ADVOKS GLOBAL · KENYA
The Capital Markets (Derivatives Markets) Regulations
43. Duties of a clearing house of a derivatives exchange
Edition: 2025-02-14 · In force
43. Duties of a clearing house of a derivatives exchange
(1)A clearing house shall ensure that—(a)in so far as reasonably practicable, there is orderly, fair and expeditious clearing and settlement arrangements for any transactions in derivatives contracts, cleared or settled through its facilities; and(b)the risks associated with its business and operations are managed in a prudent manner.(2)In discharging its duty under subregulation (1), a clearing house shall—(a)act in the interest of the public; and(b)ensure that where the interest of the public conflicts with its interest, the interest of the public prevails.(3)A clearing house shall—(a)operate its facilities in accordance with the established clearing rules;(b)formulate and implement appropriate procedures to ensure that derivatives brokers comply with its rules;(c)ensure confidentiality of any information in its possession concerning its derivatives brokers and their clients, subject to disclosure of such information when required in writing to do so by the Authority, the derivatives exchange or if it is ordered by Court to do so; and(d)have efficient procedures and arrangements to address investor complaints.(4)A clearing house shall immediately notify the Authority if it becomes aware—(a)that any of its derivatives brokers is unable to comply with any rule of the clearing house or the derivatives exchange; and(b)of a financial irregularity or other matter which in the opinion of the clearing house may indicate that—(i)the financial standing or integrity of a derivatives broker is in question; or(ii)a derivatives broker may not be able to meet its legal obligations.(5)A clearing house shall, for the conduct of its business, provide and maintain at all times—(a)equate and properly equipped premises;(c)automated systems with adequate capacity and facilities to meet contingencies or emergencies,(d)security arrangements; and(e)technical support for the conduct of its business.