Member may call from the customer, the Clearing Member may take actions as it deems appropriate, without giving notice to the customer, to reduce its exposure to the customer. Such actions may include liquidating all or such part of the customer's collateral deposited with the Clearing Member, or taking action to offset all or such part of the customer's positions. CDP may also order such Clearing Member to immediately take such action to offset all or such part of the positions of the customer to rectify the deficiency.

          Added on 21 January 2013.

      • 6A.5 Clearing Member to Deposit Margins with CDP

        • 6A.5.1

          Clearing Member Required Margins may be determined by CDP from time to time. A Clearing Member shall deposit such margins with CDP by such time as CDP prescribes.

          Added on 23 January 2009 and amended on 21 January 2013.

        • 6A.5.1A

          If CDP is of the opinion that it is unable to inform Clearing Members, at the prescribed time, of the margins that they are required to deposit with CDP, CDP shall inform Clearing Members accordingly. CDP shall provide adequate time for Clearing Members to deposit such margins.

          Added on 21 January 2013.

        • 6A.5.2

          The amount of Clearing Member Required Margins which must be deposited by any Clearing Member with CDP shall be calculated and determined in accordance with procedures prescribed by CDP.

          Added on 23 January 2009 and amended on 21 January 2013.

        • 6A.5.3

          All margins deposited with or provided to CDP by a Clearing Member shall be retained by CDP in whole or in part, as CDP may deem necessary but, subject to these Clearing Rules and in particular Rule 6A.8, Rule 6B.3, and Rule 8.6B and the Security Deed, may be returned to the Clearing Member when the obligations in respect of the Novated Contracts for which such margins have been deposited or provided have been met.

          Added on 23 January 2009 and amended on 21 January 2013 and 10 December 2018.

        • 6A.5.4

          A Clearing Member shall not deposit with or provide to CDP, monies and assets of its customer for the purpose of meeting Clearing Member Required Margins for Novated Contracts other than Marginable Futures Contracts. For the purpose of this Rule 6A.5.4, "customer" means a Customer, except where such Customer is:

          (1) a director, officer, employee or representative of the Clearing Member; and
          (2) a related corporation of the Clearing Member with respect to accepted instructions to deal for an account belonging to, and maintained wholly for the benefit of the related corporation.

          Added on 21 January 2013.

      • 6A.6 Monies and Assets Acceptable by CDP as Margins

        Amended on 21 January 2013.

        • 6A.6.1

          Forms of monies and assets acceptable by CDP as margins are:

          (1) cash;
          (2) Singapore and US Government Securities;
          (3) selected common stocks, units of listed business trusts and units of real estate investment trusts; and
          (4) any other instruments as may be approved by CDP from time to time,

          all of which must be and remain unencumbered unless otherwise permitted or contemplated under these Clearing Rules, the Security Deed or the SFA.

          Added on 23 January 2009 and amended on 21 January 2013.

        • 6A.6.2 [Rule has been deleted.]

          Deleted on 21 January 2013.

        • 6A.6.3 [Rule has been deleted.]

          Deleted on 21 January 2013.

        • 6A.6.4

          The Clearing Member shall notify CDP as to whether such Collateral is to be maintained as margin solely for Customer Accounts or otherwise. Such Collateral will be held by CDP accordingly.

          Added on 23 January 2009 and amended on 21 January 2013.

        • 6A.6.5 [Rule has been deleted.]

          Deleted on 21 January 2013.

        • 6A.6.6 [Rule has been deleted.]

          Deleted on 21 January 2013.

        • 6A.6.7 [Rule has been deleted.]

          Deleted on 21 January 2013.

      • 6A.7 Composition of Margins Deposited with CDP

        • 6A.7.1

          Without prejudice to the generality of Rule 6A.6, Rule 6B.4 and Rule 6B.6, the aggregate amount of Collateral deposited with or provided to CDP in respect of the aggregate Customer Required Margins and the aggregate amount of collateral deposited with CDP in respect of all other margin requirements must each separately comply with the following:

          (1) where the relevant total margin requirements are US$1,000,000 (or its equivalent) or less, the entire margin requirements must be in the form of cash and/or government securities;
          (2) where the relevant total margin requirements are more than US$1,000,000 (or its equivalent), cash and/or government securities must constitute at least US$1,000,000 of the total margin requirements; and
          (3) 60 percent of the relevant total margin requirements must be in the form of cash and/or government securities.

          Added on 23 January 2009 and amended on 21 January 2013.

      • 6A.8 Mark to Market Gains

        Amended on 21 January 2013.

        • 6A.8.1

          Mark-to-market gains may be utilised by the Clearing Member or CDP as follows:

          (1) in respect of Novated Contracts other than Marginable Futures Contracts, mark-to-market gains may only be utilised to meet margin requirements for such other Novated Contracts; and
          (2) in respect of Marginable Futures Contracts, mark-to-market gains of an account may only be utilised to meet margins requirements for the same account.

          Added on 23 January 2009 amended on 21 January 2013.

      • 6A.9 Valuation Price

        • 6A.9.1

          For the computation of Customer Variation Margins and Clearing Member Variation Margins, the Valuation Price of a Novated Contract shall be determined in accordance with the relevant formula and procedures applicable to each Novated Contract, as determined by CDP. In arriving at such formula, CDP may, in consultation with SGX-ST, take into account factors, including but not limited to:

          (1) the last traded price;
          (2) the latest bid and offer spread; and
          (3) price data derived from pricing models, as selected or established by CDP from time to time.

          Added on 23 January 2009 and amended on 21 January 2013 and 3 June 2019.

        • 6A.9.2

          Notwithstanding the foregoing, CDP shall reserve the right to amend the Valuation Price of any Novated Contract under these Rules as it deems fit.

          Added on 23 January 2009 and amended on 21 January 2013.

      • 6A.9A Additional Margins

        • 6A.9A.1

          Notwithstanding anything to the contrary in the Clearing Rules, in relation to Novated Contracts, CDP may call for additional margins from one or more Clearing Members in the following situations:

          (1) when, in CDP's opinion, unstable conditions exist or market conditions or price fluctuations relating to one or more securities or futures contracts at any time require that additional margins to maintain an orderly market or to preserve financial integrity or for any other reason;
          (2) when CDP believes that any Clearing Member is carrying exposure that:
          (a) is larger than is justified by the financial condition of that Clearing Member; or
          (b) places or may place CDP at risk;
          (3) where the Clearing Member is found to have a record of frequent rule violations or inadequate or unsound management or serious operational defects which, in CDP's opinion, places or may place CDP at risk; or
          (4) where market conditions or price fluctuations are such that CDP deems it necessary, to call upon the Clearing Members whom it believes are affected by such conditions or fluctuations to deposit additional funds.

          Added on 21 January 2013 and amended on 8 October 2018.

        • 6A.9A.2

          Where CDP calls for additional margins from a Clearing Member in accordance with Rule 6A.9A.1, the Clearing Member shall deposit such margins with CDP by such time as CDP shall specify and in such forms as CDP prescribes.

          Added on 21 January 2013.

      • 6A.9B CDP's Records

        Save for manifest error, CDP's records shall be conclusive and binding on a Clearing Member as to its margin requirements. Notwithstanding any manifest error in CDP's records, or any dispute in relation to such records, a Clearing Member shall deposit or provide, in accordance with these Clearing Rules, such margins as required by CDP, and any rectification shall be done as soon as practicable after the dispute is resolved.

        Added on 10 December 2018.

      • 6A.10 Segregation of Customer's Money and Assets

        • 6A.10.1 General

          (1) A Clearing Member shall comply with the customer segregation requirements under these Rules and/or the SFA at all times.
          (2) A Clearing Member shall ensure that it shall at all times inform and keep CDP informed of such information as would be required for CDP to discharge its segregation obligations under the SFA and/or to enable CDP to issue to the Authority the verification of margin funds statement placed with CDP as required under the SFA.

          Added on 23 January 2009.

        • 6A.10.2 [Rule has been deleted.]

          Deleted on 21 January 2013.

      • 6A.11 Notification of Under-Segregation

        • 6A.11.1

          Every Clearing Member shall immediately report to CDP of any under-segregation of moneys or assets as required under these Rules and/or the SFA.

          Added on 23 January 2009.

      • 6A.12 [Rule has been deleted.]

        Deleted on 21 January 2013.

      • 6A.13 [Rule has been deleted.]

        Deleted on 21 January 2013.

      • 6A.14 Under-Margined Accounts

        • 6A.14.1

          Each Clearing Member shall immediately notify CDP when any account does not comply with the Customer Required Margins by an amount which exceeds its aggregate resources, except that no notification is required for the Clearing Member's own proprietary House Account.

          Added on 23 January 2009.

        • 6A.14.2

          CDP may require the Clearing Member to submit to CDP information pertaining to any matter in such form and within such time as may be stipulated by CDP.

          Added on 23 January 2009.

      • 6A.15 [Rule has been deleted.]

        Deleted on 21 January 2013.

    • Rule 6B — Collateral

      • 6B.1 Trust Arrangements

        • 6B.1.3

          CDP shall have the right to commingle any or all Collateral held by it or otherwise provided to it by Clearing Members solely in respect of Customer Accounts in the same bank account or custodian account.

          Added on 21 January 2013 and amended on 10 December 2018.

        • 6B.1.1

          Subject to all rights and remedies of CDP against or in respect of Collateral under these Clearing Rules, the Security Deed and the SFA, Collateral held by or otherwise provided to CDP shall be held on trust by CDP for the benefit of:

          (1) Clearing Members, except where such Collateral is held by or otherwise provided to CDP solely in respect of Customer Accounts; and
          (2) the relevant customers of the Clearing Member pursuant to the SFA where such Collateral is held by or otherwise provided to CDP solely in respect of Customer Accounts.

          Added on 21 January 2013.

        • 6B.1.2

          CDP shall have the right to commingle any or all Collateral held by it or otherwise provided to it by Clearing Members, except where such Collateral is held by or otherwise provided to CDP solely in respect of Customer Accounts, in the same bank account or custodian account.

          Added on 21 January 2013 and amended on 10 December 2018.

      • 6B.2 Security Deed to be executed by Clearing Member

        • 6B.2.1

          Prior to CDP commencing any clearing activities in respect of any Clearing Member, the Clearing Member shall execute and deliver a Security Deed in the form and on terms prescribed by CDP, setting out the terms under which its Collateral are provided to, and held by, CDP.

          Added on 21 January 2013.

      • 6B.3 General Lien and Right to Set-Off

        • 6B.3.1

          Without prejudice and in addition to any Security Interest or other right or remedy which CDP may have under these Clearing Rules, contract, law or equity, and subject to any applicable restrictions pursuant to the provisions of the SFA and/or imposed by the Authority, CDP shall have a lien on all Collateral deposited with or provided to CDP and on any other monies and/or assets of the Clearing Member which may be or become available to CDP.

          Added on 21 January 2013.

        • 6B.3.2

          Without prejudice to the generality of the foregoing, in addition to any Security Interest or other right or remedy which CDP may have under these Clearing Rules, contract, law or equity, and subject to any applicable restrictions pursuant to the provisions of the SFA and/or imposed by the Authority, CDP may at any time consolidate any or all accounts, notwithstanding that any relevant positions remain open, of the Clearing Member and set-off and/or transfer and/or apply any Collateral in such accounts towards satisfaction of any liabilities of the Clearing Member to CDP, whether or not:

          (1) such Collateral and liabilities are denominated in the same currency; and
          (2) such liabilities are due, owing or incurred, or joint or several.

          Added on 21 January 2013.

      • 6B.4 Collateral Deposit

        • 6B.4.1

          A Clearing Member shall deposit or otherwise provide to CDP such Collateral, in such acceptable form and denomination as may be prescribed by CDP from time to time, subject to such terms and conditions prescribed by CDP from time to time.

          Added on 21 January 2013.

      • 6B.5 Collateral Withdrawal

        • 6B.5.1

          Where any obligation under these Clearing Rules, the Security Deed, or as may otherwise be owing to CDP remains outstanding on the part of a Clearing Member, such Clearing Member shall have no right to withdraw any Collateral or request for the repayment of any credit balance held with or subject to the control of CDP without CDP's prior consent.

          Added on 21 January 2013.

        • 6B.5.2

          Any withdrawal of Collateral consented to by CDP under these Clearing Rules shall not be deemed to be a release of the existing or future Security Interest over any remaining Collateral held with or subject to the control of CDP, other than the withdrawn Collateral.

          Added on 21 January 2013.

        • 6B.5.3

          A request for withdrawal of Collateral may only be made by a Clearing Member subject to Rule 6B.5.1. A Third Party may not withdraw or request for the withdrawal of any Collateral held with or subject to the control of the CDP, other than through the Third Party's Clearing Member. All Collateral permitted by the CDP to be withdrawn shall be returned only to the Clearing Member.

          Added on 21 January 2013.

      • 6B.6 Valuation of Collateral

        • 6B.6.1

          CDP shall value Collateral deposited with or provided to CDP as it deems appropriate. CDP shall, at its sole discretion, determine

          (1) what monies and assets are acceptable as Collateral;
          (2) when any monies and/or assets cease to be acceptable as Collateral; and
          (3) the valuation to be attributed thereto.

          Added on 21 January 2013.

        • 6B.6.2

          If any Collateral deposited or provided by any Clearing Member is found in any way to be unacceptable by CDP, CDP shall have the right to immediately give a zero value to such Collateral for the purposes of satisfying such Clearing Member's obligations under these Clearing Rules or as may otherwise be owing to CDP, pursuant to which such Collateral was deposited or provided.

          Added on 21 January 2013.

        • 6B.6.3

          Following revaluation of any Collateral deposited with or provided to CDP, where such Collateral is found to be insufficient to meet any obligation of the Clearing Member under these Clearing Rules or as may otherwise be owing to CDP, pursuant to which such Collateral was deposited or provided, the Clearing Member shall deposit with or provide to CDP such additional Collateral as may be required to meet such obligation, within such time as CDP may require.

          Added on 21 January 2013.

        • 6B.6.4

          In the event of any dispute as to any matters covered under this Rule, CDP's decision shall be final and binding.

          Added on 21 January 2013.

      • 6B.7 Investment and Use of Collateral

        • 6B.7.1

          CDP may invest, manage and use Collateral in such manner as it shall deem fit provided that:

          (1) Collateral solely in respect of Customer Accounts shall be invested in accordance with these Clearing Rules, the Security Deed and the SFA; and
          (2) CDP shall not use any Collateral received and notified to it as Collateral solely in respect of Customer Accounts, to settle any obligations that are incurred in relation to any House Account, except in accordance with these Clearing Rules, the Security Deed and the SFA.

          Added on 21 January 2013.

        • 6B.7.1A

          Each Clearing Member shall secure contractual waivers in favour of the Clearing Member from its customers waiving their respective rights to all interest and investment earnings from the Collateral held with or otherwise provided to CDP solely in respect of Customer Accounts, in the form and manner as may be prescribed by the CDP, as may be necessary to give effect to CDP's rights in relation to interest and fees under Rule 6B.8.

          Added on 22 April 2013.

        • 6B.7.2

          All Collateral deposited or provided by each Clearing Member to CDP shall be subject to these Clearing Rules, the Security Deed and the SFA (each as amended or supplemented from time to time). Each Clearing Member shall ensure that all Collateral deposited or provided to CDP are deposited or provided only on the foregoing basis and shall also ensure that, prior to depositing or providing any Collateral to CDP for the account or for the contracts of any person, such person has been notified of and has accepted the foregoing.

          Added on 21 January 2013.

      • 6B.8 Interest and fees

        • 6B.8.1

          The Clearing Member shall pay CDP such administrative fees as may be prescribed by CDP and notified to the Clearing Member from time to time for the investment and management of the Collateral. Administrative fees may be deducted from the interest on the Collateral payable to the Clearing Member by CDP pursuant to this Rule 6B.8 or paid directly to CDP as determined by CDP.

          Added on 21 January 2013.

        • 6B.8.2

          Unless otherwise provided for in these Clearing Rules, CDP shall pay the Clearing Member interest on the Collateral at such rate and in such manner as prescribed by CDP and notified to a Clearing Member.

          Added on 21 January 2013.

        • 6B.8.3

          Except as set forth in this Rule, CDP shall have no obligation to make payment of any other fees, interest and investment earnings arising from or in connection with the Collateral to any person.

          Added on 21 January 2013.

      • 6B.9 Safekeeping Indemnity

        • 6B.9.1

          Any Collateral accepted by CDP shall be, where necessary, deposited with the appropriate custodian(s) designated by CDP for safekeeping in a CDP account designated for House Accounts or in a CDP account designated for Customer Accounts, as the case may be, and CDP shall retain control over such Collateral.

          Added on 21 January 2013.

        • 6B.9.2

          CDP shall not have any obligation or responsibility to preserve, protect, collect or realise, and under no circumstances shall CDP be liable for any loss or diminution in value or depreciation in or in connection with, the Collateral maintained pursuant to this Rule.

          Added on 21 January 2013.

        • 6B.9.3

          A Clearing Member who maintains Collateral with CDP shall indemnify and hold CDP harmless from any loss, damage, costs, charges and/or expenses of whatsoever nature and howsoever arising ("Loss") suffered or incurred by CDP to any designated custodian which may result from or arise with respect to:

          (1) any act, delay or omission in connection with Collateral (whether by such Clearing Member or CDP) deposited with such designated custodian; or
          (2) any contract or agreement between CDP and any designated custodian, or any representation, warranty or undertaking given by CDP to any designated custodian, in relation to or otherwise in connection with Collateral deposited with such designated custodian,

          PROVIDED THAT this indemnity shall not cover any Loss and/or liability of CDP attributable or referable to the gross negligence or wilful misconduct of CDP or any of CDP's officers, agents and/or employees.

          Added on 21 January 2013.

        • 6B.9.4

          If any loss of Collateral occurs, or any Collateral becomes unavailable to CDP such that any obligation of the Clearing Member under these Clearing Rules or as may otherwise be owing to CDP, pursuant to which such Collateral was deposited or provided, cannot be fully met as determined by CDP, the Clearing Member shall deposit with or provide to CDP such additional Collateral as may be required to meet such obligation within such time as CDP may require.

          Added on 21 January 2013.

      • 6B.10 Regulatory Information

        • 6B.10.1

          Clearing Members shall provide CDP with any information necessary in relation to such Collateral deposited with or provided to CDP to enable CDP to meet its reporting obligations to the Authority and/or other relevant governmental or regulatory authorities or for any other regulatory purposes including but not limited to withholding tax purposes.

          Added on 21 January 2013.

    • Rule 6C — Payments

      This Rule 6C shall not apply to any payment of a Final Settlement Balance. Payment of a Final Settlement Balance shall be made in accordance with Rule 6.4.

      Amended on 10 December 2018.

      • 6C.1 Nomination of Accounts

        • 6C.1.1

          Any nomination of an account for the purpose of receiving any funds or other assets to be paid or deposited under these Clearing Rules shall, in the case of nomination by a Clearing Member, be in writing to CDP, and in the case of nomination by CDP, be by way of circular or otherwise.

          Added on 26 April 2013 and amended on 10 December 2018.

      • 6C.2 Cash Payments : Settlement Bank Payment

        • 6C.2.1

          The payment method that is set out in this Rule 6C.2 shall be referred to in these Clearing Rules as "Settlement Bank Payment".

          Added on 26 April 2013.

        • 6C.2.2

          A "Payment Instruction" means an instruction given by CDP to a Settlement Bank to:

          (a) place at the disposal of a Clearing Member by crediting a nominated account held by that Clearing Member at that Settlement Bank an amount of money to be debited from a nominated account held by CDP at that Settlement Bank; or
          (b) place at the disposal of CDP by crediting a nominated account held by CDP at that Settlement Bank an amount of money to be debited from a nominated account held by a Clearing Member at that Settlement Bank.

          The means by which a Payment Instruction may be communicated by CDP to a Settlement Bank shall be as agreed between CDP and the Settlement Bank.

          Added on 26 April 2013.

        • 6C.2.3

          A "Confirmation" in relation to a Payment Instruction means a confirmation by a Settlement Bank to CDP that it will carry out that Payment Instruction.

          The means by which a Confirmation shall be made or deemed to have been made and communicated by a Settlement Bank to CDP shall be as agreed between CDP and the Settlement Bank.

          Added on 26 April 2013.

        • 6C.2.4

          A Payment Instruction may be given by CDP in respect of any obligation to pay a sum of money pursuant to or in connection with these Clearing Rules. A Payment Instruction shall be irrevocable upon the Confirmation of that Payment Instruction by the relevant Settlement Bank.

          Added on 26 April 2013.

        • 6C.2.5

          Unless stated otherwise, where any sum of money is paid pursuant to or in connection with these Clearing Rules through Settlement Bank Payment:

          (a) such payment shall not be considered to have been made to the intended recipient until a Confirmation of the relevant Payment Instruction is given by the relevant Settlement Bank; and
          (b) such Confirmation shall discharge the payment obligation in respect of which the relevant Payment Instruction was given.

          Added on 26 April 2013 and amended on 10 December 2018.

        • 6C.2.6 [Rule has been deleted.]

          Deleted on 10 December 2018.

      • 6C.3 Cash Payments : Other Payment Methods

        • 6C.3.1

          Where any sum of money is to be paid pursuant to or in connection with these Clearing Rules, CDP may stipulate the payment method through which such payment is to be made and Clearing Members shall comply with such stipulation.

          Added on 26 April 2013.

        • 6C.3.2

          Where any sum of money is paid pursuant to or in connection with these Clearing Rules through an Other Payment Method, such payment shall not be considered to have been made to the intended recipient until the payment sum is irrevocably and unconditionally received, in immediately available funds, in such account of the intended recipient as is nominated by the intended recipient.

          Added on 26 April 2013.

      • 6C.4 Deposit and Return of Government Securities

        • 6C.4.1

          Any deposit or return of government securities pursuant to or in connection with these Clearing Rules shall not be considered to have been made until such government securities are received in such account of the intended recipient as is nominated by the intended recipient.

          Added on 26 April 2013.

      • 6C.5 Deposit and Return of Book-Entry Securities

        • 6C.5.1

          Any deposit of book-entry securities by a Clearing Member with CDP pursuant to or in connection with these Clearing Rules shall not be considered to have been made until the charge over such securities becomes effective in accordance with section 81SS of the SFA.

          Added on 26 April 2013 and amended on 3 June 2019.

        • 6C.5.2

          Any return of book-entry securities by CDP to a Clearing Member pursuant to or in connection with these Clearing Rules shall not be considered to have been made until the charge over such securities is discharged in accordance with section 81SS of the SFA.

          Added on 26 April 2013 and amended on 3 June 2019.

    • Rule 7 — Clearing Fund

      • 7.1 Establishment of Clearing Fund

        • 7.1.1

          CDP shall establish and maintain a fund to be called the Clearing Fund.

        • 7.1.2

          The assets of the Clearing Fund shall be vested in CDP but shall be segregated from CDP's other property and shall be held by CDP on trust for the purposes set out in these Clearing Rules.

        • 7.1.3

          The Clearing Fund shall comprise:—

          (1) Contributions by Clearing Members;
          (2) CDP Contribution (as defined in Rule 7.4.1);
          (3) moneys paid by an insurer under a contract of insurance (if any) entered into by CDP under Rule 7.5; and
          (4) any other contributions to the Clearing Fund.

          Amended on 3 May 2011

      • 7.2 Contributions by Clearing Members

        • 7.2.1

          Except as otherwise provided in this Clearing Rules or as determined by CDP, each Clearing Member shall pay to CDP such amounts as may be determined under this Clearing Rules or as determined by CDP in its absolute discretion (the "Contribution") in respect of every Exchange Trade cleared and/or settled by the Clearing Member herein. Each Clearing Member shall pay to CDP its Contribution to the Clearing Fund by such time or times as stipulated by CDP.

          Amended on 1 July 2008 and 3 May 2011.

        • 7.2.1A

          The Contribution of a Clearing Member shall consist of the Collateralised Contribution and the Contingent Contribution. Each Clearing Member shall pay:

          (1) in respect of the Contribution, an amount as specified by CDP from time to time, in its discretion which shall not exceed 0.9 basis points of the Clearing Member's Turnover;
          (2) in respect of the Collateralised Contribution, an amount as specified by CDP from time to time, in its discretion which shall not exceed 0.6 basis points of the Clearing Member's Turnover; and
          (3) in respect of the Contingent Contribution, an amount which is determined by the rate which is the difference between the Contribution rate as specified by CDP under Rule 7.2.1A(1) and the Collateralised Contribution rate as specified by CDP under Rule 7.2.1A(2).

