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Central Moneymarkets Unit
OTC Derivatives Trade Repository
Matching and Confirmation Service
Reference Manual
December 2012
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 2
CONTENTS Clause Page 1. INTRODUCTION……………………………………………………………………….. 6 1.1 Purpose…………………………………………………………………………………...... 6 1.2 CMU contact for TR Service……………………………………………………………… 6 1.3 Related Documents………………………………………………………………………... 7 1.4 Operating Procedures……………………………………………………………………… 7
2. BACKGROUND………………………………………………………………………….. 8 2.1 Enquiries on Mandatory Clearing Requirements………………………………………….. 9
3. MATCHING AND CONFIRMATION SERVICE……………………………………. 10 3.1 HKTR Matching and Confirmation Service Product Scope……………………………… . 10 3.2 Business Day……………………………………………………………………………...... 11
4. PARTICIPATION PROCEDURES…………………………………………………….. 12 4.1 CMU TR Membership……………………………………………………………………... 12 4.2 Operation Information……………………………………………………………………... 13 4.3 Obligations of CMU TR Member………………………………………………………….. 14
5. LEAVING THE MATCHING AND CONFIRMATION SERVICE…………………. 16 5.1 Termination Notice………………………………………………………………………… 16 5.2 Termination Arrangements………………………………………………………………… 16
6. SUSPENSION OR TERMINATION BY THE HKTR………………………………… 17 6.1 Suspension or Termination of Access to Service………………………………………….. 17
7. CONNECTING TO THE HKTR………………………………………………………... 18 7.1 Connection and Information Submission Channels………………………………………... 18
8. TRADE INFORMATION SUBMISSION………………………………………………. 19 8.1 Trade Information Submission Approach………………………………………………….. 19 8.2 Parties to Submit Trade Information………………………………………………………..20 8.3 Scope of Trade Information to be Submitted………………………………………………. 20 8.4 Format of Trade Information Submission…………………………………………………..21 8.5 Timeframe for Trade Information Submission…………………………………………….. 23 8.6 HKTR System Window for Capturing Trade Information…………………...……………. 23
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 3
Clause Page 9. TRADE MATCHING AND CONFIRMATION……………………………………….. 25 9.1 Transaction or Trade Event Validation…………………………………………………….. 25 9.2 Transaction or Trade Event Matching and Confirmation………………………………….. 25
10. TRADE SUBMISSION FOR CLEARING AND DECLEARING…………………….. 28 10.1 Trade Submission for Central Clearing……………………………………………………. 28 10.2 Declearing of Trade from the CCP and Resend for Clearing……………………………… 28
11. MATCHING AND CONFIRMATION SERVICE REPORTS……………………….. 30 11.1 Types of Report……………………………………………………………………………. 30 11.2 Reconciliation of Reports………………………………………………………………….. 30
12. CONTINGENCY ARRANGEMENTS………………………………………………….. 31 12.1 Local Terminal Service…………………………………………………………………….. 31 12.2 Typhoon and Rainstorm Procedures……………………………………………………….. 31
13. BILLING………………………………………………………………………………….. 32 13.1 Settlement Arrangements…………………………………………………………………. 32 13.2 Billing Arrangements……………………………………………………………………... 33
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 4
APPENDICES
Version date TR.1 CMU TR Membership Application Form
December 2012
TR.2 CMU TR Member Record of Authorized Signatures
December 2012
TR.3 CMU TR Member Profile Maintenance Form
December 2012
TR.4 CMU TR Member Administrative Account Setup Form
December 2012
TR.5 Broker List of CMU TR Member
December 2012
TR.6 Designation of Hong Kong Dollar Account for Settling Fees and Charges
December 2012
TR.7 Direct Debit Limit of Settlement Bank
December 2012
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 5
ANNEXES
Version date Availability 1 HKTR Matching and Confirmation
Service Product Scope
December 2012 Attached
2 Fee Scale for Matching and Confirmation Service
December 2012 Attached
3 Matching and Confirmation Service Agreement
December 2012 Available on request
4 Trade Repository Administration and
Interface Development Guide – Matching and Confirmation Service
December 2012 Available on request
5 HKTR Matching and Confirmation Service Training Materials (Compact Disc)
December 2012 Available on request
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 6
1. INTRODUCTION This OTC Derivatives Trade Repository Matching and Confirmation Service
Reference Manual (“Manual”) describes the matching and confirmation service for
over-the-counter (“OTC”) derivatives transactions (“Matching and Confirmation
Service”) provided by the OTC Derivatives Trade Repository (“HKTR”) operated by
the Central Moneymarkets Unit (“CMU”) to CMU TR Members in accordance with,
and subject to any limitations contained in their Matching and Confirmation Service
Agreements with the HKMA. Any of the provisions of this Manual or of operational
circulars may be varied at any time upon written notice to that effect being given by
the HKMA to CMU TR Members without their agreements.
1.1 Purpose
Set out in this Manual are the procedures for CMU TR Membership and
communications, the security provision underlying the Matching and Confirmation
Service and details of the various processes. The Appendices at the back of this
Manual provide sample forms for use by CMU TR Members.
