Past version: Effective from 17 Jul 2019 to 05 Sep 2021
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 201322 April 2013 and 17 July 201917 July 2019.