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LCH Group Holdings Limited |LCH Limited | Banque Centrale de Compensation | LCH.Clearnet LLC

LCH Group Holdings Limited. Registered in England No. 4743602 Registered Office: Aldgate House, 33 Aldgate High Street, London EC3N 1EA

VIA CFTC PORTAL

December 15, 2021

Mr. Christopher Kirkpatrick

Commodity Futures Trading Commission

1155 21st Street NW

Three Lafayette Centre

Washington, DC 20581

LCH Limited Self-Certification: ForexClear Fees Update

Dear Mr. Kirkpatrick,

Pursuant to Commodity Futures Trading Commission (“CFTC”) Regulation §40.6(a), LCH Limited 

(“LCH”), a derivatives clearing organization registered with the CFTC, is submitting for selfcertification changes to the ForexClear fee schedule.

Part I: Explanation and Analysis

The ForexClear service charges fees to Clearing Members in relation to their activity in eligible

deliverable and non-deliverable FX products, as appropriate.

1 These include fixed and variable 

components and are charged at the Clearing Member Group level. In accordance with an annual 

review of ForexClear fees that is expected by Clearing Members, LCH will make changes to its 

ForexClear Fee Schedule.

Part II: Description of Rule Changes

The proposed revisions to the ForexClear Fee Schedule include the following:

• Revise certain fees applicable to the Gold tariff (a combined deliverable and nondeliverable products fee) and Zinc tariffs (a deliverable products fee) in accordance with 

an annual increase.

• Add a reference to a clearing fee holiday for deliverable products, except FX Options, until 

January 1, 2024. This applies to Clearing Members on the Gold and Zinc tariffs.

• Clarify explanatory notes related to the Gold tariff and Silver, Zinc, and Bronze tariff fee 

schedules for deliverable and non-deliverable products as applicable; the changes do not 

impact the economics related to the explanatory notes. 

1 https://www.lch.com/services/forexclear/what-we-clear
o Options fees continue to apply only after the first $60bn cumulative notional 

cleared in each calendar year.

o Add a reference to FX Swaps for completeness, where relevant. 

• Extend the Silver, Bronze, and Client tariff exemption related to Non-Deliverable Options 

clearing fees until December 31, 2022.

• Extend the Gold, Silver, Bronze, Zinc and Client tariffs exemption related to the 

ForexClear Compression Service until January 1, 2023.

• Simplify wording related to clients to eliminate the mention of clearing brokers. Clients 

access the clearing service through clearing brokers and the current language may imply

there are two classes of clients which is not the case. 

• Update the ForexClear Non-Deliverable Service section to add that the discount based on 

cleared volume by trade count currently applied to Silver or Bronze ForexClear Clearing 

Members will end on December 31, 2022.

• Update the ForexClear Deliverable Service section to revise the fee waiver duration for 

Silver and Bronze tariffs to the initial three months.

• Throughout update “mn” to “million.”

The changes to the ForexClear fees webpage are set out in Appendix I. The changes will be 

effective not earlier than January 3, 2022.

Part III: Core Principle Compliance

LCH reviewed the proposed changes against the requirements of the Core Principles and finds it 

will continue to comply with all the requirements and standards set forth therein. Specifically, 

these rule changes have potential relevance to Core Principle L (Public information).

The changes described in this filing ensure that LCH meets the objectives of Core Principle L, 

including that, in addition to the specified requirements of §39.21, LCH make available any 

information that is relevant to participation in the clearing and settlement activities of LCH. LCH 

considered its public information requirements and believes making the revisions described 

above will enhance its compliance with Core Principle L. The changes provided for in this 

submission will be included in LCH’s publicly available ForexClear Fee Schedule, thereby 

providing clarity to market participants. As a result, LCH believes these changes are consistent 

with the requirements of Core Principle L on Public Information under CFTC regulation §39.21.

Part IV: Public Information

LCH has posted a notice of pending certification with the CFTC and a copy of the submission on 

LCH’s website at: https://www.lch.com/resources/rulebooks/proposed-rule-changes.

Part V: Opposing Views

There were no opposing views expressed to LCH by governing board or committee members, 

members of LCH or market participants.

