COMMODITY FUTURES TRADING COMMISSION

FORM FBOT

FOREIGN BOARD OF TRADE APPLICATION FOR REGISTRATION (IN

ORDER TO PERMIT DIRECT ACCESS TO MEMBERS AND OTHER

PARTICIPANTS)

MexDer, Mercado Mexicano de Derivados, S.A. de C.V.

Paseo de la Reforma 255, Col. Cuauhtémoc, México, D.F. C.P. 6500

 If this Form FBOT is a new application for registration, complete in full and 

check here.

 If this Form FBOT is an amendment to a pending application or to a final 

application that resulted in the issuance of an Order of Registration, list and/or 

describe all items that are amended or otherwise updated and check here.

When appropriate, please attach additional page(s) containing a list and 

explanatory statement of amendment(s) or update(s).

GENERAL INFORMATION

1. Name under which the business of the foreign board of trade will be conducted, if 

different than name specified above:

2. List of principal office(s) where foreign board of trade activities are/will be conducted 

(please use multiple entries, when applicable):
Office (name and/or location): Colonia Cuauhtémoc, Mexico

Address:

Paseo de la Reforma 255, Col. 

Cuauhtémoc, México, D.F. C.P. 6500

Phone Number: (5255) 5342-9900

Fax Number: (5255) 5342-9903

Website Address: http://www.mexder.com.mx

3. Contact Information.

3a. Primary Contact for Form FBOT (i.e., the person authorized to receive Commission 

correspondence in connection with this Form FBOT and to whom questions regarding 

the submission should be directed):

Name:

Title:

Email Address:

Mailing Address:

Katten Muchin Rosenman LLP

525 W. Monroe

Chicago, IL 60661

Phone Number: 312-902-5494

Fax Number: 312-902-1061

3b. If different than above, primary contact at the foreign board of trade that is authorized 

to receive all forms of Commission correspondence:
Name:

Title: Chief Executive Officer

Email Address:

Mailing Address:

Paseo de la Reforma 255, Col. 

Cuauhtémoc, México, D.F. C.P. 6500

Phone Number: (5255) 5342-9913

Fax Number: (5255) 5342-9903

BUSINESS ORGANIZATION

Describe organizational history, including date and, if applicable, location of filing of original 

organizational documentation, and describe all substantial amendments or changes thereto. 

For example:

MexDer, Mercado Mexicano de Derivados, S.A. de C.V. (“MexDer”) is a corporation, 

having filed its articles of incorporation with the Public Property and Commerce Bureau in 

Mexico on October 16, 1998.

SIGNATURES

By signing and submitting this Form FBOT, the applicant agrees to and consents that the 

notice of any proceeding before the Commission in connection with the foreign board of 

trade’s application for registration or registration with the Commission may be given by 

sending such notice by certified mail or similar secured correspondence to the persons 

specified in sections 3a and 3b above.

MexDer has duly caused this Form FBOT to be signed on its behalf by the undersigned, 

hereunto duly authorized, this 15th day of August, 2012 and the undersigned represent that 
all information and representations contained herein are true, current, and complete. It is 

understood that all information, documentation, and exhibits are considered integral parts of 

this Form FBOT. The submission of any amendment to Form FBOT represents that all items 

and exhibits not so amended remain true, current, and complete as previously filed.

Signature of Chief Executive Officer (or functional equivalent), on behalf of the Foreign 

Board of Trade

Title:

Chief Executive Officer

Name of Foreign Board of Trade

MexDer, Mercado Mexicano de Derivados, S.A. de C.V.
EXHIBIT A – GENERAL INFORMATION AND DOCUMENTATION
EXHIBIT A-1

Attach, as Exhibit A-1, a description of the following for the foreign board of trade: Location, 

history, size, ownership and corporate structure, governance and committee structure, 

current or anticipated presence of offices or staff in the United States, and anticipated 

volume of business emanating from members and other participants that will be provided 

direct access to the foreign board of trade’s trading system.

1. Location

Mercado Mexicano de Derivados, S.A. de C.V.’s (“MexDer” or the “Exchange”) principal 

business office is located at Paseo de la Reforma 255, Col. Cuauhtémoc, México, D.F. C.P. 06500. 

MexDer’s principal business telephone number is +52 (55) 5342-9900.

MexDer’s website is located at www.mexder.com.mx. 

2. History

MexDer is a self-regulatory organization that is authorized by the Mexican Ministry of Finance 

and Public Credit (“Ministry of Finance” or “SHCP”), to do business as a derivatives exchange. 

The development of an exchange-listed derivatives market in Mexico was initiated by the Mexican 

Stock Exchange (“Bolsa Mexicana de Valores”) and the Central Securities Depository (“S.D. 

Indeval”). The Bolsa Mexicana de Valores financed the creation of the futures and options market 

that became MexDer, while S.D. Indeval assumed responsibility for the organization and initial 

financing of MexDer’s clearinghouse, Asigna, Compensación y Liquidación (“Asigna”). Together 

with the Association of Securities Brokerage Firms, the Bolsa and S.D. Indeval developed the 

infrastructure and facilities necessary to satisfy the legal, operational, systems and other 

requirements promulgated by the Financial Authorities (i.e., the Ministry of Finance, the Mexican 

Central Bank (“Central Bank”) and the National Banking and Securities Commission of Mexico 

(“CNBV”). The incorporation of MexDer under the laws of Mexico was authorized by Ministry 

of Finance, and MexDer began operations on December 15, 1998.

