Oslo Clearing ASA Self Assessment ESCB-CESR Recommendation

11 - Risks in links between CCPs
CCPs that establish links either cross-border or domestically to clear trades should
design and operate such links so that they effectively reduce the risks associated with
the link. It should evaluate the potential sources of risks that can arise from the
linked CCP and from the link itself. It should ensure that the risks are managed
prudently on an ongoing basis. There should be a framework for co-ordination
between the relevant regulators and overseers.
Observing Recommendation 11
1. What kind of links are in operation? Has the CCP carried out an initial risk
assessment of the potential sources of risks that may stem from the linked CCP and
arise from the link? In particular, has the CCP ensured that the linked CCP observes
the ESCB-CESR Recommendations for CCPs (if established in the EU), or CPSS-IOSCO
Recommendations for CCPs (in the case of non EU CCPs)? Does the initial risk
assessment of the linked CCP include any other link arrangements of that CCP? Is the
risk assessment information up-to-date?
What kind of links are in operation?
Equity segment:
There is currently no interoperable link in operation for clearing of equity market
instruments traded on Oslo Børs and Oslo Axess.
Oslo Clearing, Oslo Børs and LCH signed a Memorandum of Understanding ("MoU") on
a clearing co-operation agreement on the 22 October 2009, with the intention for
both CCPs to clear equity market instruments on Oslo Børs and Oslo Axess. Oslo Børs
has appointed LCH as the second to clear its markets.
An interoperable link between Oslo Clearing and LCH presupposes an agreement
between Oslo Børs and LCH, but also that Oslo Clearing and LCH enter into a
agreement on the interoperable clearing.
LCH is required to obtain authorisation by the competent authorities, and the clearing
co-operation agreement between Oslo Clearing and the CCP will require approval
from the competent authorities. The commencement of the interoperable clearing
arrangement is pending on all parties reaching the necessary agreements, and
obtaining approval by the competent authorities.
Derivatives segment:
Oslo Clearing and Oslo Børs have entered into a linked exchange and clearing cooperation
on standardised derivatives with LCH and Turquoise (London Stock
Exchange Group, "LSEG") respectively. This agreement replaces the agreement
originally established in 2004 between NOS Clearing, Oslo Børs, OM Stockholm AB
and the OMLX Exchange in London. This agreement was terminated on the 7
December 2009.
48/69