          Added on 3 May 2011

        • 7.2.2

          The aggregate Collateralised Contributions from Clearing Members shall at all times be at least $40 million or such lower amount as may be specified by CDP from time to time in its discretion.

          Amended on 1 January 2010, 3 May 2011.

        • 7.2.3

          Notwithstanding Rule 7.2.1A:

          (1) A Clearing Member's Collateralised Contribution shall be at least $500,000, or such lower amount as may be specified by CDP from time to time in its discretion; and
          (2) If the aggregate Collateralised Contributions from all Clearing Members do not meet the minimum amount specified in Rule 7.2.2, the shortfall shall be contributed by each Clearing Member according to its Proportion.

          Amended on 3 May 2011 and 21 January 2013.

        • 7.2.4

          Where there is reason to believe that the operations of the Clearing Member is or is likely to be impaired by any event or circumstances, or such action is in the interests of maintaining a safe and efficient clearing facility, CDP may require:

          (1) such additional amounts to be paid as a top-up to the Contribution of the Clearing Member as it may, in its absolute discretion, decide; or
          (2) a Clearing Member's Contingent Contribution to be deposited with CDP; or
          (3) both.

          Amended on 1 January 2010 and 3 May 2011.

        • 7.2.5

          CDP shall notify each Clearing Member in writing of its Contribution required under Rules 7.2.1A and 7.2.4.

          Added on 3 May 2011

      • 7.3 Form of Contributions

        • 7.3.1

          Each Clearing Member shall provide its Contribution in cash or in such other forms and subject to such conditions as may be prescribed by CDP from time to time. Such Contribution shall form part of the assets of the Clearing Fund.

          Amended on 1 July 2008 and 3 May 2011.

        • 7.3.2

          Where a Clearing Member provides its Contribution (or any part thereof) in the form of cash, CDP shall place the entire cash amount in an interest-bearing account with its bankers. CDP shall not be obliged to segregate the cash Contributions and may commingle cash Contributions for ease of administration.

        • 7.3.3 [Rule has been deleted.]

          Deleted on 21 January 2013.

        • 7.3.4

          CDP shall have the absolute discretion to decide upon the bank or banks with which the cash Contributions are to be placed on deposit and the terms of deposit, provided that any such bank shall be a licensed bank in Singapore within the meaning of the Banking Act (Cap. 19).

        • 7.3.5

          Save for manifest error, CDP's records shall be conclusive and binding on a Clearing Member as to its Contributions. Notwithstanding any manifest error in CDP's records, or any dispute in relation to such records, a Clearing Member shall provide, in accordance with these Clearing Rules, such Contributions as required by CDP, and any rectification shall be done as soon as practicable after the dispute is resolved.

          Added on 10 December 2018.

      • 7.4 Contributions by CDP

        • 7.4.1

          Contributions by CDP shall be an amount not less than 25% of the clearing fund size, as determined by CDP, and shall consist of:

          (1) an amount not less than 15% of the clearing fund size or $30 million, whichever is the higher (the "CDP Contribution"), to be applied pursuant to Rule 7.9.1(2); and
          (2) such other sums referred to in Rule 7.1.3(4), to be applied pursuant to 7.9.1(6).

          Amended on 1 January 2010 and 3 May 2011.

        • 7.4.2

          Contribution by CDP shall be in the form of cash or in such other form and subject to such conditions as may be determined by CDP. If any contributions by CDP (or any part thereof) is in the form of cash, such cash amount shall be placed in an interest bearing account with CDP's bankers and the entire interest earned on such contributions (or such part thereof) shall be paid to CDP.

          Amended on 3 May 2011

        • 7.4.3 [Rule has been deleted.]

          Deleted on 21 January 2013.

        • 7.4.4

          CDP shall have the absolute discretion to decide upon the bank or banks with which the cash portion of contributions by CDP is to be placed on deposit and the terms of deposit, provided that any such bank shall be a licensed bank in Singapore within the meaning of the Banking Act (Cap. 19).

          Amended on 3 May 2011

      • 7.5 Insurance Policy

        • 7.5.1

          CDP may take out a policy of insurance in respect of the Clearing Fund for such amount and with such insurer as it may, at its absolute discretion, determine and on such terms and conditions as it shall, at its absolute discretion, deem fit.

          Amended on 3 May 2011

        • 7.5.2

          The premium payable on such insurance policy and any other related costs and expenses shall be payable by CDP, provided always that CDP may, at its absolute discretion, require Clearing Members to reimburse it in respect of such moneys paid, in the Proportion, or in such other manner as CDP may, at its absolute discretion, consider fair and appropriate.

      • 7.6 CDP'S Standby Line of Credit [Rule has been deleted.]

        Deleted on 3 May 2011.

        • 7.6.1 [Rule has been deleted.]

          Deleted on 3 May 2011.

      • 7.7 Investment of Assets of Clearing Fund

        • 7.7.1

          CDP may invest the assets and resources of the Clearing Fund in such manner as it shall deem fit.

        • 7.7.2 [Rule has been deleted.]

          Deleted on 21 January 2013.

        • 7.7.3

          CDP may appoint such persons as it may deem suitably qualified to invest the assets and resources of the Clearing Fund.

        • 7.7.4

          CDP, if acting in good faith and in the absence of fraud or wilful misconduct on its part, shall not be liable for any losses in the investment of the assets or resources of the Clearing Fund.

      • 7.7A Interest and fees

        • 7.7A.1

          Each Clearing Member shall pay CDP such administrative fees as may be prescribed by CDP and notified to the Clearing Member from time to time for the investment and management of the assets of the Clearing Fund and any excess monies or assets placed with CDP in respect of the Clearing Fund. Administrative fees may be deducted from the interest on the assets of the Clearing Fund, and on any excess monies or assets placed with CDP in respect of the Clearing Fund, payable to the Clearing Member by CDP pursuant to this Rule 7.7A or paid directly to CDP as determined by CDP.

          Added on 21 January 2013.

        • 7.7A.2

          Interest and any other sums accruing to the assets of the Clearing Fund shall not form part of the assets of the Clearing Fund.

          Added on 21 January 2013.

        • 7.7A.3

          CDP shall pay the Clearing Member interest on their respective Contributions and on any excess monies or assets placed with CDP in respect of the Clearing Fund at such rate and in such manner as prescribed by CDP and notified to the Clearing Member.

          Added on 21 January 2013.

        • 7.7A.4

          Except as set forth in this Rule, CDP shall have no obligation to make payment of any other fees, interest and investment earnings arising from or in connection with the assets of the Clearing Fund, and any excess monies or assets placed with CDP in respect of the Clearing Fund, to any person.

          Added on 21 January 2013.

      • 7.8 Application of Clearing Fund

        • 7.8.1

          Subject to Rule 7.8.2 and unless otherwise provided in the Clearing Rules or as determined by CDP, the Clearing Fund may be applied:—

          (1) to make good all losses suffered by CDP as a result of the breach by a Defaulting Clearing Member of any of its Novated Contracts;
          (2) to make good any shortfall (resulting from the inapplicability of Rule 6.4 to the New Purchase Contracts and New Sale Contracts) of moneys payable by CDP to the other Clearing Members pursuant to Rule 6.4; and
          (3) in respect of the obligations and liabilities of CDP arising out of the Novated Contracts (including but not limited to the costs and expenses incurred in relation to making recoveries from a Defaulting Clearing Member and in relation to any action taken by CDP pursuant to Rule 8).

          Amended on 23 January 2009 and 21 January 2013.

        • 7.8.2

          CDP shall apply the Clearing Fund only after the Defaulting Clearing Member's Collateral deposited with or provided to CDP has been fully applied to satisfy the obligations of the Clearing Member to CDP in accordance with Rule 8.6B.

          Added on 21 January 2013.

      • 7.9 Order of Application of Contributions

        • 7.9.1

          Subject to the provisions of Rule 7.9, payments out of the Clearing Fund shall be in the following order:—

          (1) firstly, against the Contributions made by the Defaulting Clearing Member;
          (2) secondly, against CDP Contributions;
          (3) thirdly, against the Collateralised Contributions required from all other non-Defaulting Clearing Members on a pro rata basis of each Clearing Member's required Collateralised Contribution to the aggregate required Collateralised Contributions made by all other non-Defaulting Clearing Members';
          (4) fourthly, against the Contingent Contributions required from all other non-Defaulting Clearing Members on a pro rata basis of each Clearing Member's required Contingent Contribution to the aggregate required Contingent Contributions made by all other non-Defaulting Clearing Members';
          (5) fifthly, against such policy(ies) of insurance (if any) as may be in effect at the time; and
          (6) lastly, against any other contributions to the Clearing Fund,

          (the "Order", and each stage thereof shall be referred to as a "Stage" of the Order or as a certain "Stage of the Order").

          Amended on 3 May 2011

        • 7.9.2

          Subject to Rule 7.9.2 and Rule 7.9.3, in any Relevant Period, the Order shall be followed irrespective of the number of drawings on the Clearing Fund. In such Relevant Period, in the event that a drawing on the Clearing Fund shall draw on part only of the funds available at any Stage under Rules 7.9.1(2) to (6) of the Order (the "Unexhausted Stage") (whether or not funds from a previous Stage or previous Stages have also been drawn upon for that drawing), the next drawing on the Clearing Fund in the Relevant Period shall, after exhausting the Contributions made by the Defaulting Clearing Member in the Stage under Rule 7.9.1(1), draw first from the remaining funds available at the Unexhausted Stage before drawing from the next Stage(s) of the Order.

          Amended on 3 May 2011

        • 7.9.3

          Once all the Stages of the Order have been exhausted in any Relevant Period, any current or subsequent drawing on the Clearing Fund in that Relevant Period shall revert to the strict sequence of the Order, provided always that:—

          (1) (subject to Rule 7.12) CDP shall not be required to top up the CDP Contribution, once paid out in full. Nothing in this Rule prevents CDP from topping up the CDP Contribution, in such amounts as CDP may determine, during any Relevant Period or upon commencement of a new Relevant Period; and
          (2) the policy(ies) of insurance (referred to in Rule 7.9.1(5)), once paid out in full in any Relevant Period, may have limitations on the time periods during which the insured amount, after having been fully paid out in that Relevant Period, will be next available for payment out of the Clearing Fund (whether in that Relevant Period or the next Relevant Period), and any such current or subsequent drawing will be subject to any terms and conditions of the policy(ies) of insurance.

          Amended on 3 May 2011

        • 7.9.4

          Upon the commencement of a new Relevant Period, regardless of the Stage of the Order from which the last payment out from the Clearing Fund was made in the previous Relevant Period, the first drawing on the Clearing Fund in the new Relevant Period shall revert to the first Stage of the Order in Rule 7.9.1(1) and the subsequent Stages of the Order shall follow accordingly, provided always that subject to Rule 7.12, CDP shall not be required to top up the CDP Contribution, once paid out in full. Nothing in this Rule prevents CDP from topping up the CDP Contribution, in such amounts as CDP may determine, during any Relevant Period or upon the commencement of a new Relevant Period.

          Amended on 3 May 2011

        • 7.9.5

          Notwithstanding Rule 7.9.1, CDP shall be entitled to draw upon its available lines of credit or other such liquidity resources available to CDP at any time for the purposes set out in Rule 7.8 in the event that there is any delay in obtaining payment from the Clearing Fund in any Stage of the Order, such delays arising for example, where the cash deposits of the Clearing Fund are placed in fixed deposit accounts and penalty charges may be incurred for the premature termination of the fixed deposit accounts or arising out of the realisation or disposal of the resources and assets of the Clearing Fund or delay in obtaining payment from the policies, guarantees or other facilities of the Clearing Fund or where CDP, in its absolute discretion, deems it advisable to draw upon its available lines of credit or other such liquidity resources available to CDP first.

          Amended on 3 May 2011

        • 7.9.6

          Where the CDP draws down on any lines of credit or other such liquidity resources available to CDP pursuant to Rule 7.9.5, CDP shall be entitled to be reimbursed for this amount and all costs in relation to drawing down such lines of credit or other such liquidity resources available to CDP from the moneys which are eventually obtained from any relevant Stage of the Order.

          Amended on 3 May 2011.

      • 7.10 Top-Up of Clearing Member's Contributions in an Event of Default

        Amended on 3 May 2011

        • 7.10.1

          CDP shall notify a Clearing Member in writing whenever its Contribution (or any part thereof) is applied in accordance with Rule 7.9.1.

        • 7.10.2

          A Defaulting Clearing Member shall reimburse the Clearing Fund for any amount (except such Contributions made by the Defaulting Clearing Member) which was applied out of the Clearing Fund (the "Default Amount") as a result of his default.

        • 7.10.3

          If any amount is paid out of a Clearing Member's Contributions pursuant to the third Stage of the Order in Rule 7.9.1(3) or fourth stage of the Order in Rule 7.9.1(4), the Clearing Member shall, upon demand by CDP, top-up the deficiency in its Contribution arising from the said payment. CDP shall notify each of the Clearing Members in writing of the amount payable by it to CDP under this Rule.

          Amended on 1 July 2008 and 3 May 2011.

      • 7.11 Resignation

        • 7.11.1

          A Clearing Member who is required to make any payment to the Clearing Fund pursuant to Rule 7.10, may resign in accordance with Rule 3.11 to CDP after settlement of such payment.

        • 7.11.2

          From the date of receipt by CDP of the resignation notice, such Clearing Member's aggregate liability to make payment into the Clearing Fund by reason of events occurring before the termination of its status as a Clearing Member shall not exceed an amount equal to its required Contribution at the date of the resignation notice, plus 2 times such amount.

      • 7.12 Recovery of Sums

        • 7.12.1

          Subject to the provisions of this Rule, if any amount paid out of the Clearing Fund pursuant to Rule 7.8 and in accordance with Rule 7.9 is subsequently recovered by CDP in whole or in part, CDP shall credit the amount so received to the Clearing Fund in the reverse of the Order in which it was paid out. Where Contributions by Clearing Members had been paid out of the Clearing Fund, the amount so received for the relevant Stage of the Order shall be paid back to such Clearing Members on a pro-rata basis of each Clearing Member's required Contribution to the aggregate required Contributions from all Clearing Members other than the Defaulting Clearing Member for that relevant Stage of the Order, provided that if any Clearing Member has not paid any part of the moneys required to be paid into the Clearing Fund pursuant to Rule 7.10, such Clearing Member's Contribution of such amount shall be paid first into the Clearing Fund together with any interest accruing thereon from the date such amount was due to date of actual payment of such amount, and any excess shall be paid back to such Clearing Member. Where contributions by CDP have been paid out of the Clearing Fund, the amount so received shall be paid towards the relevant stage of the Order and not to CDP.

          Amended on 3 May 2011.

        • 7.12.2

          Where insurance moneys have been paid out of the Clearing Fund in any Relevant Period, any recovered moneys shall notwithstanding Rule 7.12.1 above:—

          (1) if the recovery is made in that Relevant Period, be paid to the insurer provided that the insurer agrees that the recovered moneys shall be used to reset the applicable limits on insurance coverage for the Relevant Period under the insurance policy; and
          (2) if the recovery is not made in that Relevant Period and:—
          (a) no other drawing has subsequently been made on the Clearing Fund whether or not in that Relevant Period), be paid to the insurer; or
          (b) drawings have subsequently been made on the Clearing Fund (whether or not in that Relevant Period), be paid in the reverse of the Stages of the Order in which such drawings were made if moneys have not already been recovered for such Stages, and any excess shall be paid to the insurer.

      • 7.13 Return of Contributions

        • 7.13.1

          Within 6 months of the termination of membership of the Clearing Member, provided that all liabilities of such Clearing Member to CDP at the time of termination, whether actual or contingent, shall have been satisfied or paid for in full, CDP may return to the Clearing Member the balance of its Contribution (taking into account any pending and previous applications of the Clearing Fund at the time of such termination).

      • 7.14 Calculation of Variable Deposit [Rule has been deleted.]

        Deleted on 3 May 2011.

        • 7.14.1 [Rule has been deleted.]

          Deleted on 3 May 2011.

        • 7.14.2 [Rule has been deleted.]

          Deleted on 3 May 2011.

        • 7.14.3 [Rule has been deleted.]

          Deleted on 3 May 2011.

        • 7.14.4 [Rule has been deleted.]

          Deleted on 3 May 2011.

        • 7.14.5 [Rule has been deleted.]

          Deleted on 3 May 2011.

      • 7.15 Time of Payment of Contributions

        • 7.15.1

          Clearing Members shall pay any amount required by CDP as its Collateralised Contribution or as a top-up to its Collateralised Contribution promptly within 3 Settlement Days after the date of the written notice from CDP requiring such payment, or within such other period as may from time to time be determined by CDP.

          Amended on 3 May 2011.

        • 7.15.1A

          Clearing Members shall pay any amount required to be deposited with CDP as its Contingent Contribution or as a top-up to its Contingent Contribution promptly, within such time as specified in the written notice from CDP requiring such payment.

          Added on 3 May 2011.

        • 7.15.2

          CDP shall be entitled to charge interest (at such rates and upon such terms, as it may in its absolute discretion determine) on any amount payable by a Clearing Member as its Contribution or as a top-up to its Contribution at such rate as may be determined by CDP in the event that such Clearing Member does not pay the required amount in accordance with these Clearing Rules.

    • Rule 8 — Default Rules

      • 8.1 Events of Default

        • 8.1.1

          In the event that:—

          (1) a Clearing Member fails duly to perform or is, in the opinion of CDP, in breach of any provision of these Clearing Rules or Clearing Directives or of any agreement, understanding or arrangement which the Clearing Member has from time to time with CDP;
          (2) a Clearing Member, not being an Exempt Person, ceases to hold a valid Capital Markets Services Licence under the SFA or ceases to be authorised to conduct banking business in Singapore pursuant to section 4 of the Banking Act (Chapter 19);
          (3) a Clearing Member is insolvent or is deemed insolvent pursuant to Rule 8.1A.;
          (4) in view of the Clearing Member's financial or operating conditions, CDP, in its absolute discretion, considers it necessary or desirable to protect its own interests, the interests of other Clearing Members and/or the interests of the customers of the Clearing Member; or
          (5) conversion, theft, breach of trust, embezzlement, or any other similar cause, caused or suffered by or in connection with a Clearing Member,

          CDP shall be entitled, at its absolute discretion, then or at any time thereafter, whether or not such event is, in the opinion of CDP, continuing, to declare that an Event of Default has occurred and to give notice thereof to all Clearing Members.

          Amended on 1 July 2008, 21 January 2013 and 22 April 2013.

        • 8.1.2

          Immediately upon CDP declaring that an Event of Default has occurred in respect of any Clearing Member, such Clearing Member (the "Defaulting Clearing Member") shall be deemed:—

          (1) to be in breach of its obligations to CDP under its Novated Contracts; and
          (2) to be unable to meet its obligations to CDP

          and to the extent permitted by law, Rules 8.2 to 8.9 herein shall apply.

          Added on 23 January 2009 and 22 April 2013.

        • 8.1.3

          Without prejudice to the generality of Rule 1 or Rule 10, CDP shall not be liable to any Clearing Member or any Third Party in respect of any damage, loss, cost or expense of whatsoever nature (whether direct, indirect, special or consequential, including without limitation any loss of business, revenue, goodwill, bargain or profit), suffered or incurred by such Clearing Member or Third Party, arising out of or in connection with the declaration or non-declaration of an event of default by CDP.

          Added on 26 April 2013.

      • 8.1A Insolvency and Deemed Insolvency

        • 8.1A.1

          For the purpose of these Clearing Rules, a Clearing Member becomes insolvent or shall be deemed to be insolvent on the occurrence of any of the following events:—

          (1) it fails to fulfil or meet margins or settlement requirements for all or any of its Novated Contracts;
          (2) it defaults upon any levy owing to CDP arising out of Rule 7.2.1 or Rule 7.10.3;
          (3) it is or is at risk of being in material default under the term of any loan or other agreement relating to its indebtedness;
          (4) it fails, is unable, admits its inability, or is deemed for the purposes of any law to be unable, to pay its debts as they fall due;
          (5) a composition, assignment or arrangement is proposed or made for the benefit of its creditor;
          (6) the value of its assets is less than its liabilities, taking into account contingent and prospective liabilities;
          (7) by reason of its financial integrity having been or anticipated to be compromised, it proposes, or commences negotiations with one or more of its creditors, to suspend, stop, defer or reschedule payments on any of its indebtedness, or announces an intention to do so;
          (8) it or any of its directors or other officers seeks or gives notice of its or his intention to seek, or if it or any of its assets becomes subject to, the appointment of an administrator, provisional liquidator, receiver, administrative receiver, judicial manager, judicial custodian, compulsory manager, trustee, trustee in bankruptcy, conservator, custodian or other similar officer, whether out of court or otherwise;
          (9) a moratorium is declared in respect of any of its indebtedness;
          (10) the enforcement of any security over any of its assets, or any distress, execution, attachment, sequestration or other legal process levied, enforced or served upon any of its assets;
          (11) any corporate action, legal proceedings or other procedure or step is taken, including without limitation the presentation of a petition, the making of an application, the filing of documents with a court, the convening of a meeting of the Clearing Member, its directors or its members, the giving of a notice of a proposal or the passing of a resolution, in relation to or with a view to:
          (a) the winding up, liquidation, dissolution, or seeking of a judgment of insolvency or other relief under any insolvency law or other similar law affecting creditors' rights in respect of the Clearing Member, whether voluntary or involuntary; or
          (b) the administration, whether out of court, with a registrar or otherwise, judicial management or reorganisation, whether by way of voluntary arrangement, scheme of arrangement or otherwise, of the Clearing Member, whether voluntary or involuntary;
          (12) it causes or is subject to any event which, under the applicable laws of any jurisdiction, has an effect analogous to any of the events specified above;
          (13) it takes any action or step in furtherance of, or indicating its consent to, approval of or acquiescence in, any of the foregoing acts; or
          (14) if CDP considers in its absolute discretion that the occurrence of any such events or their equivalent is imminent or likely in any jurisdiction.

          Added on 22 April 2013.

      • 8.2 Effect of Default on Novated Contracts other than in respect of Marginable Futures Contracts

        Amended on 10 December 2018.

        • 8.2.1

          Except for Rules 8.6A, 8.6AA, 8.6B, 8.6E and 8.7, Rules 8.2 to 8.9 shall apply to Novated Contracts other than in respect of Marginable Futures Contracts.

          Amended on 23 January 2009, 22 April 2013 and 10 December 2018.

        • 8.2.2

          Immediately upon such breach under Rule 8.1.2:—

          (1) each Novated Contract for the purchase of securities between CDP and the Defaulting Clearing Member in relation to a Customer Account and any right of the Defaulting Clearing Member to receive compensation for corporate action entitlement under Rule 6.5.4(2) in respect of that Novated Contract shall be terminated. In respect of each such Novated Contract, a new contract (the "New Purchase Contract") shall be deemed to have been made between CDP and the relevant buying customer of the Defaulting Clearing Member, pursuant to which the buying customer shall have:
          (a) the obligation to pay the relevant purchase consideration to CDP; and
          (b) subject to Rule 8, the right to receive the relevant securities and any compensation for corporate action entitlement under Rule 6.5.4(2) as applicable from CDP;
          (2) each Novated Contract for the sale of securities between CDP and the Defaulting Clearing Member in relation to a Customer Account and any obligation of the Defaulting Clearing Member to make compensation for corporate action entitlement under Rule 6.5.4(1) in respect of that Novated Contract shall be terminated. In respect of each such Novated Contract, a new contract (the "New Sale Contract") shall be deemed to have been made between CDP and the relevant selling customer of the Defaulting Clearing Member, pursuant to which the selling customer shall have:
          (a) the obligation to deliver the relevant securities and to make any compensation for corporate action entitlement under Rule 6.5.4(1) as applicable to CDP; and
          (b) subject to Rule 8, the right to receive the relevant sale consideration from CDP; and
          (3) in respect of Novated Contracts between CDP and the Defaulting Clearing Member in relation to a House Account:
          (a) CDP shall be entitled (but not obliged) to set-off any or all Novated Contracts for the sale of a security against any or all Novated Contracts for the purchase of that security, regardless of the Intended Settlement Days for such Novated Contracts;
          (b) CDP shall be entitled (but not obliged) to force-sell any or all securities that would have been due from CDP to the Defaulting Clearing Member but for its default at such time and price as CDP may determine, and use the resulting proceeds of any force-sale to satisfy any liabilities that the Defaulting Clearing Member owes to CDP. Where any of those securities are not force-sold by the seventh (7th) Settlement Day after an Event of Default is declared under Rule 8.1.2:
          (i) CDP shall, on the next Settlement Day, take the purchase consideration for those securities as a loss suffered by CDP due to the Clearing Member's default;
          (ii) CDP shall thereafter have absolute discretion to deal with those securities as it deems appropriate;
          (iii) any amount recovered by CDP shall be applied to make good any loss that was suffered by CDP due to the Clearing Member's default and that was not met by the Clearing Fund; and
          (iv) any amount that remains thereafter shall be credited to the Clearing Fund in accordance with Rule 7.12.
          CDP has no liability for any losses to the Defaulting Clearing Member arising from the force-sale or attempted force-sale of securities; and
          (c) any securities due from the Defaulting Clearing Member to CDP regardless of the Intended Settlement Days and if not set-off pursuant to Rule 8.2.2(3)(a) shall be settled in accordance with these Clearing Rules on such day as CDP may determine.

