LCH.Clearnet has signed a memorandum of understanding with the European Multilateral Clearing Facility (EMCF) to introduce a user-choice clearing model.
The agreement will enable trading participants on Chi-X and BATS Europe to select the clearing house of their choice, maximising value to users whilst continuing to ensure the highest standards of risk management. LCH.Clearnet members can benefit from higher volumes which translate into lower clearing fees, now as low as 1p.
In 2003, LCH.Clearnet led the way with clearing house interoperability by successfully implementing and operating a clearing service for SIX Swiss Exchange (formerly virt-x) with SIX x-clear (formerly SIS x-clear).
Wayne Eagle, Director, Equity services said: "The agreement with EMCF highlights our long-standing commitment to interoperability across the European equities market. EquityClear offers a compelling combination of high-quality service and cost-effective pricing, which continues to drive our market share."
Commenting on the announcement, Hirander Misra, COO of Chi-X Europe, said, "We believe that the user choice offered by CCP interoperability will help lower the overall frictional costs of trading. We welcome this cooperation between LCH.Clearnet and EMCF for the benefit of the industry."
Mark Hemsley, CEO of BATS Europe said: "BATS Europe fully supports the agreement, which is a major step forward for European equities trading. The implementation of interoperability will deliver clearing choice resulting in cost efficiency and service innovation for our participants."
The deal between LCH.Clearnet and EMCF is in line with the Access and Interoperability Guidelines within the European Code of Conduct and is subject to regulatory approval.