Past version: Effective up to 20 Jan 2013
Without prejudice and subject to the other provisions of these 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 margins or collateral (including without limitation letters of credit procured by the Clearing Member to be issued to CDP) deposited by the Clearing Member in relation to House Accounts.
(2) 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 collateral, (including without limitation letters of credit procured by the Clearing Member to be issued to CDP) deposited by the Clearing Member in relation to Customer Accounts provided that the conditions in the SFA are satisfied; and
(b) any qualifying letters of credit deposited with 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 200923 January 2009.