          Subject as otherwise provided in these Clearing Rules, the terms of each New Purchase Contract and New Sale Contract shall be on the same terms as its corresponding Novated Contract. For the avoidance of doubt, the termination of each Novated Contract shall be without prejudice to any of the rights or remedies of CDP thereunder and CDP's right to damages in respect of any breach (whether antecedent or otherwise) under each Novated Contract shall not be extinguished.

          Amended on 23 January 2009, 22 April 2013, 10 December 2018 and 17 July 2019.

        • 8.2.2A

          Upon such breach under Rule 8.1.2, CDP shall be entitled to cancel any free-of-payment instructions in relation to any Novated Contract or any New Purchase Contract.

          Added on 22 April 2013 and amended on 10 December 2018.

        • 8.2.3

          (1) Rules 6.3 to 6.5 shall not apply to each New Purchase Contract or New Sale Contract.
          (2) Payment and delivery under New Purchase Contracts and New Sale Contracts shall be made in accordance with Rules 8.3 to 8.6.

          Amended on 10 December 2018.

        • 8.2.3A

          Settlement of transactions between the buying customer and CDP in respect of New Purchase Contracts; and the selling customer and CDP in respect of New Sale Contracts shall be in such currency as determined by CDP and, if applicable, at such exchange rate as determined by CDP. Without prejudice to the generality of the foregoing, CDP may refer to exchange rates published by data vendors in determining the relevant exchange rates.

          Added on 22 April 2013.

        • 8.2.4

          For the purposes of Rule 8.2:

          (1) "Customer Account" means a Position Account for a Customer except where such Customer is:
          (a) a director, officer, employee or representative of the Clearing Member; or
          (b) a related corporation of the Clearing Member.
          For the avoidance of doubt, a Clearing Member's own proprietary account is not a Customer Account; and
          (2) "House Account" means a Position Account which is not a Customer Account (as such term is defined in Rule 8.2.4(1)).

          Amended on 22 April 2013 and 10 December 2018.

      • 8.3 Payment by Buying Customer Under New Purchase Contract

        • 8.3.1

          In respect of a New Purchase Contract:—

          (1) unless otherwise notified by CDP, the buying customer shall pay the full purchase consideration directly to CDP at such time as CDP may determine, regardless of whether the buying customer has made payment of such amount to the Defaulting Clearing Member;
          (2) subject to Rule 8.6C.2, title and right to the purchase consideration paid by the buying customer to CDP shall not at any time pass to the Defaulting Clearing Member; and
          (3) CDP shall have no obligation to the buying customer in respect of any payment by the buying customer to the Defaulting Clearing Member.

          Amended on 22 April 2013.

        • 8.3.2

          For so long as the purchase consideration in respect of New Purchase Contracts has not been paid in full to CDP by a buying customer:

          (1) CDP shall have no obligation to make delivery of any securities to that buying customer pursuant to the New Purchase Contracts; and
          (2) to the extent that any securities pursuant to New Purchase Contracts have been transferred to the Defaulting Clearing Member's Clearing Account or the Securities Account of the buying customer, CDP shall have the right to recover such securities.

          Added on 22 April 2013 and amended on 10 December 2018.

      • 8.4 Delivery of Securities Under New Purchase Contract

        • 8.4.1

          Subject to Rule 8, the obligation of CDP to make delivery of securities to a buying customer pursuant to a New Purchase Contract shall be discharged by CDP transferring such securities to the Securities Account of the buying customer at such time as CDP may determine after payment by the buying customer. Title and right to such securities shall not at any time pass to the Defaulting Clearing Member.

          Amended on 3 April 2008, 22 April 2013 and 10 December 2018.

        • 8.4.1A

          On any Settlement Day, if and to the extent that the securities available to CDP are insufficient for CDP to settle its delivery obligations under the New Purchase Contracts that are due for settlement on that Settlement Day, CDP may:

          (1) defer any of those delivery obligations, in whole or in part, for settlement on the next Settlement Day; or
          (2) cash settle any of those delivery obligations, in whole or in part.

          Refer to Practice Note 6.5.1B(2), 6.6.2, 6.7.11, 8.4.1A, 8.5.2A and 8.6F.2

          Added on 10 December 2018.

        • 8.4.2

          In the event that the buying customer does not pay any part of the purchase consideration for any New Purchase Contract to CDP by such time as CDP may determine:

          (1) CDP shall be entitled (but not obliged) to force-sell any or all securities that would have been due from CDP to such customer but for its non-payment at such time and price as CDP may determine, and use the resulting proceeds of any force-sale to satisfy any liabilities that the buying customer owes to CDP. Where any of those securities are not force-sold by the seventh (7th) Settlement Day after an Event of Default is declared under Rule 8.1.2:
          (a) CDP shall, on the next Settlement Day, take the purchase consideration for those securities as a loss suffered by CDP due to the Clearing Member's default;
          (b) CDP shall thereafter have absolute discretion to deal with those securities as it deems appropriate;
          (c) any amount recovered by CDP shall be applied to make good any loss suffered by CDP due to the Clearing Member's default and that was not met by the Clearing Fund; and
          (d) any amount that remains thereafter shall be credited to the Clearing Fund in accordance with Rule 7.12.
          CDP has no liability for any losses to the buying customer or the Defaulting Clearing Member arising from the force-sale or attempted force-sale of securities; and
          (2) any securities due from the customer to CDP (if not set-off pursuant to Rule 8.4.2(1)) shall be settled in accordance with Rule 8.5.

          Amended on 22 April 2013 and 17 July 2019.

        • 8.4.3

          Notwithstanding that the Clearing Fund may have been drawn upon, CDP may at any time thereafter claim all losses and expenses consequent upon such force-sale or attempted force-sale, and all damages which CDP may sustain in this connection (regardless of whether such losses, expenses and damages have been insured against) shall be recoverable by CDP from:—

          (1) the buying customer and, failing him;
          (2) the Defaulting Clearing Member.

          Amended on 17 July 2019.

      • 8.5 Delivery of Securities Under New Sale Contract

        • 8.5.1

          The obligation of the selling customer to make delivery of securities to CDP pursuant to a New Sale Contract shall be discharged by CDP transferring such securities from the Securities Account of the selling customer and crediting CDP's account on such Settlement Day as CDP may determine. Title and right to such securities shall not at any time pass to the Defaulting Clearing Member. In the event that there are insufficient or no securities in such Securities Account that can be transferred to CDP, the selling customer shall be responsible to CDP for such shortfall.

          The selling customer shall ensure that the securities are available in his Securities Account by the time set out in the CDP Settlement Rules, or such time as CDP shall specify.

          Where the selling customer:

          (1) has not made available in his Securities Account the securities or sufficient securities in accordance with this Rule 8.5.1; or
          (2) has failed to deliver the securities or sufficient securities in accordance with this Rule 8.5.1,

          such securities will be acquired in the manner prescribed by CDP to discharge the selling customer's delivery obligation.

          Amended on 3 April 2008, 20 November 2009, 22 April 2013 and 10 December 2018.

        • 8.5.2

          Notwithstanding that the Clearing Fund may have been drawn upon, CDP may at any time thereafter claim the difference and all losses and expenses consequent upon such acquiring of securities, and all damages which CDP may sustain in this connection (regardless of whether such losses, expenses and damages have been insured against) shall be recoverable by CDP from:—

          (1) the selling customer and, failing him;
          (2) the Defaulting Clearing Member.

          Added on 22 April 2013.

        • 8.5.2A

          If a selling customer's obligation to deliver securities under a New Sale Contract remains outstanding on the fifth (5th) Settlement Day (or such other number of Settlement Days as CDP may determine) after delivery is due, CDP shall, on the next Settlement Day, cash settle the selling customer's delivery obligation.

          Refer to Practice Note 6.5.1B(2), 6.6.2, 6.7.11, 8.4.1A, 8.5.2A and 8.6F.2

          Added on 10 December 2018.

      • 8.6 Payment to Selling Customer Under New Sale Contract

        • 8.6.1

          Subject to Rule 8, in respect of a New Sale Contract, CDP shall pay the sale consideration to the selling customer at such time as CDP may determine. Subject to Rule 8.6C.2, title and right to such sale consideration shall not at any time pass to the Defaulting Clearing Member.

          Amended on 22 April 2013 and 10 December 2018.

        • 8.6.2 [Rule has been deleted.]

          Deleted on 22 April 2013.

        • 8.6.3 [Rule has been deleted.]

          Deleted on 22 April 2013.

      • 8.6A Effect of Default on Novated Contracts in respect of Marginable Futures Contracts

        Amended on 10 December 2018.

        • 8.6A.1

          This Rule shall apply only to Novated Contracts in respect of Marginable Futures Contracts (hereafter "novated Marginable Futures Contracts").

          Added on 23 January 2009.

        • 8.6A.2

          For positions in novated Marginable Futures Contracts, immediately upon such breach under Rule 8.1.2, CDP may:—

          (1) transfer all positions in relation to any Customer Account held by the Defaulting Clearing Member to another Clearing Member designated by CDP. When such positions are so transferred, the following shall apply:
          (a) subject to Rule 8.6A.2(1)(c), margins deposited with CDP in respect of the positions shall be entrusted to the designated Clearing Member;
          (b) the margins entrusted to a designated Clearing Member pursuant to this Rule 8.6A.2(1) may not be in such form as was originally deposited with the CDP;
          (c) CDP shall have the discretion not to entrust all or any part of the margins to a designated Clearing Member as described in Rule 8.6A.2(1)(a) if Collateral deposited with CDP in relation to such Customer Accounts may be applied pursuant to Rule 8.6B.1. Where margins are not entrusted to the designated Clearing Member, the designated Clearing Member shall be required to collect the required margins from the relevant customer in accordance with these Clearing Rules; and
          (d) the margins not entrusted to the designated Clearing Member shall be retained by CDP and may be applied in accordance with Rule 8.6B.1. Any unused margins shall be returned to the Defaulting Clearing Member, or entrusted to the designated Clearing Member, as CDP deems appropriate:
          (i) following the settlement of losses arising from the Event of Default; or
          (ii) at such time that CDP determines that the margins may not be used;
          (2) borrow securities, execute buying-in or offset against the customer's obligations under New Purchase Contracts and New Sale Contracts, on behalf of and at the risk of the Defaulting Clearing Member, for the purpose of meeting settlement obligations;
          (3) execute hedging transactions, on behalf of and at the risk of the Defaulting Clearing Member, to eliminate or reduce market risk resulting from such positions; and
          (4) appoint 1 or more Trading Members to liquidate such positions on the behalf of and at the risk of the Defaulting Clearing Member.

          Added on 23 January 2009 and amended on 21 January 2013 and 22 April 2013.

        • 8.6A.3

          All costs and expenses sustained by CDP in connection with any steps which are or may be taken by CDP pursuant to Rule 8.6A.2, including losses incurred from authorised hedging transactions and the unwinding of such hedging transactions, shall be charged to the account of the Defaulting Clearing Member.

          Added on 23 January 2009 and amended on 21 January 2013.

      • 8.6AA

        Added on 10 December 2018.

        • 8.6AA.1

          Unless otherwise determined by CDP, any money that has been paid to CDP by a Defaulting Clearing Member pursuant to the CDP Settlement Rules shall be held by CDP as Collateral deposited by the Defaulting Clearing Member other than in relation to a Customer Account and applied in accordance with these Clearing Rules and the Security Deed.

          Added on 10 December 2018.

      • 8.6B Application of Collateral

        Amended on 21 January 2013.

        • 8.6B.1

          Without prejudice and subject to the other provisions of these Clearing Rules, in particular Rule 7.9.1:

          (1) where a Clearing Member has failed promptly to discharge any of its obligations to CDP, CDP may apply Collateral, including without limitation letters of credit procured by the Clearing Member to be issued to CDP, deposited or provided by the Clearing Member, except where such margins or other Collateral were deposited solely in relation to a Customer Account;
          (2) notwithstanding Rule 8.6B.1(1), where a Clearing Member has failed promptly to discharge any of its obligations to CDP, and CDP has reasonable grounds for forming an opinion that the failure is directly attributable to the failure of any Customer Account holder to meet its obligations, CDP may apply:
          (a) margins or other Collateral, (including without limitation letters of credit procured by the Clearing Member to be issued to CDP) deposited or provided by the Clearing Member solely in relation to Customer Accounts provided that the conditions in the SFA are satisfied; and
          (b) any qualifying letters of credit deposited with or provided to CDP by a Trading Member sponsored by the Clearing Member, provided that the Clearing Member's default is attributable to such Trading Member's act or omission.

          Added on 23 January 2009 and amended on 21 January 2013.

        • 8.6B.1A

          In exercising its powers under Rule 8.6B.1, CDP may liquidate any non-cash Collateral deposited with it by a Clearing Member. Such Clearing Member shall be liable to CDP for any costs and expenses incurred in connection with the liquidation. CDP shall not be liable for any losses to any person arising from such liquidation.

          Added 21 January 2013.

        • 8.6B.2

          The Clearing Member shall not take any action or do anything that will directly or indirectly interfere with, prohibit, restrict or inhibit the ability of CDP to so apply such Contributions, margins or other Collateral and CDP shall, except where it has acted in bad faith, be under no liability to the Clearing Member or any other person whatsoever in so applying such Contributions, margins or other Collateral and the Clearing Member shall fully indemnify and keep indemnified CDP and hold CDP harmless against any such liability.

          Added on 23 January 2009 and amended on 21 January 2013.

        • 8.6B.3

          Where the Clearing Member has failed to settle its financial obligations to SGX-DC, CDP shall be entitled to retain any Collateral deposited or provided by the Clearing Member which have not been utilised pursuant to this Rule 8.6B, except where such Collateral were deposited with or provided to CDP solely in relation to Customer Accounts.

          Added on 21 January 2013 and amended on 22 April 2013.

      • 8.6C Set-Off of Obligations Under New Purchase Contract and New Sale Contract

        • 8.6C.1

          In respect of any or all New Purchase Contracts and any or all New Sale Contracts for the same customer, CDP shall be entitled (but not obliged) to set-off:

          (1) any or all moneys due from CDP to such customer, including without limitation the proceeds from the force-sale pursuant to Rule 8.4.2 and the sale consideration pursuant to Rule 8.6.1; against
          (2) any or all moneys due from such customer to CDP, including without limitation the purchase consideration pursuant to Rule 8.3.1, all losses and expenses consequent upon any force-sale pursuant to Rule 8.4.3 and all losses and expenses consequent upon any acquiring of securities pursuant to Rule 8.5.1.

          Added on 22 April 2013.

        • 8.6C.2

          If a customer in respect of any New Purchase Contract or New Sale Contract is indebted to the Defaulting Clearing Member, the customer agrees that CDP shall be entitled to:

          (1) withhold the amount or part thereof due from CDP to the customer pursuant to Rule 8 in satisfaction or part satisfaction of such customer's debt to the Defaulting Clearing Member; and
          (2) at any time as CDP may determine, treat such withheld amount as assets of the Defaulting Clearing Member subject to such rights and remedies of CDP under these Clearing Rules.

          Added on 22 April 2013.

      • 8.6D Trust Arrangements for Monies in Connection with New Purchase Contracts and New Sale Contracts

        • 8.6D.1

          Subject to all rights and remedies of CDP against or in respect of such amount under these Clearing Rules, any amount due from CDP to a customer pursuant to Rule 8 shall be held on trust by CDP for the benefit of such customer.

          Added on 22 April 2013.

        • 8.6D.2

          CDP shall have the right to commingle any or all amounts due to a customer pursuant to Rule 8 with any other amounts due to any other customer pursuant to Rule 8.

          Added on 22 April 2013.

        • 8.6D.3

          Unless otherwise notified by CDP to a customer from time to time, CDP shall have no obligation to make payment of any fees, interest and investment earnings to any customer arising from or in connection with such amounts held on trust by CDP pursuant to Rule 8.6D.1.

          Added on 22 April 2013.

        • 8.6D.4

          CDP shall not have any obligation or responsibility to preserve, protect, collect or realise, and under no circumstances shall CDP be liable for any loss or diminution in value or depreciation in or in connection with, such amounts held on trust by CDP pursuant to Rule 8.6D.1.

          Added on 22 April 2013.

      • 8.6E Exclusion of Liability

        • 8.6E.1

          Without prejudice to the generality of Rule 1 or Rule 10, CDP shall not be liable to any customer in respect of a New Purchase Contract, a New Sale Contract or a novated Marginable Futures Contract whose positions or margins are transferred or entrusted to another Clearing Member, in respect of any damage, loss, cost or expense of whatsoever nature (whether direct, indirect, special or consequential, including without limitation any loss of business, revenue, goodwill, bargain or profit), suffered or incurred by such customer, arising out of or in connection with any act or omission of CDP in the performance of CDP's obligations in Rule 8 or the exercise or non-exercise of its powers under Rule 8.

          Added on 26 April 2013.

      • 8.6F CDP's Obligations under New Purchase Contracts or New Sale Contracts

        Added on 10 December 2018.

        • 8.6F.1

          If and to the extent that the funds or assets available to CDP are insufficient, either in aggregate or in respect of in any settlement currency, to meet CDP's obligations to customers under any New Purchase Contracts or New Sale Contracts, CDP may upon notice to the relevant customer defer any of those obligations, in whole or in part, for settlement at such later time as CDP may determine.

          Added on 10 December 2018.

        • 8.6F.2

          If and to the extent that CDP determines that it is not or may not be possible or reasonably practicable to deliver securities under a New Purchase Contract, CDP may cash settle its obligation to deliver securities, in whole or in part.

          Refer to Practice Note 6.5.1B(2), 6.6.2, 6.7.11, 8.4.1A, 8.5.2A and 8.6F.2

          Added on 10 December 2018.

      • 8.7 Certification of Net Sum Due

        • 8.7.1

          Upon CDP declaring that an Event of Default has occurred, CDP shall as soon as reasonably practicable certify the net sum payable by the Defaulting Clearing Member in respect of its rights and obligations arising under these Clearing Rules. The Defaulting Clearing Member shall pay any net amount so payable by it to CDP forthwith.

      • 8.8 [Rule has been deleted.]

        Deleted on 21 January 2013.

      • 8.9 Clearing Members to Render Assistance

        • 8.9.1

          To facilitate the operation of a safe and efficient clearing facility, including the settlement of New Sale Contracts and New Purchase Contracts by CDP, the Defaulting Clearing Member shall:

          (1) render all assistance as CDP requires, including without limitation making available the Defaulting Clearing Member's premises, systems and officers;
          (2) provide CDP with information, books and records which, in CDP's opinion may be relevant to the settlement of New Sale Contracts and New Purchase Contracts; and

          (3) comply with all other requirements that CDP may specify.

          Added on 22 April 2013.

        • 8.9.2

          CDP may request one or more Clearing Members to assist CDP in the settlement of New Sale Contracts and New Purchase Contracts, where CDP considers such assistance necessary to facilitate the operation of a safe and efficient clearing facility. Clearing Members shall, upon such request, render such assistance as CDP may require.

          Added on 22 April 2013.

        • 8.9.3

          CDP shall be entitled (but not obliged) to rely on the books and records of the Defaulting Clearing Member as conclusive evidence of the entitlements or indebtedness of the customers of the Defaulting Clearing Member due from or owing to the Defaulting Clearing Member.

          Added on 22 April 2013.

    • Rule 9 — Suspension or Restriction of Clearing

      • 9.1 CDP May Suspend or Restrict Clearing and Settlement

        • 9.1.1

          CDP may suspend or restrict the membership of any Clearing Member, or the clearing and settlement of Exchange Trades in general or in particular, or the clearing and settlement of the Exchange Trades of any Clearing Member for such duration as it sees fit if in the opinion of CDP:—

          (1) the functioning of CDP is or is likely to be impaired by any event or circumstance;
          (2) such action is in the general interest of CDP and/or its Clearing Members; or
          (3) in respect of a Clearing Member, an Event of Default has occurred in respect of that Clearing Member.

        • 9.1.2

          Without prejudice to Rule 9.1.1, CDP may also take such other action as it may deem necessary or appropriate in the interests of CDP and/or its Clearing Members, or for the protection of CDP with respect to the Novated Contracts to which a Defaulting Clearing Member is a party, at the Defaulting Clearing Member's expense and if appropriate, in its name.

          Amended on 23 January 2009.

        • 9.1.3

          CDP may also request SGX-ST to suspend the Clearing Member from further trading on SGX-ST and/or notify any other Exchange of any action or proceedings taken against the Clearing Member.

        • 9.1.4

          If any Clearing Member shall be ordered to wind up, or proceedings for the voluntary or involuntary liquidation of the affairs of the Clearing Member be commenced, or a composition with the creditors of the Clearing Member under the provisions of any law or regulation relating to bankruptcy or insolvency be entered into under the laws of any jurisdiction, or if the Clearing Member, not being an Exempt Person, ceases to hold a valid Capital Markets Services Licence under the SFA, or ceases to be authorized to conduct banking business in Singapore pursuant to section 4 of the Banking Act (Chapter 19), the Clearing Member shall be deemed to have been automatically suspended.

          Amended on 1 July 2008.

      • 9.2 SGX-ST Requirement

        • 9.2.1

          CDP shall suspend or restrict the clearing and settlement of Exchange Trades in general or in particular, or in respect of the Exchange Trades of any Clearing Member, if advised by SGX-ST or any other Exchange or pursuant to any requirement of SGX-ST or any other Exchange, and if it is in the interest of CDP to do so.

      • 9.3 Notification of Suspension

        • 9.3.1

          CDP shall notify the Clearing Member concerned and the other Clearing Members as soon as practicable upon any automatic suspension or any decision to suspend or restrict the clearing and settlement of Exchange Trades of a Clearing Member pursuant to Rule 9. Pending such decision, the Clearing Member concerned may resign from CDP subject to the Clearing Rules.

        • 9.3.2

          A Clearing Member against whom suspension, restriction or other action is imposed by CDP pursuant to Rule 9 may, within 7 Settlement Days, appeal to the Disciplinary Committee against the said suspension, restriction or other action. Notwithstanding such appeal, the suspension, restriction or other action imposed on the Clearing Member by CDP shall continue in effect until such time as it is revoked or lifted by CDP or the Disciplinary Committee.

        • 9.3.3

          A Clearing Member suspended or deemed suspended for whatsoever reasons (including on a voluntary basis) shall not have any of the privileges of a Clearing Member during the period of its suspension. A suspended Clearing Member may be reinstated upon such conditions as CDP may impose.

        • 9.3.4

          Unless otherwise decided by CDP, a Clearing Member who is suspended or whose clearing activities are restricted by CDP is still liable to CDP to clear and settle any and all Exchange Trades that are entered by the Clearing Member right up to the time the suspension or restriction takes effect.

      • 9.4 Positions Carried in Any Account on the Books of Clearing Members Who are Suspended or Restricted in Clearing Activities

        • 9.4.1

          When a Clearing Member is suspended or is restricted in its clearing activities by CDP, other than for default, CDP may designate 1 or more Clearing Members to deal with any positions carried in any account on the books of the suspended or restricted Clearing Member in accordance with CDP's direction.

          Added on 23 January 2009.

    • Rule 10 — Liabilities

      Amended on 15 September 2017.

      • 10.1 No Liability to Clearing Members and Others in Absence of Fraud Etc

        Amended on 15 September 2017.

