SEC批准CME证券清算公司(CMESC)修订有上限流动性工具(CLF)相关规则，属清算业务上线前的技术性规则更新

8011-01-P
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-106657; File No. SR-CMESC-2026-008]
Self-Regulatory Organizations; CME Securities Clearing Inc.; Order Approving
Proposed Rule Change to Amend Rule 410, Rule 101, the Capped Liquidity Facility
Procedure, and the Liquidity Risk Management Policy
October 13, 2026.
On August 21, 2026, CME Securities Clearing Inc. (“CMESC”) filed with the
Securities and Exchange Commission (“Commission”) proposed rule change CMESC2026-008, pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”)1
and Rule 19b-4 thereunder.2 The proposed rule change was published for public comment
in the Federal Register on September 3, 2026.3 The Commission has received no comments
on the changes proposed. For the reasons discussed below, the Commission is approving
the proposed rule change.
I.

BACKGROUND
As a registered clearing agency providing central counterparty services, CMESC is

a covered clearing agency subject to clearing agency standards provided in Section 17A of
the Act,4 and rules thereunder. Rule 17ad-22(e)(7) under the Act requires each covered
clearing agency to maintain and hold qualifying liquid resources at a minimum to effect
same-day, intraday and multiday settlement of payment obligations with a high degree of
confidence under a wide range of foreseeable stress scenarios, including, but not limited
to, the default of the participant family that would generate the largest aggregate payment

15 U.S.C. 78s(b)(1).

17 CFR 240.19b-4.

See Securities Exchange Act Release No. 106243 (Aug. 31, 2026), 91 FR 56678 (Sept. 3, 2026)
(File No. SR-CMESC-2026-008) (“Notice of Filing”).

15 U.S.C. 78q-1(b)(3)(F).

obligation for the covered clearing agency in extreme but plausible market conditions.5
CMESC has established several liquidity tools in its Rules and policies and procedures to
meet these requirements, including the Capped Liquidity Facility (“CLF”)6 in Rule 410,
the associated CLF Procedure, and the Liquidity Risk Management Policy (“LRMP”).7
The CLF is designed to provide access to required liquidity in the event CMESC’s other
sources of liquidity are unavailable or insufficient.
To facilitate the implementation of the CLF in connection with launching its
Clearing Services, the proposed rule change would amend Rules 410 and 101 regarding
the CLF and CLF Master Repurchase Agreement (“CLF MRA”), the CLF Procedure, and
the LRMP, as described below.
II.

DESCRIPTION OF THE PROPOSED RULE CHANGE
A.

Amendments to Rule 410
1.

Rules-Based CLF MRA

Under existing Rule 410(a) each Member is required to enter into a separate CLF
MRA with CMESC to purchase Eligible Securities up to the Member’s Allocated CLF
Amount if CMESC declares a CLF Event. First, the proposed rule change would amend
Rule 410(a)(i) to provide instead that each Member is a party to a CLF MRA by operation
of Rule 410(a) without any additional execution steps by CMESC or Members. CMESC
states that it is proposing this rules-based MRA to mitigate administrative burdens on both
CMESC and the Members in preparing and executing separate agreements and to promote
efficiency and consistency.8
Second, the proposed rule change would modify the first sentence of Rule 410(a)(i)

See Rule 17ad-22(e)(7)(i) and (ii), 17 CFR 240.17ad-22(e)(7)(i) and (ii).

Capitalized terms used herein and not defined have the meanings assigned to such terms in the
Rules of CME Securities Clearing Inc. (“Rules”), as applicable, available at
https://www.cmegroup.com/rulebook/CMESC/CMESC%20Rulebook.pdf.

The LRMP and CLF Procedure were submitted to the Commission as part of the Application.

See Notice of Filing, supra note 3, 91 FR at 56679.

to make clear that the CLF MRA will be on terms set out at the end of Rule 410 and move
existing Rule 410(a)(ii)(A)-(F) that contains the terms of CLF MRA to the end of Rule 410
with certain adjustments, as described below:
•

The proposed CLF MRA set out at the end of Rule 410 will include new
language to provide that the CLF MRA is entered into between CMESC and
each Member by operation of Rule 410 and that capitalized terms used but not
defined in the CLF MRA have the meanings set forth in the Rules;

•

As a rules-based agreement, the proposed CLF MRA will incorporate by
reference the SIFMA Master Repurchase Agreement September 1996 version
(“SIFMA MRA”) (without the referenced annexes therein), rather than being
established as a separate agreement in a form based on the SIFMA Master
Repurchase Agreement as provided in existing Rule 410(a)(ii), and will provide
that each CLF Transaction is subject to the terms of the SIFMA MRA and Rule
410(a);