1.2 CMU contact for TR Service
All requests for further information relating to the Matching and Confirmation
Service described in this document should be directed to:
Trade Repository – Central Moneymarkets Unit,
Hong Kong Monetary Authority
55th Floor
Two International Finance Centre
8 Finance Street
Central
Hong Kong
Telephone : (852) 8100 3115
Facsimile : (852) 2878 1679
e-mail : [email protected]
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 7
For technical support and enquiries on the operation of the computer system for
accessing and making use of the Matching and Confirmation Service, please contact
the Hong Kong Interbank Clearing Limited (“HKICL”) at:
Services Support
Hong Kong Interbank Clearing Limited
Telephone : (852) 2533 1100
Facsimile : (852) 2533 1123
e-mail : [email protected]
1.3 Related Documents
The following documents issued by the HKMA may contain further information in
relation to the operation of the Matching and Confirmation Service:
(a) Operating Procedures for Trade Repository - User Manual for Participants
(Administrative Functions)
(b) Operating Procedures for Trade Repository - User Manual for Participants (Trade
Functions – Matching and Confirmation Service)
(c) Operating Procedures for Trade Repository - User Manual for Participants (Trade
Functions – Matching and Confirmation Service - Appendix)
(d) Trade Repository Administration and Interface Development Guide – Matching
and Confirmation Service (“Matching and Confirmation Service AIDG”)
1.4 Operating Procedures
For the sake of clarity, the term “Operating Procedures” mentioned in this Manual
include this OTC Derivatives Trade Repository Matching and Confirmation Service
Reference Manual and operational circulars issued by the HKMA from time to time.
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 8
2. BACKGROUND
The global financial crisis in 2008 triggered a global movement to improve
transparency and reduce counterparty risks in the OTC derivatives markets, resulting
in reforms to the OTC derivatives markets on various fronts. The reform measures
adopted by the international regulatory community include requiring all OTC
derivatives transactions be reported to trade repositories (“TRs”) and all standardized
OTC derivatives transactions be cleared at central counterparty (“CCP”) clearing
facilities.
To meet international standards, the HKMA announced in December 2010 to
establish a TR in Hong Kong under the CMU, and that a link will be developed
between the TR and the CCP for OTC derivatives to be launched by Hong Kong
Exchanges and Clearing Ltd. (“HKEx”) to allow eligible transactions to be passed to
the CCP for central clearing. The HKMA also worked in concert with the
Government and the Securities and Futures Commission (“SFC”) to build a regulatory
regime for the OTC derivatives markets (“OTC regulatory regime”) under the
Securities and Futures Ordinance (“SFO”), including requirements for mandatory
reporting to the TR of the HKMA and mandatory clearing at designated CCPs.
Under the OTC regulatory regime to be established, Authorized Institutions (“AIs”)
and Approved Money Brokers (“AMBs”) licensed and regulated by the HKMA under
the Banking Ordinance, Licensed Corporations (“LCs”) licensed and regulated by the
SFC under the SFO, and any Hong Kong persons that are a counterparty in a specified
OTC derivatives transaction and with an activity level in OTC derivatives exceeding a
threshold are expected to be required to clear specified transactions through a
designated CCP, except where an exemption applies.
The HKTR provides an electronic platform for matching and confirming the details of
OTC derivatives transactions efficiently, securely and in conformity with market
standards, and submitting transactions to the CCP of the HKEx for central clearing,
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 9
primarily for facilitating market participants to meet the mandatory clearing
requirements under the OTC regulatory regime.
2.1 Enquiries on Mandatory Clearing Requirements
AIs should direct their enquiries on the mandatory clearing requirements to their usual
supervisory contacts at the Banking Supervision Department of the HKMA.
AMBs should direct their enquiries on the mandatory clearing requirements to their
usual contacts at the Payment Systems Oversight and Licensing Division of the
Banking Conduct Department of the HKMA.
Entities or persons other than an AI or an AMB should direct their enquiries on the
mandatory clearing requirements to the SFC at: [email protected].
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 10
3. MATCHING AND CONFIRMATION SERVICE
The HKTR provides service to CMU TR members who are users of the CCP of the
HKEx for matching and confirming OTC derivatives transactions eligible and
intended for central clearing at the CCP of the HKEx, and submitting the confirmed
details of the transactions to it for clearing. For the avoidance of doubt, the HKTR
does not match and confirm transactions not intended for central clearing at the CCP
of the HKEx.
Pursuant to the Matching and Confirmation Service Agreement, the transactions
matched and confirmed through the Service would be binding on the CMU TR
Members.
3.1 HKTR Matching and Confirmation Service Product Scope
The types of OTC derivatives product supported by the Matching and Confirmation
Service of the HKTR (“HKTR Matching and Confirmation Service Product Scope”)
are determined by the types of product subject to mandatory clearing under the OTC
regulatory regime and those supported by the CCP of the HKEx.
Over time, new OTC derivatives products may be added to the Matching and
Confirmation Service as the scope of products subject to mandatory clearing under the
OTC regulatory regime expands. It should be noted that products supported by the
CCP of the HKEx but not subject to mandatory clearing may not be supported by the
Matching and Confirmation Service of the HKTR.
The HKTR Matching and Confirmation Service Product Scope can be found in
Annex 1. The updated list is also available in the HKTR Section of the HKMA
website. Changes to the list will be advised to CMU TR Members through circulars.
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 11
3.2 Business Day
The term “business day” as stipulated in this Manual means a day other than a
Saturday, a Sunday or a day which is a general holiday as specified in the General
Holidays Ordinance (Chapter 149 of the Laws of Hong Kong) except otherwise
specified in the relevant chapters of this Manual.
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 12
4. PARTICIPATION PROCEDURES
4.1 CMU TR Membership
The Matching and Confirmation Service of the HKTR is open only to Clearing
Members of the CCP of the HKEx. For the avoidance of doubt, Clearing Members of
the CCP of the HKEx that are not subject to mandatory clearing requirement under
the OTC regulatory regime are eligible to participate in the Service. Similarly,
transactions in a product within the HKTR Matching and Confirmation Service
Product Scope that are not subject to mandatory clearing, e.g. if one transacting party
is exempted from mandatory clearing, can be submitted to the HKTR for matching
and confirmation, and submission for central clearing, on a voluntary basis.