        • 10.1.1

          Without prejudice to the generality of Rule 1.1.3, except as otherwise expressly provided in these Clearing Rules, none of CDP, its related corporations, SGX RegCo, any person or entity referred to under Rule 1.1.7, or their respective directors, officers, employees, representatives or agents ("Relevant Persons"), if acting in good faith and in the absence of fraud or negligence on their parts shall be liable to any Clearing Member or any Third Party in contract, tort or under any other cause of action with respect to, or with respect to any thing done or not done as a direct or indirect consequence of, any action or omission by any Relevant Person in connection with the clearing and settlement of Exchange Trades, and all other matters as contemplated in these Clearing Rules.

          Amended on 15 September 2017 and 3 June 2019.

        • 10.1.2

          Without prejudice to the generality of Rule 1.1.3, the Relevant Persons shall have no obligation or liability of any kind to a Clearing Member or Third Party, or to any of the Clearing Member's customers in respect of any loss or damage (including consequential loss or damage) which may be suffered or incurred or which may arise directly or indirectly in respect of, or in respect of any thing done or not done as a direct or indirect consequence of, the exercise of any discretion or decision making power under the Clearing Rules or Clearing Directives.

          Amended on 15 September 2017 and 3 June 2019.

      • 10.2 Force Majeure

        • 10.2.1

          No Relevant Person shall be liable for, or for any thing done or not done as a direct or indirect consequence of, any action or omission or any failure, hindrance, suspension, restriction or delay in the provision of services and facilities to clear and settle any Exchange Trade or the performance in whole or in part of CDP's obligations under these Clearing Rules or Clearing Directives if such action, omission, failure, hindrance, suspension, restrictions or delay arises out of causes beyond the Relevant Person's reasonable control.

          Amended on 15 September 2017 and 3 June 2019.

        • 10.2.2

          Such causes may include, but shall not be limited to, acts of God, war, civil disturbances, riots, acts of a civil or military authority, embargoes, fires, floods, explosions, accidents, labour disputes, mechanical breakdowns, computer or system failures or other failures of equipment, failures of or defects in computer or system software, unavailability of or restrictions on any on-line communications system or communication media or facilities, interruptions (whether in whole or in part) of power supplies or other utility or service, any suspension, restriction or closure of any market, any market emergency, failure, interruption or suspension of any depository or custodian, bank or financial institution, any law, decree, regulation or order or directive of any government, competent authority or any court or tribunal, and any other causes beyond the Relevant Person's reasonable control.

          Amended on 15 September 2017.

        • 10.2.3

          On the happening of any 1 or more of the events or circumstances referred to in Rule 10.2.1 above, CDP and any party affected shall immediately notify the same to the relevant party or parties.

          Added on 23 January 2009.

        • 10.2.4

          In respect of affected Clearing Members, CDP shall be entitled, at any time after the receipt of such notice by CDP or any relevant party or parties, to exercise the powers under Rules 6A.9A and 6.10.

          Added on 23 January 2009 and amended on 21 January 2013.

        • 10.2.5

          Without prejudice to the generality of the foregoing, the Relevant Persons shall not be liable for any failure, hindrance or delay in the performance (in whole or in part) of any of CDP's obligations to Clearing Members with regard to any Collateral where such failure, hindrance or delay arises from causes beyond CDP's control, such as but not limited to the failure whether partial or total, interruption or suspension of any depository or custodian or other service ("depository", which expression shall include banks or financial institutions with which such Collateral is placed with) CDP is using, the termination or suspension of CDP's membership or use of the depository or any variation of the depository's operational timetable, whether or not occasioned by action of the depository operator or other party, or any embargo, unavailability or restriction of bank transfer systems or wires, malfunction or overload of the depository or other emergency.

          Added on 23 January 2009 and amended on 21 January 2013 and 15 September 2017.

      • 10.3 No Liability for Acts or Omissions of Clearing Members

        Amended on 15 September 2017.

        • 10.3.1

          The Relevant Persons shall have no liability for:—

          (1) any breach or failure of any Clearing Member to comply with these Clearing Rules; or
          (2) the acts or omissions of any of the Clearing Members.

          Amended on 15 September 2017.

      • 10.4 Consequential Losses

        • 10.4.1

          The Relevant Persons shall not be liable for any special, indirect or consequential losses or damages or for the loss of business, revenue, goodwill, bargain or loss of profit suffered by any Clearing Member, even if the Relevant Persons had been notified of the possibility of these damages being incurred.

          Amended on 15 September 2017.

      • 10.5 Limit on Amount of Damages Recoverable

        • 10.5.1

          Except for CDP's liability to make payment of the Final Settlement Balance owing to a Clearing Member, under no circumstances shall CDP's liability and the amount of damages owing to a Clearing Member exceed 100% of the aggregate amount of the fees, charges, fines or default interest paid by the Clearing Member in the calendar year the incident giving rise to the claim(s) in question occurs.

      • 10.6 Indemnity

        Amended on 15 September 2017.

        • 10.6.1

          Each Clearing Member indemnifies each of CDP, its related corporations, SGX RegCo, any person or entity referred to under Rule 1.1.7, and their respective directors, officers, employees, representatives and agents ("Indemnified Persons") against any loss or liability reasonably incurred or suffered by the Indemnified Persons where such loss or liability arose out of or in connection with:—

          (1) any breach by the Clearing Member of its obligations under the Clearing Rules and/or Clearing Directives; or
          (2) any wilful, unlawful, reckless or negligent act or omission by the Clearing Member.

          Amended on 26 April 2013, 15 September 2017 and 3 June 2019.

        • 10.6.2

          Without prejudice to the generality of Rule 10.6.1, in the event that any legal, arbitration or other proceedings are brought to impose any liability on all or any of the Indemnified Persons for an alleged failure on the part of any Indemnified Person to prevent or to require action by a Clearing Member or any of its directors, officers, employees, representatives or agents, the Clearing Member shall reimburse the relevant Indemnified Person for:—

          (1) all expenses and legal fees incurred by or on behalf of the Indemnified Person in connection with such proceedings;
          (2) any payment made by or on behalf of the Indemnified Person with the approval of the Clearing Member in connection with any settlement of such proceedings; and
          (3) any payment made by or on behalf of the Indemnified Person as a result of any order, award or judgment made in the such proceedings.

          The Clearing Member shall render such co-operation as the Indemnified Person reasonably requires in respect of such proceedings including without limitation the production of any document or records.

          Amended on 26 April 2013 and 15 September 2017.

        • 10.6.3

          Without prejudice to Rule 10.6.2, the Clearing Member shall pay to an Indemnified Person, if the Indemnified Person so requires, the costs incurred by or on behalf of the Indemnified Person of producing or obtaining, pursuant to a court order or other legal process, records relating to the business or affairs of a Clearing Member or any of its directors, officers, representatives, employees or agents, regardless of the party requiring such production or obtainment.

          Amended on 15 September 2017.

    • Rule 11 — Supervisory Rules

      • 11.1 Clearing House Investigations

        • 11.1.1

          CDP may conduct an investigation if:—

          (1) the investigation involves a possible breach of the SFA, the Clearing Rules or any Clearing Directives;
          (2) CDP receives a written complaint involving a Clearing Member, director, officer, employee or agent;
          (3) there is a dispute between Clearing Members on a clearing and settlement matter; or
          (4) in CDP's opinion, the circumstances warrant it.

          Amended on 3 June 2019.

        • 11.1.2

          CDP shall conduct an investigation if the Authority directs it.

        • 11.1.3

          CDP may require a Clearing Member, any of its directors, officers, employees or agents to:—

          (1) render all assistance as CDP requires, at CDP's premises or elsewhere; and
          (2) provide CDP with information, books and records which, in CDP's opinion, may be relevant to the investigation.

        • 11.1.4

          A Clearing Member, directors, officer, employee or agent shall not wilfully make, furnish or permit the making or furnishing of any false or misleading information, statement or report to CDP.

        • 11.1.5

          CDP may appoint any person or persons to assist in its investigation (the "Clearing House Examiners").

        • 11.1.6

          CDP may delegate all or any of its powers under this Rule to the Clearing House Examiner. The Clearing House Examiner shall report the results of the investigation to CDP.

      • 11.2 Clearing House Inspections

        • 11.2.1

          CDP may appoint any person or persons to conduct inspections of Clearing Members (the "Clearing House Inspectors").

        • 11.2.2

          CDP may conduct an inspection on a Clearing Member at any time.

        • 11.2.3

          A Clearing Member, director, officer, employee or agent shall give the Clearing House Inspector access to all information, books and records as requested. For the avoidance of doubt, reference to "information, books and records" in relation to a Bank Clearing Member shall refer to information, books and records falling within the Bank Clearing Member's business governed by this Clearing Rules.

          Amended on 1 July 2008.

        • 11.2.4

          CDP shall give a copy of the inspection report to the Clearing Member concerned.

        • 11.2.5

          CDP may charge a fee for the inspection. The fee is payable immediately by the Clearing Member concerned.

      • 11.3 Disciplinary Action

        • 11.3.1

          If an investigation or inspection reveals that a Clearing Member, any of its directors, employees or agents has breached any Clearing Rule or Directive, CDP may take any of the following forms of disciplinary action, namely:

          (1) to charge the Clearing Member before the Disciplinary Committee;
          (2) to make an offer of composition to the Clearing Member, if the Rule violation is indicated in the third column of Schedule A as a compoundable Rule violation; or
          (3) to issue a letter of warning to the Clearing Member.

          Amended on 16 May 2011.

        • 11.3.2

          If the Clearing Member does not accept the offer of composition or comply with the terms of the composition within the stipulated time as prescribed by CDP, CDP may refer the said Clearing Member to the Disciplinary Committee.

          Added on 16 May 2011.

        • 11.3.3

          Where CDP becomes aware of any incident of overtrading as described in Rule 10.11.1 of the SGX-ST Rules, CDP may, in its sole discretion, withhold any profits from the transaction that resulted in overtrading, or any other moneys, that are due or owing to the Clearing Member which qualified that trade, and may not release such profits or moneys until all disciplinary proceedings (including any appeal) in respect of that incident of overtrading have been concluded.

          Added on 23 January 2009 and amended on 16 May 2011 and 3 June 2019.

      • 11.3A Composition by CDP

        • 11.3A.1

          CDP may make an offer of composition to a Clearing Member who has breached any Clearing Rule. The terms of the offer of composition include payment of a specified sum to CDP and may include the fulfillment of any accompanying terms that CDP may prescribe.

          Added on 16 May 2011.

        • 11.3A.2

          Upon payment of the specified sum and fulfillment of the accompanying terms within the stipulated time, no further proceedings shall be taken against that Clearing Member for that Rule violation.

          Added on 16 May 2011.

        • 11.3A.3

          Acceptance of the offer of composition by the Clearing Member amounts to an admission of liability and the Clearing Member will be deemed to have committed the conduct described in the charge.

          Added on 16 May 2011.

        • 11.3A.4

          In respect of Rule violations which CDP may offer composition, guidelines on the range of composition which CDP may offer to a Clearing Member who has committed a Rule violation are indicated in Schedule A.

          Added on 16 May 2011.

        • 11.3A.5

          CDP retains the discretion to offer composition to a Clearing Member of an amount which is lower or higher than the guidelines, except that the amount of composition that CDP may offer shall not exceed S$10,000 for each Rule violation.

          Added on 16 May 2011.

        • 11.3A.6

          Notwithstanding that a Rule violation is indicated as being compoundable or may be compoundable under Schedule A, CDP retains the discretion not to make an offer of composition to the Clearing Member and instead, to charge the said Clearing Member before the Disciplinary Committee.

          Added on 16 May 2011.

        • 11.3A.7

          If CDP has made an offer of composition, it will not commence disciplinary proceedings against a Clearing Member until after the stipulated period for the offer lapses.

          Added on 16 May 2011.

        • 11.3A.8

          For the purposes of determining whether a Rule violation is classified as a first, second, third or subsequent offence under Schedule A, only previous violations under the same Rule will be taken into consideration.

          Added on 16 May 2011.

      • 11.4 Disciplinary Committee

        • 11.4.1

          The Disciplinary Committee shall comprise persons appointed by the SGX RegCo Board and shall not have a member who is, or who within three years of the proposed appointment date was, a director, officer or employee of:

          (1) SGX; or
          (2) any of SGX's related corporations.

          Amended on 15 September 2017 and 3 June 2019.

        • 11.4.2

          The SGX RegCo Board shall appoint the chairman and deputy chairman of the Disciplinary Committee. In the absence of the chairman, the deputy chairman shall have all the authority of the chairman.

          Amended on 15 September 2017 and 3 June 2019.

        • 11.4.3 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.4.4 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.4.5 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.4.6 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.4.7

          Procedures may be issued in relation to Disciplinary Committee proceedings. The procedures are binding on all the parties to the proceedings and may be varied by the Disciplinary Committee as provided in the procedures or these Clearing Rules. Where any matter is not dealt with by the procedures or these Clearing Rules, the Disciplinary Committee may establish its own procedures.

          Refer to the [Disciplinary Committee and Appeals Committee Handbook].

          Amended on 3 June 2019.

      • 11.5 Disciplinary Committee Powers

        • 11.5.1

          CDP may initiate disciplinary proceedings and charge a Clearing Member before the Disciplinary Committee if CDP is of the opinion that the Clearing Member has committed any of the following:—

          (1) breached the SFA
          (2) subject to Rules 11.3A.2 and 11.3A.7, breached the Clearing Rules or Clearing Directives,
          (3) breached any relevant laws or regulations that govern the Clearing Member's other business activities,
          (4) breached the rules of any other exchange,
          (5) engaged in fraud or dishonesty, whether in or out of Singapore,
          (6) breached directors duties,
          (6A) engaged in conduct that has the effect of circumventing the Clearing Rules, the SFA, or any laws, regulations;
          (7) engaged in conduct detrimental to the financial integrity, reputation or interests of CDP, other Clearing Members or the investing public.

          Amended on 3 June 2019.

        • 11.5.1A

          The Disciplinary Committee shall, as a tribunal of first instance, hear and determine charges brought by CDP against a Clearing Member pursuant to Rule 11.5.1. The Disciplinary Committee may exercise its powers against a Clearing Member if it is satisfied, on a balance of probabilities, that the Clearing Member has committed any of the matters set out in Rule 11.5.1.

          Added on 3 June 2019.

        • 11.5.2

          The Disciplinary Committee may exercise its powers against a Clearing Member if a director, officer, employee or agent breaches, or causes the Clearing Member to breach, the Clearing Rules or any Clearing Directives.

        • 11.5.3

          A former Clearing Member is bound by these Clearing Rules in respect of acts occurring before the registration ended or before expulsion. CDP and the Disciplinary Committee retain their respective jurisdiction, notwithstanding the ending of registration or expulsion.

        • 11.5.4

          The powers of the Disciplinary Committee include:—

          (1) expelling a Clearing Member. The Disciplinary Committee may order a Clearing Member to be expelled notwithstanding that he has resigned
          (2) suspending a Clearing Member;
          (3) imposing a fine not exceeding S$250,000 per charge on a Clearing Member, or in the case of multiple charges, not exceeding S$1,000,000 per hearing;
          (4) reprimanding (publicly or privately) a Clearing Member;
          (5) requiring an education program to be undertaken;
          (6) requiring a compliance program to be undertaken;
          (7) imposing any restrictions or conditions on activities that a Clearing Member undertakes or in the case of a Bank Clearing Member, its business governed by this Clearing Rules;
          (8) requiring compensation to be paid;
          (9) ordering payment of fines by instalments, which shall not exceed 12 months from the date of imposition of the fine, unless otherwise permitted by the Disciplinary Committee;
          (10) ordering a stay of the penalty imposed, pending an appeal to the Appeals Committee;
          (11) requiring any director or in the case of a Bank Clearing Member, any director or person in a senior management position who is responsible for its business governed by this Clearing Rules, to step down from the day-to-day conduct of business affairs of the Clearing Member; and
          (12) confirming, changing or discharging the appointment of a Manager under Rule 11.12.2(4).

          Amended on 1 July 2008 and 3 June 2019.

        • 11.5.6

          A failure to comply with any sanction imposed by the Disciplinary Committee constitutes a breach of these Rules.

          Added on 3 June 2019.

        • 11.5.5

          Mandatory Minimum Penalties to be Imposed by Disciplinary Committee for certain Rule violations.

          Where a mandatory minimum penalty has been stipulated for a particular Rule violation in the seventh column of Schedule A, the Disciplinary Committee:

          (1) shall impose a penalty not lower than such minimum amount; and
          (2) may choose to impose, in addition to the penalty in Rule 11.5.5(1), any one or more of the sanctions as set out in Rule 11.5.4.

          Added on 16 May 2011 and amended on 3 June 2019.

        • 11.5.6

          A failure to comply with any sanction imposed by the Disciplinary Committee constitutes a breach of these Rules.

          Added on 3 June 2019.

      • 11.6 Disciplinary Committee Proceedings

        • 11.6.1 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.6.2 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.6.3 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.6.4 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.6.5 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.6.6 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.6.7 Decision of Disciplinary Committee

          The Disciplinary Committee shall provide written grounds of its decision, which shall include any sanctions imposed against the Clearing Member, within a reasonable period after the conclusion of the hearing..

          Amended on 3 June 2019.

        • 11.6.8 Notification of Decision

          (1) The Disciplinary Committee shall cause its written grounds of decision to be published, unless the sanction imposed involves the issuance of a private reprimand. Where a private reprimand is issued by the Disciplinary Committee, the Disciplinary Committee shall determine whether the written grounds of decision are to be published in part or in whole.
          (2) [deleted]
          (3) Each Clearing Member irrevocably consents to the publication of the Disciplinary Committee's written grounds of decision pursuant to Rule 11.6.8. The consent will remain valid and effective notwithstanding that the Clearing Member ceases to be a Clearing Member. A Clearing Member cannot initiate any action or proceeding against CDP or the Disciplinary Committee for such publication.

          Amended on 3 June 2019.

      • 11.7 Appeals Committee

        • 11.7.1

          The Appeals Committee shall comprise persons appointed by the SGX RegCo Board and approved by the Authority provided that:—

          (1) the Appeals Committee shall not have a member who is, or who within three years of the proposed appointment date was, a Director, Officer or employee of:
          (a) SGX; or
          (b) any of SGX's related corporations;
          (2) a majority of the Appeals Committee shall not be directors, officers or employees of any member of SGX or SGX's subsidiaries; and
          (3) a majority of the Appeals Committee shall not be substantial shareholders of SGX or directors, officers or employees of any substantial shareholder of SGX.

          Amended on 30 November 2005, 15 September 2017 and 3 June 2019.

        • 11.7.1A

          The SGX RegCo Board shall appoint the chairman and the deputy chairman of the Appeals Committee. In the absence of the chairman, the deputy chairman will have all the powers of the chairman.

          Added on 3 June 2019.

        • 11.7.2

          The powers of the Appeals Committee include:—

          (1) all the powers of the Disciplinary Committee;
          (2) varying the sanctions imposed by the Disciplinary Committee, and overturning, varying or upholding any decision or specific findings of the Disciplinary Committee;
          (3) hearing and deciding appeals in accordance with the Clearing Rules; and
          (4) dealing with such other matters as the SGX RegCo Board gives it (either generally or in a particular case).

          Amended on 15 September 2017 and 3 June 2019.

        • 11.7.2A

          A failure to comply with any sanction imposed by the Appeals Committee constitutes a breach of these Rules.

          Added on 3 June 2019.

        • 11.7.3 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.7.4 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.7.5 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.7.6 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.7.7 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.7.8

          Procedures may be issued in relation to Appeals Committee proceedings. The procedures are binding on all the parties to the proceedings and may be varied by the Appeals Committee as provided in the procedures or these Clearing Rules. Where any matter is not dealt with by the procedures or these Clearing Rules, the Appeals Committee may establish its own procedures.

          Refer to the [Disciplinary Committee and Appeals Committee Handbook].

          Amended on 3 June 2019.

      • 11.8 Appeals

        • 11.8.1

          CDP or the person charged may appeal against the decision of the Disciplinary Committee.

        • 11.8.2

          A decision of the Appeals Committee is final and binding.

          Amended on 12 October 2005.

      • 11.9 Appeals Proceedings

        • 11.9.1 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.9.2 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.9.3 Appeals by Rehearing

          The Appeals Committee shall determine the appeal by way of rehearing. It shall only rehear that part of the decision of the Disciplinary Committee appealed against.

          Amended on 3 June 2019.

        • 11.9.4 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.9.5 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.9.6 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.9.7 [Rule has been deleted.]

          Deleted on 3 June 2019.

        • 11.9.8 Decision of Appeals Committee

          (1) [deleted]
          (2) The Appeals Committee shall provide written grounds of its decision, which shall include any sanctions imposed against the Clearing Member, within a reasonable period after the conclusion of the hearing.
          (3) The Appeals Committee shall cause its written grounds of decision to be published, unless the sanction imposed involves the issuance of a private reprimand. Where a private reprimand is issued by the Appeals Committee, the Appeals Committee shall determine whether the written grounds of decision are to be published in part or in whole.
          (4) Each Clearing Member irrevocably consents to the publication of the Appeals Committee's written grounds of decision pursuant to Rule 11.9.8. The consent will remain valid and effective notwithstanding that the Clearing Member ceases to be a Clearing Member. A Clearing Member cannot initiate any action or proceeding against CDP or the Appeals Committee for such publication.

          Amended on 3 June 2019.

      • 11.10 Payment of Costs

        • 11.10.1

          The Disciplinary Committee or Appeals Committee may require the Clearing Member charged to pay all or part of the costs of the investigation, inspection or hearing.

        • 11.10.2

          The Committee may order the costs awarded to be paid within 14 days.

        • 11.10.3

          Where an order for costs of the proceedings has been imposed against a Clearing Member and the Clearing Member does not make payment within the specified period, the outstanding sum shall be a debt payable to CDP. CDP may commence legal action to recover that debt, subject to any subsequent payments made by the Clearing Member. CDP shall be entitled to claim reasonable interest, a month after the payment is due, based on the sum outstanding.

          Added on 3 June 2019.

      • 11.11A Limitation of Liability

        • 11.11A.1

          No liability (whether in contract, tort or otherwise) shall be incurred by the Disciplinary Committee, Appeals Committee, CDP, or a manager appointed under Rule 11.12.2(4) for anything done or omitted to be done with reasonable care and in good faith in the course of or in connection with:

          (1) the exercise or purported exercise of any power under the Rules;
          (2) the performance or purported performance of any function or duty under the Rules; or
          (3) the compliance or purported compliance with the Rules.

          Added on 3 June 2019.

      • 11.11 Fine

        • 11.11.1

          A fine shall be paid within 14 days from the date of notice, or such longer time as the Chairman of the Disciplinary Committee or the Appeals Committee (as applicable), or his nominee, permits.

        • 11.11.2

          If a fine remains unpaid 7 days after the deadline, the Clearing Member's clearing rights is suspended. The suspension ends upon full payment of the fine.

        • 11.11.3

          Where a fine has been imposed against a Clearing Member and the Clearing Member does not make payment within the specified period, the outstanding sum shall be a debt payable to CDP. CDP may commence legal action to recover that debt, subject to any subsequent payments made by the Clearing Member. CDP shall be entitled to claim reasonable interest, a month after the payment is due, based on the sum outstanding.

          Added on 3 June 2019.

      • 11.12 Interim Powers of CDP

        • 11.12.1

          Without prejudice to the rights and powers of CDP or any other body or person under the Clearing Rules,

          (1) CDP may suspend, or otherwise restrict the activities of a Clearing Member if it is charged with:—
          (a) an offence under the SFA, or
          (b) an offence involving fraud or dishonesty, whether in or out of Singapore, or
          (c) an offence relating to director's duties; or
          (d) an offence under any relevant law or regulation which governs the Clearing Member's other business activities.
          (2) The suspension or restriction ends if the Clearing Member is acquitted or the charge is not proceeded with.

          Amended on 3 June 2019.

        • 11.12.2

          If CDP is of the opinion that:—

          (1) a Clearing Member has, or may have, insufficient capital for the conduct of its business, or
          (2) a review should be carried out in respect of a Clearing Member's management policies or business conduct in the interests of the Clearing Member, CDP, other Clearing Members or the investing public,

          CDP may do any or all of the following:—

          (1) require the Clearing Member to operate its business or in the case of a Bank Clearing Member, its business governed by this Clearing Rules, subject to such restrictions or conditions as CDP decides.
          (2) suspend the Clearing Member for a period CDP decides. The suspension shall be announced to all Clearing Members. During the suspension, the Clearing Member:—
          (a) shall not clear new transactions without the approval of CDP.
          (b) remains liable to complete all contracts outstanding at the time of suspension. However, it shall not deliver any securities or settle any transaction without the approval of CDP.
          (3) require any director or in the case of a Bank Clearing Member, any director or person in a senior management position who is responsible for its business governed by this Clearing Rules, to step down from day-to-day conduct of the business affairs of the Clearing Member; and
          (4) appoint a Manager to manage the business of the Clearing Member or in the case of a Bank Clearing Member, its business governed by this Clearing Rules. CDP shall fix the remuneration of the Manager, which shall be paid by the Clearing Member. The Clearing Member is solely responsible for the Manager's acts and defaults. The Manager shall carry out directions given by CDP in relation to the business of the Clearing Member, including carrying on the business of the Clearing Member in accordance with instructions.

