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