| Guvnor

Status: In Force
Penalty ceiling: Regulated

Does it bind you?

Business-side roles with duties under this instrument.

Financial Services Firm52 Employer1

Other Acts binding the same actors

If a role above is yours, these are the other instruments that most often bind it.

Financial Services Firm — also bound by 167 other Acts

Commission Delegated Regulation (EU) No 231/2013 of 19 December 2012 supplementing Directive 2011/61/EU of the European Parliament and of the Council with regard to exemptions, general operating conditions, depositaries, leverage, transparency and supervision (Text with EEA relevance) 63 duties

Friendly Societies Act 1992 52 duties

The Financial Services and Markets Act 2000 (Recognition Requirements for Investment Exchanges , Clearing Houses and Central Securities Depositories ) Regulations 2001 50 duties

The Credit Unions (Northern Ireland) Order 1985 43 duties

Commission Delegated Regulation (EU) 2017/392 of 11 November 2016 supplementing Regulation (EU) No 909/2014 of the European Parliament and of the Council with regard to regulatory technical standards on authorisation, supervisory and operational requirements for central securities depositories (Text with EEA relevance) 39 duties

Employer — also bound by 682 other Acts

The Income Tax (Pay As You Earn) Regulations 2003 241 duties

Provision and Use of Work Equipment Regulations 1998 120 duties

TULRCA 1992 72 duties

Income Tax (Earnings and Pensions) Act 2003 54 duties

Employment Rights (Northern Ireland) Order 1996 (current NI employment law) 53 duties

What it requires

Regulations creating concrete business duties or carrying penalties, grouped as the instrument is structured. Titles link to the source text — blue means you’re leaving for legislation.gov.uk.

s.art003 Governance arrangements Regulated

Set up governance arrangements with clear roles, responsibilities and reporting linesEmployer

s.art004 Risk management and internal control mechanisms Regulated

Establish comprehensive risk management and internal control frameworkFinancial Services Firm

s.art005 Compliance policy and procedures Regulated

Establish and maintain compliance policies and procedures to detect and prevent regulatory breachesFinancial Services Firm

s.art006 Compliance function Regulated

Establish and maintain an independent compliance functionFinancial Services Firm

s.art007 Organisational structure and separation of the reporting lines Regulated

Set up board, committees and clear reporting linesFinancial Services Firm

s.art008 Remuneration policy Regulated

Establish and maintain a risk-aligned remuneration policyFinancial Services Firm

s.art009 Information technology systems Regulated

Ensure IT systems are reliable, secure and resilientFinancial Services Firm

s.art010 Disclosure Regulated

Publish CCP governance, rules, and risk information publiclyFinancial Services Firm

s.art011 Internal auditing Regulated

Set up an independent internal audit function that reports to the boardFinancial Services Firm

s.art012 General requirements Regulated

Keep proper records and provide them to regulators on requestFinancial Services Firm

s.art013 Transaction records Regulated

Maintain detailed, searchable records of all cleared transactionsFinancial Services Firm

s.art014 Position records Regulated

Maintain detailed records of positions and margins for each clearing memberFinancial Services Firm

s.art015 Business records Regulated

Maintain comprehensive business records as a central counterpartyFinancial Services Firm

s.art016 Records of data reported to a trade repository Regulated

Keep records of all reported transaction data including date and timeFinancial Services Firm

s.art017 Strategy and policy Regulated

Have a board-approved business continuity policy and disaster recovery planFinancial Services Firm

s.art018 Business impact analysis Regulated

Analyse and manage risks to critical business functionsFinancial Services Firm

s.art019 Disaster recovery Regulated

Maintain disaster recovery and business continuity arrangements for critical functionsFinancial Services Firm

s.art020 Testing and monitoring Regulated

Test and monitor your business continuity and disaster recovery plansFinancial Services Firm

s.art021 Maintenance Regulated

Regularly review and update business continuity policy and disaster recovery planFinancial Services Firm

s.art022 Crisis management Regulated

Establish and maintain a crisis management function with written procedures and post-crisis reviewFinancial Services Firm

s.art023 Communication Regulated

Maintain a crisis communication planFinancial Services Firm

s.art024 Percentage Regulated

Calculate initial margins with required confidence intervals and inform regulatorFinancial Services Firm

s.art025 Time horizon for the calculation of historical volatility Regulated

Calculate initial margins using at least 12 months of historical volatility dataFinancial Services Firm

s.art026 Time horizons for the liquidation period Regulated

Determine appropriate liquidation period time horizons for cleared instrumentsFinancial Services Firm

s.art027 Portfolio margining Regulated

Document and implement portfolio margining with correlation analysis and stress testingFinancial Services Firm