•

In addition to incorporating the SIFMA MRA, the proposed CLF MRA will
provide that, notwithstanding anything else in the SIFMA MRA, certain terms
will apply to CLF Event Transactions between CMESC and the Member. These
terms are listed as paragraphs (a) – (g) in the proposed CLF MRA and are
described below:
▪

Existing Rule 410(a)(ii)(A) will become new paragraph (a) in the
proposed CLF MRA except that the reference to “this Rule 410” will be
changed to “Rule 410”;

▪

Existing Rule 410(a)(ii)(B) will become new paragraph (b) of the
proposed CLF MRA and the proposed rule change would create a new
defined term “Liquidating Trade” to refer to a trade liquidating the
financed securities in clause (x) of this new paragraph (b);

▪

Existing Rule 410(a)(ii)(C) will become new paragraph (c) of the
proposed CLF MRA and a new sentence would be added from existing
Rule 410(g) to new paragraph (c), which will provide that “[e]ach CLF
Event Transaction will be entered into on an overnight basis, unless
otherwise specified by the Corporation”; the text of “trade liquidating
the financed securities” in clause (x) of this new paragraph (c) would be
replaced with “Liquidating Trade” as a result of the creation of the new
defined term described above; the text “upon expiration of the term of a
CLF Event Transaction” would be added to the end of clause (z) of this
new paragraph (c) to clarify that each CLF Event Transaction will
remain open until the occurrence of the CLF Event Transaction
Termination Date upon expiration of the term of a CLF Event
Transaction;

▪

Existing Rule 410(a)(ii)(D) will become new paragraph (d) of the
proposed CLF MRA with minor adjustments and will state that “[i]t
shall be an “Event of Default” (for purposes of this CLF MRA) with
respect to the buyer under a CLF MRA if the Corporation ceases to act
for the Member pursuant to Rule 901 or 902”;

▪

Existing Rule 410(a)(ii)(E) will become new paragraph (e) of the
proposed CLF MRA with minor adjustments and will state that “[t]here
shall be no “Event of Default” (for purposes of this CLF MRA) with
respect to the Corporation as the seller other than a Corporation Default
within the meaning of Rule 714”;

▪

Existing Rule 410(a)(ii)(F) will become new paragraph (f) of the
proposed CLF MRA without any changes;

▪

Finally, the proposed rule change would add a new paragraph (g) in the

proposed CLF MRA to deal with any potential conflicts between the
CLF MRA and SIFMA MRA, which states that in the event of any
inconsistency between the terms of the SIFMA MRA and the CLF
MRA, the terms of the CLF MRA will govern.
▪

After moving existing Rule 410(a)(ii) to the proposed CLF MRA at the
end of Rule 410, existing Rule 410(a)(i) would be renumbered as Rule
410(a).

Finally, the proposed rule change would make additional clean-up changes to Rule
410(a). First, the proposed rule change would remove a sentence in existing Rule 410(a)(i)
regarding the categories of securities CMESC may include as Eligible Securities in the
context of a CLF Event Transaction. This sentence repeats the same provision in existing
Rule 410(e) (to be renumbered as Rule 410(c) as described below) and its deletion will
remove redundancy. Second, the phrase “pursuant to Rule 410(b) below” would be added
to the last sentence of Rule 410(a)(i) to clarify that CMESC’s declaration of a CLF Event
and the ensuing actions taken by CMESC will be pursuant to Rule 410(b).
2.

CLF Size and Allocated CLF Amount

Existing Rule 410(i) (to be renumbered as Rule 410(e)) would be amended to
provide additional detail regarding the calculations of the CLF size and the Allocated CLF
Amount. CMESC states that these amendments do not change the existing methodology
and formulae used to size the CLF and calculate each Member’s allocation.9
a.

Sizing the CLF

The proposed rule change would clarify the first sentence of Rule 410(i)(i)
regarding the assessment CMESC conducts at least quarterly by specifying that CMESC
shall conduct an assessment at least every quarter, or more frequently as CMESC deems

Id.