Certification

LCH hereby certifies to the CFTC, pursuant to the procedures set forth in CFTC Regulation 

§40.6, that the attached submission complies with the Commodity Exchange Act, as amended, 

and the regulations promulgated thereunder.
Should you have any questions please contact me at julian.oliver@lch.com.

Yours sincerely,

Julian Oliver

Chief Compliance Officer

LCH Limited
Appendix I

Website changes (ForexClear fees)

https://www.lch.com/services/forexclear/fees

Fees

ForexClear Clearing Members may be members of either or both of the ForexClear 

Deliverable Service and the ForexClear Non-Deliverable Service. ForexClear Clearing 

Members may choose from a variety of fee tariffs: Gold – Combined Tariff, Bronze, Silver 

and Zinc. Each tariff covers all house trade registration activity for a ForexClear Clearing 

Member Group.

ForexClear Gold Tariff – Combined Non-Deliverable and Deliverable FX Fee

Annual 

Tariff*

Options/ 

NDONDOs

Fee / 

mn*million**

FX Spot /

Forward Hedges/ 

Swap Hedges and 

NDF

Fee / mnmillion

FX ForwardForwards 

and FX Swaps

Settlement Fee** mn

million***

Annual Fee 

Cap

GBP 

1,250,000 GBP 2.50 n/a 0.2 EUR or USD GBP 1,800850,000 

*The Annual Tariff includes unlimited clearing volumes for FX Swaps, FX Forwards and FX Spot (that 

(in each case) are not cleared for the purpose of hedging FX Optionsfeesapplicablethe ) until 1st

January 2024.

**Options and NDOs fees are applicable after beyond the first $60bn cumulative notional cleared is 

included in the GBP 1.25mn fee in each calendar year.

** ***Only applicable to FX ForwardSwaps and FX Forwards transactions that (in each case) are not 

cleared for the purpose of hedging FX Options (which hedging is undertaken either to reduceing initial 

margin requirements or reducingreduce settlement risk.).

Non-Deliverable FX Only Fees**

Tariff Annual

Tariff

EMTA NDF

Fee / 

mnmillion

Non-EMTA NDF

Fee / mnmillion

Client n/a US$ 2 US$ 1

Silver GBP 825,000 n/a n/a

Bronze US$ 350,000* US$ 2 US$ 1

*Non-deliverable bronze tariff is capped at US$1,250,000 per calendar year.

**Silver, Bronze and Client tariffs are exempted from Non-Deliverable Options clearing fees until 31st

Dec 2021. December 2022.
Deliverable FX Only Fees

Tariff Annual

Tariff

FX Options

Fee / 

mnmillion

FX Spot /

Forward Hedges

and Swap Hedges

Fee / mnmillion

FX Forwards and 

FX Swaps

Settlement Fee / 

mnmillion**

Annual Fee 

Cap

Silver GBP 885,000 n/a n/a 0.2 EUR or USD

Zinc GBP 

495545,000* GBP 2.50 n/a 0.2 EUR or USD GBP 1,045145,000 

Bronze US$ 400,000 US$ 2 US$ 2 0.2 EUR or USD

Note: New Clearing Members of the ForexClear Deliverable Service will be eligible for a fee discount, -

please refer to ‘Fee Discounts’

* The Zinc Annual Tariff includes unlimited clearing volumes for FX Swaps, FX Forwards and FX Spot

that (in each case) are not cleared for the purpose of hedging FX Options) until 1st January 2024.

**Only applicable to FX Swaps and FX Forwards transactions that (in each case) are not cleared for 

the purpose of hedging FX Options (which hedging is undertaken either to reduceing initial margin 

requirements or reducingreduce settlement risk.).

Member Fees

Where a ForexClear Clearing Member wishes to move from a lower fee tariff to a higher fee tariff, 

including to the combined Non-Deliverable and Deliverable Gold Tariff, if the Member gives notice by 

the 20th of the preceding month, it will move to the newly elected fee tariff effective the 1st of the 

following month. From that month the remaining monthly instalments of the calendar year will be 

payable at the newly elected fee tariff irrespective of fee amounts already invoiced under the 

ForexClear Clearing Member’s previous fee tariff. ForexClear Clearing Members may only move to a 

lower fee tariff at the start of the new calendar year.

