LCH Ltd Account Structures under EMIR

The way in which CCPs manage members' and clients' assets is one of the most significant areas of change required by regulators. In Europe, EMIR has been designed to reduce counterparty risk and increase transparency within the markets.

LCH Ltd and SA offers members a choice of Individually Segregated and Omnibus Segregated accounts.

Click here to find out more about the choice of accounts that LCH Ltd offers (Last updated January 2014).

Please select the approriate LCH Legal Entity

LTD SA

For the purposes of all Security Deeds and Deeds of Release, Reassignment and Termination entered into by LCH Limited in preparation for LCH Limited's authorisation under EMIR (all such deeds, the ‘Deeds'), the Authorisation Date (as defined in the Deeds) will be 12 June 2014, such date being the ‘New Authorisation Date' for the purposes of the Deeds. This notification constitutes a notification for the purposes of (a) clause 7 of each Deed of Release, Reassignment and Termination that relates to a Tripartite Deed of Assignment, (b) clause 9 of each Deed of Release, Reassignment and Termination that relates to a Security Trustee Deed of Assignment, and (c) clause 9 of each Security Deed.

Click here for a copy of the Security Deed

Annual Account Fees

An annual fee is charged for the account types described below:

1.    For all Services except SwapClear & ForexClear
 

  ISA (£) OSA Net (£)  OSA Gross (£)
Business

Fee

Fee Fee
Denominated in £
EnClear 3,000 1,000 3,000
Equities 3,000 1,000 N/A
Derivatives 3,000 1,000 3,000
FEX*  3,000 1,000 3,000
Listed Rates** 3,000 1,000 3,000
RepoClear 3,000 1,000 N/A
LSE Derivative Markets 3,000 1,000 3,000

*FEX service not yet live

** For Listed Rates packages only: the first OSA account is charged at £0, subsequent OSA arrangements will be charged at £1,000 per OSA Net or £3,000 per Gross OSA per year.

‘OSA’ means Omnibus Segregated Account.

‘ISA’ means Individual Segregated Account.


2.    SwapClear & ForexClear Account Charges

SwapClear and ForexClear charge a semi-annual account fee for the 6 month periods beginning 1 January and 1 July. Account fees are calculated on the day immediately preceding each 6 month period, being 31 December and 30 June of each year (‘Billing Points’).

a.    ISA / OSA Net Account Charges

  6 Month Billing Charge (€)   Comparison Annual Cost (€)
Accounts package Per account Capped cost per package   Per account Capped cost
per package

1 - 50

1,750 50,000   3,500 100,000

51 - 100

1,000 60,000   2,000 120,000

101 - 200

600 75,000   1,200 150,000

200+

375 -   750 -

The account fee is calculated based on the number of Live Accounts^ of the relevant type within the SwapClear or ForexClear service on the last day of the previous period (i.e. 31 December and 30 June).

Account fees will be charged at the lower of (a) the number of accounts multiplied by the banded cost per account, and (b) the capped cost per package.

Package discounts apply in relation to each Client^^ or Client Group^^ (as applicable) considering all accounts opened across all Clearing Members for such Client or Client Group (as applicable). Once the account cost is calculated, it will be billed to the client’s respective Clearing Member(s). Clearing Members are responsible for pricing arrangements between themselves and their clients.


b.    OSA Gross Account Charges

The first OSA Gross is charged at €0/€0, subsequent OSA Gross arrangements will be charged at €1,750 for each 6 month period (comparison annual cost €3,500).
 

c.    Custodial Segregated Account Charges (SwapClear only)

LCH will charge a Clearing Member who has an open Custodial Segregated Account the following account fee on each Billing Point (i.e. 31 December and 30 June of each year):

  • A fee of €750 per account at the first Billing Point after account opening.
  • At the second Billing Point and each subsequent Billing Point, the applicable ‘6 Month Billing Charge’ fee (shown in column two in the table below) per account.
  • No fee applies for the period between account opening and the first Billing Point.  
Total Annualised SwapClear Client Clearing
Fees prior to the relevant Billing Point (€)
6 Month Billing
Charge (€)
Comparison
Annual Cost (€)
0 – 50,000 20,000 40,000
50,001 – 200,000 5,000 10,000
201,000 – 1,500,000 1,250 2,500
> 1,500,000 750 1,500

Please see these definitions which apply to the table above:

  • Total Annualised SwapClear Client Clearing Fees – The total SwapClear Client Clearing Fees which LCH has billed in relation to the Client^^ or Client Group^^ (as applicable) in the 6 month period prior to the relevant Billing Point (converted to an annualised amount).
  • SwapClear Client Clearing Fees – All SwapClear client clearing, compression and account fees (except Custodial Segregated Account fees) relating to the Client^^ or Client Group^^ (as applicable), irrespective of account type and Clearing Member.