          Amended on 1 July 2008.

        • 11.12.3

          Subject to Rule 11.12.4, CDP shall notify the Clearing Member in writing before it exercises any of its powers under this Rule.

        • 11.12.4

          If, in CDP's opinion, it is necessary to protect the financial integrity, reputation or interests of CDP, other Clearing Members or the investing public, it may exercise its powers under this Rule without prior notice to the Clearing Member. CDP shall notify the Clearing Member in writing after it has exercised the powers.

        • 11.12.5

          CDP shall refer the matter (together with an account of its exercise of the interim powers) to the Disciplinary Committee for a decision within 14 days of CDP's notification of its actions under this Rule. The Disciplinary Committee proceedings in Rule 11.6 apply. The Disciplinary Committee may expedite the proceedings if it thinks fit. CDP's notification shall serve as the written notice under Rule 11.6.1.

    • Rule 12 — Foreign Market Links

      • 12.1 Application

        • 12.1.1

          In addition to and without prejudice to the generality of the other provisions of these Clearing Rules, Rule 12 shall apply to an Exchange Trade transacted on such Foreign Exchange with which CDP may have direct or indirect clearing arrangements from time to time, or in relation to which trade CDP has clearing arrangements in place (such Exchange Trade is hereinafter referred to as a "Foreign Market Links Exchange Trade").

      • 12.2 Definition

        • 12.2.1

          For the purposes of Rule 12, unless the context otherwise requires:—

          Term Meaning
          "Foreign Exchange" means an Exchange other than SGX-ST.
          "Foreign Market Links Exchange Trade" shall have the meaning as defined in Rule 12.1.1.
          "Foreign Market Links System" means the electronic order book facility system maintained by the SGX-ST for the automatic placing of orders and notification of Foreign Market Links Exchange Trade.

      • 12.3 Novation

        • 12.3.1

          A transaction of the Foreign Market Links Exchange Trade done through the Foreign Market Links System shall be novated to CDP only upon receipt by CDP of the confirmation by the Foreign Market Links System that the Foreign Market Links Exchange Trade has been done.

        • 12.3.2

          Upon such novation, the provisions of Rule 6 shall apply subject to:—

          (1) such modifications, amendments or variations as CDP may deem necessary in order to comply with the prevailing business rules/practices or clearing rules/practices applicable to such Foreign Market Links Exchange Trade at such relevant Foreign Exchange whenever possible and practicable; or
          (2) such other rules as may be determined by CDP from time to time.

        • 12.3.3

          The modifications, amendments or variations, or such other rules as referred to in Rule 12.3.2 shall be set out in the Clearing Directives from time to time. Such modifications, amendments or variations, or such other rules shall become effective on such date as may be specified in the written notice to be given to the Clearing Member. The Clearing Member shall be deemed, by continuing to enter into the Foreign Market Links Exchange Trade at the time the modifications, amendments or variations, or such other rules take effect, to consent to and agree to be bound by the same.

      • 12.4 Clearing with Other Foreign Exchanges

        • 12.4.1

          Notwithstanding Rule 12.3, CDP shall have the flexibility of facilitating and/or clearing transactions of the Foreign Market Links Exchange Trade not done through the Foreign Market Links System without the novation of such transactions. CDP has the right to set out the rules applicable to such Foreign Market Links Exchange Trade in the Clearing Directives, which may be amended from time to time.

    • Rule 13 — General

      • 13.1 Amendment of the Clearing Rules

        • 13.1.1

          CDP reserves the right in its absolute discretion to amend these Clearing Rules and the Clearing Directives at any time. Such amendment shall become effective on such date as may be specified in the written notice to be given to the Clearing Member. The Clearing Member shall be deemed, by continuing to enter into Exchange Trades at the time the amendment takes effect, to consent to and agree to be bound by the Clearing Rules as amended.

        • 13.1.2

          The Clearing Member will be bound by any amendment to these Clearing Rules with respect to any transaction occurring at or subsequent to the time such amendment takes effect as fully as though such amendment were now a part of these Clearing Rules.

      • 13.1A General Disclosure of Information by CDP

        • 13.1A.1

          CDP will take all reasonable measures to protect information provided to it by or on behalf of a Clearing Member or a Chief Executive Officer under these Clearing Rules from unauthorised use or disclosure.

          Added on 17 July 2019.

        • 13.1A.2

          Disclosure of information by CDP is authorised use or disclosure if it:

          (1) is approved by the Authority and is to any governmental agency or regulatory authority (in or out of Singapore) that requests that CDP provide the information for the proper exercise of powers relating to:
          (a) the governance of a Clearing Member or a Chief Executive Officer; or
          (b) the clearing or settlement of trades (in or out of Singapore);
          (2) is required under any law (in or out of Singapore) or any order of any court or regulatory authority (each in or out of Singapore);
          (3) is publicly available at the time of disclosure to or by CDP;
          (4) is in connection with the discharge of its regulatory obligations under the Securities and Futures Act or when compelled under applicable laws to do so or pursuant to any cross-border regulatory sharing arrangement subject to its obligation to maintain confidentiality under the Securities and Futures Act;
          (5) is in relation to the enforcement of these Clearing Rules or adjudication of a matter;
          (6) is to any of CDP's related corporations;
          (7) is authorised by the Authority to be disclosed or furnished under the Securities and Futures Act;
          (8) is specifically authorised under these Clearing Rules; or
          (9) constitutes authorised use or disclosure of information at common law.

          Added on 17 July 2019.

      • 13.2 Fees Payable

        • 13.2.1

          The Clearing Member will pay to CDP such fees and charges for the clearing and settlement of Exchange Trades based on CDP's fee schedules from time to time, and such fines and default interest as may be imposed by CDP from time to time.

        • 13.2.2

          The Clearing Member will pay to CDP such out-of-pocket expenses incurred by CDP caused directly or indirectly by such Clearing Member's actions or omissions including without limitation the cost of producing records pursuant to a court order or other legal process in any litigation or other legal proceeding to which such Clearing Member or its customer is a party or in which such records relating to the Clearing Member or its customer are so required to be produced; whether such production is required at the instance of the Clearing Member or its customer or at the instance of any other party.

      • 13.3 Conclusive Evidence

        • 13.3.1

          Any certification, advice, statement or report provided by CDP shall, in the absence of manifest error, be final and conclusive. Except as otherwise agreed by CDP, the failure of any Clearing Member to inform CDP of any error or omission in any certification, advice, statement or report promptly (in any event within the next Settlement Day) shall constitute a waiver in favour of CDP by such Clearing Member of any right to require rectification.

      • 13.4 Miscellaneous

        • 13.4.1

          The Clearing Rules may from time to time be altered or supplemented or repealed for the administration of CDP, for the admission and regulation of Clearing Members, for the creation and regulation of any class of membership and the rights and obligations attaching thereto, for the access to and regulation of business in CDP, for the resolution of disputes and for such other purpose as may be thought fit by CDP.

        • 13.4.2

          Failure or delay by CDP to enforce any of these Clearing Rules or the Clearing Directives will not be construed as a waiver of its rights.

        • 13.4.3

          CDP has the right at its absolute discretion to waive compliance with any provision of these Clearing Rules or the Clearing Directives.

        • 13.4.4

          The invalidity, illegality or unenforceability in whole or in part of any of the provisions of these Clearing Rules or the Clearing Directives shall not affect the validity, legality and enforceability of the remaining part or provisions of the rest of these Clearing Rules and the Clearing Directives.

        • 13.4.5

          These Clearing Rules and the Clearing Directives shall be governed by and construed in accordance with the laws of Singapore. Each of the Clearing Member and its Chief Executive Officer irrevocably submit to the exclusive jurisdiction of the Singapore courts.

          Amended on 3 June 2019.

    • Rule 14 — Transitional Provisions

      • 14.1 Transitional Provisions Regarding Capital/Financial Requirements

        • 14.1.1 Applicability

          This Rule establishes the transitional provisions relating to Rules 1.2, 5.1C.1, 5.1G.1, 5.1I, 5.11.1, 5.11.2, 5.11.3, 5.11.4 of the CDP Clearing Rules that was amended on and in force from 29 December 2014.

          Added on 29 December 2014.

        • 14.1.2 Transitional Arrangements

          Rules 1.2, 5.1C.1, 5.1G.1, 5.1I, 5.11.1, 5.11.2, 5.11.3, 5.11.4 (as amended on and in force from 29 December 2014), except for the definition of Base Capital, shall not apply to a Transitional Clearing Member during the Transitional Period, and the aforesaid Rules as in force immediately before 29 December 2014 shall continue to apply to a Transitional Clearing Member during the Transitional Period. A reference to any provision of the SFR (Financial and Margin Requirements) in the aforesaid Rules as in force immediately before 29 December 2014 is to that provision in the SFR (Financial and Margin Requirements) as in force immediately before 3 April 2013. For avoidance of doubt, the definition of Base Capital applicable to a Transitional Clearing Member has the same meaning ascribed in the SFR(Financial and Margin Requirements) as in force on 3 April 2013.

          Added on 29 December 2014.

        • 14.1.3 Transitional Period

          For the purposes of Rule 14.1.2, "Transitional Period" means the period commencing on 3 April 2013 and:—

          (1) in relation to all rule amendments except the definition of Base Capital, till 2 April 2015; or
          (2) ending on such date, before the expiry date stated in Rule 14.1.3(1), specified in a written notice to CDP informing CDP of the Transitional Clearing Member's intention to adopt the requirements pursuant to Rule 14.1.4,

          whichever is the earlier.

          Added on 29 December 2014.

        • 14.1.4 Notification by Writing

          For the purpose of Rule 14.1.3(2), the Transitional Clearing Member shall notify CDP in writing at least 14 days before the intended date to adopt the requirements.

          Added on 29 December 2014.

        • 14.1.5 Transitional Clearing Member

          "Transitional Clearing Member" means

          (1) in the case of a Clearing Member who is a holder of the Capital Markets Services License, is a “specified holder” as defined under Regulation 25 of the Securities and Futures (Financial and Margin Requirements for Holders of Capital Markets Services Licences) (Amendment) Regulations 2013 or a “new holder” as defined under Regulation 26 of the Securities and Futures (Financial and Margin Requirements for Holders of Capital Markets Services Licences) (Amendment) Regulations 2013
          (2) in the case of a Clearing Member who is not a holder of the Capital Markets Services Licence, is an existing Clearing Member prior to 3 April 2013 or one who applied to be a Clearing Member prior to 3 April 2013.

          Added on 29 December 2014.

    • Appendices

    • Regulatory Notices to CDP Clearing Rules

      • Regulatory Notice 6.5—Compensation for corporate action entitlements

        1. Rule 6.5.4 provides that, subject to Rule 6.5.5,
        (a) a Clearing Member that is due to, but does not, deliver securities in respect of Novated Contracts is liable to compensate CDP for corporate action entitlements that accrue on those securities and that a recipient of those securities would have been entitled to receive but for the delivery failure; and
        (b) a Clearing Member that is due to, but does not receive securities in respect of Novated Contracts is entitled to be compensated by CDP for corporate action entitlements that accrue on those securities and that a recipient of those securities would have been entitled to receive but for the delivery failure.
        2. Rule 6.5.5 states that Rule 6.5.4 applies only to such types of corporate action entitlements that CDP shall from time to time notify.
        3. Rule 6.5.6 states that any compensation under Rule 6.5.4 shall be made in such form and value, and be due by such time, as CDP shall specify. Where CDP requires any action by a Clearing Member to effect such compensation, the Clearing Member shall do so, and shall obtain all necessary authorisation from its Customer to enable it to do so, by such time as CDP shall specify.
        4. Appendix A to this Regulatory Notice sets out:
        (a) the types of corporate action entitlements to which Rule 6.5.4 applies. CDP may additionally prescribe, as it shall from time to time notify, further types of corporate action entitlements to which Rule 6.5.4 applies; and
        (b) the form and value of the compensation to be made, the date on which such compensation is due to be made between the Clearing Member and CDP, and the action required by a Clearing Member to effect such compensation. CDP may replace, vary, supplement or additionally specify, as it shall from time to time notify, the form or value of any compensation to be made under Rule 6.5.4, the due date of such compensation, and the action required by Clearing Member to effect such compensation.

        Added on 10 December 2018.

        • Appendix A to Regulatory Notice 6.5

          No. Corporate Action Action required of
          Clearing Member to
          effect compensation
          Form and value of
          compensation
          Due date of
          compensation
          1. Cash dividend None Cash in the currency and
          amount that the buying
          Customer would have received
          but for the failed delivery
          Dividend
          payment date
          2. Renounceable
          entitlement (e.g.,
          bonus issue /
          renounceable rights
          issue/ dividend in
          specie) in security
          that is custodised
          with CDP
          None The security in the quantity
          that the buying Customer
          would have received but for
          the failed delivery
          Credit date of the
          entitlement
          3. (a) Non-
          renounceable
          entitlement (e.g.,
          non-renounceable
          rights issue) in
          security that is
          custodised with CDP

          (b) Renounceable or
          non-renounceable
          entitlement in
          security that is not
          custodised with CDP
          None Cash in a currency and in such
          amount as determined by CDP
          based on the closing price of
          the underlying security as of
          the closing day of the
          entitlement exercise period
          minus the subscription price of
          the entitlement
          One Market Day
          after CDP
          determines the
          compensation
          amount.
          4. Conversion None The security into which the
          conversion has been made and
          in the quantity that the buying
          Customer would have received
          but for the failed delivery
          Effective date of
          conversion, i.e.
          one Market Day
          after book
          closure date
          (BCD+1)
          5. Bond redemption Clearing Members to
          submit settlement
          instructions for the
          offsetting trades for
          settlement with their
          Customers one Market
          Day after bond maturity
          Cash in a currency and in such
          amount as determined by CDP
          based on the cash-settlement
          methodology described in
          paragraph 4 of Appendix 2—
          Determination of Cash
          Settlement Amount.
          Two Market Days
          after bond
          maturity date
          6. Scrip / cash election
          dividend
          Buying Clearing
          Member shall obtain its
          Customer's election
          instruction and submit
          the same to CDP one
          Market Day before
          election closure date
          (ECD-1).

          Selling Clearing
          Member shall inform its
          Customer of the
          elected form of
          compensation upon
          being notified by CDP
          of the assignment of
          elections.
          (a) Scrip dividend elected: The
          security, in the quantity that
          the buying Customer would
          have received but for the failed
          delivery.

          (b) Cash dividend elected: Cash
          in the currency and amount
          that the buying Customer
          would have received but for
          the failed delivery.
          Dividend
          payment date
          7. Currency election
          dividend
          Buying Clearing
          Member shall obtain its
          Customer's election
          instruction and submit
          the same to CDP one
          Market Day before
          election closure date
          (ECD-1).

          Selling Clearing
          Member shall inform its
          Customer of the
          elected form of
          compensation upon
          being notified by CDP
          of the assignment of
          elections.
          Cash in the currency elected
          and in the amount that the
          buying Customer would have
          received but for the failed
          delivery
          Dividend
          payment date
          8. Partial Offer Buying Clearing
          Member shall obtain its
          Customer's election
          instruction (as to
          whether to accept the
          offer) and submit the
          same to CDP one
          Market Day before
          election closure date
          (ECD-1).
          (a) If the offer consideration is
          in the form of cash: Cash in the
          currency and in the amount
          that the buying Customer
          would have received but for
          the failed delivery

          (b) If the offer consideration is
          in the form of a securities
          listed on SGX-ST: The security
          in the quantity that the buying
          Customer would have received
          but for the failed delivery.

          (c) If the offer consideration is
          in the form of a security that is
          non-transferable or not listed
          on SGX-ST: Cash in a currency
          as determined by CDP and in
          the amount that CDP
          determines is a fair
          representation of the market
          value of the security that the
          buying Customer would have
          received but for the failed
          delivery.
          Payment date of
          the partial offer
          9. Takeover Offer Buying Clearing
          Member shall obtain its
          Customer's instruction
          (as to whether to
          accept the offer) and
          submit the same to CDP
          within 3 Market Days
          from election closure
          date (by ECD+3).
          (a) If the offer consideration is
          in the form of cash: Cash in the
          currency and in the amount
          that the buying Customer
          would have received but for
          the failed delivery.

          (b) If the offer consideration is
          in the form of a security listed
          on SGX-ST: The security in the
          quantity that the buying
          Customer would have received
          but for the failed delivery.

          (c) If the offer consideration is
          in the form of a security that is
          non-transferable or not listed
          on SGX-ST: Cash in a currency
          as determined by CDP and in
          the amount that CDP
          determines is a fair
          representation of the market
          value of the security that the
          buying Customer would have
          received but for the failed
          delivery.
          6 Market Days
          from election
          closure date
          (ECD+6)

          Added on 10 December 2018.

    • Practice Notes

      • Practice Note 1.2 Marginable Futures Contracts

        Issue Date Cross Reference Enquiries
        Added on 21 January 2013. Rule 1.2 — Definition of Marginable Futures Contract Please contact Clearing Risk:

        Facsimile No : 6532 0297

        1 Introduction

        1.1. This Practice Note sets out the Futures Contracts approved for listing on SGX-ST designated as Marginable Futures Contracts by CDP.

        2 Marginable Futures Contracts

        2.1. Marginable Futures Contracts refers to Extended Settlement Contracts.

      • Practice Note 3.5.4 — Business Continuity Requirements

        Issue Date Cross Reference Enquiries
        Added on 22 January 2009. Rule 3.5.4 Please contact Member Supervision:

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

        1. Introduction

        1.1 Rule 3.5.4 requires Clearing Members to:
        (i) maintain adequate business continuity arrangements;
        (ii) document business continuity arrangements in a business continuity plan;
        (iii) test and review business continuity plans regularly; and
        (iv) appoint emergency contact persons.
        1.2 The objective is to ensure that Clearing Members have the ability to:
        (i) React swiftly to emergency situations; and
        (ii) Maintain critical functions and fulfill obligations to customers and counterparties in the event of major operational disruptions.

        2. Business Continuity Plan

        2.1 Critical Elements of a Business Continuity Plan
        2.1.1 Rule 3.5.4(1) requires Clearing Members to maintain adequate business continuity arrangements, and document such arrangements in a business continuity plan. As a guide, a Clearing Member's business continuity plan should document the following elements:
        (i) Risk assessment: This includes a comprehensive assessment of business continuity risks (including financial and operational risks) and threat scenarios which may severely disrupt a Clearing Member's operations. Such scenarios may include prolonged power outages, IT system software or hardware failures, loss of voice or data communication links, acts of terrorism, and outbreak of infectious diseases;
        (ii) Business impact analysis: This is an evaluation of the impact of the risks and threat scenarios identified in (i) above. The business impact analysis should identify critical business functions (including support operations and related information technology systems) and potential losses (monetary and non-monetary) to enable the Clearing Member to determine recovery strategies/priorities and recovery time objectives;
        (iii) Work area recovery: This refers to continuity arrangements for a Clearing Member's critical functional capabilities in the event that the Clearing Member's primary office becomes inaccessible, for example, availability of a disaster recovery site ready for activation within a reasonable period of time;
        (iv) Crisis communications: This refers to a communications plan for the Clearing Member to liaise with its internal and external stakeholders such as employees, customers and regulatory authorities during a crisis;
        (v) Roles and responsibilities: This refers to the identification of a Clearing Member's key personnel and management staff, their roles and responsibilities, and reporting lines. Alternates should be identified to cover the responsibilities of absent key personnel.
        (vi) Backup for critical functions*, information technology systems and data;

        * Critical functions refer to business functions whose failure or disruption may incapacitate the firm.
        (vii) Key service providers^: This refers to assessing a Clearing Member's dependencies on key service providers in recovery strategies and recovery time objectives, and taking steps to ensure that key service providers are capable of supporting the Clearing Member's business, even in disruptions;

        ^ Key service providers refer to third-parties who are performing functions that are not normally carried out by Clearing Members internally, but are critical to the Clearing Member's ability to carry on business operations. For example, IT system hardware/software vendors.
        (viii) Outsourcing service providers#: This refers to assessing whether the service provider has established satisfactory Business Continuity Plans commensurate with the nature, scope and complexity of the outsourced services; and

        # Outsourcing service providers refer to third parties who are performing functions that would normally be performed by Clearing Members internally. For example, Operations and Technology.
        (ix) Any other elements that the Clearing Member deems necessary to be included in its business continuity plan or which CDP may prescribe from time to time.
        2.2 Emergency Response During Crisis
        2.2.1 A Clearing Member should establish and maintain a crisis management plan as part of its business continuity plan. The crisis management plan should include (but not be limited to):
        (i) Emergency response procedures;
        (ii) Roles and responsibilities of the crisis management team;
        (iii) Command and control structures; and
        (iv) Salvage and restoration procedures.
        2.2.2 CDP may declare a wide-area crisis in the event of a major and widespread incident. When such declaration is made, CDP may require a Clearing Member to submit status reports to CDP. A wide-area crisis may include any incident where the operations of a large number of market participants are disrupted simultaneously.
        2.3 Regular Review, Testing and Training
        2.3.1 Rule 3.5.4(4) requires a Clearing Member to review and test its business continuity plan regularly. Clearing Members should do so at least once a year to ensure that their business continuity plans remain relevant.
        2.3.2 Where there are material changes to a Clearing Member's business activities and operations, the Clearing Member should update its business continuity plan accordingly. Regular training should be conducted for staff to be updated and aware of any relevant changes to the Clearing Member's business continuity arrangements. As a principle, training should be conducted when:
        (i) changes have been made to the Clearing Member's BCP; and
        (ii) new staff are recruited.
        Clearing Members should also conduct refresher courses for existing staff where appropriate.

        3. Emergency Contact Persons

        3.1 Rule 3.5.4(5) requires a Clearing Member to appoint emergency contact persons and furnish the contact information of such persons to CDP. Clearing Members may appoint an emergency contact person and up to two (2) alternates. A template is attached as Appendix A to this Practice Note for the notification of contact information (postal address, email, telephone, mobile telephone and facsimile numbers) to CDP.

        Refer to Appendix A of Practice Note 3.5.4.
        3.2 Clearing Members are to ensure that the contact information provided to CDP is updated on a semi-annual basis. Nonetheless, where there are changes to a Clearing Member's emergency contact persons and contact information, the Clearing Member should notify CDP immediately in writing.
        3.3 A Clearing Member's authorized emergency contact person should immediately notify CDP in the event where:
        (i) A Clearing Member's business operations are or will be significantly disrupted; and/or
        (ii) A Clearing Member's business continuity plan is activated.

        • Appendix A to Practice Note 3.5.4 Business Continuity Management Emergency Contact Person(s)

          Please click here to view Appendix A to Practice Note 3.5.4 Business Continuity Management Emergency Contact Person(s).

      • Practice Note 3.9.1(3) — Pre-Execution Checks

        Issue Date Cross Reference Enquiries
        Added on 18 September 2012 and amended on 15 March 2013. Rule 3.9.1(3) Please contact Member Supervision:

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

        1. Introduction

        1.1 This Practice Note explains the parameters and functions which pre-execution checks may contain as contemplated in Rule 3.9.1(3).

        2. Pre-Execution Checks

        2.1 Rule 3.9.1(3) requires a Clearing Member, in order to clear the trades of a Trading Member, to satisfy CDP that it has in place automated pre-execution risk management control checks to monitor the Trading Member's Exchange Trades and manage its risk exposure to such Exchange Trades. The purpose of this is to prevent overtrading and for credit risk management purposes. The parameters of such pre-execution checks and filters may include but are not limited to:—
        (a) dollar limit to control the gross buy and sell value and/or net buy/sell value;
        (b) security limit to control the dollar/quantity exposure to each security;
        (c) dollar/quantity limit and price limit for each order. This allows for the detection of errors in inputting orders; and
        (d) controls to restrict Trading Members to selected markets, order types and securities.
        2.2 By way of illustration, pre-execution risk management control functions may include the following:—
        (a) the ability to adjust credit or quantity limits in real time during a trading session;
        (b) the ability to set permission levels (e.g. access to selected products/ instruments) and suspend the Trading Member during the trading session on a real time basis; and
        (c) the ability to intercept orders that exceed credit limits and trigger error-prevention alerts on a real time basis.
        2.3 Clearing Members will be able to meet the requirement in Rule 3.9.1(3) by being able to directly set and control pre-determined automated limits in the Trading Member's system, having automated alerts whenever such limits are altered, and by conducting regular post-execution reviews of trades. Clearing Members should assess and continue to ensure that the pre-execution risk management control checks are robust on an ongoing basis.