Application for CMU TR Membership must be made in writing to the HKTR. Prior
to becoming a CMU TR Member, each successful applicant is required to enter into a
contractual agreement with the HKMA, i.e. the Matching and Confirmation Service
Agreement. Each successful applicant will be assigned and advised a unique CMU
TR Member code to represent its identity in the HKTR system.
The list of CMU TR Members and their CMU TR Member codes can be found in the
HKTR section of the HKMA website. The list will be updated regularly. Changes to
the list will also be advised to CMU TR Members through circulars.
The Matching and Confirmation Service Agreement, which incorporates the
provisions of this Manual, as updated from time to time, together with any directions
given in HKTR circulars by the HKMA, sets out the terms and conditions of the
Matching and Confirmation Service Agreement with which a CMU TR Member is
required to comply.
It should be noted that apart from the Matching and Confirmation Service, the HKTR
may also provide reporting service to CMU TR Members for them to fulfil their
statutory reporting obligations under the OTC regulatory regime (“Reporting
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 13
Service”). The Reporting Service is provided independently of the Matching and
Confirmation Service, and is subject to a different set of procedures. Trade
information submitted to the HKTR under the Matching and Confirmation Service
cannot be applied to the Reporting Service.
4.2 Operation Information
Before joining the Matching and Confirmation Service, a CMU TR Member must
supply certain operation information to the HKTR by completing and submitting the
following forms to the HKTR:
(a) CMU TR Membership Application Form attached at Appendix TR.1
(b) CMU TR Member Record of Authorized Signatures form attached at Appendix
TR.2
(c) CMU TR Member Profile Maintenance Form attached at Appendix TR.3
(d) CMU TR Member Administrative Account Setup Form at Appendix TR.4
(e) Broker List of CMU TR Member, if applicable, at Appendix TR.5
(f) Designation of Hong Kong Dollar Account for Settling Fees and Charges form
attached at Appendix TR.6
(g) Direct Debit Limit of Settlement Bank form, if applicable, attached at Appendix
TR.7
Unless otherwise required by or agreed with the HKTR, the above completed forms
must be submitted to the HKTR at least 10 business days before the date on which the
CMU TR Member can commence making use of the Matching and Confirmation
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 14
Service, subject to the completion of other relevant logistical and technical
arrangements.
After the CMU TR Membership has commenced, any changes to the operation
information must be notified to the HKTR in writing, supported by updated version of
the relevant forms, if applicable. Unless otherwise required by or agreed with the
HKTR, CMU TR Members should notify the HKTR a change at least 10 business
days before the change takes effect.
4.3 Obligations of CMU TR Member
All CMU TR Members must fulfil the following obligations:
(a) All CMU TR Members shall have systems in place which are complementary to
the HKMA/HKICL’s contingency arrangements so as to enable HKMA/HKICL
to ensure timely recovery of its usual operation in the event of occurrence of an
adverse contingency affecting such operation. Such contingency arrangements
shall be modified from time to time in the manner required by the HKMA, and
the HKMA shall notify CMU TR Members the changes accordingly.
(b) CMU TR Members shall participate in the contingency drills arranged by the
HKMA/HKICL from time to time so as to verify the readiness of CMU TR
Members’ contingency arrangements.
(c) CMU TR Members shall participate in various member/simulation tests
arranged by the HKMA/HKICL from time to time so as to prepare themselves
ready for any new service to be launched.
The HKMA will through HKICL monitor performance by CMU TR Members of
these obligations under the arrangements.
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 15
In the event that HKICL becomes aware of any non performance by any CMU TR
Member of its obligations under these arrangements, HKICL shall as soon as
practicable inform the CMU TR Member concerned and request it to ensure
performance of the relevant provision, and inform the HKMA of such incident.
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 16
5. LEAVING THE MATCHING AND CONFIRMATION SERVICE
5.1 Termination Notice
At least 30 calendar days’ notice in writing is required if a CMU TR Member is to
withdraw from the Matching and Confirmation Service or terminate its CMU TR
Membership.
5.2 Termination Arrangements
After a CMU TR Member leaves the Matching and Confirmation Service, or
terminates its CMU TR Membership, it will no longer be able to gain access through
the HKTR to those of its transactions previously matched and confirmed, and
submitted to the CCP of the HKEx, including where it becomes necessary to declear a
transaction from the CCP. It will need to approach the CCP of the HKEx directly or
to do so through another matching and confirmation platform, subject to the relevant
procedures promulgated by or agreed with the CCP.
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 17
6. SUSPENSION OR TERMINATION BY THE HKTR
6.1 Suspension or Termination of Access to Service
Under the terms of the Matching and Confirmation Service Agreement, the HKMA
may suspend or terminate the membership of a CMU TR Member or its access to the
Matching and Confirmation Service under specified circumstances. On suspension or
termination of a CMU TR Membership, the HKTR will:
(a) prevent the CMU TR Member from accessing the Matching and Confirmation
Service until the HKMA authorises otherwise
(b) inform other CMU TR Members as soon as practicable about the suspension or
termination
The Matching and Confirmation Service will, however, continue to be in operation
subject to the terms and conditions of the Matching and Confirmation Service
Agreement. Insofar as any transactions or trade events submitted to the HKTR before
the suspension are concerned, the HKTR system will continue to match and confirm
them after the suspension takes effect. Where a transaction or trade event does not
require further input from the suspended CMU TR Member (which is no longer
feasible after the suspension) for matching and confirmation, and submission for
clearing, e.g. correction of mis-matched details, making a request for sending to
clearing, it will be submitted to the CCP for clearing after it is matched and confirmed
by the HKTR system.