 

3. Size

For 2010, MexDer had a total volume of 41,827,321 futures contracts and 768,254 options 

contracts. From January to July of 2011, MexDer had a total volume of 29,792,221 futures 

contracts and 168,327 options contracts. In the same period of 2012, MexDer’s total volume for 

futures grew to 32,248,738 futures contracts and 766,178 options contracts.

4. Ownership

Currently, Bolsa Mexicana de Valores owns approximately ninety-seven percent of the shares in 

MexDer and other MexDer members and investors own the remaining shares. 

The capital stock of MexDer is comprised of common stock, with each share having an equal value 

and conferring the same rights and obligations. Common shares in MexDer may be acquired by 
3

brokers1, clearing members (or, more precisely, their trustor banks), and other individuals and 

entities authorized by MexDer under the terms of its bylaws.

5. Corporate Structure, Governance and Committee Structure

Details of MexDer’s internal organization and corporate governance are set forth in MexDer’s 

bylaws (“Bylaws”). As required by applicable Mexican law, MexDer has additionally promulgated 

internal regulations (“MexDer’s Internal Regulations”) and a manual of policies and procedures 

(“MexDer’s Manual of Policies and Procedures”) that address the organization of the Exchange 

and govern its market participants.

a. General Meeting of Shareholders

As mentioned above, the capital stock of the Exchange is comprised of common stock, with each 

share having an equal value and conferring the same rights and obligations. Common shares in 

MexDer may be acquired by trading members, clearing members, and other individuals and 

entities authorized by the Exchange under the terms of its Bylaws. The Shareholders’ Assembly is 

the highest body of MexDer and is charged with, among other duties, appointing members of 

MexDer’s Board of Directors. Resolutions adopted by the Shareholders’ Assembly are binding on 

all MexDer shareholders.

b. Board of Directors

MexDer is managed by a Board of Directors that is elected by the shareholders and comprised 

equally of MexDer members and independent members of the Board. The Bylaws require that 

independent Board members be recognized authorities in the financial field who (i) do not own 

any share in the capital or equity of the shareholders of MexDer, its clearing members or its 

brokers, or in financial institutions that are lenders to or owners of MexDer clearing members, and 

(ii) are not employed or commissioned by any of the foregoing.

The duties of the Board include:

(i) establishing the committees discussed below;

(ii) authorizing and suspending entry on the Exchange’s registry of brokers and clearing 

members and approval of new trading and/or clearing members;

(iii) issuing MexDer’s Internal Regulations;

(iv) ordering audits of brokers, and clearing members of Asigna; if not delegated to a 

committee, imposing sanctions for breaches of the MexDer regulations and the approval 

of the plans to be implemented by the Compliance Officer for audits and supervision of 

MexDer members, clearing members and Asigna;

1

Brokers are defined in the Mandatory Rules for corporations and trusts participating in the establishment and 

operation of a market for Exchange traded futures and options as the legal entities approved by the exchange to 

act as trading members.
4

(v) establishing the fees charged by the Exchange for its services; approving and submitting 

applications by proposed purchasers of MexDer stock to the Shareholders’ Assembly for 

ratification;

(vi) determining the subscription price of shares; and

(vii) adopting measures to handle contingencies that may alter or interrupt trading; and generally 

managing the business of the Exchange.

c. Committees

The Board of Directors is supported by various committees, whose role is to address and resolve 

matters described in the Prudential Provisions to which market participants must be subject to in 

their trading with exchange traded derivatives contracts (“Prudential Provisions”) (Attached hereto 

in Exhibit A 5), as well as in MexDer’s Bylaws and Internal Regulations. The MexDer Board 

currently has appointed the following eight Committees:

(i) the Executive Committee, consisting solely of persons appointed by the Board members, 

whose responsibilities include approval of all agreements and contracts and the 

development of the Exchange’s futures and options markets;

(ii) the Auditing Committee, none of whose members may be members of the Executive 

Committee, whose responsibilities include the Exchange’s internal controls, appointment 

of the Exchange’s independent auditors, and review the plans to be implemented by the 

Compliance Officer for audits and supervision of MexDer members, clearing members and 

Asigna;

(iii) the Regulatory and Ethics Committee, whose members may not also serve on the 

Committee of Discipline and Arbitration, and which is responsible, inter alia, for the 

development of operating, conduct and ethics rules;

(iv) the Committee of Discipline and Arbitration, none of whose members may also be 

members of the Board, which oversees hearing cases of alleged violations of MexDer’s 

Internal Regulations, as well as disputes between and among brokers, clearing members or 

their clients;

(v) the Committee of Admission and New Products, the members of which must be associated 

with a broker or clearing member, and whose duties include the evaluation of proposed 

new products, the review of the admission applications of new trading and/or clearing 

members, the establishment of position limits for each market participant, and the 

temporary suspension or delisting of a contract;

(vi) the Clearinghouse Committee, which is responsible for oversight of the services provided 

by Asigna pursuant to the contract executed with MexDer;

(vii) the Certification Committee, which establishes technical, proficiency and other 

requirements for the employees and officers of brokers and clearing members; and
5

(viii) the Promotion Committee, which oversees the Exchange’s marketing efforts.

