Clearing and Settlement
Member firms must at all times have adequate clearing and settlement procedures in place.
The access to the clearing and settlement systems is not required to member firms acting as Non Executing Brokers only.
Trades executed on the ETFplus market are cleared by a Central Counterparty (CCP) System. The CCP manages counterparty risk by acting as a seller for the buyer and as a buyer for the seller of each trade executed on guaranteed markets.
On Borsa Italiana markets this function is carried out by Cassa di Compensazione e Garanzia S.p.A. (CC&G).
Applicant firms may become members of CC&G, acting as General Clearing Member (GCM), Individual Clearing Member (ICM) or Non Clearing Member (NCM).
For further information please refer to the CC&G website: http://www.ccg.it/en/home
Trades executed on the ETFplus market are settled via ‘ Express II’ run by Monte Titoli, the Italian Central Securities Depositary (CSD) for Borsa Italiana markets. Express II is a settlement service managing net and gross settlement functions for transactions in non-derivatives transactions.
Applicants trading on guaranteed markets can access Monte Titoli directly or indirectly regardless of their CC&G membership. Should they act as NCMs on the CC&G with no direct access to Monte Titoli, they need to have their trades settled either by their GCM or by their GCM’s settlement provider. Should they act as NCMs on CC&G and direct member on Monte Titoli they need to be authorized by their GCMs to settle trades via their own account at Monte Titoli.
In order to send execution feeds from ETFplus market to a CSD applicants need to access to X-TRM pre-settlement system managed by Monte Titoli. Access to this system can be direct or via a power of attorney granted to a third party.
For further information please refer to the Monte Titoli website: www.montetitoli.it