appropriate, “to determine the required size of the CLF and each Member’s Allocated CLF
Amount.” CMESC states that this additional detail clarifies the purpose of the quarterly
assessment (or more frequently as determined appropriate by CMESC) that will determine
the size and allocation of the CLF.10
Second, the proposed rule change would provide additional details regarding its
calculation of the size of the CLF. CMESC states that these changes are designed to provide
clarity and transparency in how CMESC calculates the size of the CLF and that they do
not change the existing methodology to size the CLF.11 Currently, Rule 410(i)(i) provides
that CMESC will determine the size of the CLF through the assessment to evaluate its
hypothetical liquidity need in the event of a default of a Participant Family (defined as the
“Stress Potential Payment Obligation” or “SPPO”) to which CMESC would be obligated
to make the largest cash payment. The proposed rule change would modify the second
sentence of Rule 410(i)(i) to make clear that CMESC would calculate the SPPO of each
Participant Family by evaluating the hypothetical cash settlement obligation that CMESC
may experience in the event of a Default of such Participant Family in extreme but
plausible market conditions, using a lookback period deemed appropriate by CMESC. The
proposed rule change would also add a new sentence to Rule 410(i)(i) to explain that
CMESC will use the largest SPPO across all Participant Families (defined as “Cover 1
SPPO”) over the designated lookback period as the starting point for determining the
required size of the CLF.
Finally, the proposed rule change includes non-substantive changes to the last
sentence of Rule 410(i)(i) (renumbered as Rule 410(e)(i)). Specifically, the proposed rule
change would add certain text to specify that CMESC may “also” consider other factors it
deems relevant “in sizing the CLF” to make clear that in addition to assessing the SPPO of

Id. at 56680.

Id.

each Participant Family over the designated lookback period and to determine the Cover 1
SPPO over the lookback period as the starting point in determining the size of the CLF,
CMESC may also consider other factors it deems relevant in its calculation of the size of
the CLF. As a result of these proposed revisions, the proposed rule change would eliminate
a redundant phrase “in determining the required size of the CLF (e.g., aggregated Allocated
Capped CLF Amounts of all Members)” from the end of this sentence and add “as deemed
relevant by the Corporation” to the end of this sentence as a clarifying change.
b.

Calculation of the Allocated CLF Amount

The proposed rule change would also include amendments to Rule 410(i)(ii)
(renumbered as Rule 410(e)(ii)). CMESC states that these changes are designed to enhance
the description of the calculation of the Allocated CLF Amount for added clarity and
transparency and would not change the calculation or methodology used to determine each
Member’s Allocated CLF Amount, as described in the Application materials.12
First, existing Rule 410(i)(ii) provides that CMESC shall calculate each Member’s
Allocated CLF Amount at the time CMESC performs its assessment referred to in clause
(i) of Rule 410(i). The proposed rule change would amend this sentence to clarify that
CMESC will calculate each Member’s Allocated CLF Amount at the time “as” it performs
its assessment and change the reference to “clause (i)” in this sentence to Rule 410(e)(i)
due to renumbering Rule 410(i) to Rule 410(e).
Second, the second sentence of current Rule 410(i)(ii) states that, each Member’s
Allocated CLF Amount will be calculated on a pro rata basis, based on the size of each
Member’s “SPPO” relative to the total aggregate SPPO across all Members. The proposed
rule change would add a new defined term “Maximum SPPO”, as described in the
paragraph below, and would specify that the Maximum SPPO is determined using “a

Id.

designated lookback period” in the second sentence of Rule 410(i)(ii). As such, the
proposed rule change would modify the second sentence of Rule 410(i)(ii) to provide that
“[e]ach Member’s Allocated CLF Amount will be calculated on a pro rata basis, based on
the size of each Member’s Maximum SPPO during the designated lookback period relative
to the total aggregate Maximum SPPOs across all Members during the same period.” The
proposed rule change would also define the pro rata ratio described in this sentence as the
“Obligation Ratio.”
Third, the proposed rule change would amend the third sentence of existing Rule
410(i)(ii) by replacing the first reference to each Member’s “SPPO” with the “Maximum
SPPO for purposes of calculating the Member’s Obligation Ratio.” In addition, the
proposed rule change would clarify that a Member’s Maximum SPPO is calculated by
taking the sum of the Member’s largest SPPO plus the two largest SPPOs among the Users
it authorizes, if applicable, over the designated lookback period. The word “two” would be
inserted before the term “largest SPPO”, while pluralizing the latter reference in the
existing text. In the same sentence, “of the two” would be deleted and replaced with
“among the.” Parallel changes would be included in the subsequent sentence. CMESC
states that this formulation is intended to result in a clearer, more precise description of
CMESC’s process for incorporating User SPPOs in the calculation of a Member’s
Maximum SPPO and aligns with the way the process is described in the CLF Procedure.13
CMESC states that the process itself is unchanged; only the language in the Rulebook and
the CLF Procedure used to describe the calculation process is being updated for additional
clarity.14
Fourth, “SPPO” would be replaced with “Maximum SPPO” in the fourth sentence
of existing Rule 410(i)(ii) to conform to the defined term and to add “Obligation Ratio and”

Id.