Custodial Segregated Accounts are currently only offered by the SwapClear service.

Terms and conditions

LCH charges its Clearing Members and Clearing Members make their own pricing arrangements with their clients.

The fees do not apply to Clearing Member Proprietary Accounts.

The fees are non-refundable once paid, no refunds for partial years.

No discounts for multiple accounts, except where explicitly specified for SwapClear and ForexClear fee plans.

The same fee model applies to client accounts for Indirect Clearing Clients.  

On the creation of a new account, the account fee becomes immediately payable, and then annually on the anniversary of the creation date thereafter, except for SwapClear and ForexClear Accounts where fees are payable on a semi-annual basis.

Terms which begin with a capital letter, but are not defined, herein have the meaning assigned in the LCH Rulebook.

For SwapClear and ForexClear accounts specifically:

^ ‘Live Account’ means any account that has been onboarded and could accept transactions for clearing on the calculation date.

^^ ‘Client’ means a client for whom a Clearing Member maintains the relevant client account with LCH.

‘Client Group’ means all Clients who are managed as a group by the same investment or administrative manager (as determined by LCH).

Legal Implications

It is important that Clearing Members familiarise themselves with the legal implications associated with these client accounts.  LCH Limited has produced disclosure for the purposes of Article 39(7) of EMIR which can be accessed by clicking on the links below:

Legal Implications - Account Arrangements (Article 39.7 disclosure)

Legal Implications - Account Arrangements (Article 39.7 disclosure  - FCM business)

These disclosure statements include links to jurisdictional legal opinions which form part of such disclosure.  These legal opinions are also available within the jurisdictional legal opinions heading above and contain details of the main legal implications of the respective levels of segregation offered including information on the insolvency law applicable in the relevant jurisdictions (including, but not limited to, information on how the default rules interact with applicable local insolvency laws).

Click here to view LCH Limited's EMIR compliant Rulebook

Jurisdictional Risk Disclosure

The following risk disclosure notice must be provided by all clearing members that clear for clients through the SwapClear, ForexClear or EnClear (Freight Division) services to clients that are incorporated in Singapore or operate through a Singaporean branch.

Singapore Clearing Client Disclosure

Rates Service Default Management Disclosure

The following disclosure notice must be provided by all clearing members to each clearing client, and all clearing members must provide confirmation to the Clearing House that it has discharged this obligation with respect to each of its clearing clients.

Rates Service Default Management Disclosure

FCM Rates Service Default Management Disclosure


Click here to view this page as a PDF

 

Annual Account Fees

A yearly fee is charged for each ISA or OSA account as indicated in the table below.

  ISA OSA Net  OSA Gross
Business Fee Fee Fee
CDSClear* €0* €0* €0*
Derivatives €3,500 €1,200 €3,500
Equities €3,500 €1,200 €3,500
Fixed Income €3,500 €1,200 N/A
€GC Plus €3,500 €1,200 N/A

*CDSClear account structure fees will be waived until 31st December 2017.

 

Legal implications

It is important  that clearing members familiarise themselves with the legal implications associated with these ISA and OSA accounts.

Legal implications - Account Structures

Click here to see the current Cash and Derivatives markets and Fixed Income products Rulebook.

Click here to see the current CDS Clearing Rule Book.

Terms and conditions

This fee model becomes effective from the date LCH is authorised under EMIR

On the creation of a new account, the Fee becomes immediately payable, and annually on the anniversary of the creation date thereafter

For existing Client accounts, the fee applies upon LCH being authorised under EMIR and annually on the anniversary thereafter

The Fees do not apply to House accounts

The Fees are non-refundable once paid, no refunds for partial years
No discounts for multiple accounts

No adjustments for multiple collateral accounts

The same Fee model applies to Indirect Clearing Accounts

Jurisdictional Legal Opinions

Information will be published as it becomes available.

SA

Australia 
Belgium 
Denmark 
Finland
France
Germany
Italy 
Luxembourg
Netherlands
Portugal 
Spain
Sweden
Switzerland 
United Kingdom

Jurisdictional Legal Opinions

Ltd

Australia
Austria
Belgium
Canada (Ontario)
Canada (Quebec)
Denmark
England I
England II
Finland
France
Germany
Hong Kong
Ireland
Italy
Japan
Netherlands
New Zealand
Norway
Poland
Portugal
Scotland
Singapore
Spain
Sweden
Switzerland
USA
USA - FCM

SA
The following legal opinions are available on request

Belgium 
Denmark 
Finland
France
Germany
Italy 
Luxembourg
Netherlands
Portugal 
Spain
Sweden
Switzerland 
United Kingdom