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Settlement Agent (DVP) Late Confirmation Penalty After (T+2)

Service ID
3.2.7

Details

1- If the rejection reversal request (for Sale) or transfer request (for Buy) is executed by Dubai Clear on (T+3).

2- If the rejection reversal request (for Sale) or transfer request (for Buy) is executed by Dubai Clear on (T+4).

For information on this service, please contact:
Dubai Clear  
T:+971 4 305 5555
E: clearing&settlement@dubaiclear.ae 


Fees

1- AED 500 or 0.05% of trade value whichever is the higher.

2- AED 2,500 or 0.25% of trade value whichever is the higher.

Procedures

Settlement Agent will receive a penalty report from Dubai Clear on Monthly Basis.

- Settlement Agent has 14 working days to pay the penalty amount in Dubai Clear IBAN AE370260000412063720929 with Emirates NBD Bank.


Required Documents
Copy of credit advise

How to Apply?
Send a copy of credit advise to Dubai Clear email address: clearing&settlement@dubaiclear.ae

FAQs

Yes, a penalty will be applied for a minimum of AED 2500 or the total order values of each sell rejection transaction X 0.25%.

Yes, a penalty will be applied for a minimum of AED 500 or the total order values of each sell rejection transaction X 0.05%.

The Late Confirmation Period is from T+2 to T+4 or S+2. The Late Confirmation Period is a market infrastructure provided by the Dubai Clear to facilitate trade settlement for clients using a Local Settlement Agent for the settlement of trades. It is a commercial decision of the Local Clearing Member to determine whether or not a Late Confirmation Period should be offered to its client using a Local Settlement Agent for settlement.

The Dubai Clear changes are summarized as follows:

  1. These enhancements impact Clearing Members dealing with clients which use a Local Settlement Agent for the settlement of trades, whereby a Local Settlement Agent can reject both securities and cash settlement of purchase and sell trades if it does not receive settlement instructions from its clients.
  2. A ‘buy-in’ mechanism to facilitate settlement of rejected sell trades is also introduced whereby Clearing Members which do not trade for clients who settle trades using a Local Settlement Agent will be able to participate in a buy-in, by selling to any buy-in bids in the DFM buy-in board.
  3. A Late Confirmation period of up to T+4 will be introduced for Local Settlement Agents clients to confirm settlement of trades. The Late Confirmation period is however subject to the Clearing Members agreement.
  4. A Local Settlement Agent will now have full control of securities making it unnecessary to operate a dual account structure. This means that all securities may be held in one account of the Local Settlement Agents (i.e. the Agent Trading account).