Id.

in front of Allocated CLF Amount to make clear that CMESC, at its sole discretion, can
add a multiplier to a particular Member’s Maximum SPPO as part of determining that
Member’s Obligation Ratio and Allocated CLF Amount.
Fifth, the proposed rule change would add a sentence between the fourth sentence
and fifth sentence in existing Rule 410(i)(ii) to enhance the description of the allocation of
the CLF, which provides that each Member’s Allocated CLF Amount is calculated as the
product of the Member’s Obligation Ratio and the required CLF size determined in
accordance with Rule 410(e)(i), which provides for at least quarterly resizing (or more
frequently as the Corporation deems appropriate). Although this calculation is implied in
the second sentence of existing Rule 410(i)(ii) regarding each Member’s Allocated CLF
Amount calculated on a pro rata basis, CMESC states that by explicitly establishing how a
Member’s Allocated CLF Amount is calculated, the proposed change will provide clarity
and transparency with respect to each Member’s CLF obligation.15
With respect to informing each Member of its individual Allocated CLF Amount,
the proposed rule change would clarify that CMESC will provide each Member with its
individual Allocated CLF Amount following each re-sizing of the CLF. Therefore,
references to the “periodic report” from the fifth sentence would be deleted and “following
each resizing of the CLF” would be added to the same sentence.
Finally, the proposed rule change would combine and restate the last two sentences
of existing Rule 410(i)(ii). The changes consist of restating CMESC’s obligation to notify
each Member of its Allocated CLF Amount following each resizing, and to remove a
redundancy regarding Members’ obligations to enter into CLF Event Transactions upon
CMESC’s declaration of a CLF Event, which is already provided for in greater detail in
Rule 410(b)(i)(B).

Id. at 56681.

c.

Member Information to Facilitate CLF Calculations

In addition to the proposed changes described above, which are designed to enhance
the description of the CLF allocation, CMESC also proposes modifications to Rule
410(i)(ii) (renumbered as Rule 410(e)(ii)) to provide a new requirement for a Member, in
order to commence clearance and settlement of Eligible Securities Transactions, to provide
information to CMESC to support CMESC’s determination of such Member’s Allocated
CLF Amount. Specifically, the proposed rule change would insert in Rule 410(i)(ii) a
provision that requires a Member to provide certain information, including, without
limitation, the projected volumes and sizes of Eligible Securities Transactions to be
submitted for clearance and settlement by the Member and its authorized Users, if any,
over a period deemed relevant by CMESC, which will be incorporated as an input into the
sizing and allocation calculations for the CLF. CMESC states that this information is
intended to facilitate CMESC’s assessment of the Cover 1 SPPO as well as a Member’s
Maximum SPPO for purposes of calculating the Member’s Allocated CLF Amount during
an initial ramp-up phase.16 CMESC states that its Cover 1 SPPO calculations and Maximum
SPPO calculations for new Members will leverage this projected data and blend it with
data from the Member’s actual cleared activity on a going-forward basis, until the
appropriate lookback period has lapsed.17 For avoidance of doubt, the information required
under the proposed changes to Rule 410(i)(ii), renumbered as Rule 410(e)(ii), serves as an
input to existing methodologies for calculating the size and allocation of the CLF, which
are unchanged by the proposed modifications.
3.

Other Clarifying and Technical Amendments to Rule 410

CMESC further proposes several non-substantive, clarifying changes to Rule 410
to improve readability and remove redundancies. The table below lists each Rule 410

Id.

Id.

subsection which CMESC is proposing changes, describing the proposed changes,
and indicating the types of changes, i.e., whether the changes are in the nature of
clarification, technical, or incorporation of proposed changes to Rule 410.
Rule
Rule
410(b)(i)(A)

Proposed Change
To facilitate readability, added the sentence “the
Corporation has sole discretion as to the nonDefaulting Members with whom it will enter into CLF
Event Transactions upon declaration of a CLF Event
and the terms of each such transaction;” from existing
Rule 410(c).

Purpose
Clarification;
consolidated
existing Rule
410(c) into Rule
410(b)(i)(A)

Rule
410(b)(i)(B)

Added “selected to participate in CLF Event
Transactions” to refer more precisely to the Member
that is selected by CMESC to participate in CLF Event
Transactions.

