Clearing Member is one of nine Exchange participant classes.
The Exchange refers to this class as GX-CM. It sits in the Clearing & Settlement group and carries the obligations set out below in addition to the requirements common to every participant.
Admission test: Audited financials for three years, a settlement account at a panel bank, and a named operations contact reachable during every corridor session.
Exchange Designation
Class Group
Public Register Entry
Rule Change Notice
Obligations of the Class
What it does
A Clearing Member novates its executed trades to the Exchange clearing house, which becomes buyer to every seller and seller to every buyer. From the moment of novation the member faces the clearing house, not its counterparty.
What it posts
Initial margin sized to a two-day close-out, variation margin called at least once per session, and a default fund contribution scaled to its share of cleared value.
Where it sits in a default
A defaulting member's margin is consumed first, then its own default fund contribution, then Exchange capital, and only then the mutualised contributions of surviving members.
What it may not do
A Clearing Member may not clear for third parties. Members that wish to extend clearing to non-members must be admitted as General Clearing Members.
Standing
Published
Admission, restriction, suspension and withdrawal for this class are published on the participant register with the effective date and the rulebook section relied on.
Reviewed annually
Standing is reviewed every year against the admission test, and at any time on a material change in the participant's circumstances.
Appealable
Adverse decisions may be referred to the Exchange review panel, which sits independently of the desk that made the original determination.