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 18
7. CONNECTING TO THE HKTR
7.1 Connection and Information Submission Channels
CMU TR Members have to submit trade information of OTC derivatives transactions
to the HKTR for matching and confirmation through the channels specified by the
HKTR. All CMU TR Members can submit trade information to the HKTR through
internet. CMU TR Members that are users of FinNet1 and SWIFTNet can also submit
trade information via such two channels. For the avoidance of doubt, CMU TR
Members may adopt multiple channels for the submission of trade information of
different transactions, of same or different products, to the HKTR simultaneously.
The system connection and interface of CMU TR Members with the HKTR for trade
information submission should be developed and established in conformity with the
specifications set out in the Matching and Confirmation Service AIDG. Submission
of trade information via the established channels must also be made in conformity
with the standards specified in the AIDG, for example, standards of file format, file
naming convention, configuration of parameters under different channels, user
authentication, etc.
1 The operation of FinNet is expected be taken up by the HKICL starting from March 2013. Users of the new communication platform (“ICL Net”) replacing FinNet can submit specified trade information to the HKTR through the new platform
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 19
8. TRADE INFORMATION SUBMISSION
8.1 Trade Information Submission Approach
Except in the case of backloading outstanding transactions to the HKTR, CMU TR
Members have to adopt life-cycle approach for submitting trade information of OTC
derivatives transactions to the HKTR for matching and confirmation, and submission
for central clearing. Under the life-cycle approach, CMU TR Members have to
submit trade information at inception and on subsequent trade events (collectively
referred to as “trade events” hereinafter) individually and sequentially, in
chronological order, as they occur until the expiry or scheduled termination of the
contract. Each submission made will therefore signify a single trade event.
In the case of backloading, CMU TR Members have to submit trade information of
the outstanding position of the transactions intended for matching and confirmation to
the HKTR. New trade events of an outstanding transaction can be submitted to the
HKTR only after the transaction has been backloaded to the HKTR, and similarly,
one-by-one in sequential order.
Trade events applicable to transactions in different types of OTC derivatives product
may be different, due to differences in the economic substance and underlying of
different products, as well as the specific clearing requirements of the CCP of the
HKEx for the products. Generally, the trade events supported by the HKTR for
matching and confirmation include backloading, trade inception, amendment of
transaction details, novation, early termination of trade, submission for central
clearing at CCP, and declearing from CCP. In addition, CMU TR Members may
initiate requests to manage the trade events submitted to the HKTR, e.g. cancellation,
quit. For details of the trade events applicable to different products and under
different circumstances, please refer to the Matching and Confirmation Service AIDG.
Each trade event should be backloaded or submitted to the HKTR only once. In the
event that a CMU TR Member is simultaneously making use of multiple channels for
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 20
trade information submission, it must ensure that there is no duplication of submission
through the various channels.
8.2 Parties to Submit Trade Information
If a trade event is intended to be matched and confirmed at the HKTR through the
automatic mode, both transacting CMU TR Members of the transaction concerned
have to submit the trade information of the event (in opposite direction) to the HKTR.
If the event is intended for matching and confirmation by the affirmation mode, only
one of the transacting CMU TR Members is required to submit, and its counterparty
CMU TR Member can confirm the event by affirming on the HKTR system the event
submitted by the submitting CMU TR Member (see details in clause 9.2).
Transacting CMU TR Members should agree among themselves the matching and
confirmation mode applicable to their trade events. For the avoidance of doubt, a
CMU TR Member may adopt different matching and confirmation modes for
transactions with different counterparty CMU TR Members, and for different
transactions or trade events with the same counterparty CMU TR Member.
8.3 Scope of Trade Information to be Submitted
The scope of information of a trade event required to be submitted to the HKTR for
matching and confirmation will depend on the nature of the event, the type of product
to which the transaction belongs and the relevant clearing requirements of the CCP of
the HKEx. The information required generally includes information required by the
HKTR to administer the trade events received from CMU TR Members, information
commonly adopted by the industry for matching and confirmation (in accordance with
the standards promulgated by the International Swaps and Derivatives Association
(“ISDA”)), and information required by the CCP of the HKEx for facilitating central
clearing. For details of the information to be submitted for different trade events and
products, and under different circumstances, please refer to the Matching and
Confirmation Service AIDG.
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December 2012 Page 21
8.4 Format of Trade Information Submission
CMU TR Members should observe the standards specified in the Matching and
Confirmation Service AIDG in terms of the format and contents of the information
submitted to the HKTR for matching and confirmation.
Format of information submission
Trade event records submitted to the HKTR must be in either Extensible Markup
Language (“XML”) (the extended Financial Products Markup Language (“FpML”))
format or Comma Separated Value (“CSV”) format. The technical specifications for
representing individual transaction details under the two formats, e.g. the nature,
length and layout of the data strings, may also be different. A CMU TR Members
may opt to adopt the format that can best suit its requirements and technical capability.
For the avoidance of doubt, a CMU TR Member may opt to adopt different formats
for submitting trade information of different transactions to the HKTR. For details of
the technical specifications of trade information submission under the two formats,
please refer to the Matching and Confirmation Service AIDG.
The HKTR accepts submission of a trade event request file containing records of
multiple OTC derivatives transactions and multiple trade events of a transaction.
When preparing and submitting files containing trade event information to the HKTR,
reporting entities also have to observe other technical standards set out in the
Matching and Confirmation Service AIDG, e.g. file identification and authentication
standards, and configuration standards applicable to the two information formats and
different submission channels, i.e. internet, FinNet and SWIFTNet.