Clarification;
consolidated
existing Rule
410(d) into Rule
410(b)(i)(B)

Added “and any additional pertinent information; Upon
notice from the Corporation, such Member must enter
into the CLF Event Transaction(s) with the Corporation
at an aggregate purchase price up to the maximum
amount allocated to such Member (‘Allocated CLF
Amount’) as calculated by the Corporation” from
existing Rule 410(d).
Created the defined term “Allocated CLF Amount” to
replace existing “Allocated Capped CLF Amount”
throughout Rule 410.
Rule
410(b)(i)(C)

Replaced “an aggregate purchase price up to the
maximum amount allocated to such Member
(‘Allocated Capped CLF Amount’)” with “the
aggregate purchase price determined by the
Corporation, in its sole discretion.”

Clarification;
removed
redundancy that
overlaps with
410(b)(i)(B)

Rule
410(b)(i)(D)

Deleted existing Rule 410(b)(i)(D) in its entirety (i.e.,
“Pursuant to the terms of the CLF MRA, each CLF
Event Transaction will remain open until the earlier of
(x) such time that the Corporation has executed a trade
liquidating the financed securities (‘Liquidating
Trade’), (y) such time that the Corporation has
obtained liquidity through its other available liquid
resources and closes the CLF Event Transactions or (z)
the CLF Event Transaction Termination Date”).

Removed
redundancy that
overlaps with
paragraph (c) of
CLF MRA

Added “Each CLF Event Transaction will remain open
pursuant to and in accordance with the terms of the
CLF MRA set forth at the end of this Rule 410” to set

out the sequence of events and the timeline of a CLF
Event Transaction.
Rule
410(b)(i)(E)

Added “that is a” to refer to each Member “that is a”
party to a CLF Event Transaction.

Technical and
Clarification

Added “exchange for cash in” to the part that states
“each such Member to deliver the related Eligible
Securities to the Corporation in exchange for cash in
order to enable the Corporation to complete
settlement”
Rule 410(c)

Deleted.

Rule 410(d)

Deleted.

Rule 410(e)

Renumbered as Rule 410(c).

Technical;
consolidated into
Rule 410(b)(i)(A)
Technical;
consolidated into
Rule 410(b)(i)(B)
Technical

Rule 410(f)

Renumbered as Rule 410(d).

Technical

Rule 410(g)

Deleted.

Rule 410(h)

Deleted.

Rule 410(j)

Renumbered as Rule 410(f).

Technical;
consolidated into
CLF MRA
paragraph (c)
Technical;
removed to
reduce
redundancy due
to overlap with
Rule 410(b)(i)(E)
Technical

Replaced “Allocated Capped CLF Amount” with
“Allocated CLF Amount” for consistency with the new
proposed defined term.
Rule 410(k)

Renumbered as Rule 410(g).

Technical

Rule 410(l)

Renumbered as Rule 410(h).

Technical

Rule 410

Added “to” in the legacy text relocated to CLF MRA
paragraph (d) for grammatical accuracy.

Technical

B.

Amendments to Rule 101

As a result of the proposed changes to Rule 410(a) described above to create a rulesbased CLF MRA, the definition of “CLF MRA” in Rule 101 would be amended to conform

to the proposed changes to Rule 410(a). The proposed rule change would add more detail
to the definition of “CLF MRA” in Rule 101 to prescribe that “CLF MRA means a Capped
Liquidity Facility Master Repurchase Agreement formed between a Member and the
Corporation by operation of Rule 410(a), which governs any CLF Event Transaction
between the Member and the Corporation, as defined and further prescribed in Rule 410.”
This new definition clarifies that the CLF MRA is a rules-based agreement between a
Member and CMESC by operation of Rule 410(a) and that CLF MRA governs CLF Event
Transactions between the Member and CMESC as further prescribed in Rule 410.
C.

Amendments to CLF Procedure

The CLF Procedure establishes a framework for the governance, execution and
testing of CMESC’s CLF, covering areas such as calculation of the size and apportioning
of CLF among Members, administration of CLF Event Transactions, notification to
Members, Member attestation, and operational testing. As a result of the proposed
amendments to Rule 410 described above, CMESC states that similar changes would be
made to the CLF Procedure that are consistent with the proposed amendments to Rule
410, as described below, for the purpose of aligning provisions of the CLF Procedure
with Rule 410.18
1.

Rules-based CLF MRA

The proposed rule change would amend the Governance section of the CLF
Procedure to add that CLF Event Transactions are governed by a CLF MRA, as set out in
the Rules. This proposed addition is to align with and acknowledge the proposed
amendment to Rule 410 to state that each Member is a party to a CLF MRA pursuant to
and by operation of Rule 410(a), without additional steps taken by CMESC or Members to
execute an agreement. The proposed rule change would also update the internal governance

Id. at 56682.

committee identified in the Governance section that is responsible for reviewing and
approving the CLF Procedure on at least an annual basis.
2.

