Article 3.1.3

1.    The a admission of intermediaries to trading shall be subject to verification by Borsa Italiana, in accordance with objective non-discriminatory criteria, of fulfilment of the following requirements on a continuing basis:

-          sufficient staff with adequate professional qualifications in relation to the types of activity carried on and the types of interconnection with the markets;

-          adequate clearing and guarantee and settlement procedures;

-          adequate internal procedures and controls for trading activity;

-          identification of the compliance officer to Borsa Italiana. The compliance officer must have a good knowledge of these Rules and of the rules governing the functioning of the market and provide adequate support to the intermediary’s structures in their application. Among other things, the compliance officer shall be entrusted with relations with Borsa Italiana’s trading supervision office. The compliance officer shall appoint a deputy with analogous qualifications.

2.    Intermediaries must ensure the adequacy of the technological systems used for trading and associated activities carried on and the number and types of interconnections with the markets, and their compatibility with the electronic data processing and telecommunication support systems adopted by Borsa Italiana for the operation of the markets.

3.    Intermediaries may entrust the management of technological systems to third parties, subject to the conditions laid down in the Instructions.

4.      The admission of intermediaries shall also be subject to verification, according to the markets or financial instruments in which intermediaries intend to trade, of:

a)      direct or indirect participation in the settlement system through which contracts are settled and participation in their accessory systems (trade-checking systems);

b)      membership of the clearing and guarantee system for transactions in financial instruments referred to in Article 5.3.1.

5.    In order to participate in trading in markets or financial instruments that provide for contracts to be settled through a foreign settlement system, Borsa Italiana may require the intermediary to participate directly in such system.

6.    For markets and segments that are not guaranteed, in the case of indirect participation in the settlement system, i.e. where a market intermediary uses another intermediary to settle its contracts, the market intermediary and the other intermediary must send Borsa Italiana a declaration containing:

a)      an undertaking by the intermediary participating in the settlement system to settle contracts concluded in the markets by the approved intermediary up to the time of withdrawal from the agreement;

b)      an authorisation for the approved intermediary to be suspended by Borsa Italiana, at the request and on the responsibility of the intermediary participating in the settlement system, without Borsa Italiana being required or entitled to verify the appropriateness of such suspension or its conformity with any understandings between the approved intermediary and the participating intermediary.