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Requirements for Clearing Members

CM categories

CM categories:

Category "О" Clearing Member - General Clearing Member (Clearing Broker inclusively), is admitted to the clearing of partially secured trades
Category "B" Clearing Member - Individual Clearing Member, is admitted to the clearing of partially secured trades
Category "C" Clearing Member - Individual Clearing Member, is not admitted to the clearing of partially secured trades

Requirements in respect of Category "C" Clearing Members:

General requirements

Clearing membership agreement in force
agreement on integrated technical service provision, concluded with the Technical Centre, in force
to be a participant of the EDI System of the Moscow Exchange
to meet NCC requirements regarding information and reporting provision, stipulated by the Clearing Rules

Additionally for Credit Institutions

valid banking license issued by the Bank of Russia

Additionally for Non-credit Institutions, which perform licensed activities on the financial Market

valid license, issued by the Bank of Russia, on performing the particular type(s) of activity by non-credit financial institutions
valid broker license and/or dealer license and/or trust management license (for Clearing Members – Non-credit Institutions that are Professional securities market participants)

Additionally for Non-credit Institutions, which perform microfinance activities

information on such entities shall be included by the Bank of Russia in the state register of microfinance market participants

Additionally for Non-resident Banks

valid special permission (a license or other basement), issued by a competent authority of the state of establishment of a Non-resident Bank, on the basis of which a Non-resident Bank is entitled to execute banking operations, stipulated by a personal law

Additionally for Clearing Members that are Non-resident Non-credit Institutions or Non-credit Institutions, which do not perform licensed activity on the financial market or microfinance activity

valid special permission on performing operations on financial markets, issued by a competent authority of the state of establishment of a Clearing Member, or own assets (capital) not less than 1 000 000 000 (one billion) Russian rubles

Requirements in respect of Category "B" Clearing Members:

in addition to requirements, set in respect of Clearing Members of the category "C":

General requirements

contribution to the Default Fund of the relevant market in the amount defined for each market
there shall be no facts showing decline in the financial statement and/or there shall be no information that gives reasons to consider decline in the financial statement of a Clearing Members possible and/or inability of a Clearing Member to fulfil its obligations under Partially Secured Trades, to pay Margin Calls and/or other obligations of a Clearing Member, arising from the Clearing Rules (this requirement does not refer to national (central) banks of EurAsEC/EAEC member states)

Financial stability requirements

no grounds for bankruptcy-prevention measures under the laws of the Russian Federation on insolvency (bankruptcy) or under the domicile law of the Clearing Member
the Clearing Members - Credit Institutions shall comply with mandatory indicators and requirements for the minimum amount of equity (capital) set by the Bank of Russia / established by the competent authority of the state of establishment if, in accordance with the national legislation of the state of establishment of the Clearing Member, such mandatory indicators / requirements are established
no grounds for revocation by the Bank of Russia of the banking license under the banking legislation, no grounds for withdrawal in accordance with the national law of the country of registration of the Non-Resident Bank of a special permit (license or other document) issued by the competent authority of the country of registration of the Non-Resident Bank, where under the Non-Resident Bank is entitled to conduct banking operations

Requirements in respect of Category "O" Clearing Members

in addition to requirements, set in respect of Clearing Members of the categories "B" and "C":

General requirements

proprietary funds (equity) not less than 50 000 000 000 (fifty billions) Russian rubles,

proprietary funds (equity) not less than 20 000 000 000 (twenty billions) Russian rubles and

- international long-term credit rating in respect of obligations in Russian rubles or in foreign currency not lower than BB+ according to the rating agencies "Standard & Poor's" or "Fitch Ratings" or "Ba1" according to the rating agency "Moody's Investors Service", or

- national credit rating not lower than А- according to the Analytical Credit Rating Agency (АCRА) or the rating agency "Expert RA",

proprietary funds (equity) not less than 20 000 000 000 (twenty billions) Russian rubles under condition that an organization that is entitled directly or indirectly supervise the activity of a Clearing Member, has:

- national credit rating not lower than А- according to the Analytical Credit Rating Agency (АCRА) or the rating agency "Expert RA".

valid license issued by the Bank of Russia on executing banking operations with funds in Russian rubles and foreign currencies and/or a license on performing clearing activity (for Clearing Members - Residents).

