In the event of a clearing Member default, the primary responsibility of the Clearing House is to contain the cost of closing out the Defaulter’s position to an amount less than the margin and guaranty fund contribution of the Defaulter.

This protects both the non-defaulting Members and the Clearing House from losses and by extension the markets that the clearing house provides clearing services to.

ICE Clear Europe has extensive powers under the Clearing Rules (Part 9: Default Rules) that allow it to perform this function. This includes details on events that could constitute an Event of Default.

The Clearing House will, on a best endeavours basis and where it is able to identify individual client positions and it does not compromise its duty to contain the Defaulter’s losses, assist clients of the Defaulter in the transfer of their positions to an alternative Member. Please note that, under the existing client account structure and relevant laws and regulations, individual clients margin monies cannot be ported at the same time as positions.