        Added on 18 September 2012 and amended on 15 March 2013.

      • Practice Note 3.9.1(6) — Conflicts of Interest

        Issue Date Cross Reference Enquiries
        Added on 18 September 2012. Rule 3.9.1(6) Please contact Member Supervision:

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

        1. Introduction

        1.1 This Practice Note provides guidance on how front office and back office functions of Clearing Members should be separated, in accordance with Rule 3.9.1(6).

        2. Separation of Key Functions

        2.1 The purpose of separating a Clearing Member's various key functions is to minimise and manage conflicts of interests among these functions.
        2.2 Examples of proper separation include:—
        (a) the setting and authorising credit limits on customers by senior management staff who are independent of sales and marketing functions, and are not related to the customer in question; and
        (b) having adequate separation of management responsibilities e.g the heads of sales, dealing or marketing functions should not have responsibilities over the middle and back office functions of Clearing Members.
        2.3 The basis for determining and amending credit limits should be properly documented. Adequate audit trail reports should be maintained to show all changes to credit limits, the date and time of the modifications and the authorised person who approved the changes. In addition, sufficient checks and procedures should be in place to ensure that all limits and parameters set and modified by the credit control administrator are accurate and have been approved.

        Added on 18 September 2012.

      • Practice Note 3.9.2A, 3.9.3 Procedures to Suspend Qualification of a Trading Member

        Issue Date Cross Reference Enquiries
        Added on 11 January 2011. Rule 3.9.2A
        Rule 3.9.3
        Please contact: Member Supervision
        Facsimile No : 6538 8273
        E-Mail Address: membersup@sgx.com

        Market Control
        Hotline : 6236 8820

        1 Introduction

        1.1 Rule 3.9.2A states that a Clearing Member who wishes to suspend its qualification of a Trading Member, shall notify CDP of its decision to suspend its qualification of that Trading Member, and comply with any reasonable direction of CDP in relation to the suspension of the qualification of the Trading Member's Exchange Trades.
        1.2 Rule 3.9.3 states that the Clearing Member shall clear and settle all the Exchange Trades of the Trading Member which are done right up to the point when the Trading Member has been disabled from entering Exchange Trades to be qualified by the Clearing Member.
        1.3 This Practice Note sets out the operational procedures that a Clearing Member should follow to notify CDP of its decision to suspend its qualification of a Trading Member.

        2 Procedures for Suspending A Trading Member

        Designated Officers

        2.1 Clearing Members shall at all times have at least two Designated Officers whose role is to notify CDP of the Clearing Member's decision to suspend a Trading Member.
        2.2 For each Designated Officer, the Clearing Member shall submit to Market Control the Designated Officer's name, identification number, contact details, and a sealed envelop containing authentication information stipulated by Market Control. (For security reasons, the required authentication information will not be published in this Practice Note. Clearing Members are to contact Market Control regarding the required information.)
        2.3 Clearing Members must promptly update Market Control of changes in Designated Officers, and any changes to a Designated Officer's information.

        Notification of Suspension of Trading Member

        2.4 Once a Clearing Member has decided to suspend a Trading Member, the Clearing Member's Designated Officer shall contact Market Control by telephone during trading hours at the Market Control Hotline, 6236 8820, and notify Market Control of the suspension.
        2.5 Market Control will verify the identity of the caller by requiring the caller to respond correctly to two authentication questions.
        2.6 If the caller is authenticated as the Clearing Member's Designated Officer, Market Control will effect the suspension of the Trading Member. The suspension will be effected within one hour of the authentication of the Designated Officer.
        2.7 SGX will suspend the Trading Member's trading access and cancel all open orders for the suspended Trading Member. Market Control will notify the Designated Officer when this is done.

        Final Traded Position

        2.8 For the purposes of Rule 3.9.3, the Clearing Member shall accept the Trading Member's final traded position as stated in the trade report produced by SGX.
        2.9 For clarifications, the Clearing Member may contact CDP Client Services at 6236 8250.

        Added on 11 January 2011 and amended on 15 September 2017 and 3 June 2019.

      • Practice Note 5A.2.1, 5A.2.2 — Position Account Reporting

        Issue Date Cross Reference Enquiries
        Added on 1 July 2016 and amended on 3 June 2019. Rules 5A.2.1, 5A.2.2. Please contact Member Supervision:

        Facsimile No : 6538 8273


        Please contact Risk Management:

        Facsimile No : 6532 0297
        E-Mail Address: rm-securities@sgx.com

        1. Introduction

        1.1. Rule 5A.2.1 requires each Clearing Member to report to CDP such information as CDP may require for each Position Account opened with CDP as soon as practicable, and in any event, no later than such time as may be required for timely and orderly settlement of the first trade cleared by the Clearing Member for the Customer into the intended Securities Account. In addition, Rule 5A.2.2 requires each Clearing Member to report to CDP any change in information previously reported to CDP for any Position Account as soon as practicable.
        1.2. This Practice Note provides guidance on some of the types of information in relation to Position Accounts that are to be reported to CDP under Rule 5A.2.1.
        1.3. This Practice Note also provides guidance on the timelines within which reporting of Position Account information and reporting of changes in Position Account information are to be completed by.
        1.4 The terms "Trading Representative" and "Remisier" as used in this Practice Note shall have the meanings as ascribed to them in the SGX-ST Rules.

        2. Type of Information

        2.1. Each Clearing Member shall report to CDP such information as CDP may require in relation to Position Accounts. The information required may be communicated by CDP to Clearing Members through technical specifications or other mediums as CDP may determine.
        2.2 For the following types of information, each Clearing Member shall report in accordance with the criteria set out in the tables below:

        (a) Origin

        Description of origin Criteria
        Customer The origin of a Position Account shall be reported as "Customer" if the Position Account holder is a customer, as defined in Part III of the Securities and Futures (Licensing and Conduct of Business) Regulations.
        House The origin of a Position Account shall be reported as "House" if the Position Account holder is neither a customer, as defined in Part III of the Securities and Futures (Licensing and Conduct of Business) Regulations, nor a Remisier, as defined in the SGX-ST Rules.
        Remisier of the Member The origin of a Position Account shall be reported as "Remisier" if the Position Account holder is a Remisier of the member, as defined in SGX-ST Rules.

        (b) Ownership Type

        Description of origin Criteria
        SGX Member The ownership type of the account shall be reported as "SGX Member" if the account holder is the Clearing Member itself.
        Individual Person The ownership type of the account shall be reported as "Individual Person" if the account holder is an individual, except where such individual is an officer, employee, non-executive director or Trading Representative of the Clearing Member.

        This value shall be used for joint accounts of two or more individuals, except where any party to the account is an officer, employee, non-executive director or Trading Representative of the Clearing Member.
        Officers and employees of the Member
        (excluding Trading Representatives)
        The ownership type of the account shall be reported as "Officers and employees of Member (excluding Trading Representatives)" if the account holder is
        (a) a Chief Executive Officer of the Clearing Member (regardless of whether such approved executive director is a Trading Representative); or
        (b) an officer or employee of the Clearing Member, but not a Trading Representative of the Clearing Member.
        Non-executive Director of Member The ownership type of the account shall be reported as “Non-executive Director of Member” if the account holder is a non-executive director of the Clearing Member.
        Trading Representative of Member – Remisier The ownership type of the account shall be reported as "Trading Representative of Member – Remisier" if the account holder is a Remisier of the Clearing Member.
        Trading Representative of Member – non-Remisier The ownership type of the account shall be reported as "Trading Representative of Member – non-Remisier" if the account holder is a Trading Representative of the Clearing Member and not a Remisier of the Clearing Member.
        Related Entity The ownership type of the account shall be reported as "Related Entity" if the account holder is a related entity of the Clearing Member.

        "Entity" here includes corporates, unincorporated societies/associations, trusts, partnerships and limited liability partnerships, but excludes statutory boards and government bodies.
        Non-Related Entity The ownership type of the account shall be reported as "Non-Related Entity" if the account holder is an entity that is not a Related Entity.

        "Entity" here includes corporates, unincorporated societies/associations, trusts, partnerships and limited liability partnerships, but excludes statutory boards and government bodies.
        Statutory Board/ Government Body The ownership type of the account shall be reported as "Statutory Board/Government Body" if the account holder is a statutory board or government body, including those of a foreign jurisdiction.


        3. Manner of reporting to CDP

        3.1. Each Clearing Member shall report to CDP such information as CDP may require in relation to Position Accounts in such manner as may be determined by CDP.

        4. Timelines for Position Account reporting

        4.1. Each Clearing Member is required to perform the obligations required under Rule 5A.2.1 as soon as practicable, and in any event, no later than such time as may be required for timely and orderly settlement of the first trade cleared by the Clearing Member for the Customer into the intended Securities Account. Each Clearing Member is also required to perform the obligations required under Rule 5A.2.2 as soon as practicable.
        4.2. For Rule 5A.2.1, each Clearing Member shall report to CDP such information as CDP may require for a Position Account opened with CDP before the Clearing Member first clears a trade for the relevant Position Account holder.
        4.3. For Rule 5A.2.2, each Clearing Member shall report to CDP any change in information previously reported to CDP for any Position Account by the end of the next Market Day from the time when the Clearing Member receives notice of the change. If there is a delay, the Clearing Member shall ensure that there are valid reasons to explain the delay. An example of a valid reason for delay includes when the customer has first notified the Clearing Member of a change in information, but fails to provide sufficient or complete information in time for the Clearing Member to update the change in information by the required time, and such delay is not due to the Clearing Member's negligence and/or other internal control weaknesses.

      • Practice Note 5A.3.1, 5A.3.4 — Position Account Allocation

        Issue Date Cross Reference Enquiries
        Added on 1 July 2016 and amended on 10 December 2018. Rules 5A.3.1, 5A.3.4. Please contact Member Supervision:

        Facsimile No: 6538 8273

        1. Rule 5A.3.1 requires each Clearing Member to allocate the position of each trade cleared by the Clearing Member for a Customer to that Customer's Position Account or in accordance with that Customer's instructions, as soon as practicable, and in any event no later than such time as may be required for timely and orderly settlement of the relevant trade into the intended Securities Account. This Practice Note provides guidance on the timelines within which such allocation is to be completed by in various circumstances.

        2. With the exception of warehoused trades, each Clearing Member shall allocate the position of each trade cleared by the Clearing Member for a Customer to that Customer's Position Account or in accordance with that Customer's instructions immediately upon the trade being cleared, or at the latest by the end of the next Market Day immediately following the trade date.

        3. For warehoused trades under Rule 5A.3.4, each Clearing Member shall ensure that no trades are warehoused for more than one Market Day, unless under exceptional circumstances. Each Clearing Member shall allocate the position of each trade to the relevant Customer's Position Account or in accordance with that Customer's instructions, immediately after the order is completed, or at the latest by the end of the Market Day on which the order is completed.

      • Practice Note 5A.4.2, 5A.4.3 — Requirement for Clearing Member to Ensure Compliance of Position Account Rules by Authorized Trading Member

        Issue Date Cross Reference Enquiries
        Added on 1 July 2016. Rules 5A.4.2., 5A.4.3. Please contact Member Supervision:

        Facsimile No: 6538 8273

        1. Rules 5A.4.2 and 5A.4.3 requires a Clearing Member who authorizes an Authorized Trading Member to open and maintain Authorized Accounts, or to open, maintain and allocate positions to Authorized Accounts, to ensure that the Authorized Trading Member performs the relevant obligations in relation to the Authorized Accounts.

        2. There may be circumstances where a Clearing Member is unable to directly ensure that its Authorized Trading Member performs the relevant obligations in relation to the Authorized Accounts in compliance with Rules 5A.1 and 5A.2 or with Rules 5A.1, 5A.2, 5A.3 and 5A.6 (as may be applicable). This Practice Note clarifies the expectations on the Clearing Member in such circumstances.

        3. Where a Clearing Member is unable to directly ensure that its Authorized Trading Member complies with the above-mentioned rules, the Clearing Member is to implement reasonable measures to ensure that the Authorized Trading Member complies with the relevant rules. The following are non-exhaustive examples of the steps which the Clearing Member should take:

        a. The Clearing Member should ensure that the Authorized Trading Member is aware of its obligations relating to Authorized Accounts under the Rules and under the SGX-ST Rules.
        b. The Clearing Member should obtain an undertaking from the Authorized Trading Member stating that the Authorized Trading Member will put in place adequate internal controls and processes to comply with all rules relating to Authorized Accounts.

      • Practice Note 6.5.1B(2), 6.6.2, 6.7.11, 8.4.1A, 8.5.2A and 8.6F.2 — Determination of Cash Settlement Amount

        Issue Date Cross Reference Enquiries
        Added on 10 December 2018. Rules Rule 6.5.1B(2), 6.6.2, 6.7.11, 8.4.1A, 8.5.2A, 8.6F.2. Please contact Clearing Ops:

        E-Mail Address: securitiesclearing@sgx.com

        Cash settlement under Rules 6.5.1B(2), 6.7.11, 8.4.1A and 8.5.2A

        1. Under Rules 6.5.1B(2), 6.7.11, 8.4.1A and 8.5.2A, CDP has the power to cash settle an obligation to deliver or a right to receive securities in respect of a Novated Contract, New Purchase Contract or New Sale Contract, in whole or in part.
        2. The monetary sum to be paid or received pursuant to such cash settlement shall be as set out in this Practice Note.
        3. When a Novated Contract for the sale of securities or a New Sale Contract (each a "Sell Contract"), or any part of it, is cash settled, a Novated Contract for the purchase of securities or a New Purchase Contract (each a "Buy Contract"), or such part of it, comprising the same number of securities, will be correspondingly cash settled.
        4. Unless otherwise specified by CDP, the Cash Settlement Amount for both the Sell Contract and the Buy Contract will be the number of securities to be cash settled multiplied by:
        (a) the highest of:
        (i) the selling price of the trade that gave rise to the Sell Contract;
        (ii) the purchase price of the trade that gave rise to the Buy Contract;
        (iii) the following as may be applicable:
        (I) for shares: 120% of the latest closing price;
        (II) for rights and company warrants: 120% of the latest closing price of the underlying security, less the exercise price, taking into account the conversion ratio;
        (III) for structured warrants: 120% of the final settlement value; or
        (b) such other price, based on such methodology, as CDP shall in its discretion determine.

        Cash settlement under Rules 6.6.2 and 8.6F.2

        5. Under Rules 6.6.2 and 8.6F.2, CDP has the power to cash settle an obligation to deliver securities in respect of a Novated Contract or New Purchase Contract, in whole or in part.
        6. The monetary sum to be paid pursuant to such cash settlement shall be a fair and appropriate sum as determined by CDP.

      • Practice Note 6.5.1B(2) — Priority Considerations when Selecting Buy Trades to Cash Settle

        Issue Date Cross Reference Enquiries
        Added on 10 December 2018. Rule 6.5.1B(2). Please contact Clearing Ops:

        E-Mail Address: securitiesclearing@sgx.com
        1. Rule 6.5.1B(2) states that on any Settlement Day, if and to the extent that the securities available to CDP are insufficient for CDP to settle its delivery obligations in respect of Novated Contracts that are due for settlement on that Settlement Day, CDP may cash settle any of those delivery obligations in whole or in part.
        2. This Practice Note sets out the general principles CDP may consider when deciding which buy trade(s) to cash settle when there are insufficient securities available to CDP to settle its delivery obligations.
        3. The general principle that CDP considers in selecting which buy trade(s) to cash settle is to minimise knock-on impact and reduce risk to CDP's clearing facility. In particular, the factors that CDP considers, in decreasing order of priority, include the following:
        (a) Whether CDP has been informed of any onward sell trade in respect of the buy trade, in which case that buy trade will not be selected for cash settlement.
        (b) Age of the buy trade, generally giving priority to the oldest buy trade.
        (c) Quantity of securities in the buy trade, generally giving priority to the buy trade with the largest quantity of securities.
        4. With respect to paragraph 3(a) above, Clearing Members should immediately inform CDP of any onward sell trade when so informed by a Customer.

      • Practice Note 6.6A.1 [Rule has been deleted.]

        Deleted on 21 January 2013.

        • Appendix A to Practice Note 6.6A.1 [Rule has been deleted.]

          Deleted on 21 January 2013.

      • Practice Note 6.7.2(1A), 6.7.4(8), 6.7.7A and 6.7.11 — Buying-in, Procurement and Cash Settlement if Intended Settlement Day is Day with Half Day Trading

        Issue Date Cross Reference Enquiries
        Added on 10 December 2018. Rule 6.7.2(1A), Rule 6.7.4(8), Rule 6.7.7A and Rule 6.7.11. Please contact Clearing Ops:

        E-Mail Address: securitiesclearing@sgx.com
        1. Rule 6.7.2(1A) states that subject to Rule 6.7.12(1), buying-in in respect of a Novated Contract will commence on the Intended Settlement Day of the Novated Contract.
        2. Rule 6.7.4(8) states that subject to Rule 6.7.12(1), if securities to be bought-in are not bought-in on the first day scheduled for buying-in and unless the securities are withdrawn from buying-in or the short Clearing Member makes the securities available for delivery to CDP by such time as specified by CDP on the following Market Day, the buying-in shall continue on the following Market Day.
        3. Rule 6.7.7A states that subject to Rule 6.7.12(1), if securities to be bought-in are not bought-in by the second day scheduled for buying-in, the short Clearing Member shall procure the securities.
        4. Rule 6.7.11 states that if a Clearing Member's obligation to deliver securities remains outstanding on the fifth (5th) Settlement Day (or such other number of Settlement Days as CDP may specify) after delivery is due, CDP shall, on the next Settlement Day, cash settle the Clearing Member's delivery obligation.
        5. This Practice Note clarifies the timelines for buying-in, procurement and cash settlement in respect of those Novated Contracts with Intended Settlement Days that fall on a day with half day trading.
        6. Where the Intended Settlement Day of a Novated Contract falls on a day with half day trading, there will be no buying-in conducted on the first day scheduled for buying-in (i.e. the Intended Settlement Day). Any buying-in will be conducted only on the second day scheduled for buying in (i.e. the Market Day following the Intended Settlement Day). There shall only be one day of buying-in.
        7. If the securities to be bought-in are not bought-in by that day, the short Clearing Member shall procure the securities, whether by transacting on the ready market or otherwise, to discharge its delivery obligation.
        8. If the short Clearing Member's obligation to deliver securities remains outstanding on the fifth (5th) Settlement Day (or such other number of Settlement Days as CDP may specify) after the Intended Settlement Day, CDP shall, on the next Settlement Day, cash settle the Clearing Member's delivery obligation.
        9. This Practice Note does not limit CDP's discretion with regard to buying-in, procurement and cash settlement, as provided in the Rules.

      • Practice Note 6A.5.2 Calculation of Amount of Clearing Member Required Margins

        Issue Date Cross Reference Enquiries
        Added on 21 January 2013 and amended on 14 September 2017, 10 December 2018 and 21 October 2019. Rule 6A.5.2 Please contact Clearing Risk:

        Facsimile No : 6532 0297
        E-Mail Address: margins@sgx.com

        1 Introduction

        1.1. This Practice Note sets out the procedures pursuant to Rule 6A.5.2, for the calculation of the amount of Clearing Member Required Margins that a Clearing Member must deposit with CDP.

        2 Composition of Clearing Member Required Margins

        2.1. Pursuant to Rule 6A.5.1, a Clearing Member is required to deposit Clearing Member Required Margins with CDP by such time as CDP prescribes.
        2.2. Clearing Member Required Margins comprise margin requirements in respect of Marginable Futures Contracts and Novated Contracts other than Marginable Futures Contracts.
        2.3. The procedures for the calculation of margin requirements in respect of Marginable Futures Contracts and Novated Contracts other than Marginable Futures Contracts differ, and their respective procedures are set out in this Practice Note.

        3 Calculation of Clearing Member Required Margins for Novated Contracts other than Marginable Futures Contracts

        3.1. The Clearing Member Required Margins for Novated Contracts other than Marginable Futures Contracts cannot be met by collateral belonging to customers of the Clearing Member, as defined under the SFA in relation to Part III of the SFA.

        Calculation of Clearing Member Maintenance Margins for Novated Contracts other than Marginable Futures Contracts

        3.2. The Clearing Member Maintenance Margins for Novated Contracts other than Marginable Futures Contracts is calculated based on the Valuation Price of securities in the Novated Contracts.
        3.3. The Clearing Member Required Margins that a Clearing Member is required to place for Novated Contracts other than Marginable Futures Contracts is calculated with reference to all outstanding settlement obligations of such Clearing Member. The calculation methodology is set out below:
        3.3.1. A margin rate will be applied on the Clearing Member's Aggregate Net Buy Position or Net Sell Position, whichever is higher.
        3.3.2. The Clearing Member's Aggregate Net Buy Position or Aggregate Net Sell Position are derived by:
        a) calculating the value of the Clearing Member's buy and sell positions in each security which have not been settled, based on the Valuation Price and quantity of securities in the buy and sell trades;
        b) in respect of each security, netting the total value of the Clearing Member's buy positions, against the total value of its sell positions to arrive at a net buy value or a net sell value in respect of that security;
        c) aggregating the net buy values and the net sell values separately in respect of all of the Clearing Member's unsettled Novated Contracts to arrive at the Aggregate Net Buy Position and Aggregate Net Sell Position. The net buy value for a security with an inverse payoff function (for example, put warrant and inverse ETFs) will be treated as a net sell value for aggregation purpose. Conversely, its net sell value will be treated as a net buy value.
        3.3.3. Sell transactions for which the Clearing Member has not made available the required number of shares for delivery and therefore failed to deliver on Intended Settlement Day, will be included in the aggregation process set out in paragraph 3.3.2.
        3.3.4. Presently, CDP clears securities denominated in Singapore Dollars, as well as the following foreign currencies: Australian Dollars, Chinese Yuan, US Dollars, Euros, British Pounds and Hong Kong Dollars. For the purpose of determining the Aggregate Net Buy Position and Aggregate Net Sell Position, CDP will convert net buy values and net sell values into a common currency for aggregation.
        3.3.5. The margin rate comprises two components:
        a) base rate calculated based on the volatility of the FTSE Straits Times Index; and
        b) mark-up rate calculated based on the volatility of relevant indices of the Singapore securities market, subject to a minimum of 0.5%.
        3.3.6. The margin rate is reviewed regularly by CDP and the applicable margin rate will be published on SGX's website.
        3.3.7. CDP may prescribe higher margin rates in respect of specific securities that exhibit higher volatility or unusually high trading value to cover their potential future price fluctuations.

        Calculation of Clearing Member Variation Margins for Novated Contracts other than Marginable Futures Contracts

        3.4. Novated Contracts other than Marginable Futures Contracts are individually marked-to-market in order to determine the Clearing Member Variation Margins. The marked-to-market gain or loss of each Novated Contract is calculated based on the difference between the Valuation Price of the security of the Novated Contract and the price at which the Novated Contract is bought and sold, as well as the quantity of securities in the Novated Contract.
        3.5. The marked-to-market gains and losses of a Clearing Member's Novated Contracts are aggregated to determine its Clearing Member Variation Margins:

        Clearing Member Variation Margins = Sum of (Valuation Price − Traded Price) × (buy quantity − sell quantity) of securities in each Novated Contract across all unsettled Novated Contracts of the Clearing Member

        Positive results are Clearing Member Variation Margin gains. Negative results are Clearing Member Variation Margin losses.
        3.6. Clearing Member Variation Margins will be collateralised. This means that:
        a) Mark to market losses must be met by depositing acceptable collateral with CDP; and
        b) Mark to market gains will not paid out by CDP, but will be used to offset Clearing Member Maintenance Margins.
        3.7. The Clearing Member Variation Margins is calculated separately for Marginable Futures Contracts and Novated Contracts other than Marginable Futures Contracts. Mark to market gains for Novated Contracts other than Marginable Futures Contracts cannot be used to offset margin requirements for Marginable Futures Contracts, and vice versa.

