Updated 18/09/2024
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CCPRRR ToolDelegated Regulation 2024/450
Article 5

Article 5 - The sale of assets or of business lines

Article 5

The sale of assets or of business lines

1.   Where the measures to be adopted to restore the CCP’s long-term viability include the sale of assets or of business lines referred to in Article 37(3), point (c), of Regulation (EU) 2021/23, the description referred to in Article 2(1) of this Regulation shall include the following elements:

(a)

a description of the measures identifying which of the CCP’s relevant business lines or assets and relating liabilities, rights and obligations, will be wound up or sold, including:

(i)

a description of the relevant conditions for the winding up or sale;

(ii)

the method for the winding up or sale, including the underlying assumptions and any possible expected losses;

(iii)

the expected timescale;

(iv)

any financing or services provided by or to the remaining CCP;

(b)

where part of the business line or asset form part of the CCP’s critical functions or core business lines, a description of how, to the extent the information is available to the CCP, such critical functions or core business lines could be separated from other critical or non-critical functions or core business lines in economic, operational and legal terms;

(c)

where part of the business line or asset form part of the CCP’s critical functions or core business lines, a description of, to the extent the information is available to the CCP, any possible material effects of such separation of assets on clearing members and, to the extent that the information is available, their direct and indirect clients, as well as on trading venues and other FMIs and CCPs;

(d)

where relevant and where possible to identify, a description of any material effects due to the wind up or sale of relevant business lines or assets and positions of the CCP on:

(i)

netting sets, operations or legal arrangements for clearing members and, to the extent that the information is available, their direct and indirect clients;

(ii)

the calculation of collateral requirements, in particular variation margins, and how such wind up or sale could materially affect the collateral requested by clearing members, and, to the extent that the information is available, their direct and indirect clients;

(iii)

the price of allocating and transferring such positions and transactions to another CCP;

(iv)

an explanation of the process for the portability of positions and related assets of the clearing members and clients of the CCP to another CCP, where envisaged, and a description of how likely such portability is to be successful and the measures to be taken to facilitate it;

(v)

a description of the following:

(i)

how the CCP keeps up to date the relevant data on positions in the client omnibus and segregated accounts during the business reorganisation;

(ii)

how the CCP is able to provide the relevant information rapidly during the reorganisation to ensure that all positions and transactions, including client positions, where identifiable, held at the CCP can be identified and potentially transferred successfully;

(e)

where service arrangements or other contractual arrangements are provided by group entities, a description of how such group entities will be affected;

(f)

a description of how the business reorganisation plan takes into account and ensures continuity of the CCP’s legal and technical arrangements and how the plan supports the transfer of the CCP’s functions, including a description of any agreements entered into with other FMIs or relevant service providers in preparation for the application of the business reorganisation plan.

2.   For the parts of the CCP that will not be wound up or sold, the business reorganisation plan shall indicate ways to remedy any shortcomings in their operation or performance that could have an impact on their long-term viability, even if those shortcomings are not directly related to the failure of the CCP.