Contents of information submitted
The contents of individual data strings contained in a trade event record should reflect
the value of the corresponding transaction details applicable to or referred to in the
trade event agreed by the transacting CMU TR Members, e.g. the product type,
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 22
currency type, price/rate level, transaction amount, transaction date, payment and
settlement conventions, etc., and may vary from one transaction to another. However,
CMU TR Members are required to observe the enumerations and coding schemes set
out in the Matching and Confirmation Service AIDG in representing the transaction
details so as to facilitate the processing of trade events by the HKTR and submission
of the events to the CCP of the HKEx for central clearing. The applicable ISDA
standards (the relevant versions of the ISDA standards are specified in the Matching
and Confirmation Service AIDG) have been followed in setting the enumerations and
coding schemes for representing information applicable to the matching and
confirmation process. CMU TR Members, however, should also observe the
requirements specified by the CCP of the HKEx, if any, to supply specific value in
representing individual transaction details when submitting trade information to the
HKTR for matching and confirmation, and submission to the CCP for clearing.
Identifiers for transacting parties and brokers
A CMU TR Member submitting a trade event to the HKTR for matching and
confirmation should provide the CMU TR Member code of the counterparty CMU TR
Member as the identifier for identifying the identity of the counterparty.
CMU TR Members have to confirm with transacting counterparties their CMU TR
Member codes for reporting to the HKTR. Upon request of a counterparty CMU TR
Member, CMU TR Members should supply their CMU TR Member codes to the
counterparty CMU TR Member for reporting to the HKTR.
Apart from counterparties, CMU TR Members may also be required to identify the
brokers involved in brokering their transactions. CMU TR Members have to notify
the HKTR the brokers that may be involved in brokering OTC derivatives
transactions for them, by filing the Broker List of CMU TR Member at Appendix
TR.5 to the HKTR. The list of brokers that have been notified to the HKTR by any
CMU TR Members, together with the identifiers assigned by the HKTR to the brokers
for identifying the brokers in the TR system can be found in the HKTR section of the
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 23
HKMA website. CMU TR Members have to report the identifier assigned to a broker
for identifying the broker in a transaction.
8.5 Timeframe for Trade Information Submission
The HKTR has not set any minimum or maximum time limit for submitting a trade
event to it for matching and confirmation after the event is agreed by the transacting
CMU TR Members. The HKTR, however, will not accept requests for matching and
confirmation of trade events of a transaction that take effect on or after the maturity
day of the transaction. In addition, the HKTR will only accept requests for sending a
trade event (except for new trades and backloading of outstanding transactions) to the
CCP of the HKEx for central clearing on or after the effective date of the event.
CMU TR Members, however, should observe the schedule, rules and requirements of
the CCP of the HKEx as well as the requirements in the OTC regulatory regime, if
any, in deciding the timing for submitting a trade event to the HKTR for matching and
confirmation, and submission for central clearing.
8.6 HKTR System Window for Capturing Trade Information
The HKTR system is open 7 days a week and 24 hours a day for capturing
information of OTC derivatives trades submitted by CMU TR Members except during
certain outage windows for system maintenance and software migration. The outage
windows for submitting trade events to the HKTR through different channels are set
out in the following table.
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December 2012 Page 24
Channel Monday to Saturday
(Hong Kong time)
Sunday
(Hong Kong time)
UI upload via SWIFTNet
FileAct via SWIFTNet
0:30 - 4:00 23:00 (Sat)– 12:00
(and additional outage period published by SWIFT from time to
time, if any)
FTS via FinNet 0:30 – 4:00 23:00 (Sat) – 5:00
UI upload via Internet 0:30 – 4:00 23:00 (Sat) – 5:00
While CMU TR Members will not be able to upload trade event request files through
the user interface (“UI”) functions via the internet or SWIFTNet during the system
outage window, members can continue to submit files through FileAct via SWIFTNet
or File Transfer Service (“FTS”) via FinNet, the files will be queued in the system and
will be automatically captured for processing after the system resumes operation.
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December 2012 Page 25
9. TRADE MATCHING AND CONFIRMATION
9.1 Transaction or Trade Event Validation
Upon receiving a trade event request file from a CMU TR Members, the HKTR
system will validate the format, contents and syntax of the file as well as that of the
individual trade event records contained in the file. If an error is detected, the whole
file or individual trade event records will be rejected, depending on whether the error
occurs at file level or trade event record level. A response will be provided to the
CMU TR Members submitting the trade event request file about whether the file or
individual trade event records have been accepted or rejected.
Trade event records successfully validated will then go through the matching and
confirmation process.
9.2 Transaction or Trade Event Matching and Confirmation
The matching and confirmation of trade events in the HKTR system can be conducted
through either one of the following two modes:
(a) Automatic mode
After a trade event record submitted by a CMU TR Member passes the validation
process, the HKTR system will automatically and immediately search for the trade
event record submitted by the CMU TR Member’s counterparty (also a CMU TR
Member) and represents the same event (but in opposite direction), and match the two
records by comparing the details contained in the records.
Where the details of a trade event record submitted by a CMU TR Member can be
fully matched with the details of a record submitted by its counterparty in the
transaction, the trade event is deemed matched and confirmed in the HKTR system.
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CMU TR Members submitting the trade event records can check from HKTR system
those records that have been matched and confirmed.
Where no trade event record submitted by the counterparty CMU TR Member fully
matching the record submitted by a CMU TR Member can be found, the trade event
record will deem to be unmatched. The HKTR system will identify and list out trade
event records submitted by the counterparty CMU TR Member having key attributes
(contents in certain identifying fields) same as the record submitted by the CMU TR
Member. In case there are multiple records bearing the same key attributes, the
HKTR system will produce a list showing the percentage matched (of the other details)
of each of such records to facilitate the two CMU TR Members involved to identify
and resolve the potential discrepancies.
(b) Affirmation mode
Where a CMU TR Member opts not to submit a trade event record representing its
side of the transaction to the HKTR, or the record submitted by it is incorrect and
therefore cannot be fully matched automatically with the record submitted by its
counterparty, the trade event may be matched and confirmed by the affirmation mode.
