The Multi Commodity Exchange Clearing Corporation Limited (MCX) on October 03, 2024, issued the clarification on Margin Collection & Reporting.
The following has been stated namely: -
• It states that the penalties for short/non-collection of upfront margins by clearing corporations may be passed on to clients if the issues arise from a dishonoured cheque or an increase in margins due to changes in the client's hedge position.
• It clarifies that penalties can be passed on to clients only if their Risk Management Policy informs clients of potential situations that may lead to hedge breaks or loss of cross-margin benefits, resulting in higher margin obligations.
• The provisions of this circular shall be applicable from November 01, 2024, and members shall inform their clients of the changes in their risk management policy at least 7 days in advance of this date or the penalty date, whichever is later.
[Circular no. - MCX/INSP/662/2024]