Compression Fees (Member & Client Clearing)

• Gold, Silver, Bronze, Zinc and Client tariffs will not be charged fees for using the ForexClear 

Compression Service until 31st Dec 20211

st January 2023.

• Thereafter, Members and Clients will be charged US$1 per US$1 million of notional reduced using

ForexClear Compression.

• A cap of US$500,000 per annum will apply per ForexClear Clearing Member Group for compression

of Member Group trades (i.e.,. proprietary trades).

• There is no cap on compression feesforfees for clients or clearing brokers clearing Client business.

Variable Fee Calculation

The Variable tariff fees are calculated on each trade as:

• [Notional amount of trade] * the per million (US$) notional fee from the relevant tier in the schedule

above.

• ForexClear Client Clearing fees are calculated based on the total cleared notional in a calendar month

for each independent Client Clearing portfolio.
Fee Discounts

ForexClear Non-Deliverable Service

The ForexClear Clearing Member on the Silver or Bronze tariff that clears the most non-deliverable FX 

volume by trade count with respect to its house (i.e.,. proprietary) account, including any inter-affiliate 

trades, will receive a monthly fee discount of £15,000. The discount is applied to the Silver or Bronze 

ForexClear Clearing Member’s monthly fee bill in arrears and will end on 31st December 2022.

ForexClear Deliverable Service

When first electingselecting the Deliverable Silver or Bronze tariff, ForexClear Clearing Members of 

the ForexClear Deliverable Service will be eligible for their first 4-3 months free of clearingfixed and 

variable fees will be waived.

Settlement Reduction Fees for the Deliverable Service

LCH will impose a fee as part of the automated settlement reduction process, levied against members 

who are in breach of relevant settlement limits at end of day on SD-2.

The fee will take the form of a “per unit of notional” charge against settlement amounts in excess of 

relevant currency settlement limits applied in respect of the excess of member’s Settlement Position 

Amount over the Settlement Position Limit as per table below:

AUD CHF EUR GBP JPY

Bps on notional 0.26 0.23 0.2 0.22 0.2

EMIR Account Structures

For more information on EMIR account structure charges please click here

Fee Notes

All fees are billed monthly in arrears.

Fixed Member fees are pro-rated monthly where a Member joins intra year.

A one-off on- boarding fee of $70,000 will be billed one month in arrears for each new ForexClear 

Clearing Member, FCM Clearing Member or ForexClear Dealer or Affiliate, which is a member of, or 

an Affiliated Firm of, a Member Group.

Members clearing both non-deliverable and deliverable FX will be required to pay both non-deliverable 

and deliverable fees or the combined ‘Gold’ tariff.

For a member to offer Client Clearing they must be part of a fee-paying Member Group.

Client Clearing fees are billed to Clearing Members.

A "Client Clearing Portfolio" is a separate legally identified Client Account that exists at a specific 

Clearing Member. A Client Clearing Portfolio is unique to each Clearing Member.

A "Member Group" means a ForexClear Clearing Member or an FCM Clearing Member, its direct and 

indirect subsidiaries and its direct and indirect holding companies and every direct and indirect 

subsidiary of each such holding company, from time to time. For the purposes of this definition: (i) 

‘subsidiary' means a company in which an entity holds more than 50% of the voting rights; and (ii) 

‘holding company' means a company that holds more than 50% of the voting rights in another entity.
An "Affiliated Firm" in relation to a Member Group means a firm that satisfies both of the following 

tests:

• A ForexClear Clearing Member or a FCM Clearing Member (or any other member of its Member 

Group) holds 50% or more of the voting rights in the firm; and

• One or more ForexClear Clearing Members or FCM Clearing Members (or any other member of their 

Member Group) together hold more than 50% of the voting rights in the firm.

"Voting rights" means the rights conferred on shareholders in respect of their shares or, in the case of 

a company not having a share capital, on members, to vote at general meetings of the company on 

all, or substantially all, matters.

Changes in an entity's corporate ownership may lead to changes in the tariff that applies to it.

Terms used herein are as defined in the rulebook of LCH, which you can access from the Quick Links 

below.