The CMU TR Member can affirm the trade event record submitted by the
counterparty CMU TR Member and alleged to have been conducted with it (but
cannot be automatically matched in the HKTR system). By affirming a trade event
record submitted by its counterparty, a CMU TR Member agrees to adopt the details
of the trade event record submitted by the counterparty. Nevertheless, the CMU TR
Member affirming the record will be required to supplement the details by inputting
to the HKTR system certain information specific to the affirming CMU TR Member.
The HKTR system will treat trade event record affirmed as matched and confirmed,
which will be covered in the report on matched and confirmed trade event records to
the CMU TR Members.
It is up to the transacting CMU TR Members to agree among themselves whether both
of them should submit a trade event record representing their respective side of an
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 27
OTC derivatives transaction to the HKTR for automatic matching, or only one side of
the transaction will submit while the other side will affirm the record submitted by the
counterparty. Where a CMU TR Member has submitted an incorrect trade event
record to the HKTR (and hence cannot be automatically matched with the record
submitted by the counterparty), but later opts to affirm the record submitted by the
counterparty, the CMU TR Member has to cancel the incorrect record submitted by it
to the HKTR system.
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10. TRADE SUBMISSION FOR CLEARING AND DECLEARING
10.1 Trade Submission for Central Clearing
After a new trade or a backloaded trade is matched and confirmed on the HKTR
system, the HKTR system will automatically and immediately send the trade to the
CCP of the HKEx for central clearing. CMU TR Members can check from the HKTR
system on whether the trade has been delivered to the CCP, or whether the trade is
being processed or has been accepted or rejected for clearing by the CCP.
10.2 Declearing of Trade from the CCP and Resend for Clearing
After a trade has been accepted by the CCP of the HKEx for central clearing, it has to
be decleared from the CCP before any change, including amendment, termination or
novation, can be made to the trade. The transacting CMU TR Members have to
submit a request to the HKTR for declearing the trade from the CCP of the HKEx,
and the HKTR will submit the declear request to the CCP accordingly. CMU TR
Members can check from the HKTR system on whether the declear request has been
accepted by the CCP.
After a trade has been decleared from the CCP of the HKEx, the transacting CMU TR
Members can then initiate an amendment trade event to the HKTR for amending the
details of the trade. The amendment trade event will then undergo the matching and
confirmation process of the HKTR system. For a matched and confirmed amendment
trade event, the transacting CMU TR Members, however, have to submit a request to
the HKTR for submitting the event to the CCP for central clearing again. As the CCP
of the HKEx does not accept central clearing of post-trade trade events with a future
effective date, transacting CMU TR Members should request (to the HKTR) for their
clearing only on or after the effective date of the trade events. CMU TR Members
can check from the HKTR system the list of matched and confirmed post-trade trade
events, so that they can arrange to send instructions to the HKTR for re-sending the
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events to the CCP of the HKEx for central clearing on or after the effective date of the
events.
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11. MATCHING AND CONFIRMATION SERVICE REPORTS
11.1 Types of Report
There are three types of report:
(a) System reports –generated automatically by the system. Reports are generated
in off-line batch mode at pre-defined time or after a specific event, and can be
delivered via file transfer or viewed/downloaded via UI function
(b) Enquiry-Initiated User Requested reports – Reports are generated in
background mode. Users can check report generation status, view or
download the generated report via the View Report List function
(c) UI Enquiry reports – Reports are tied to the enquiry functions, showing the
same result set as the enquiry. Reports are generated in on-line real-time
mode and then sent to the browser front-end for the user’s viewing
Please refer to the various User Manuals for Participants of the Operating Procedures
for Trade Repository for the summary of report list, report samples, and the schedule
and procedures for retrieving the relevant reports through different channels and in
different formats.
11.2 Reconciliation of Reports
CMU TR Members are required to download all the reports under the Matching and
Confirmation Service and reconcile their reports on a daily basis. Any discrepancies
should be reported to the HKMA as soon as practicable and in any event, not later
than 7 business days from the date of the relevant report. If any report is reported to
be incorrect, the HKMA will make the relevant investigation and if applicable, re-
issue the report revised as necessary.
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12. CONTINGENCY ARRANGEMENTS
12.1 Local Terminal Service
In case a CMU TR Member cannot access the HKTR system through its own
production facilities due to prolonged system connectivity problems with SWIFTNet,
the CMU TR Member may make use of the Local Terminal Service (“LTS”) provided
by the HKICL to access the Matching and Confirmation Service. The CMU TR
Member can generate the relevant trade event request files from its own system, and
then upload the files to the HKTR system directly at the terminals located at the office
of the HKICL.
LTS should be used as the last resort for accessing the Matching and Confirmation
Service. CMU TR Members should rely on their own backup facilities for
contingency operations. In case a CMU TR Member needs to utilise LTS under
contingency situation, the CMU TR Member has to apply to the HKICL directly in
accordance with the arrangements promulgated by the HKICL.
12.2 Typhoon and Rainstorm Procedures
The Matching and Confirmation Service of the HKTR will remain accessible under
rainstorm and typhoon scenarios. CMU TR Members can continue to send trade
events to the HKTR system for matching and confirmation, and for submission to the
CCP of the HKEx for central clearing. If the CCP of the HKEx is not open under
rainstorm and typhoon scenarios, the HKTR will store the trade events matched and
confirmed during the closure of the CCP, and submit the events to the CCP upon its
re-opening of business.
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13. BILLING
In entering into an agreement for subscribing to any service of the HKTR, CMU TR
Members will undertake to pay a membership fee if applicable.
CMU TR Members using the Matching and Confirmation Service will also be subject
to transaction charges based on the usage of the HKTR System.
