OPEN FOR COMMENT! ICE Clear Europe Limited’s Request to Withdraw from Registration as a Clearing Agency, it intends to terminate its credit default swap clearing business as of October 27, 2023.
TLDRS:
- ICE Clear Europe Limited’s Request to Withdraw from Registration as a Clearing Agency, it intends to terminate its credit default swap clearing business as of October 27, 2023
- ICE Clear Europe has the authority under ICE Clear Europe’s Rules to terminate and cash settle those contracts--will it be exercised though?
Source: https://public-inspection.federalregister.gov/2023-19847.pdf
ICE Clear Europe has the authority under ICE Clear Europe’s Rules to terminate and cash settle those contracts--will it be exercised though?
- At end-of-day (18:00 London time) on October 26, 2023, ICE Clear Europe will be permanently closed for CDS trade submission. Accordingly, effective as of the Withdrawal Date, ICE Clear Europe will no longer accept any CDS Contracts for clearing, and all open positions in CDS Contracts will have been closed out by the CDS Clearing Members holding the positions. To the extent any CDS Clearing Member has not completed the closing out of any open CDS positions as of the Withdrawal Date, ICE Clear Europe will be entitled and expects, pursuant to ICE Clear Europe Rule 105(b), to terminate and cash settle such positions. As a result, all liabilities in respect of the close out and/or termination of any open positions in CDS Contracts will be finally determined by end-of-day (18:00 London time) on the Withdrawal Date.
- Accordingly, effective as of the Withdrawal Date, ICE Clear Europe will no longer be performing any activities of a clearing agency with respect to security based swaps that would require registration under the Act.
- On the next business day following the Withdrawal Date (i.e., October 30, 2023), any remaining Margin or Permitted Cover held by ICE Clear Europe in respect of CDS Contracts will be available to CDS Clearing Members for withdrawal in accordance with standard ICE Clear Europe procedures, either through “autorelease” under ICE Clear Europe’s banking system or as instructed by the relevant CDS Clearing Member. On that same day (i.e., October 30, 2023), a new Guaranty Fund Period for the CDS Guaranty Fund will start. ICE Clear Europe will set the required CDS Guaranty Fund Contribution to “zero” and notify CDS Clearing Members in accordance with ICE Clear Europe Rule 1102 by end-of-day that same day (i.e., 18:00 London Time on October 30, 2023). The next day, on October 31, 2023, the CDS Guaranty Fund Contributions of CDS Clearing Members will be available for withdrawal in accordance with standard ICE Clear Europe procedures, either through “auto-release” under ICE Clear Europe’s banking system or as instructed by the relevant CDS Clearing Member.
- On the following Monday, November 6, 2023, ICE Clear Europe will follow its business-as-usual established processes for clearing membership terminations to calculate a final settlement amount reflecting any remaining net amount owed to or by each CDS Clearing Member, including with respect to any final fees and interest payments for the October 2023 period. Any such final amounts will be settled by 09:00 London time on November 7, 2023
How to comment:
- Use the Commission’s Internet comment form (- http://www.sec.gov/rules/other.shtml)
- Send and email to [email protected], Please include File No. 4-809 on the subject line.
- Send comments only via 1 method
- Do not include personal identifiable information in submissions; you should submit only information that you wish to make available publicly.
- Comments due by October 5th!