6. No U.S. Presence

MexDer has no offices in the U.S. and does not intend to open a U.S. office. MexDer’s website is 

located at www.mexder.com.mx. With the exception of the MexDer website, MexDer’s marketing 

activities in the U.S. are limited to (i) MexDer’s presence at industry events, such as the 

International Futures Industry Conference held annually in Boca Raton, Florida and (ii) occasional 

meetings between MexDer staff and U.S.-based industry participants for the purpose of describing 

MexDer and products listed on the Exchange. MexDer endeavors as appropriate to describe the 

regulatory and legal restrictions applicable to U.S. persons trading Exchange products. MexDer’s 

staff does not provide investment services or accept, solicit, receive or direct orders in the U.S. 

with respect to products traded on the Exchange, and no trade processing or clearance functions 

are performed by MexDer or Asigna in the U.S. 

7. Anticipated Volume in U.S.

Attached please find a chart detailing the trading volume of MexDer from January 2012 

through June 2012.
Product1

Volume 

from All 

Terminals2

Total Buy/Sell 

Side Volume Volume from U.S. Terminals

Percentage 

from U. S. 

Terminals7

(COLUMN 2 

X2)3 Buy Side4 Sell Side5 Total (4) +(5)6

28 day Interbank Equilibrium 

Interest Rate Futures 22,043,245 44,086,490

10 year Centrally Cleared Swap 2048 4096

2 year Centrally Cleared Swap 9,305 18,610

91 day Treasury Bill Certificate 

Futures 915,700 1,831,400

30 year Bond Futures 230,258 460,516

20 year Bond Futures 791,962 1,583,924 1,067 1,732 2,799 0.18%

10 year Bond Futures 925,702 1,851,404 3,994 4,080 8,074 0.44%

5 year Bond Futures 20,397 40,794 0.00%

3 year Bond Futures 181,824 363,648 69 69 138 0.04%

Mexican Stock Exchange Price 

and Quotations Index Futures 557,005 1,114,010 130,430 118,633 249,063 22.36%

Mexican Peso / U.S. Dollar 

Futures 4,860,971 9,721,942 385,433 419,980 805,413 8.28%

Mexican Peso / Euro Futures 11,535 23,070 0.00%

Options on Mexican Stock 

Exchange Price and Quotations 

Index Futures

24,682 49,364 6,641 5,871 12,512 25.35%

Mexican Peso / U.S. Dollar 

Options 270 540 0.00%

Total 30,574,904 61,149,808 527,634 550,365 1,077,999 1.76%

1 List each contract that is eligible to be traded by direct access from the U.S., including those contracts for which 

there was no trading volume during the reporting period.

2 Include the total volume worldwide on the electronic trading system for each listed contract and, in the bottom row, 

enter the total of such volume worldwide for all listed contracts.

3 Multiply Column 2 X 2 (this should represent the total electronic buy side plus the total sell side volume worldwide 

for each listed contract).

4 Include the total electronic buy side volume for each contract originating by direct access in the U.S.

5 Include the total electronic sell side volume for each contract originating by direct access in the U.S.

6 Add Columns 4 + 5 to represent the total electronic buy side and sell side volume for each contract originating by 

direct access in the U.S.

7 Divide Column 6 by Column 3 and multiply the result by 100 to determine the percentage of the total buy/sell side 

volume originating from the U.S.
EXHIBIT A-2

Articles of association, constitution, or other similar organizational documents.

Public Deed 103,397 dated on August 18th, 1998, certifies the legal existence and constitution of 

MexDer, Mercado Mexicano de Derivados, S.A. de C.V. The attached Public Deed is apostil, but 

it is not translated since the Bylaws contained therein have been modified from time to time. 
EXHIBIT A-3

(1) Membership and trading participant agreements.

There are no membership agreements signed with brokers. All rights and duties derived from the 

relationship between MexDer and brokers are regulated by Mandatory Rules for corporations and 

trusts participating in the establishment and operation of a market for Exchange traded futures and 

options (“Mandatory Rules”), Prudential Provisions, MexDer’s Internal Regulations and 

MexDer’s Manual of Policies and Procedures.

(2) Clearing agreements.

There are no agreements signed with the clearing members. All rights and duties derived from the 

relationship between MexDer and clearing members are regulated by Mandatory Rules for 

corporations and trusts participating in the establishment and operation of a market for Exchange 

traded futures and options (“Mandatory Rules”), Prudential Provisions, MexDer’s Internal 

Regulations and MexDer’s Manual of Policies and Procedures.

NOTE: In accordance with the procedure of admission and/or approval established in MexDer’s 

Internal Regulations, the participants of MexDer do not sign any Membership agreements with 

MexDer. Members (brokers and clearing members) present an application for admission 

addressed to the Board of Directors, which approves whether or not an application is admissible. 

The Committee on Admission and New Products reviews the relevant application materials and 

makes a recommendation to the Board of Directors who definitely approves or rejects a new

members admission.
Exhibit A-3 – User Agreement

The Exchange is party to the following user agreements:

• Service Contract (MexFix) allows a user to access the production environment of 

MexFix, the Exchange’s remote access platform. There are two types of IDs: (1) market 

data – allows access to the information of all the trades that are executed in the derivatives 

market through the MexFix system; and (2) trading – allows the execution through the 

MexFix system of the various trades established in MexDer’s Internal Regulations.

• Sub-License Agreement grants a limited, non-exclusive, non-transferable and temporary 

sub-license for the use of software products on a server, personal computer or other 

equipment, limited to the maximum number of users listed in Annex A of the Agreement, 

provided that: a) the sub-licensee notifies MexDer in writing of the particular equipment 

in which the software products will be used; and b) MexDer has previously determined that 

the hardware and the operating system that comprise the equipment are compatible with 

the software products. 