The CMU TR Membership fee and the transaction charges for the Matching and
Confirmation Service are set out in the fee scale in Annex 2. The updated scale is
available in the HKTR section of the HKMA website. Changes to the scale will be
advised to CMU TR Members through circulars.
13.1 Settlement Arrangements
For CMU TR Members which are also CMU Members (participants of CMU service
offered by the CMU in respect of safe custody, recording and transfer of debt
securities) and are direct participants in the Hong Kong dollar Real Time Gross
Settlement (“RTGS”) system (“Direct Participant CMU TR Members”), their fees are
settled through their own settlement accounts maintained with the HKMA. Other
CMU TR Members are required to appoint a settlement bank (“Appointed Settlement
Bank”) which is a CMU member and a direct participant in the Hong Kong dollar
RTGS system for the settlement of their fees.
CMU TR Members are required to designate their settlement accounts and authorise
the CMU to debit the fees from the designated accounts by using the Designation of
Hong Kong Dollar Account for Settling Fees and Charges form (“Account
Designation Form”) at Appendix TR.6.
To enable direct debiting of fees by the CMU from the designated settlement accounts,
Direct Participant CMU TR Members and Appointed Settlement Banks shall
authorise and instruct the CMU to set up direct debit limits in the CMU system. The
Hong Kong Monetary Authority CMU OTC Derivatives Trade Repository Matching and Confirmation Service Reference Manual
December 2012 Page 33
CMU system makes reference to the last four digits of the CMU TR Member Code
(“HKTR Billing Code”) in referring to a CMU TR Member in the system. Direct
Participant CMU TR Members should advise the CMU the direct debit limits to be set
in the Account Designation Form at Appendix TR.6. Appointed Settlement Banks
should advise the CMU the direct debit limits to be set for their clients in the Direct
Debit Limit of Settlement Bank form at Appendix TR.7.
13.2 Billing Arrangements
All fees are invoiced in Hong Kong dollar and billed monthly to CMU TR Members.
The arrangements are as follows:
(a) The total amount of fees payable will be advised to Members on the 10th day
of the following month or next business day if the 10th is not a business day to
the contacts for the Matching and Confirmation Service specified by Members
in the CMU TR Member Profile Maintenance Form in Appendix TR.3.
(b) On the business day following the billing day, Members shall ensure that
sufficient funds are arranged in their respective settlement accounts.
(c) The total fees will be automatically debited from the settlement account
designated by Members (as at Appendix TR.6) on the 15th or the following
business day if 15th is not a business day.
(d) Upon completion of the billing process, the RTGS system will format the
settlement advices in MT900 format and distribute to the CMU TR Members
or its Appointed Settlement Banks via SWIFT. The advice will bear the
HKTR Billing Code of the CMU TR Member concerned for reference.
Hong Kong Monetary Authority Central Moneymarkets Unit
OTC Derivatives Trade Repository Appendix TR.1
CMU TR Membership Application Form
To : Hong Kong Monetary Authority Date:
Facsimile: (852) 2878 1679
From :
Name of Institution
We request for your approval for ___________________________________ (Name of the Applicant) to be admitted as a Member of the OTC Derivatives Trade Repository operated by the Central Moneymarkets Unit (CMU TR Member). We understand that the continuation of a CMU TR Membership is subject to the CMU TR Member’s compliance with the applicable service agreement with the Monetary Authority, and rules and operating procedures from time to time prescribed by the Monetary Authority. The Monetary Authority may suspend or terminate the membership of a CMU TR Member in the event of a breach of any of the agreement, rules and operating procedures. Applicant Institution : (Legal Full Name)
Address :
Telephone :
Facsimile :
Name(s) of person(s) to contact in respect of this application :
e-mail address :
_________________________ Authorized Signature(s)
Company Chop
Hong Kong Monetary Authority Central Moneymarkets Unit
OTC Derivatives Trade Repository Appendix TR.2
CMU TR Member Record of Authorized Signatures
To : Hong Kong Monetary Authority Date: __________________ Name of Participant :__________________________________________________________________ CMU TR Member Code :________________________ Telephone Number : ________________________ Address :__________________________________________________________________ The persons in the table below are authorized to sign for and on behalf of us under (please tick as appropriate):
Reporting Service
Matching and Confirmation Service
AUTHORIZED SIGNATURE AND/OR STAMP
NAME AND TITLE (IN BLOCK LETTERS)
AUTHORIZED SIGNATURE AND/OR STAMP
NAME AND TITLE (IN BLOCK LETTERS)
AUTHORIZED SIGNATURE AND/OR STAMP
NAME AND TITLE (IN BLOCK LETTERS)
AUTHORIZED SIGNATURE AND/OR STAMP
NAME AND TITLE (IN BLOCK LETTERS)
AUTHORIZED SIGNATURE AND/OR STAMP
NAME AND TITLE (IN BLOCK LETTERS)
AUTHORIZED SIGNATURE AND/OR STAMP
NAME AND TITLE (IN BLOCK LETTERS)
SIGNING INSTRUCTIONS :
(Please add a new page if there are more authorized signatures to specify)
____________________________
Authorized Signature(s)
Company Chop
Hong Kong Monetary Authority Central Moneymarkets Unit
OTC Derivatives Trade Repository Appendix TR.3
CMU TR Member Profile Maintenance Form
To : Hong Kong Monetary Authority Date:
Facsimile: (852) 2878 1679
From : ( )
Name of CMU TR Member CMU TR Member Code
We refer to the appointment of our institution as a CMU TR Member, the following are the
information of our institution:
Type of Institution (please tick as appropriate)
Institution authorized or approved under the Banking Ordinance
Full Licensed bank Restricted Licence Bank
Deposit Taking Company Approved Money Broker
Licensed Corporation under the Securities and Futures Ordinance
Others
Place of Incorporation (please tick as appropriate)
Hong Kong Outside Hong Kong
Identification number (please provide all those numbers that your institution possesses)
Global Legal Entity Identifier or pre-LEI1 Issued by: ________________________________________
SWIFT BIC (Business Identifier Code issued by SWIFT under ISO9362)
Number of the Certificate of Incorporation (CI) or Certificate of Registration (CR) issued by the Companies Registry of Hong Kong2
Business Registration Number (BRN) issued by the Inland Revenue Department of Hong Kong2
Clearing Member Code at the OTC derivatives CCP of the HKEx
Notes
(1) Global Legal Entity Identifier (“Global LEI”) refers to the unique identifier for legal entity issued under the Global LEI System established by the Financial Stability Board (“FSB”). If the Global LEI is not yet available, please provide pre-LEI identification code (“pre-LEI”) in compliance with the Global LEI numbering scheme specified by the FSB and issued by an entity that has been allocated a prefix by the FSB (or the Global LEI System) for issuing such codes, if any.