Sizing the CLF

The proposed rule change would amend the Sizing of the Facility section of the
CLF Procedure to add that CMESC may consider additional factors in addition to the
Cover 1 SPPO amount, including but not limited to information requested from
Members. These proposed additions are to align with and acknowledge similar proposed
amendments to Rule 410 as described above.
More specifically, the proposed rule change would modify the Sizing of the Facility
section of the CLF Procedure to clarify that the objective of its CLF sizing methodology is
to use the Cover 1 SPPO as the starting point for estimating CMESC’s hypothetical
liquidity needs under extreme but plausible market conditions. The proposed rule change
would add language to this section to mirror and align with the language at Rule 410(i)(i)
(to be renumbered as Rule 410(e)(i)), which provides consideration of these historical and
relevant factors in sizing the CLF.
CMESC also proposes that the CLF Procedure expressly state that with respect to
a Member approved by CMESC to commence clearance and settlement of Eligible
Securities Transactions, a Member’s SPPO may be based on information provided by the
Member, in accordance with abovementioned amendments to the Rules. This addition
would account for circumstances where CMESC does not already have historical trade
submission data from the Member to determine that Member’s SPPO (e.g., a new Member)
and CMESC seeks to request from and rely on appropriate information supplied by a
Member in order for CMESC to determine a Member’s SPPO. This addition also would
bring the CLF Procedure into alignment with Rule 410, as proposed to be amended.
3.

Apportioning the CLF

The proposed rule change would amend the Apportioning section of the CLF
Procedure to similarly add that CMESC may request information from Members to facilitate
CMESC’s calculation of each Member’s Allocated CLF Amount and to remove the
description of how CMESC would otherwise calculate the CLF obligation of a Member that
had no transactions during the relevant lookback period. The proposed additions are to align
with and acknowledge the proposed amendments to Rule 410(i)(ii).
Consistent with proposed changes to Rule 410(i)(ii) (renumbered as Rule
410(e)(ii)), the CLF Procedure would provide that a Member’s Maximum SPPO may be
based on information requested by CMESC, including the Member’s projected volumes and
sizes of transactions to be cleared, to be calculated using a minimum lookback period as
defined in the CLF Procedure. The proposed change is designed to establish a method for
CMESC to compute each Member’s Allocated CLF Amount in accordance with CMESC
Rules.
4.

Notification and Attestation

The proposed rule change would modify the Notification and Attestation sections
of the CLF Procedure to clarify that on at least a quarterly basis and upon any resizing of
the CLF, each Member will be informed of its individual Allocated CLF Amount, as well
as the effective date of any amended Allocated CLF Amount. An authorized representative
must acknowledge and affirm the Member’s potential CLF obligations on at least an annual
basis, as well as make other acknowledgments as required to ensure Members are aware of
and prepared to meet their relevant obligations.
These proposed changes regarding notice would be consistent with changes
proposed for Rule 410. CMESC states that these proposed amendments would enhance
clarity on the operation of the CLF and that they are reasonably designed to ensure that
CMESC and its Members will engage in meaningful and helpful information exchange in

support of assuring that Members meet their obligations under the CMESC Rules, thereby
facilitating CMESC meeting its obligations under the Act and the rules thereunder.19
5.

Other Clarification and Clean-Up Changes

Finally, the proposed rule change would include other clarifying, clean-up changes
throughout the CLF Procedure. CMESC’s proposed clarifying, clean-up changes fall within
the following categories: (1) use capitalized terms for consistency with the CMESC Rules
and, where indicated, the LRMP and the CLF Procedure;20 (2) use precise terminology
consistently across the CMESC Rules, the LRMP, and the CLF Procedure;21 (3) correct
minor grammatical or typographical errors; and (4) make clarifying changes to improve the
readability of the CLF Procedure. CMESC states that these changes do not change the
substance of the proposed rule change. 22
D.

Proposed Amendments to LRMP

The proposed rule change includes several corresponding modifications to the
LRMP to align with proposed changes to Rule 410 as discussed above. The LRMP contains
CMESC’s policies and procedures to monitor, measure, and manage potential liquidity
events and resources available to satisfy liquidity obligations in extreme but plausible
market conditions. Specifically, the proposed rule change would amend Section 5.5.3.2.
provisions on the declaration of a CLF Event to clarify that CMESC will notify Members
of their CLF Event Transactions and also the cash amount required to be obtained (in total
across Members and per Member), the type and volume of securities to be utilized, and the
initial tenor of the CLF Event Transactions, and declare an end to the CLF Event once it has

Id. at 56683.