• Financial Information Services Contract (SIM) provides various types of services or 

financial information packages, which may include text, data, graphics, photographs, 

scenes and/or moving images or sound recordings. There are two types of packages: SIM 

Basic and SIM Plus. The SIM Basic package includes users’ queries about daily and 

historical information and general queries and interest indicators. The SIM Plus package 

includes the functions of SIM Basic User and a statistics menu where the comparative of 

indicators, databases and daily averages may be consulted.

• Licensing of Information Agreement (Vendors) grants the non-exclusive right to receive 

market information, derived information and deferred information, and use it in accordance 

with the Annexes of the Agreement. 
EXHIBIT A-4

Terms and conditions of contracts to be available through direct access (as specified in 

Exhibit E). 

MexDer currently has the following listed contracts available for trading:

FUTURES CONTRACTS

CURRENCY U.S. dollar

US DOLLAR 

FUTURES.pdf

Euro (EURO)

EURO FUTURES.pdf

INDICES S&P/BMV Index (S&P/BMV IPC)

S&P BMV IPC.pdf

MINI S&P/BMV Index (S&P/BMV 

IPC)

MINI S&P BMV 

IPC.pdf

DEBT 30-days Overnight TIIE

30 DAYS 

OVERNIGHT TIIE.pdf

91 day CETES (CE91)

91 Days CETE.pdf

M241205 Bond

M 241205 Bond.pdf

M260305 Bond

M 260305 Bond.pdf

M270603 Bond

M 270603 Bond.pdf

M290531 Bond 

M 290531 Bond.pdf

Eliminado: FUTURES CONTRACTS¶
11

M310529 Bond

M 310529 Bond.pdf

M361120 Bond

M 361120 Bond.pdf

M421113 Bond

M 421113 Bond.pdf

M471107 Bond

M 471107 Bond.pdf

3 year Bond (M3)

3 Year Bond 

(M3).pdf

10 year Bond (M10)

10 Year Bond 

(M10).pdf

20 year Bond (M20)

20 Year Bond 

(M20).pdf

30 year Bond (M30)

30 Year Bond 

(M30).pdf

2 year TIIE Swap (Physical Delivery)

(SW02)

2 year TIIE 

Swap.pdf

10 year TIIE Swap (Physical Delivery)

(SW10)

10 year TIIE 

Swap.pdf
12

OPTIONS CONTRACTS

INDICES Future on BMV Index 

(S&P/BMV IPC)

Option S&PBMV 

IPC.pdf

CURRENCY U.S. dollar

US DOLLAR 

OPTION.pdf

The peso and bond contracts are settled by delivery, and all of the other contracts are 

settled in cash, in Mexican pesos, payable at Mexican banks. (The peso/dollar and 

peso/euro contracts are settled through agent banks with offices in Mexico and in the 

United States and Europe, respectively. The bond contracts are settled through S.D. 

Indeval (the Mexican Central Securities Depository) by the delivery of bonds 

corresponding to the specifications set out in MexDer’s Internal Regulations.) Thus, with 

the exception of the peso/dollar contract that is settled by the exchange of dollars for 

pesos, and the yellow corn contracts, none of these contracts has any nexus whatsoever 

to the United States. 
EXHIBIT A-5

The national statutes, laws and regulations governing the activities of the foreign board of 

trade and its respective participants.

Mandatory Rules

Mandatory 

Rules.pdf

Prudential Provisions

Prudential 

Provisions.pdf

MexDer Internal Regulations

Internal 

Regulation.pdf

MexDer Manual of Policies and 

Procedures

Manual of Policies 

and Procedures.pdf
EXHIBIT A-6

The current rules, regulations, guidelines and bylaws of the foreign board of trade.

See Exhibit A-5. MexDer’s Bylaws are attached.
EXHIBIT A-7

Evidence of the authorization, licensure or registration of the foreign board of trade 

pursuant to the regulatory regime in its home country jurisdiction and a representation by 

its regulator(s) that it is in good regulatory standing in the capacity in which it is authorized, 

licensed or registered.

In 1998, MexDer was authorized by the Ministry of Finance to be a futures and options exchange.

The original authorization and its translation are attached. 

Original Author Transl Author
EXHIBIT A-8

A summary of any disciplinary or enforcement actions or proceedings that have been 

brought against the foreign board of trade, or any of the senior officers thereof, in the past 

five years and the resolution of those actions or proceedings.

There have not been any procedures or disciplinary actions against MexDer over the past 5 years.
17

EXHIBIT A-9

An undertaking by the chief executive officer(s) (or functional equivalent[s]) of the foreign 

board of trade to notify Commission staff promptly if any of the representations made in 

connection with or related to the foreign board of trade’s application for registration cease 

to be true or correct, or become incomplete or misleading.
EXHIBIT B – MEMBERSHIP CRITERIA
EXHIBIT B(1)

A description of the categories of membership and participation in the foreign board of 

trade and the access and trading privileges provided by the foreign board of trade. The 

description should include any restrictions applicable to members and other participants to 

which the foreign board of trade intends to grant direct access to its trading system.

MexDer membership is open to foreign (i.e., non-Mexican) individuals and entities who (i) 

reside in or are organized under the laws of countries whose regulatory authorities are members 

of the Technical Committee of the International Organization of Securities Commissions 

(“IOSCO”) or its successor, (ii) consent to the jurisdiction of the Exchange with respect to 

disciplinary measures, and (iii) if not admitted as a clearing member, have entered into an 

appropriate services agreement with a MexDer clearing member.

