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I. Purpose
Osaka Exchange, Inc. (OSE) will partially revise the Clearing and Settlement Regulations, etc. with effect from April 20, 2017.
In consideration of the state of participation by remote trading participants, revisions will be made to enable a customer of a remote trading participant belonging to the same corporate group to, among others, directly submit margin to the remote trading participant's designated clearing participant. This shall be subject to the condition where the customer has, in advance, concluded the relevant agreements with the remote trading participant and its designated clearing participant.
II. Outline of revisions
1. Clearing margin
(1) Special rules concerning submission of clearing margin
・ If a customer of a remote trading participant (limited to a customer belonging to the same corporate group (meaning “corporate group” defined in Article 5, Paragraph 1, Item 2 of the Financial Instruments and Exchange Act) as the remote trading participant; the same will apply hereinafter) has concluded an agreement in advance with the remote trading participant and its designated clearing participant, it will be able to submit clearing margin to the designated clearing participant in place of the remote trading participant.
・ If such a customer has submitted clearing margin to the designated clearing participant, it will be deemed that the customer has submitted clearing margin to the remote trading participant and that the remote trading participant has submitted it to the designated clearing participant.
(2) Understanding status of submission of clearing margin, etc.
・ A remote trading participant that concluded the agreement in 1.(1) must establish an arrangement to understand the status of submission of clearing margin by such customer to the designated clearing participant.
・ A customer that submits clearing margin to the designated clearing participant shall report, to the remote trading participant in accordance with its instruction, the status of such submission to the designated clearing participant.
(3) Notification of required amount of clearing margin
・ If a designated clearing participant can understand the total required amount of clearing margin for a non-clearing participant's proprietary and customer accounts on each trading day, the non-clearing participant does not need to notify the designated clearing participant about such total required amount of clearing margin.
2. Settlement
(1) Settlement matters related to remote trading participant
(a) Special rules concerning settlement
・ If a remote trading participant has concluded an agreement in advance with its customer and its designated clearing participant, it will be able to make the customer and the designated clearing participant deliver/receive money/securities related to trades entrusted by the customer.
・ If such a customer has delivered/received the money/securities to/from the designated clearing participant, it will be deemed that the delivery/receipt has been conducted between the remote trading participant and its designated clearing participant.
(b) Understanding status of settlement
・ A remote trading participant that concluded the agreement described in 2.(1)(a) must establish an arrangement to understand the status of delivery/receipt of money/securities between the customer and the designated clearing participant.
(2) Settlement matters related to customer
(a) Special rules concerning settlement
・ If a customer has concluded an agreement in advance with a remote trading participant and its designated clearing participant, it will be able to conduct settlement with the designated clearing participant in place of the remote trading participant.
・ If such a customer has conducted settlement with the designated clearing participant, it will be deemed that the settlement has been conducted between the customer and the remote trading participant.
(b) Reporting concerning status of settlement
・ A customer that conducts settlement with the designated clearing participant shall report, to the remote trading participant in accordance with its instruction, the status of such settlement.
3. Miscellaneous
・ If a designated clearing participant can understand the resale and repurchase quantities of a non-clearing participant's trades, the non-clearing participant does not need to notify the designated clearing participant about the distinction between resale and repurchase of its trades, and the quantities thereof.
・ If a customer has concluded an agreement in advance with its remote trading participant and its designated clearing participant, it will be able to give instructions on options exercise, etc. to the designated clearing participant in place of the remote trading participant.
III. Effective Date
These revisions will be effective on April 20, 2017.