        Calculation of Clearing Member Required Margins for Novated Contracts other than Marginable Futures Contracts

        3.8. The Clearing Member Required Margins for Novated Contracts other than Marginable Futures Contracts is the sum of the Clearing Member Maintenance Margins and Clearing Member Variation Margins for such Novated Contracts: Clearing Member Required Margins = Maximum of (Clearing Member Maintenance Margins − Clearing Member Variation Margins, 0)
        3.9. Clearing Member Variation Margins gains decrease the Clearing Member Required Margins and Clearing Member Variation Margins losses increase the Clearing Member Required Margins.
        3.10. Where the Clearing Member Variation Margins is greater than the Clearing Member Maintenance Margins, the Clearing Member Required Margins is zero. This means the Clearing Member's Maintenance Margins is fully met through its Clearing Member Variation Margins gains.
        3.11. Clearing Member Variation Margins will reset to zero when all outstanding positions are settled.

        Examples

        3.12. An example of the calculation of Clearing Member Maintenance Margins for Novated Contracts other than Marginable Futures Contracts is set out below.

        Clearing Member Maintenance Margins for Novated Contracts other than Marginable Futures Contracts
        •   Calculation of Maintenance Margin ("MM") requirement
        •   Hypothetical member's outstanding positions for cash securities (in S$),
        •   Clearing Member MM requirements = S$12,000 × Maintenance Margin Rate
        3.13. An example of the calculation of Clearing Member Variation Margins for Novated Contracts other than Marginable Futures Contracts is set out below.

        Clearing Member Variation Margins for Novated Contracts other than Marginable Futures Contracts
        •   Calculation of Clearing Member Variation Margins ("VM")
        •   This VM gains will be collateralized (ie not paid out by CDP), and can be used to meet Clearing Member's Maintenance Margin requirements.
        3.14. An example of the calculation of Clearing Member Required Margin for Novated Contracts other than Marginable Futures Contracts is set out below.

        Clearing Member Required Margins for Novated Contracts other than Marginable Futures Contracts
        •   Clearing Member Required Margins = Higher of [ (Maintenance Margin − Variation Margin), 0 ]
        •   Examples of Clearing Member Required Margins (in S$). Assume margin rate = 5%

        4 Calculation of Clearing Member Required Margins for Marginable Futures Contracts

        Calculation of Clearing Member Required Margins for Marginable Futures Contracts

        4.1. The Clearing Member Required Margin for Marginable Futures Contracts is calculated on a gross basis with reference to all accounts carried by the Clearing Member, by aggregating the margin requirements for all such accounts. In addition, Marginable Futures Contracts that fail to settle on the Intended Settlement Day are added to the Clearing Member Required Margin in respect of House Accounts.

        Calculation of Clearing Member Maintenance Margin for Marginable Futures Contracts

        4.2. The calculation methodology is set out below:
        4.2.1. An outright margin rate and a spread margin rate are determined for each underlying security of Marginable Futures Contract. A delivery margin rate is determined for each contract month of Marginable Futures Contract.
        4.2.2. The relevant outright margin rate for each underlying security is based on the volatility for the price of the corresponding Marginable Futures Contracts.
        4.2.3. The relevant spread margin rate for each underlying security is based on the volatility for the spread differential between different contract months of the corresponding Marginable Futures Contracts.
        4.2.4. The margin rates are reviewed regularly by CDP and the applicable margin rates will be published on SGX's website.

        Calculation of Clearing Member Maintenance Margin in respect of a single account

        4.3. The outright margin requirement for each underlying security for each account is determined by multiplying the net buy or sell quantity across all contract months by the valuation price and outright margin rate of the underlying security.
        4.4. The spread margin requirement for each underlying security for each account is determined as follows:
        a) determine net position in each contract month by netting the total quantity of securities in outstanding buy contracts against total quantity of securities in outstanding sell contracts to obtain net long position or net short position in the contract month;
        b) aggregate the net positions across all contract months with net long positions to obtain gross long position and gross short position;
        c) determine the number of spreads formed by taking the minimum of gross long and gross short positions; and
        d) determine spread margin requirement by multiplying the number of spreads formed by spread margin rate and valuation price of the underlying security.
        4.5. The Clearing Member Maintenance Margin in respect of an account is the sum of outright margin requirement and spread margin requirement of each underlying security across all underlying securities of Marginable Futures Contracts in unsettled contracts held in the account.

        Calculation of Clearing Member Variation Margin in respect of a single account

        4.6. The Clearing Member Variation Margin for each account is calculated based on the difference between the Valuation Price of such Marginable Futures Contracts and the price at which such Marginable Futures Contracts are bought and sold, in accordance with the methodology below:

        Clearing Member Variation Margins for each account = Sum of (Valuation Price − Traded Price) × (buy quantity − sell quantity) of securities in each unsettled Marginable Futures Contract across all unsettled Marginable Futures Contracts in the account
        4.7. Mark to market gains will not be paid out, but can be used to offset the Clearing Member Maintenance Margins for the same account.

        Calculation of Clearing Member Required Margin

        4.8. The Clearing Member Maintenance Margin and Clearing Member Variation Margin for each account are aggregated to arrive at the Clearing Member Required Margin for the account, in accordance with the formula below:

        Clearing Member Required Margin = Maximum of (Clearing Member Maintenance Margin − Clearing Member Variation Margin, 0)
        4.9. The Clearing Member Required Margin for each Customer Account is aggregated across all Customer Accounts of the Clearing Member.

        Clearing Member Required Margin for Customer Accounts = Sum of Account Required Margin across all Accounts of the Clearing Member
        4.10. The Clearing Member Required Margin for each House Account is aggregated across all House Accounts of the Clearing Member.

        Clearing Member Required Margin for House Accounts = Sum of Account Required Margin across all House Accounts of the Clearing Member

      • Practice Note 6A.6 Forms of Collateral Acceptable by CDP as Margins

        Issue Date Cross Reference Enquiries
        Added on 21 January 2013 and amended on 29 July 2013. Rule 6A.6 Please contact Clearing Risk:

        Facsimile No : 6532 0297
        E-Mail Address: margins@sgx.com

        1 Introduction

        1.1. This Practice Note sets out the forms of collateral that CDP accepts as margins.

        2 Forms of Monies and Assets Acceptable by CDP as Margins

        2.1. Rule 6A.6.1 states, among other things, that CDP accepts the following forms of monies and assets as margins:
        a) cash
        b) Singapore and US government securities, and
        c) selected common stocks, units of listed business trusts and units of real estate investment trusts.

        Cash

        2.2. Cash denominated in Singapore Dollars and US Dollars are accepted as collateral.

        Singapore and US government securities, and selected common stocks

        2.3. Singapore and US government debt securities of varying maturities are acceptable as collateral.
        2.4. CDP also accepts constituent stocks of the MSCI Singapore Free Index and FSSTI Index as collateral. This may include units of listed business trusts and units of real estate investment trusts.

        3 Collateral is subject to appropriate hair-cuts

        3.1. The collateral, referred to in paragraph 2, are subjected to appropriate hair-cuts as prescribed by CDP to reflect the price risk of the collateral.
        3.2. The haircuts for government securities are available on the SGX website
        http://www.sgx.com/wps/portal/sgxweb/home/clearing/securities/acceptable_collaterals.

      • Practice Note 6A.9A — Additional Margins

        Issue Date Cross Reference Enquiries
        Added on 21 January 2013 and amended on 8 August 2016 and 15 September 2017. Rule 6A.9A Please contact Risk Management:

        rm-securities@sgx.com

        1 Introduction

        1.1 Rule 6A.9A.1 states that in relation to Novated Contracts, CDP may call for additional margins from one or more Clearing Members in the following situations:
        (1) when, in CDP's opinion, unstable conditions exist or market conditions or price fluctuations relating to one or more securities or Futures Contracts at any time require additional margins to maintain an orderly market or to preserve financial integrity or for any other reason;
        (2) when CDP believes that any Clearing Member is carrying exposure that:
        (a) is larger than is justified by the financial condition of that Clearing Member; or
        (b) places or may place CDP at risk;
        (3) where the Clearing Member is found to have a record of frequent rule violations or inadequate or unsound management or serious operational defects which, in CDP's opinion, places or may place CDP at risk; or
        (4) where market conditions or price fluctuations are such that CDP deems it necessary, to call upon the Clearing Members whom it believes are affected by such conditions or fluctuations to deposit additional funds.
        1.2 The objective of additional margin requirements is to provide greater assurance that specific risks which may potentially not be captured under CDP's margin setting methodologies are appropriately accounted for and collateralised for a safer and more robust clearing system.
        1.3 CDP conducts daily stress testing of Clearing Members' positions under a comprehensive range of stressed scenarios, to monitor Clearing Members' exposures and to ascertain the adequacy of the CDP Clearing fund. In addition, as part of its continuing risk management process, CDP monitors news and developments which may affect Clearing Members, and conducts risk-based inspections on Clearing Members' risk and credit management practices.
        1.4 In the event that any of the circumstances specified in paragraph 1.1 ("Specified Circumstances") exist, CDP may impose additional margin requirements. Such additional margin requirements will typically be one of the following:
        (1) Concentration risk add-on;
        (2) Default Fund risk add-on;
        (3) Credit risk add-on; or
        (4) Specific Security risk add on.
        1.5 This Practice Note provides guidance on the additional margin requirements set out in paragraph 1.4.

        2 Concentration risk add-on

        2.1 CDP may impose a concentration risk add-on if the Clearing Member's portfolio is concentrated in a security.

        2.1.1 For guidance, a Clearing Member portfolio is deemed to be concentrated in a security if its net Mark-to-Market (MTM) buy or sell value in that security is more than 10% of its Aggregate (across all securities) net MTM buy or sell value respectively.
        2.1.2 The concentration risk add-on is imposed as a percentage add-on to a Clearing Member's maintenance margin requirements. The add-on would typically be up to 50%, but deviations may occur depending on factors such as the risk profile of the security, the concentration level of the portfolio in that security, and the side (buy or sell) that is used to compute the portfolio maintenance margin.
        2.1.3.A Clearing Member will be notified if concentration margin add-on is to be imposed. The concentration add-on will be effective until such time that trades are settled and CDP considers that there is no longer any undue concentration risk in the Clearing Member's portfolio. CDP may impose the add-on as early as the next clearing cycle after the Clearing Member is notified.

        3 Default Fund risk add-on

        3.1 CDP may impose a default fund risk add-on for Clearing Members with significant potential tail risk exposure under CDP's stress testing regime.
        3.2 CDP conducts stress testing of Clearing Members' outstanding positions in line with CPMI-IOSCO1 and other global best practice standards to assess Clearing Fund adequacy. CDP applies a comprehensive range of stressed scenarios and provides sufficient resources to cover the simultaneous default of the Clearing Member and its affiliated Clearing Members with the largest aggregate loss ("Top 1"), and two other financially weakest Clearing Members ("Weak 1", "Weak 2"). CDP also simulates its obligation to settle outstanding cash trades with the direct customers of the Clearing Member should the Clearing Member default ("re-novation"). Stress testing is performed at every end of day, as well as intraday.
        3.2.1 While stress testing focuses on the mutualized resources to cover a default of the Top 1, Weak 1 and Weak 2, CDP would also want to secure appropriate amount of resources from an individual Clearing Member with significant potential tail risk exposure. This provides a balance between mutualization and the defaulter pay principle.
        3.2.2 CDP may require this additional margin to be deposited with CDP not later than the day after the trades are executed or reported to SGX-ST.
        3.2.3 To provide Clearing Members with more time to prepare any necessary funding arrangements to meet the higher margin requirements, Clearing Members are encouraged to engage CDP early on potential additional margin requirements if they expect significant traded values or large direct business transactions that may result in unusually large potential stress test exposures.
        3.2.4 For early engagement with CDP, Clearing Members should notify CDP when their aggregated 3-day gross buy value or gross sell value, whichever is higher, is expected to exceed S$500 mil or any figure that may be communicated by CDP.
        3.2.5 For guidance, the potential tail risk exposure is the worst loss estimated from different stressed scenarios, net of margins and any add-ons. The potential tail risk exposure is considered to be significant if:
        (a) the potential tail risk exposure of any Clearing Member and its affiliated Clearing Members (“Member Group”) exceeds a percentage (a threshold as determined by SGX) of CDP Clearing Fund resources ("Threshold 1"); or
        (b) the aggregate potential tail risk exposure of any Member Group, together with Weak 1 and Weak 2, exceeds a percentage (a threshold as determined by SGX) of CDP Clearing Fund resources ("Threshold 2"). Threshold 2 will be higher than Threshold 12 .
        3.2.6 CDP will determine the quantum of the default fund risk add-on based on the potential tail risk exposure from each Clearing Member relative to each of the two thresholds, as described below:
        •  In respect of Threshold 1, the applicable add-on for a Member Group is equal to the difference between its potential tail risk exposure and Threshold 1;
        •  In respect of Threshold 2, the total applicable add-on is equal to the difference between (i) the potential tail risk exposure aggregated across the Member Group, Weak 1 and Weak 2, (provided the Member Group does not include Weak 1 or Weak 2) after offsetting any add-on arising from Threshold 1, and (ii) Threshold 2. The applicable add-on is then allocated to the Member Group, Weak 1 and Weak 2 proportional to their exposure; and
        •  The add-on for a Clearing Member is equal to the sum of its applicable add-on arising from Threshold 1 and/or Threshold 2. CDP may at its sole discretion not impose on Weak 1 or Weak 2 the add-on if it is not significant.
        3.2.7 An illustration of the calculation is provided at the end of this Practice Note.

        4 Credit risk add-on

        4.1 CDP may impose a credit risk add-on if there are concerns regarding the liquidity, solvency or credit-worthiness of a Clearing Member. Indicators of potential heightened credit risk posed by a Clearing Member includes, without limitation:
        (a) deterioration in the credit standing of the Clearing Member as assessed through SGX's internal credit risk rating model, downgrading of the credit rating or credit outlook of the member or its parent/affiliates by external credit agencies, widening credit default swaps of the member or its parent/affiliates;
        (b) adverse market sentiments/news on the Clearing Member or its parent/affiliate or when CDP believes the Clearing Member or its parent/affiliate may be adversely affected by unstable market conditions or price fluctuations which CDP deems a concern;
        (c) reduction of the Clearing Member's financial resources;
        (d) in CDP's view, there is an increase in the Clearing Member's risk exposure, for example, increased operational risk due to unsound risk or credit practices or exceptional large non-SGX exposures, that potentially places CDP at greater risk; and
        (e) other specific issues or concerns relating to the Clearing Member, which may arise from CDP's on-site inspection, the Authority's audit findings; or frequent rule violations committed by the Clearing Member.
        4.2 For guidance, the quantum of the credit risk add-on for Clearing Members will be determined by considering the following:
        (a) for a Clearing Member with credit standing CDP deems equivalent to B rating and below (based on the indicators described in paragraph 4.1 of this Practice Note), the quantum is equal to the difference between the member's potential tail risk exposure and a threshold. This threshold3 will be determined by SGX, as a percentage of actual CDP Clearing Fund resources and will be lower than the Threshold 1 described in paragraph 3.2.5 of this Practice Note; and
        (b) the Clearing Member's available financial resources, prevailing market conditions, the size of Clearing Member's positions.

        5 Specific security add-on

        5.1 CDP may impose a specific security add-on if there are concerns that trading in the security may be unfair or disorderly. This includes, without limitation:
        (a) where there is news that may have a significant impact on its market price (e.g. irregular practices in the listed company); or
        (b) where the security is declared a designated security in accordance with SGX-ST Rule 8.8.
        5.2 In determining whether a specific security add-on is warranted, CDP will take into account all relevant factors, including the following:
        (a) trading value of the security relative to total traded value; and
        (b) observable or expected price volatility of the security.
        5.3 The Margin Circular issued by CDP will indicate the list of securities that will be margined at different rates. In respect of changes arising from an ad-hoc review arising from exceptional events, CDP will give Clearing Members at least a 1-day notice period before applying the specific security margin.

        ILLUSTRATION ON THE CALCULATION OF THE DEFAULT FUND RISK ADD-ON

        Assumptions:
        (i) Actual Clearing Fund resource is $100.
        (ii) Assume SGX assigns percentages of 70% and 90% to Threshold 1 and Threshold 2 respectively.
        Threshold 1: 70% x 100 = 70 (Any Member Group)
        Threshold 2: 90% x 100 = 90 (Any Member Group + Weak 1 + Weak 2)
        Example 1—Add-on applies to a Member Group X only
        Assume only one stress testing scenario generates exposure that exceed the thresholds,
        •  Exposure (X + Weak 1 + Weak 2) = 85
        •  Exposure (X) = 80
        •  Exposure (Weak 1) = 5
        •  Exposure (Weak 2) = 0
            Loss exceeds threshold Potential add-on
          Loss Threshold 1 Threshold 2 Threshold 1 Threshold 2
        X + Weak 1 + Weak 2 85   No    
        X 80 Yes   80-70=10  
        Weak 1 5 No      
        Weak 2 0 No      
        •  Therefore, credit risk add-on of 10 applies to Member Group X only.
        Example 2—Add-on applies to a Member X, and Weak 1 and Weak 2 by apportionment Assume only one stress testing scenario generates exposure that exceed the thresholds,
        •   Exposure (X + Weak 1 + Weak 2) = 95
        •   Exposure (X) = 65
        •   Exposure (Weak 1) = 15
        •   Exposure (Weak 2) = 15
            Loss exceeds threshold Potential add-on
          Loss Threshold 1 Threshold 2 Threshold 1 Threshold 2
        X + Weak 1 + Weak 2 95   Yes   95-90=5
        X 65 No      
        Weak 1 15 No      
        Weak 2 15 No      
        •  Therefore, credit risk add-on of 5 applies to (Member Group X + Weak 1 + Weak 2). The add-on for each of the three members will be proportionate to their share of the aggregate exposure.
        •  For X, add-on = 65/(65+15+15)*5 = 3.5
        •  For Weak 1, add-on = 15/(65+15+15)*5 = 0.8
        •  For Weak 2, add-on = 15/(65+15+15)*5 = 0.8

        1 Principles for Financial Market Infrastructures issued by the Committee on Payments and Market Infrastructure (CPMI) and the Technical Committee of the International Organization of Securities Commissions (IOSCO).

        2 Threshold 1 and 2 is currently defined as 70% and 90% respectively, but may be revised from time to time.

        3 The threshold is currently defined as 15%, but may be revised from time to time.

    • Schedules

      • Schedule A

        • Rule 3 — Membership

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 3 — Membership
          3.5 General Obligations of a Clearing Member
          3.5.1(1) Clearing Member to comply with the applicable eligibility criteria [Unless otherwise specified in this Schedule]
          Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(2) Clearing Member to in this Schedule] clear and settle Exchange Trade transacted by it in accordance with Clearing Rules and Clearing Directives [Unless otherwise specified in this Schedule]
          Not Compoundable Not Compoundable $10,000
          3.5.1(3) Clearing Member to clear and settle Exchange Trade transacted by a Trading Member qualified by it as a principal obligor and not merely as guarantor through CDP in accordance with Clearing Rules and Clearing Directives [Unless otherwise specified in this Schedule]
          Not Compoundable Not Compoundable $10,000
          3.5.1(4) Clearing Member to in this Schedule] comply with the Clearing Rules and Clearing Directives [Unless otherwise specified in this Schedule]
          Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(5) Failure to grant CDP all rights and remedies as set forth in Clearing Rules and the Clearing Directives [Unless otherwise specified in this Schedule]
          Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(6) Failure to pay all fees, charges, costs, compensation and other sums as provided in Clearing Rules and Clearing Directives [Unless otherwise specified in this Schedule]
          Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(7) Failure to make contributions or payments to the Clearing Fund as required in Clearing Rules Not Compoundable Not Compoundable $10,000
          3.5.1(8) Failure to take or refrain from taking such action as may be required in relation to the Clearing Fund [Unless otherwise specified in this Schedule]
          Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(9)(a) Clearing Member to have proper procedures and systems for its business to prevent any violations by its directors and officers Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(9)(b) Clearing Member to have in place sufficient resources and maintain adequate internal controls and risk management systems for its business Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(9)(c) Clearing Member's employees or agents to reasonably discharge their duties and obligations in enforcing procedures and systems for business Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(10) Clearing Member to comply with the clearing limits as CDP may prescribe from time to time Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(11) Clearing Member to maintain bank accounts in the currencies as necessary, and with banks acceptable to CDP, to facilitate payments and/or settlement as may be required under these Clearing Rules. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(12) Clearing Member to ensure its Memorandum and Articles of Association or its constitution shall at all times conform to Clearing Rules and Clearing Directives Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.1(13) Clearing Member to take such steps, including without limitation procedural steps (whether of a technical or non-technical nature or otherwise), as CDP may require to ensure the orderly clearing and settlement of Exchange Trades qualified by the Clearing Member. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.2(1) Clearing Member to promptly submit to CDP and/or such party as directed by CDP such information, electronic records, returns or documents as and when such information, electronic records, returns or documents are required by CDP. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.3(1) Clearing Member to maintain complete and accurate records, or in the case of a Bank Clearing Member, records in relation to the Bank Clearing Member's business governed by this Clearing Rules, in accordance with the SFA and/or Regulations Not Compoundable Not Compoundable $10,000
          Clearing Member to maintain complete and accurate records, or in the case of a Bank Clearing Member, records in relation to the Bank Clearing Member's business governed by this Clearing Rules, in accordance with the Clearing Rules and Clearing Directives Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.3(2) Making or causing to be made false or misleading entry in books, records, reports etc Not Compoundable Not Compoundable $10,000
          3.5.3(3) Omitting to make material entry in any books, records, reports etc Not Compoundable Not Compoundable $10,000
          3.5.3(4) Altering or destroying any books, records, reports etc without a valid reason Not Compoundable Not Compoundable $10,000
          3.5.4 Business Continuity Requirements
          3.5.4(1) Clearing Member to assess business and operational risks and maintain adequate business continuity arrangements Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.4(2) Clearing Member to document its business continuity requirements in a business continuity plan Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.4(3) Clearing Member to demonstrate sufficient awareness of the risks, mitigating measures and state of readiness by way of an attestation to the Board of Directors Compoundable $500 $1,000 $2,000 N.A.
          3.5.4(4) Clearing Member to review and test its business continuity plan regularly Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.5.4(5) Clearing Member to appoint emergency contact person Compoundable $500 $1,000 $2,000 N.A.
          Clearing Member's emergency contact persons to be contactable at all times Compoundable $500 $1,000 $2,000 N.A.
          Clearing Member to immediately notify CDP in the event of an emergency Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.7A Relationship Between Clearing Member and Trading Member
          3.7A.1 Where relevant, Clearing Member to make payment or deliver securities to a Trading member in respect of any Exchange Trade, within prescribed timelines. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.7A.2 Subject to Rules 3.7A.3 and 3.7A.4, if a buying Trading Member fails to meet any of the timelines set out in the SGX-ST Rules for payment to its Clearing Member, Clearing Member to force-sell securities of the buying Trading Member within prescribed timelines. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.7A.5 Clearing Member not to engage in imprudent credit practices when exercising discretion with regards to deferment of force-sale. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.7A.7 Clearing Member, if informed by CDP that a right to receive securities pursuant to an Exchange Trade is to be cash settled, to immediately inform the relevant buying Trading Member. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8 Reporting Requirements
          3.8(1) Clearing Member to notify CDP of violations of laws and regulations or conduct which is detrimental to the financial integrity, reputation or interests of CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(2) Clearing Member to notify CDP if any of its directors, employees or agents is investigated, arrested, charged, convicted suspended or pleads guilty to any criminal offence involving fraud or dishonesty Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(3) Clearing Member to notify CDP if any of its directors, employees or agents is the subject of any written complaint of any offence involving fraud or dishonesty, which may have a material impact on the financial position on the Clearing Member Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(4) Clearing Member to notify CDP when any of tis directors, employees or agents is the subject of any investigation, disciplinary proceeding or action taken by the Clearing Member in respect of the specified matters Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(4A) Clearing Member to notify CDP if any of its directors, employees or agents engages in conduct which circumvents the SFA, SFR, this Clearing Rules or Clearing Directives, or which is inconsistent with the principles of good business practice Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(4B) Clearing Member to notify CDP if it is insolvent or is engaged in bankruptcy or winding up proceedings Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(4C) Clearing Member to notify CDP if the Clearing Member is experiencing an emergency or potentially debilitating situation that threatens its operations. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(5) Clearing Member to notify CDP of changes to its name Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(6) Clearing Member to notify CDP of changes which may have the effect of altering control in the Clearing Member Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(7) Clearing Member to notify CDP of any transactions resulting in the change of ownership of the specified proportion of the Clearing Member's share capital, or an increase of the specified proportion of the Clearing Member's share capital. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(8) Clearing Member to notify CDP of any change in the composition of its board of directors or of any director Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(9) Clearing Member to notify CDP of any change or amendment to its constitutive documents Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(10) Clearing Member to notify CDP of any death or bankruptcy of any of its directors Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(11) Clearing Member to notify CDP of any engagement or involvement in any new business or any change in the Clearing Member's business Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(12) Clearing Member to notify CDP of any change in the Clearing Member's senior management Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.8(13) Clearing Member to notify CDP of any breach of director's duties Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.9 Qualification of Trading Members
          3.9.1(1) Clearing Member to inform CDP of the qualification of a Trading Member Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          Clearing Member to provide such details as requested by CDP Not Compoundable Not Compoundable $10,000
          3.9.1(2) Clearing Member to pay such administrative fees as CDP may levy Compoundable $500 $1,000 $2,000 N.A.
          3.9.1(3) Clearing Member to have in place adequate internal control measures and risk management systems to monitor the Trading Member's Exchange Trades Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.9.1(4) Clearing Member to enter into a written agreement with the Trading Member setting out the terms and conditions governing their relationship Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.9.1(5) Clearing Member to inform CDP if it believes that a Trading Member qualified by it has defaulted or may default Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.9.1(6) Clearing Member to have proper separation of front and back office functions Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.9.2(1) Clearing Member to give not less than the time period specified by CDP of its intention to cease qualifying a Trading Member Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.9.2(2) Clearing Member to satisfy CDP that it has taken proper steps to disable the Trading Member from entering into Exchange Trades Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.9.2(3) Clearing Member to satisfy CDP that it has taken proper steps for the orderly clearing and settlement of the Trading Member's Exchange Trades Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.9.2(4) Clearing Member to comply with the directions of CDP in relation to the orderly cessation of the qualification of the Trading Member's Exchange Trades Not Compoundable Not Compoundable $10,000
          3.9.2(5) Clearing Member to take steps as CDP may deem appropriate to ensure that none of the Trading Member's Exchange Trade will be cleared and settled through the Clearing Member by the proposed date of cessation Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.9.2A(1)(a) Clearing Member to notify CDP of its decision to suspend its qualification of a Trading Member Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.9.2A(1)(b) Clearing Member to comply with any reasonable direction of CDP in relation to the suspension of the qualification of a Trading Member Not Compoundable Not Compoundable $10,000
          3.9.2A(2) Clearing Member to notify CDP in writing within the specified period, of its intention to resume or cease qualification of a Trading Member Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.10 Resignation by Clearing Member
          3.10.1 Failure to comply with procedures for resignation as a Clearing Member Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          3.10.5(1) Clearing Member shall not transact or accept for clearing and settlement, Exchange Trades that are due for settlement after the tenth Settlement Day from the date of the resignation notice. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.