The MexDer Board will consider the applicant’s capitalization and whether the applicant is 

suitably authorized in its country of origin to engage in transactions and activities related to the 

trading, clearing and settlement of derivatives. A foreign entity that wishes to act as a broker 

approved as global account manager or to carry such accounts with a clearing member must 

comply with the Mandatory Rules, the Prudential Provisions and MexDer’s Internal Regulations 

applicable to the management of global accounts and members of a market that is recognized by 

MexDer.

MexDer’s members are classified as clearing members, trading members/brokers (which may 

include non-Mexico based remote members) or market makers. Trading members may act as 

agents for customers and may also trade for their own accounts once they have been authorized 

to do so by the Exchange. Market makers are trading members that have been specifically 

approved by the Exchange to act as such. Trading members that also act as market makers must 

conduct their market making activities in a separate account.

A trading member also may act as the “manager” of a global account. A global account manager 

(which does not have discretionary authority over the accounts on its books) must be approved as 

such by MexDer and by Asigna. Remote members have a non-clearing remote membership with 

direct access to the trading system, and they clear through a MexDer clearing member.

All clearing members and trading members who have received authorization from MexDer’s 

Board of Directors to trade on the Exchange can enter bids and offers through the MexDer 

system. To guarantee that access to the System is limited to authorized individuals, each user 

has a confidential electronic signature consisting of a user name and an individual password 

which must be changed by the user on a regular basis. 

Specifically, upon the written request of a clearing member or trading member, MexDer assigns

the clearing member or trading member a “registration code” for the system, delivering the 

registration code to the individual who made the request. Additionally, each time a clearing 

member or trading member complies with all requirements to commence trading on the 

Exchange, or accredits a desk trader with the Exchange, MexDer will supply the clearing 

member, trading member and/or desk trader an “access code” for the system. (Access codes for 

the testing environment offered by MexDer to members and independent software vendors 
(“ISVs”) for purposes of determining whether front-end trading applications conform to MexFix 

are distinct from those production environment access codes used to trade via the system and 

must be requested and obtained from MexDer.) To further regulate access to the system, 

MexDer additionally sets the number of means of entry any single clearing member or trading 

member may have and publishes that determination in the Exchange’s Bulletin.

Other Types of Participants in MexDer

• A client executes as a customer through a trading member or a clearing member. Clearing 

members may have the power to execute and not only to setlle client’s trades if in his 

admission application the clearing member made such specification.

• A client executes through an omnibus account 1of a MexDer trading member or clearing 

member or, if the client has an existing agreement with a member of a recognized

exchange that has a registered omnibus account in MexDer, through the omnibus account 

of the member of the recognized exchange. Direct execution in MexDer is available 

through an existing agreement with a member of a recognized exchange that has a 

registered omnibus in MexDer. Omnibus accounts are segregated in accordance with 

CFTC Rule 30.7 of the CFTC, i.e., one account for proprietary trading and one account

for customer trading.

• A member of a recognized exchange with direct execution in MexDer through an existing 

order routing agreement with a recognized exchange (e.g., CME Order Routing 

Agreement).

1 Omnibus accounts in MexDer’s Internal Regulations are defines as Foreign Financial Entities.
EXHIBIT B(2)

A description of all requirements for each category of membership and participation on the 

trading system and the manner in which members and other participants are required to 

demonstrate their compliance with these requirements. The description should include, but 

not be limited to, the following: 

(i) Professional Qualification. A description of the specific professional requirements, 

qualifications, and/or competencies required of members or other participants and/or their 

staff and a description of the process by which the foreign board of trade confirms 

compliance with such requirements.

MexDer’s Internal Regulations contain detailed requirements that must be met by the different 

types of members of MexDer. 

First, participants (clearing members, trading members, remote members and market makers)

must complete a process of admission in which they must provide corporate and financial 

information for the Exchange to analyze (Articles 2005.00 and 2007.00 of MexDer’s Internal

Regulations). 

At the same time that participants provide the information required for admission, the member 

must demonstrate that it meets the elements to trade in compliance with the requirements of 

Article 2022.00 of MexDer’s Internal Regulations.

MexDer’s Internal Regulations establish additional requirements or exceptions to the general 

rule by type of member. For example:

• Article 2008.00 – Additional requirements for third-party brokers or integral clearing 

members.

• Article 2009.00 – Special exceptions for brokers who are credit institutions or brokerage 

firms.

• Article 2023.00 – Requirements for participants in a recognized foreign market.

• Articles 2025.01 to 2025.06 – Requirements for market makers.

• Articles 2025.07 to 2025.10 – Requirements for liquidity providers.

• Articles 2044.00 to 2045.00 – Requirements for brokers that manage global accounts.

• Articles 2046.00 to 2048.00 – Requirements for foreign entities.

• Articles 2049.00 to 2051.00 – Requirements for foreign financial entities.

The Exchange has a committee which considers the admission of new members, where 

appropriate, and recommends admission to the Board of Directors. There is a group in the 

Exchange that is composed of specialists in various fields who review the information and, 

where appropriate, requests corrections or additional information until the applicant has 

completed the entire file. 

Once the group of specialists has concluded its evaluation, the group will issue a 

recommendation to the Admission and New Products Committee on whether or not to approve 

the applicant. Once the recommendation has been received, the Admission and New Products 
Committee will evaluate it and present its ruling to the Board of Directors. Before presenting its 

ruling to the Board of Directors, the Admission and New Products Committee may require that 

the applicant and/or the group of specialists to submit additional information and make any 

clarifications it deems necessary with regard to any application. The Board of Directors will then 

grant or refuse the corresponding approval as clearing member or Broker.

