1.   The resolution authority may reduce the amount of the CCP’s payment obligations to non-defaulting clearing members where those obligations arise from gains due in accordance with the CCP’s processes for paying variation margin or a payment that has the same economic effect.

2.   The resolution authority shall calculate any reduction in payment obligations referred to in paragraph 1 of this Article using an equitable allocation mechanism determined in the valuation conducted in accordance with Article 24(3) and communicated to the clearing members as soon as the resolution tool is applied. The clearing members shall, without undue delay, communicate the application of such tool to their clients and the way in which such application affects them. The total net gains to be reduced for each clearing member shall be proportional to the amounts due from the CCP.

3.   The reduction in the value of gains payable shall take effect and shall be immediately binding on the CCP and affected clearing members from the moment at which the resolution authority takes the resolution action.

4.   A non-defaulting clearing member shall not have any claim in any subsequent proceedings against the CCP, or its successor entity, arising from the reduction in payment obligations referred to in paragraph 1.

The first subparagraph of this paragraph shall not prevent resolution authorities from requiring the CCP to reimburse clearing members, where the level of reduction based on the provisional valuation referred to in Article 26(1) is found to exceed the level of reduction required based on the definitive valuation referred to in Article 26(2).

5.   Where a resolution authority reduces only in part the value of gains payable, the residual outstanding payable amount shall still be owed to the non-defaulting clearing member.

6.   The CCP shall include in its operating rules reference to the power to reduce payment obligations referred to in paragraph 1 in addition to any similar arrangements provided for in those operating rules at the recovery stage and shall ensure that contractual arrangements are concluded to allow the resolution authority to exercise its powers under this Article.