As examples, the proposed rule change would use capitalized terms as defined in CMESC’s Rules,
including “CLF Event Transaction(s);” “Corporation;” “Allocated CLF Amount,” consistently
throughout Sections 3 through 10 of the CLF Procedure.

As examples, Section 3.2 of the CLF Procedure would be revised to replace phrases like “financial
obligations” with “liquidity needs” and “funding” to “liquidity” to be consistent with the
terminology used in the CMESC Rules.

See Notice of Filing, supra note 3, 91 FR at 56683.

determined that the CLF Event Transactions entered into pursuant to the CLF are no longer
necessary. Additionally, conforming changes to Sections 6.1.1.4.2. and 6.1.1.4.3. would
clarify that CLF sizing is based primarily on Cover 1 SPPO, and apportioning is based
primarily on the Member’s maximum SPPO and the maximum SPPOs across all Members
within a defined lookback period, consistent with proposed changes to Rule 410. The
proposed rule change would include additional changes to Section 6.1.1.4.2. to align the
description of frequency for determining the size of the CLF at least quarterly, or more
frequently if CMESC determines appropriate, with that in Rule 410(e)(i). Finally, CMESC
states that other non-substantive clarifying, organizational and cleanup changes to the
LRMP would be designed to fully align the LRMP with the proposed changes in Rule 410.23
III.

DISCUSSION AND COMMISSION FINDINGS
Section 19(b)(2)(C) of the Act24 directs the Commission to approve a proposed

rule change of a self-regulatory organization if it finds that such proposed rule change is
consistent with the requirements of the Act and rules and regulations thereunder
applicable to such organization. After careful review of the proposed rule change, the
Commission finds that the proposed rule change is consistent with the requirements of
the Act and the rules and regulations thereunder applicable to CMESC. More specifically,
for the reasons given below, the Commission finds that the proposed rule change is
consistent with Section 17A(b)(3)(F) of the Act25 and Rules 17ad-22(e)(1) and (e)(7)
thereunder.26
A.

Consistency with Section 17A(b)(3)(F)

Section 17A(b)(3)(F) of the Act requires, in part, that the rules of a clearing agency
be designed to promote the prompt and accurate clearance and settlement of securities
Id.

15 U.S.C. 78s(b)(2)(C).

15 U.S.C. 78q-1(b)(3)(F).

17 CFR 240.17ad-22(e)(1) and (e)(7).

transactions and, in general, to protect investors and the public interest.27
As described above in Section II.A.1., the proposed rule change would establish a
rules-based CLF MRA under which each Member is bound by a unified, standardized
agreement by operation of Rule 410(a), without the need for CMESC and each Member to
negotiate and execute separate bilateral agreements. This approach should avoid the
administrative burden and delay associated with preparing and executing numerous
separate agreements, fosters consistency by ensuring all Members are subject to a unified
set of terms, and provides legal certainty regarding the rights and obligations of CMESC
and its Members in a CLF Event. By facilitating the prompt implementation of the CLF,
the proposed rule change helps ensure that CMESC has sufficient qualifying liquid
resources to meet its settlement obligations in the event of a Member default. As a result,
the proposed rule change promotes the prompt and accurate clearance and settlement of
securities transactions and the protection of investors and the public interest, consistent
with Section 17A(b)(3)(F) of the Act.
Further, as described above in Section II.A.2, the amendments to Rules 410(i)(i)
and (ii) (renumbered as Rules 410(e)(i) and (ii)), and the conforming changes to the CLF
Procedure and LRMP, which include additional details regarding CMESC’s calculation of
the Cover 1 SPPO used to size the CLF and each Member’s Maximum SPPO, Obligation
Ratio, and Allocated CLF Amount, should support Members’ ability to understand and
plan for their potential CLF obligations. Moreover, the new information requirement for
Members to commence clearing Eligible Securities Transactions should enable CMESC to
receive the information it deems relevant to size and allocate the CLF appropriately and
continue to meet its liquidity needs. These changes should reduce the risk of settlement
failure by helping ensure that CMESC has sufficient liquid resources to meet its settlement

27 15 U.S.C. 78q-1(b)(3)(F).

obligations in the event of a Member default, thereby protecting investors and the public
interest, consistent with Section 17A(b)(3)(F) of the Act.
Finally, the clarifying and technical amendments to Rule 410, the CLF Procedure,
and the LRMP, which remove redundancies and align terminology across CMESC’s Rules,
the CLF Procedure, and the LRMP, support CMESC’s ability to administer the CLF
consistently and without ambiguity, which in turn supports CMESC’s ability to meet its
settlement obligations, thereby promoting the prompt and accurate clearance and
settlement of securities transactions, consistent with Section 17A(b)(3)(F) of the Act.
For these reasons, the Commission finds that the proposed rule change promotes
the prompt and accurate clearance and settlement of securities transactions and protects
investors and the public interest, consistent with Section 17A(b)(3)(F) of the Act.
B.