In addition to the aforementioned requirements, clearing members must send to the Ministry of 

Finance the approvals granted by the Exchange and the clearing house as well as the following 

documentation: 

• A general functional plan and the manuals of policies and operating and liquidity 

procedures; 

• A detailed report on the management and risk control systems; and 

• Drafts of the contracts that the clearing member will use with its clients for the execution 

of exchange-traded derivatives contracts, as well as any other information that the 

Ministry of Finance deems appropriate.

The Ministry of Finance, after hearing the opinion of the CNBV and the Central Bank, reserves 

the right to veto the aforementioned approvals, when it considers that the trustors, or the 

members of the technical committee do not have sufficient technical or moral qualities for the 

performance of their duties, or when the approval process has not been adjusted to MexDer’s

Internal Regulations and the clearing house’s regulation. If the Ministry of Finance does not 

exercise its right of veto within 90 calendar days after the clearing member submits the approvals 

and the documentation referenced above, the respective trust may begin operations as a clearing 

member.

NOTE: This information is contained in Title II of MexDer’s Internal Regulations.

The following information provides guidance to applicants on the various exams recognized by 

the Exchange, and the processes and requirements to be met. The information is divided into 

two sections:

1. Equivalency Table of Certifications and functions that may be performed:

• MexDer’s exams 

• AMIB’s Certifications that are recognized by MexDer

• Foreign Certifications that are recognized by MexDer.

2. Requirements for the accreditation before the Legal Area of MexDer in order to act as 

Accredited Personnel (Sales Person, Desk Trader, Risk Manager and Account Manager).

MexDer

Exams taken as of 

October 1, 2005

Function that may be 

performed

Conditions to be 

recognized by MexDer

Derivatives Products Sales Sale and Trade Futures and Pass the exam/ Process 
Agent and Trader Options before Legal Area

Derivatives Products Sales 

Agent 

Sale Futures and Options Pass the exam/ Process 

before Legal Area

Derivatives Products Trader Trade Futures and Options Pass the exam/ Process 

before Legal Area

Account Manager Manage Accounts Pass the exam/ Process 

before Legal Area

Risk Manager Manage Risks Pass the exam/ Process 

before Legal Area

Trader of Futures and 

Options Contracts on stocks 

and Market Index

Trade Futures and Options 

on stocks and Market Index

Pass the exam/ Process 

before Legal Area

Trader of Futures and 

Options Contracts on 

Currencies

Trade Futures and Options 

on Currencies

Pass the exam/ Process 

before Legal Area

Trader of Futures and 

Options Contracts on Debt 

Securities and Currencies

Trade Futures and Options 

on Debt Securities and 

Currencies

Pass the exam/ Process 

before Legal Area

1. EQUIVALENCY TABLES

MexDer

Exams taken before 

September 30, 2005

Function that may 

be performed

Conditions to be 

recognized by 

MexDer

Function that may 

be performed if in 

possession of a 

Certification on 

Options

Account Manager Manage Accounts in 

Futures

Pass the exam/ 

Process before Legal 

Area

Manage Accounts in 

Futures and Options

Risk Manager Manage Risks in 

Futures

Pass the exam/ 

Process before Legal 

Area

Manage Risks in 

Futures and Options

Sales Agent and 

Desk Trader

Sale and Trade 

Futures

Pass the exam/ 

Process before Legal 

Area

Sale and Trade 

Futures and Options

Futures on Stock 

and Market Index 

Trader

Trade Futures on 

stock and Market 

Index

Pass the exam/ 

Process before Legal 

Area

Trade Futures and 

Options on stock 

and Market Index

Futures on Interest 

Rates Trader

Trade Futures on 

Interest Rates and 

Currency

Pass the exam/ 

Process before Legal 

Area / Process to 

trade Currencies

Trade Futures and 

Options on Interest 

Rates and Currency
Futures on Exchange 

Rates Trader

Trade Futures on 

Exchange Rates

Pass the exam/ 

Process before Legal 

Area

Trade Futures and 

Options on 

Exchange Rates

AMIB

Exams taken as of

January 2, 2007

Function that may 

be performed

Conditions to be recognized by MexDer

Investment Strategy 

Advisor

Sale and Trade 

Futures and Options

Pass the exam with a minimum of 600 

points in the Derivatives Products module/ 

Process before Legal Area

Exchange Trader Trade Futures and 

Options on stock and 

indexes

Pass the exam with a minimum of 600 

points in the “Derivatives Products” 

module, as well as in the “Operating 

Systems in MexDer” module/ Process 

before Legal Area

Money Market 

Trader

Trade Futures and 

Options on Interest 

Rates and Currency

Pass the exam with a minimum of 600 

points in the “Derivatives Products” 