s.art028 Procyclicality Regulated

Central counterparties must limit procyclical margin changesFinancial Services Firm

s.art029 Framework and governance Regulated

Implement framework for defining extreme but plausible market conditionsFinancial Services Firm

s.art030 Identifying extreme but plausible market conditions Regulated

Identify extreme but plausible market conditions in your default risk frameworkFinancial Services Firm

s.art031 Reviewing extreme but plausible scenarios Regulated

Review extreme but plausible scenarios at least annually and report changes to boardFinancial Services Firm

s.art032 Assessment of liquidity risk Regulated

Establish and maintain a robust liquidity risk management frameworkFinancial Services Firm

s.art033 Access to liquidity Regulated

Maintain adequate liquid resources and manage liquidity riskFinancial Services Firm

s.art034 Concentration risk Regulated

Manage concentration of liquidity risk exposureFinancial Services Firm

s.art035 Calculation of the amount of the CCP’s own resources to be used in the default waterfall Regulated

Set aside dedicated own resources equal to 25% of your minimum capitalFinancial Services Firm

s.art036 Maintenance of the amount of the CCP’s own resources to be used in the default waterfall Regulated

Notify regulator of shortfall in dedicated own resources and replenish within one monthFinancial Services Firm

s.art037 General requirements Regulated

Establish and monitor collateral liquidity policies and review asset eligibility annuallyFinancial Services Firm

s.art040 Valuing collateral Regulated

Establish near real-time collateral monitoring and valuation policiesFinancial Services Firm

s.art041 Haircuts Regulated

Set and review prudent collateral haircuts for CCP clearingFinancial Services Firm

s.art042 Concentration limits Regulated

Manage concentration limits for CCP collateral and report breachesFinancial Services Firm

s.art045 Highly secured arrangements maintaining cash Regulated

Ensure cash deposits meet strict conditions on currency, counterparty, and collateralisationFinancial Services Firm

s.art047 Model Validation Regulated

Conduct comprehensive validation of risk models, methodologies and liquidity frameworkFinancial Services Firm

s.art048 Testing programmes Regulated

Test your risk models and liquidity framework with stress and back testingFinancial Services Firm

s.art049 Back testing procedure Regulated

Run daily back testing of margin models and report resultsFinancial Services Firm

s.art050 Sensitivity testing and analysis procedure Regulated

Test and analyze your CCP margin model under stress conditionsFinancial Services Firm

s.art051 Stress testing procedure Regulated

Your CCP must conduct regular stress tests on financial resourcesFinancial Services Firm

s.art052 Risk factors to stress test Regulated

Stress test for relevant risk factors in cleared contractsFinancial Services Firm

s.art053 Stress testing total financial resources Regulated

Hold enough financial resources to cover defaults of largest clearing membersFinancial Services Firm

s.art054 Stress testing liquid financial resources Regulated

Stress-test liquid financial resources and set up contingency proceduresFinancial Services Firm

s.art055 Maintaining sufficient coverage Regulated

Monitor market conditions and test margin and collateral adequacyFinancial Services Firm

s.art056 Review of models using test results Regulated

Review margin models and financial resources using test resultsFinancial Services Firm

s.art057 Reverse stress tests Regulated

Conduct reverse stress tests for extreme market conditionsFinancial Services Firm

s.art058 Testing default procedures Regulated

Test and update default procedures for member defaultsFinancial Services Firm

s.art059 Frequency Regulated

Regularly validate, test, and review risk models and frameworksFinancial Services Firm

s.art061 Information to be publicly disclosed Regulated

CCP must publicly disclose model principles and default proceduresFinancial Services Firm

15 other provisions — procedural and definitional

s.1 s.1

s.2 s.2

s.3 s.3

uri:annex/ii/division/1 uri:annex/ii/division/1

uri:annex/ii/division/2 uri:annex/ii/division/2

s.art001 Definitions

s.art002 Information to be provided to ESMA for the recognition of a CCP

s.art038 Cash collateral

s.art039 Financial instruments

s.art043 Highly liquid financial instruments

s.art044 Highly secured arrangements for the deposit of financial instruments

s.art045 Concentration limits

s.art046 Non-cash collateral

s.art060 The time horizons

s.art062 Entry into force and application

Duty extraction and severity labels are Guvnor’s analysis of the instrument, not the instrument itself. Always verify against the linked source text.

Commission Delegated Regulation (EU) No 153/2013 of 19 December 2012 supplementing Regulation (EU) No 648/2012 of the European Parliament and of the Council with regard to regulatory technical standards on requirements for central counterparties (Text with EEA relevance)

Does it bind you?

Other Acts binding the same actors

What it requires