(2) Please provide certified true copy of the certificate
Contact information for Reporting Service
Contact Person :
Telephone number :
Facsimile number :
Address :
Group/individual e-mail :
Contact information for Matching and Confirmation Service
Contact Person :
Telephone number :
Facsimile number :
Address :
Group/individual e-mail :
____________________________
Authorized Signature(s)
Company Chop
Hong Kong Monetary Authority Central Moneymarkets Unit
OTC Derivatives Trade Repository Appendix TR.4
CMU TR Member Administrative Account Setup Form To : Hong Kong Monetary Authority Date:
Facsimile: (852) 2878 1679
From : ( )
Name of CMU TR Member CMU TR Member Code
We refer to the appointment of our institution as a CMU TR Member, please set up
administrative account(s) for our institution to access the User Interface (“UI”) of the TR
system (please tick one or both as appropriate):
through Internet [Please provide SSL Client Certificate DN if this is chosen]
through SWIFTNet [Please provide SWIFT User DN if this is chosen]
SSL Certificate DN:
__________________________________________________
__________________________________________________
__________________________________________________
SWIFTNet User DN:
__________________________________________________
__________________________________________________
__________________________________________________
(Please also send a copy-and –paste-able copy of DN to the HKTR for accurate account setup purpose through email with a subject of “Admin Account Setup – CMU TR Member Code” )
____________________________
Authorized Signature(s)
Company Chop
Hong Kong Monetary Authority Central Moneymarkets Unit
OTC Derivatives Trade Repository Appendix TR.5
Broker List of CMU TR Member To : Hong Kong Monetary Authority Date:
Facsimile: (852) 2878 1679
From : ( )
Name of CMU TR Member CMU TR Member Code
The transactions of our institution may be brokered by the following broker(s):
Broker Name Broker address
Broker Name Broker address
Broker Name Broker address
Broker Name Broker address
(Please add a new page if there are more brokers to specify)
____________________________
Authorized Signature(s)
Company Chop
Hong Kong Monetary Authority Central Moneymarkets Unit
OTC Derivatives Trade Repository Appendix TR.6
Designation of Hong Kong Dollar Account for Settling Fees and Charges
To : Hong Kong Monetary Authority Date:
Facsimile: (852) 2878 1679
From : ( )
Name of CMU TR Member CMU TR Member Code*
We agree to settle the fees and charges arising from service provided by the HKTR to our
institution by direct debit from our Hong Kong dollar settlement account specified below, on
instructions from the Monetary Authority.
(Please tick the appropriate box below and supply the corresponding settlement account
information)
My institution is a CMU Member and a direct participant of the Hong Kong dollar
RTGS System, please direct debit from the following settlement account of my
institution:
Account Number: ____________________
Please set up a direct debit limit of ___________________________ in the CMU
system for debiting the fees and charges from the above Account.
My institution is not a CMU Member or a direct participant of the Hong Kong dollar
RTGS System
Name of Settlement Bank: _______________________________
Our Account Number with the Settlement Bank: ___________________________
Contact Person and Phone Number: _______________________________
We have given standing authorisation to the above bank to accept such instructions
from the Monetary Authority. We have also agreed with the above settlement bank
on the direct debit limit for our maximum settlement amount for fees and charges
arising from the service provided by the HKTR. A direct debit limit form for our
institution will be forwarded to you directly from our settlement bank.
____________________________
Authorized Signature(s)
Company Chop
(*The CMU system makes reference to the last 4 digits in the CMU TR Member Code of a CMU TR
Member in referring to the CMU TR Member in the system. The 4 digits will be applied in setting up
the direct debit limit in the CMU system.)
Hong Kong Monetary Authority Central Moneymarkets Unit
OTC Derivatives Trade Repository Appendix TR.7
Direct Debit Limit of Settlement Bank
To : Hong Kong Monetary Authority Date:
Facsimile: (852) 2878 1679
From : ( )
Name of Settlement Bank CMU Member Code
We have agreed with our client, ______________________________, (CMU TR Member
Code*) on the direct debit limit for its maximum settlement amount for the fees arising from
the service offered by the HKTR. We have also received standing authorisation from our
client to accept settlement instructions from the CMU.
The settlement details of our client are as follows:
Account Name : _________________________________________________
Settlement Account
Number in our book : _________________________________________________
Please set up a direct debit limit of ___________________________ in the CMU system for
debiting the fees and charges arising from the service offered by the HKTR to our client from
the above Account.
____________________________
Authorized Signature(s)
Company Chop
(*The CMU system makes reference to the last 4 digits in the CMU TR Member Code of a CMU TR
Member in referring to the CMU TR Member in the system. The 4 digits will be quoted in the
settlement advice for reference.)