module, as well as in the “Operating 

Systems in MexDer” module/ Process to 

trade Currencies

AMIB

Exams taken before 

January 2, 2007 

Function that may 

be performed

Conditions to be 

recognized by 

MexDer

Function that may 

be performed if in 

possession of a 

Certification on 

Options

Investment Strategy 

Advisor

Sale and Trade 

Futures

Pass the exam with a 

minimum of 600 

points in the 

Derivatives module/ 

Process before Legal 

Area 

Sale and Trade 

Futures and Options

Exchange Trader Trade Futures on 

stock and indexes

Pass the exam with a 

minimum of 600 

points in the 

Derivatives module/ 

Process before Legal 

Area

Trade Futures and 

Options on stock 

and indices
Money Market 

Trader

Trade Futures on 

Interest Rates and 

Currency

Pass the exam with a 

minimum of 600 

points in the 

Derivatives module/ 

Process before Legal 

Area/ Process to 

trade Currencies

Trade Futures and 

Options on Interest 

Rates and 

Currencies

Foreign 

Certifications 

recognized by 

MexDer

As of January 2, 

2006

Issuing 

Institution

Equivalent role in MexDer Conditions to be 

recognized by 

MexDer

Series 3 FINRA a) Derivatives Products 

Sales Agent and Trader, 

or

b) Account Manager, this 

figure is only valid in 

the case of personnel 

that works in a Broker

Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area

Series 4 FINRA a) Derivatives Products 

Sales Agent and Trader, 

or

b) Account Manager for 

the personnel that 

works in a clearing 

member or Broker

Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area

Series 7 FINRA Derivatives Products Trader Current 

Certification/ 

Process before 

AMIB/ Process 

before Legal Area

Trader 

Examination at 

Eurex

Eurex/ Deutsche 

Börse

Derivatives Products Sales 

Agent and Trader

Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area

Broker License MEFF Institute Derivatives Products Sales 

Agent and Trader

Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area

Clearing License 

and Broker

MEFF Institute a) Derivatives Products 

Sales Agent and Trader, 

or

b) Account Manager

Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area
Clearing License MEFF Institute Account Manager Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area

Associated 

Person

(AP)

NFA Derivatives Products Sales 

Agent and Trader

Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area

Floor Broker

(FB)

NFA Derivatives Products Sales 

Agent and Trader

Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area

Floor Trader

(FT)

NFA Derivatives Products Sales 

Agent and Trader

Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area

Principal NFA Derivatives Products Trader Pass the exam/ 

Process before 

AMIB/ Process 

before Legal 

Area/ 

Limitation

Financial Risk 

Manager

GARP Risk Manager Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area

Professional Risk 

Manager

PRMIA Risk Manager Pass the exam/ 

Process before 

AMIB/ Process 

before Legal Area

Notes regarding equivalency tables:

• When a participant wishes to trade futures contracts on currency (or futures and option 

contracts on currency), it shall submit a letter signed by the legal representative of their 

institution (accredited before MexDer) stating that the applicant has sufficient experience 

to conduct trades with futures contracts on currency (or futures and option contracts on 

currency). 

• Applicants who have external certifications and wish to be recognized in MexDer for any 

of the exams mentioned above must present their current certificate to the Asociación 

Mexicana de Intermediarios Bursátiles (“AMIB”) (Mexican Association of Securities 

Brokerage Firms), MexDer’s certifying institution. 
• If an applicant has a “Principal” certification, MexDer will allow the applicant to conduct 

transactions only under the role of Desk Trader in a firm trading on a proprietary basis.

2. REQUIREMENTS FOR THE ACCREDITATION BEFORE THE LEGAL AREA OF 

MEXDER IN ORDER TO ACT AS ACCREDITED PERSONNEL 

(Accredited Personnel include: Sales Person, Desk Trader, Risk Manager and Account 

Manager)

1. A letter from the legal representative of the broker or clearing member, in which the 

Accredited Personnel is appointed. 

2. Testimony or a certified copy of the public deed attesting to the faculties granted to the 

Desk Trader(s) and/or Promoter(s) to trade in MexDer.

3. A statement signed by the Desk Trader, Sales Agent, Risk Manager and Account 

Manager.

4. A letter issued by the Secretary of the Board of Directors of the broker (or, where 

appropriate, by the Trust Delegate of the clearing member) certifying the signature of the 

Desk Trader(s) and/or Sales Agent(s). 

5. Certification of the applicant that will hold the Accredited Personnel position.

6. Certification stating that the Desk Trader completed the training concerning use of

MexDer’s Electronic Trading System (SEN) of has had the proper training in their own 

trading platform.

Role 1

Appointment

2

Manifestation

3

Evidence 

of 

Signatures

4

Power

5

Certification

6

Course 

in SEN

• Desk 

Trader

X X X X X X

• Promoter X X X X X

• Risk 

Manager 

X X X

• Account 

Manager

X X X

(ii) Authorization, Licensure and Registration. A description of any regulatory and selfregulatory authorization, licensure or registration requirements that the foreign board of 

trade imposes upon, or enforces against, its members and other participants including, but 

not limited to any authorization, licensure or registration requirements imposed by the 

regulatory regime/authority in the home country jurisdiction(s) of the foreign board of 
trade. Please also include a description of the process by which the foreign board of trade 

confirms compliance with such requirements.

Persons interested in participating in MexDer must meet the following requirements:

Proprietary clearing member

Written application addressed to the Board of Directors of MexDer, corporations must include 

the following documentation:

(i) Testimony or certified copy of the public deed attesting to the faculties of the legal 

representative;

(ii) Evidence of the applicant’s incorporation;

(iii) Copy of the resolution certified by the secretary of the board of directors of the applicant 

authorizing participation on the Exchange;

(iv) Audited financial statements for the last three years;

(v) Monthly financial statements for the last three months;

(vi) Name, address, e-mail and telephone numbers of the persons who will be responsible and 

substitutes for the following roles: Sales Agent, Operations, Risk Management and 

Account Management;

(vii) Business plan;

(viii) Relevant trading procedures and risk control and liquidity policies;

(ix) Description of the account management system; and

(x) Description of the risk control system.