          Added on 16 May 2011 and amended on 18 September 2012, 1 July 2016 and 10 December 2018.

        • Rule 4 — Chief Executive Officers

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 4 — Chief Executive Officers
          4.1 Appointment of Chief Executive Officers
          4.1.1(1) Clearing Member to appoint one (1) person as a Chief Executive Officer Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          4.1.1(4) Clearing Member to notify CDP at least seven (7) days prior to the appointment of a Chief Executive Officer Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          4.2 Obligations
          4.2.1 Failure to comply with Clearing Rules or Directives. [Unless otherwise specified in this Schedule]
          Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          4.2.2 Chief Executive Officer to pay CDP all fees, levies and charges as CDP prescribes Compoundable $500 $1,000 $2,000 N.A.
          4.2.3(1) Chief Executive Officer to inform CDP within 14 days before engaging in, or holding any substantial shareholding in, any other business that might potentially conflict with being an Chief Executive Officer Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          4.2.3(3) Chief Executive Officer to supply CDP with information it requires regarding the engagement or acquisition of shareholding Not Compoundable Not Compoundable $10,000
          4.2.3(4) Chief Executive Officer not to proceed with engagement or acquisition of shareholding contrary to CDP's objection Not Compoundable Not Compoundable $10,000
          4.2.3(5) Chief Executive Officer to end engagement or shareholding if required by CDP Not Compoundable Not Compoundable $10,000
          4.3 Automatic De-Registration
          4.3 Clearing Member to notify CDP immediately upon trigger of CEO de-registration condition Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          4.5 Resignation of Approved Executive Director
          4.5 [deleted] [deleted] [deleted] [deleted] [deleted] [deleted]

          Added on 16 May 2011 and amended on 3 June 2019.

        • Rule 5 — Financial/Capital Requirements

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 5 — Financial/Capital Requirements
          5.1 Minimum Capital and Financial Requirements of Clearing Members Incorporated in Singapore
          5.1.1(1) General Clearing Member to maintain base capital requirement Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1.1(2) General Clearing Member to meet financial resources requirement Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1.1(3) General Clearing Member to meet aggregate indebtedness requirement Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1.1(4) General Clearing Member to comply with other financial and operational requirements prescribed by CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1.1A(1) Bank Clearing Member to maintain base capital requirement Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1.1A(2) Bank Clearing Member to comply with RRA Financial Requirement Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1.1A(3) Bank Clearing Member to comply with other financial and operational requirements prescribed by CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1.1B(3) Clearing Member to immediately notify CDP of failure, or impending failure, to comply with minimum capital and financial requirements Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1.1C Clearing Member to comply with CDP's directions where Clearing Member has failed to comply with the minimum capital and financial requirements Not Compoundable Not Compoundable $10,000
          5.1A Early Warning Financial Requirements of Clearing Members Incorporated in Singapore
          5.1A.1 General Clearing Member to immediately notify CDP where financial resources have fallen below 120% of its total risk requirement, or where its aggregate indebtedness has exceeded 600% of its aggregate resources Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1A.2 General Clearing Member to comply with CDP's directions where financial resources have fallen below 120% of its total risk requirement Not Compoundable Not Compoundable $10,000
          5.1A.3 General Clearing Member to comply with CDP's directions where aggregate indebtedness has exceeded 600% of aggregate resources Not Compoundable Not Compoundable $10,000
          5.1B Notification Requirements of Clearing Members Incorporated in Singapore
          5.1B.1 Clearing Member to immediately notify CDP where financial resources have fallen below 150% of total risk requirement or of any reportable event in relation to its regulatory capital and liquidity ratios Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1B.2 Clearing Member to comply with other notification requirements and conditions prescribed by CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1B.3 Clearing Member to comply with CDP's directions where financial resources have fallen below 150% of its total risk requirement or that a reportable event in relation to its regulatory capital and liquidity ratios has occurred Not Compoundable Not Compoundable $10,000
          5.1D Minimum Capital and Financial Requirements of Clearing Members Incorporated Outside Singapore
          5.1D.1(1) General Clearing Member to maintain base capital requirements Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1D.1(2) General Clearing Member to meet adjusted net head office funds requirement Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1D.1(3) General Clearing Member to meet aggregate indebtedness requirement Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1D.1(4) General Clearing Member to comply with other financial and operational requirements prescribed by CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1D.2(1) Bank Clearing Member to maintain base capital requirement Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1D.2(2) Bank Clearing Member to comply with RRA Financial Requirements Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1D.2(3) Bank Clearing Member to meet other financial and operational requirements prescribed by CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1D.3 Clearing Member to immediately notify CDP of failure, or impending failure, to meet minimum capital and financial requirements Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1D.4 Clearing Member to comply with CDP's directions where Clearing Member has failed to meet minimum capital and financial requirements Not Compoundable Not Compoundable $10,000
          5.1DA Bank Clearing Member to comply with Liquidity Resource Requirement Not Compoundable Not Compoundable $10,000
          5.1E Early Warning Financial Requirements of Clearing Members Incorporated Outside Singapore
          5.1E.1 General Clearing Member to immediately notify CDP where adjusted net head office funds or cash and/or acceptable government securities deposited with CDP have fallen below 120% of total risk requirement, or where its aggregate indebtedness has exceeded 600% of aggregate resources Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1E.2 General Clearing Member to comply with CDP's directions where adjusted net head office funds have fallen below 120% of total risk requirement Not Compoundable Not Compoundable $10,000
          5.1E.3 General Clearing Member to comply with CDP's directions where aggregate indebtedness has exceeded 600% of aggregate resources Not Compoundable Not Compoundable $10,000
          5.1F Notification Requirements of Clearing Members Incorporated Outside Singapore
          5.1F.1 Clearing Member to immediately notify CDP where Clearing Member's adjusted net head office funds have fallen below 150% of total risk requirement or of any reportable event in relation to its regulatory capital and liquidity ratios Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1F.2 Clearing Member to comply with other notification requirements prescribed by CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.1F.3 Clearing Member to comply with CDP's directions where adjusted net head office funds have fallen below 150% of total risk requirement or that a reportable event in relation to its regulatory capital and liquidity ratios has occurred Not Compoundable Not Compoundable $10,000
          [deleted] [deleted]
          [deleted] [deleted] [deleted] [deleted] [deleted] [deleted] [deleted]
          5.5 Reserve Fund Requirement
          5.5.1 General Clearing Member to maintain reserve fund based on its audited net profits of each year Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.5.2 Reserve fund not to be made available for declaration of dividends without the prior approval of CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.6 Exposure to Single Customer
          5.6.1 General Clearing Member to immediately notify CDP of excess exposure to a single customer Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.7 Exposure to Single Security
          5.7.1 General Clearing Member to immediately notify CDP of excess exposure to a single security Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.7.8 General Clearing Member not to permit exposure to suspended security to increase in monetary value above the level subsisting on 30th consecutive day of suspension until suspension lifted Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.8 Monthly Returns
          5.8.1 Clearing Member to submit monthly returns to CDP by by time frame and in format specified by CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.9 Appointment of Auditors and Audit Requirements
          5.9.1 Clearing Member to seek the approval of CDP prior to any appointment of new auditors Compoundable $500 $1,000 $2,000 N.A.
          5.9.1A Bank Clearing Member to inform CDP of the appointment of new auditors within 7 days of the appointment Compoundable $500 $1,000 $2,000 N.A.
          5.9.2 Failure by General Clearing Member to furnish relevant forms required under the SFR, annual accounts and auditors' certificate to CDP within 5 months of the end of the General Clearing Member's financial year Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.9.5 Bank Clearing Members to furnish annual accounts and auditors' certificate within 5 months of the end of the Bank Clearing Members' financial year Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.11 Other Financial Requirements
          5.11.1 General Clearing Member not to reduce paid-up ordinary share capital without prior written approval of CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.11.2(1) General Clearing Member to notify CDP prior to the issue of preference shares Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.11.2(2) General Clearing Member to comply with conditions for redeeming redeemable preference shares that are computed as part of its financial resources Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.11.3(1) General Clearing Member to obtain the prior approval of CDP if it enters into a subordinated loan agreement other than the format prescribed by CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.11.3(2) General Clearing Member to immediately notify CDP when it draws down a qualifying subordinate loan Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.11.3(3) General Clearing Member not to repay a subordinated loan principal in contravention of the requirements and conditions Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.11.4 General Clearing Member not to make any unsecured loan or advance, pay any dividend or Director's fees or increase in Director's remuneration without prior written approval of CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.11.5 General Clearing Member to submit to CDP a report on all its credit facilities, or any changes to its credit facilities Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5.12 Register of Connected Persons
          5.12 General Clearing Member to maintain register of directors and their connected persons Compoundable $500 $1,000 $2,000 N.A.

          Added on 16 May 2011 and amended on 29 December 2014 and 22 April 2019.

        • Rule 5A — Position Accounts

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 5A — Position Accounts
          5A.1 Separate Position Accounts and Position Account Designation
          5A.1.1 Clearing Member to maintain separate Position Accounts for each Customer or each group of joint Customers whose account is carried on the books of the Clearing Member. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5A.1.2 Clearing Member to identify and designate each Position Account by the full name of the Customer(s) whose account is carried on the books of the Clearing Member and by a unique account code. Compoundable $500 $1,000 $2,000 N.A.
          5A.2 Reporting Requirements for Position Account
          5A.2.1 Clearing Member to report to CDP such information as CDP may require for each Position Account as soon as practicable. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5A.2.2 Clearing Member to report to CDP any change in information previously reported to CDP for any Position Account as soon as practicable. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5A.3 Allocation of trades to Position Accounts
          5A.3.1 Clearing member to allocate positions of each trade cleared by the Clearing Member for a Customer to that Customer's Position Account or in accordance with that Customer's instructions as soon as practicable. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5A.3.2 Clearing Member to ensure conditions set out in Rules 5A.3.2(a) or (b) are satisfied in the case of any sub-allocation of positions from a Customer's Position Account to another Position Account. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5A.3.4 Clearing Member to ensure that no trades are warehoused for more than 1 Market Day, unless under exceptional circumstances, where the Clearing Member must document the reasons for the extension of time. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5A.4 Authorisation of SGX-ST Trading Member to Maintain Position Accounts
          5A.4.2 Clearing Member who authorises the Authorised Trading Member under Rule 5A.4.1(a) shall ensure that the Authorised Trading Member performs the obligations under Rules 5A.1 and 5A.2, as they apply to the Authorised Trading Member in respect of each Authorised Account. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5A.4.3 The Clearing Member who authorises the Authorised Trading Member under Rule 5A.4.1(b) shall ensure that the Authorised Trading Member performs the obligations under Rules 5A.1, 5A.2, 5A.3 and 5A.6, as they apply to the Authorised Trading Member in respect of each Authorised Account. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5A.4.4(a) Clearing Member to give not less than 30 days' written notice to CDP of its intention to cease authorizing that Authorised Trading Member and the proposed date of cessation. Compoundable $500 $1,000 $2,000 N.A.
          5A.4.4(b) Clearing Member to satisfy CDP that it has taken, or will take, proper steps for the orderly clearing and settlement of the Authorised Trading Member's Exchange Trades. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          5A.4.4(c) Clearing member to comply with any reasonable direction of CDP in relation to the orderly cessation of the authorization of the Authorised Trading Member. Not compoundable N.A. N.A. N.A. $10,000
          5A.5 Position Accounts carrying positions for more than one beneficial owner
          5A.5.1 Clearing Member is to identify the beneficial owner(s) and/or controlling party(ies) of any Position Account to CDP upon request by CDP within such time as CDP may require. Not compoundable N.A. N.A. N.A. $10,000
          5A.6 Position Reconciliation
          5A.6.1 Clearing Member to ensure that positions in each Position Account maintained with CDP are accurate, and inform CDP and if required rectify any discrepancy immediately. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.

          Added on 1 July 2016 and amended on 10 December 2018.

        • Rule 6 — Clearing and Settlement

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 6 — Clearing and Settlement
          6.4 Settlement of Payment Obligations
          6.4.1 Clearing Member to pay CDP the Final Settlement Balance during prescribed time Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6.6A [deleted]
          [deleted] [deleted] [deleted] [deleted] [deleted] [deleted] [deleted]
          6.8 [deleted]
          6.8.2.2 [deleted] [deleted] [deleted] [deleted] [deleted] [deleted]
          6.8.3 [deleted] [deleted] [deleted] [deleted] [deleted] [deleted]

          Added on 16 May 2011 and amended on 21 January 2013 and 29 July 2013.

        • Rule 6A — Margin Requirements In Respect of Margins from Customers for Marginable Futures

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 6A — Margin Requirements
          6A.2 Clearing Member to Procure Customer Margins for Marginable Futures Contract
          6A.2.1 Clearing Member to procure Initial Margins and require customers to meet Customer Required Margins for Marginable Futures Contract Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6A.2.2 Clearing Member to comply with requirements on the computation and monitoring of customer's margins Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6A.2.3 Clearing Member not to allow Excess Margins to be withdrawn unless withdrawal does not cause the deposited collateral to be less than zero. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6A.3 Margin Management for Clearing Members in Respect of Margins from Customers for Marginable Futures Contracts
          6A.3.1 Clearing Member not to accept new orders or trades in Marginable Futures Contracts for clearing from any customer unless the specified conditions are met Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6A.3.2 Clearing Member to call for additional margins from its customer if the Customer Asset Value falls below the Customer Required Margins Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6A.3.6 In respect of Marginable Futures Contracts, Clearing Member not to set margin requirements that are less stringent than those prescribed by CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6A.4A Margin Management for Clearing Members In Respect of Any Margins from Cu
          6A.4A.1(3) Clearing Member to comply with CDP's directions to take such action to offset all or part of the positions to rectify a margin deficiency Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6A.5 Clearing Members to Deposit Margins with CDP
          6A.5.1 Clearing Member to deposit Clearing Member Required Margins with CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6A.5.4 Clearing Member not to deposit with CDP, monies and assets for its customer for the purpose of meeting Clearing Member Required Margin for Novated Contracts other than Marginable Futures Contracts Not Compoundable Not Compoundable $10,000
          6A.6 Monies and Assets Acceptable by CDP as Margins
          6A.6.4 Clearing Member to notify CDP as to whether Collateral is to be maintained solely as margin for Customer Accounts or otherwise. Not Compoundable Not Compoundable $10,000
          6A.9A Additional Margins
          6A.9A.2 Clearing Member to deposit additional margins with CDP by such time as CDP shall specify and in such form as CDP prescribes Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6A.10 Segregation of Customer's Money and Assets
          6A.10.1(1) Clearing Member to comply with the customer segregation requirements under the Rules and the SFA Not Compoundable Not Compoundable $10,000
          6A.10.1(2) Clearing Member to ensure that CDP is at all times provided with such information as it requires to discharge its segregation obligations under the SFA and/or enable CDP to issue the Authority with the verification of margin funds statement placed with CDP as required under the SFA Not Compoundable Not Compoundable $10,000
          6A.11 Notification of Under Segregation
          6A.11.1 Every Clearing Member shall immediately report to CDP of any under-segregation of moneys or assets as required under the Rules of the SFA Not Compoundable Not Compoundable $10,000
          6A.12 [deleted]
          [deleted] [deleted] [deleted] [deleted] [deleted] [deleted] [deleted]
          [deleted] [deleted] [deleted] [deleted] [deleted] [deleted]
          6A.14 Under-Margined Accounts
          6A.14.1 Clearing Member to immediately notify CDP when any account does not comply with the Customer Required Margins by an amount which exceeds its aggregate resources Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6A.15 [deleted]
          [deleted] [deleted] [deleted] [deleted] [deleted] [deleted] [deleted]

          Added on 16 May 2011 and amended on 21 January 2013 and 29 July 2013.

        • Rule 6B — Collateral

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 6B — Collateral
          6B.4 Collateral Deposit
          6B.4.1 Clearing Member to deposit with CDP such Collateral, in such form and denomination as may be prescribed by CDP Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6B.6 Valuation of Collateral
          6B.6.3 Following revaluation of any Collateral, where such Collateral is found to be insufficient to meet any obligation of the Clearing Member, Clearing Member to deposit with CDP such additional Collateral as may be required to meet such obligation, within such tme as CDP may require Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6B.7 Investment and Use of Collateral
          6B.7.1A Clearing Member to secure contractual waivers in favour of the Clearing Member from its customers, waiving their rights to interest and investment earnings from Collateral held with CDP. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6B.7.2 Clearing Member to ensure that all Collateral deposited with CDP are deposited on the basis that such Collateral shall be subject to the Clearing Rules, the Security Deed and the SFA, and that prior to depositing Collateral with CDP for the account or for the contracts of any person, such person has been notified of and has accepted that the Collateral is subject to the Clearing Rules, the Security Deed and the SFA. Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6B.8 Interest and Fees
          6B.8.1 Clearing Member to pay CDP such administrative fees as may be prescribed by CDP for the investment and management of the Collateral Compoundable $500 $1,000 $2,000 N.A.
          6B.9 Safekeeping Indemnity
          6B.9.4 If any loss of Collateral occurs, or any Collateral becomes unavailable to CDP such that any obligation of the Clearing Member cannot be fully met, Clearing Member to deposit with CDP such additional Collateral as may be required within such time as CDP may require Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          6B.10 Regulatory Information
          6B.10.1 Clearing Member to provide CDP with information in relation to Collateral deposited with CDP for regulatory purposes Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.

          Added on 21 January 2013 and amended on 22 April 2013.

        • Rule 7 — Clearing Fund

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 7 — Clearing Fund
          7.15 Time Payment of Contributions
          7.15.1 Clearing Member to pay the required Contribution or to topup deficiency in Contribution within prescribed time Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          7.7A Interest and Fees
          7.7A.1 Clearing Member to pay CDP such administrative fees as may be prescribed by CDP for the investment and management of the assets of the Clearing Fund and any excess monies and assets placed with CDP in respect of the Clearing Fund. Compoundable $500 $1,000 $2,000 N.A.

          Added on 16 May 2011 and amended on 21 January 2013.

        • Rule 8 — Default Rules

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 8 — Default Rules
          8.6B Application of Margins and Collateral
          8.6B.2 Clearing Member not to take any action or do anything that will interfere with CDP's ability to apply Contributions, margins or Collateral Not Compoundable Not Compoundable $10,000
          8.7 Certification of Net Sum Due
          8.7.1 Clearing Member to make payment of net amount payable to CDP in respect of Clearing Member's rights and obligations under these Clearing Rules Not Compoundable Not Compoundable $10,000
          8.9 Clearing Members to Render Assistance
          8.9.1 Defaulting Clearing Member to render all assistance and information, and to comply with all other requirements. Not Compoundable N.A. N.A. N.A. $10,000
          8.9.2 Clearing Members to assist with the settlement of New Sale Contracts and New Purchase Contracts. Not Compoundable N.A. N.A. N.A. $10,000

          Added on 16 May 2011 and amended on 21 January 2013 and 22 April 2013.

        • Rule 10 — Liabilities

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 10 — Liabilities
          10.2 Force Majeure
          10.2.3 Clearing Member to notify CDP and any other relevant party upon the occurrence of any event of Force Majeure Not Compoundable Not Compoundable $10,000
          10.6 Indemnity
          10.6.2 Clearing Member to reimburse the relevant Indemnified Person for the specified payments Compoundable $2,000 – $4,000 $4,000 – $7,000 $7,000 – $10,000 N.A.
          Clearing Member to render cooperation to the relevant Indemnified Person in respect of any legal, arbitration or other regulatory proceedings. Not Compoundable Not Compoundable $10,000

          Added on 16 May 2011 and amended on 15 September 2017.

        • Rule 11 — Supervisory Rules

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 11 — Supervisory Rules
          11.1 Clearing House Investigations
          11.1.3 Clearing Member to cooperate with investigations conducted by CDP Not Compoundable Not Compoundable $10,000
          11.1.4 Clearing Member, director, officer, employee or agent not to wilfully make, furnish or permit the making or furnishing of any false or misleading information, statement or report to CDP Not Compoundable Not Compoundable $10,000
          11.2 Clearing House Inspections
          11.2.3 Clearing Member to give Clearing House Inspector access to all information, books and records as requested Not Compoundable Not Compoundable $10,000
          11.2.5 Clearing Member to immediately pay fees for inspection by CDP Compoundable $500 $1,000 $2,000 N.A.
          11.6 Disiplinary Committee Proceedings
          11.6.4 Evidence
          11.6.4(3) Clearing Member not to breach its undertaking not to disclose information received from CDP in relation to the charge to any person, except to the legal representative of the person charged for the purposes of the hearing Not Compoundable Not Compoundable $10,000
          11.9 Appeal Proceedings
          11.9.5(2) Clearing Member not to breach its undertaking not to disclose information received from CDP in relation to the charge to any person, except to the legal representative of the person charged for the purposes of any appeal Not Compoundable Not Compoundable $10,000

          Added on 16 May 2011.

        • Rule 13 — General

          Rule Violation Whether composition may be offered Composition Amount which may be Offered by CDP, where CDP has Determined the Clearing Member to be Liable Mandatory minimum penalty imposable by the DC
          Rule Chapter/Number Brief Description of Rule 1st Violation 2nd Violation 3rd Violation
          Rule 13 — General
          13.2 Fees Payable
          13.2.1 Failure to pay CDP such fees and charges for the clearing and settlement of Exchange Trades based on CDP's fee schedules from time to time and such fines and default interest as may be imposed by CDP from time to time Compoundable $500 $1,000 $2,000 N.A.
          13.2.2 Failure to pay CDP such fees and charges for the clearing and settlement of Exchange Trades based on CDP's fee schedules from time to time and such fines and default interest as may be imposed by CDP from time to time Compoundable $500 $1,000 $2,000 N.A.

          Added on 16 May 2011.