Consistency with Rule 17ad-22(e)(1)

Rule 17ad-22(e)(1) under the Act requires that a covered clearing agency establish,
implement, maintain and enforce written policies and procedures reasonably designed to
provide for a well-founded, clear, transparent, and enforceable legal basis for each aspect
of its activities in all relevant jurisdictions.28
As described above, the proposed rule change establishes a rules-based CLF MRA
in Rule 410, with a conforming definitional change in Rule 101, and makes conforming,
clarifying, and technical changes to Rule 410, the CLF Procedure, and the LRMP to ensure
consistent use of defined terms and precise terminology throughout. These changes should
improve the readability, clarity, and transparency of CMESC’s Rules by ensuring that
defined terms and precise terminology are used consistently throughout. Further, by
incorporating the SIFMA MRA by reference and providing that the CLF MRA governs in
the event of an inconsistency with the SIFMA MRA, the proposed rule change should

28 17 CFR 240.17ad-22(e)(1).

provide a clear, transparent, and enforceable legal basis for CMESC and its Members’
rights and obligations in a CLF Event. Accordingly, the proposed rule changes are
consistent with Rule 17ad-22(e)(1).
C.

Consistency with Rule 17ad-22(e)(7)

Rule 17ad-22(e)(7) under the Act requires, in part, that a covered clearing agency
establish, implement, maintain and enforce written policies and procedures reasonably
designed to effectively measure, monitor, and manage the liquidity risk that arises in or is
borne by the covered clearing agency, including measuring, monitoring, and managing its
settlement and funding flows on an ongoing and timely basis, and its use of intraday
liquidity.29
Specifically, Rule 17ad-22(e)(7)(i) under the Act requires policies and procedures
for maintaining sufficient qualifying liquid resources to effect same-day settlement of
payment obligations with a high degree of confidence under a wide range of foreseeable
stress scenarios, including the default of the participant family that would generate the
largest aggregate payment obligation in extreme but plausible market conditions.30
As described above, the proposed changes to Rules 410 and 101, the CLF
Procedure, and LRMP facilitate CMESC’s implementation of the CLF by creating a rulesbased CLF MRA designed to provide CMESC with a liquidity resource in the event that
CMESCs other liquidity resources prove insufficient during a Member default, enhancing
the descriptions of the calculation of the CLF and each Member’s Allocated CLF Amount,
adding the information requirement imposed on Members to allow CMESC to receive
information deemed relevant by CMESC to assess the size of the CLF and determine a new
Member’s Allocated CLF Amount, and making conforming, clarifying and technical
changes to reduce redundancy and promote clarity. These changes should support

Rule 17ad-22(e)(7).

Rule 17ad-22(e)(7)(i), 17 CFR 240.17ad-22(e)(7)(i).

CMESC’s ability to effectively assess and determine the CLF sizing and allocation and
support Members’ ability to understand and plan for their potential CLF obligations, which
should strengthen CMESC’s measurement, monitoring, and management of liquidity risk
and help CMESC maintain and hold sufficient liquid resources to effect same-day
settlement of payment obligations in the event of a default of the participant family that
would generate the largest aggregate payment obligation in extreme but plausible market
conditions. In particular, because the CLF is sized starting from the Cover 1 SPPO, and it
serves as a backstop when CMESC’s other sources of liquidity are unavailable or
insufficient, clarifying the sizing and allocation process and ensuring that CMESC has the
Member information needed to compute it should help CMESC maintain an appropriately
sized and allocated facility, consistent with Rule 17ad-22(e)(7).
IV.

CONCLUSION
On the basis of the foregoing, the Commission finds that the proposed rule change

is consistent with the requirements of the Act and in particular with the requirements of
Section 17A of the Act31 and the rules and regulations promulgated thereunder.
IT IS THEREFORE ORDERED, pursuant to Section 19(b)(2) of the Act32 that
proposed rule change SR-CMESC-2026-008 be, and hereby is, APPROVED.33
For the Commission, by the Division of Trading and Markets, pursuant to delegated
authority.34
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-21136 Filed: 10/15/2026 8:45 am; Publication Date: 10/16/2026]

15 U.S.C. 78q-1.

15 U.S.C. 78s(b)(2).

In approving the proposed rule change, the Commission considered the proposals’ impact on
efficiency, competition, and capital formation. 15 U.S.C. 78c(f).

17 CFR 200.30-3(a)(12).