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Novation and netting Once the trade has been registered in the EMCF system, it will immediately be novated. EMCF interposes itself as a buyer to each seller and as a seller to each buyer. Two new contracts are created - between EMCF and the buyer and EMCF and the seller - to replace the single contract between the two parties. This principle allows the market to remain anonymous. When the trade has been novated, it will be netted in real time on a multilateral basis. Per clearing party, netting is done by ISIN, by currency, by the client, house account or combined account at a level specified by the clearing participant. |
Useful links • Code of conduct.  • European Association of Clearing Houses (EACH). • European Commission. • FSA register. |