Additionally for Clearing Members that are Non-resident Non-credit Institutions

valid special permission (license or other basement), issued by a competent authority of the state of establishment of a Clearing Member

Special requirement in respect of Clearing Members

Residence	Organization type	Organization category	Category "C"		Category "B"					Category "O"
Residence	Organization type	Organization category	Securities, Deposit and Credit Market	FX and Precious Metals Market	Securities, Deposit and Credit Market	FX and Precious Metals Market	Derivatives Market	Standardized OTC Derivatives markets	Commodities Market	Securities, Deposit and Credit Market	FX and Precious Metals Market	Derivatives Market
Residents	Credit Institutions	Banks and non-bank financial institutions							In the absence of financial market trading license Equity ≥ 1 bn RUB	Equity ≥ 50 bn RUB or - Equity ≥ 20 bn RUB and - External rating: S&P / Fitch ≥ BB+ or Moody's ≥ Ba1 or АCRА/ Expert RA ≥ A-*
	Non-credit Institutions	Professional securities market participants						Equity ≥ 0,3 bn RUB
	Non-credit Institutions	Investment fund managers				Not admitted
	Non-credit Institutions	Insurance companies						собственные средства (капитал) ≥ 10 млрд руб. и рейтинг S&P / Fitch на уровне не ниже BB-, либо рейтинг Moody's не ниже Ba3, либо рейтинг АКРА / Эксперт РА не ниже A-
	Non-credit Institutions	NPF				Not admitted
	Regional authorities				External rating: S&P / Fitch ≥ BB+ or Moody's ≥ Ba1 or АCRА/ Expert RA ≥ A-
	Corporations		Equity ≥ 1 bn RUB or Clearing Member shall provide an irrevocable and unconditional guarantee issued by an entity that has External rating: S&P / Fitch ≥ BB- or Moody's ≥ Ba3 or АCRА/ Expert RA ≥ A-	Equity ≥ 1 bn RUB	Equity ≥ 10 bn RUB	Equity ≥ 50 bn RUB or - Equity ≥ 20 bn RUB and - External rating: S&P / Fitch ≥ BB- or Moody's ≥ Ba3 or АCRА/ Expert RA ≥ A-*		Equity ≥ 10 bn RUB or - Equity ≥ 20 bn RUB and - External rating: S&P / Fitch ≥ BB- or Moody's ≥ Ba3 or АCRА/ Expert RA ≥ A-* Clearing member has at least 2 (two) employees, all of which correspond to the requirements, stipulated in paragraph 4.6.3 of the Clearing Rules	Equity ≥ 0,1 bn RUB and Clearing Member shall provide a letter from an organization that is entitled directly or indirectly supervise the activity of a Clearing Member has Equity ≥ 1 bn RUB
Non-residents	Banks				Equity ≥ 10 bn RUB or - Equity ≥ 5 bn RUB and - External rating: S&P / Fitch ≥ BB- or Moody's ≥ Ba3			Equity ≥ 0,3 bn RUB and External rating: S&P / Fitch ≥ BB- or Moody's ≥ Ba3 or АCRА/ Expert RA ≥ A-*
	Financial companies							Equity ≥ 0,3 bn RUB and External rating: S&P / Fitch ≥ BB- or Moody's ≥ Ba3 or АCRА/ Expert RA ≥ A-*
	Corporations		Equity ≥ 1 bn RUB or Clearing Member shall provide an irrevocable and unconditional guarantee issued by an entity that has External rating: S&P / Fitch ≥ BB- or Moody's ≥ Ba3 or АCRА/ Expert RA ≥ A-	Equity ≥ 1 bn RUB	Non EurAsEC/EAEC Clearing Member: Equity ≥ 10 bn RUB EurAsEC/EAEC Clearing Member: Equity ≥ 50 bn RUB or - Equity ≥ 10 bn RUB and - External rating: S&P / Fitch ≥ BB- or Moody's ≥ Ba3 or - Equity ≥ 20 bn RUB and - direct state ownership - more than 50%	Equity ≥ 50 bn RUB or - Equity ≥ 20 bn RUB and - External rating: S&P / Fitch ≥ BB- or Moody's ≥ Ba3 or АCRА/ Expert RA ≥ A-*

* Clearing Member or an organization that is entitled directly or indirectly supervise the activity of a Clearing Member

Category assignment and change

Clearing Member, which is not admitted to the clearing service on the relevant market, shall submit the Application for the clearing service provision in order to receive admission.

Clearing Member, which is admitted to the clearing service on the relevant market, shall submit the Application for the category change in order to change category. NCC executes such Application if the following requirements are met:

there is no Margin Calls through all Settlement Accounts;
there is no unpaid Debts through all Settlement Accounts.

NCC changes category if the abovementioned requirements are met and also if there is no non-fulfilled obligations under Trades, executed by the Market Participant with the indication of the relevant Clearing Member of the category "O" as the clearing broker.

NCC is entitled to change category of the Clearing Member from "C" to "B" without application if the Clearing Member meets the abovementioned requirements, set for the Clearing Member of the category "B".
NCC is entitled not to admit the Clearing Member to the clearing service on the relevant market(s):

- in the absence of positive financial result or positive retained earnings as of the last reporting date;

- provided the Clearing Members does not comply with the financial stability requirements;

- in the case of reputation risk that can arise from clearing service provision to the Clearing Member.