Third-Party clearing member

Written application addressed to the Board of Directors of MexDer, to the attention of the Chief 

Executive Officer; in the case of corporations, they must attach to the application the following 

documentation:

(i) Testimony or certified copy of the public deed attesting to the faculties of the legal 

representative;

(ii) Testimony or certified copy of the public deed of the applicant’s incorporation;

(iii) Copy of the resolution certified by the secretary of the board of directors of the applicant 

in which such collegiate body has agreed to their participation in the Exchange;

(iv) Financial statements audited by an independent public accountant for the last three years;

(v) Monthly financial statements for the last three months;

(vi) Name, address, e-mail and telephone numbers of the persons who will be responsible and 

alternates for the duties of: Sales Agent, Operations, Risk Management and Account 

Management;

(vii) General functional plan;

(viii) Project of the manual of policies, trading procedures, risk control and liquidity;

(ix) Detailed report on the account management system;

(x) Detailed report on the risk control system; 

(xi) Trust agreement;

(xii) Customer agreement; and
(xiii) Description of order management system.

Integral clearing member

Written application addressed to the Board of Directors of MexDer, to the attention of the Chief 

Executive Officer; in the case of corporations, they must attach to the application the following 

documentation:

(i) Testimony or certified copy of the public deed attesting to the faculties of the legal 

representative;

(ii) Testimony or certified copy of the public deed of the applicant’s incorporation;

(iii) Copy of the resolution certified by the secretary of the board of directors of the applicant 

in which such collegiate body has agreed to their participation in the Exchange;

(iv) Financial statements audited by an independent public accountant for the last three years;

(v) Monthly financial statements for the last three months;

(vi) Name, address, e-mail and telephone numbers of the persons who will be responsible and 

alternates for the duties of: Sales Agent, Operations, Risk Management and Account 

Management;

(vii) General functional plan;

(viii) Project of the manual of policies, trading procedures, risk control and liquidity;

(ix) Detailed report on the account management system;

(x) Detailed report on the risk control system;

(xi) Project of the trust agreement;

(xii) Contract that they will use with their Clients for the carrying out of Futures and/or Option 

Contracts, which shall comply with the requirements established in the Prudential 

Provisions; and

(xiii) Detailed report on the system for the reception of orders and assignment of trades.

Registration requirements

Proprietary Broker

Written application addressed to the Board of Directors of MexDer, to the attention of the Chief 

Executive Officer; in the case of corporations, they must attach to the application the following 

documentation:

(i) Testimony or certified copy of the public deed attesting to the faculties of the legal 

representative;

(ii) Testimony or certified copy of the public deed of the applicant’s incorporation;

(iii) Copy of the resolution certified by the secretary of the board of directors of the applicant 

in which such collegiate body has agreed to their participation in the Exchange;

(iv) Financial statements audited by an independent public accountant for the last three years;

(v) Monthly financial statements for the last three months;

(vi) Name, address, e-mail and telephone numbers of the persons who will be responsible and 

alternates for the duties of: Operations, Risk Management and Account Management;

(vii) General functional plan;

(viii) Project of the manual of policies, trading procedures, risk control and liquidity;
(ix) Detailed report on the risk control system;

(x) The mercantile commission and/or service contract that they must sign with a clearing 

member; and

(xi) The adhesion agreement that they must sign with a clearing member, except in the case of 

those Brokers and Market Makers that already are trustors of the respective clearing 

member.

Individuals seeking to perform Proprietary Trades must submit the information specified in 

subsection c) of section III and in section IV of Article 2007.00.

Third-party Broker

Written application addressed to the Board of Directors of MexDer, to the attention of the Chief 

Executive Officer; in the case of corporations, they must attach to the application the following 

documentation:

(i) Testimony or certified copy of the public deed attesting to the faculties of the legal 

representative;

(ii) Testimony or certified copy of the public deed of the applicant’s incorporation;

(iii) Copy of the resolution certified by the secretary of the board of directors of the applicant 

in which such collegiate body has agreed to their participation in the Exchange;

(iv) Financial statements audited by an independent public accountant for the last three years;

(v) Monthly financial statements for the last three months;

(vi) Name, address, e-mail and telephone numbers of the persons who will be responsible and 

alternates for the duties of: Sales Agent, Operations, Risk Management and Account 

Management;

(vii) General functional plan;

(viii) Project of the manual of policies, trading procedures, risk control and liquidity;

(ix) Detailed report on the account management system;

(x) Detailed report on the risk control system;

(xi) The mercantile commission and/or service contract that they must sign with a clearing 

member, depending on whether they perform transactions as Broker or exclusively as 

Market Maker;

(xii) Contract that they will use with their Clients for the carrying out of Futures and/or Option 

Contracts; and

(xii) Detailed report on the system for the reception of orders and assignment of trades.

Market Maker

Written application addressed to the Board of Directors of MexDer, to the attention of the Chief 

Executive Officer; in the case of corporations, they must attach to the application the following 

documentation:

(i) Testimony or certified copy of the public deed attesting to the faculties of the legal 

representative;

(ii) Testimony or certified copy of the public deed of the applicant’s incorporation;
(iii) Copy of the resolution certified by the secretary of the board of directors of the applicant 

in which such collegiate body has agreed to their participation in the Exchange;

(iv) Name, address, e-mail and telephone numbers of the persons who will be responsible and 

alternates for the duties of: Operations, Risk Management and Account Management;

(v) General functional plan;

(vi) The service contract that they must sign with a clearing member;

(vii) The adhesion agreement that they must sign with a clearing member, except in the case of 

those Brokers and Market Makers that already are trustors of the respective clearing 

member; and

(viii) Abide by the Liquidity Terms and Conditions set by the Exchange.

Global Accounts Manager

Written application addressed to the Board of Directors of MexDer, to the attention of the Chief 

Executive Officer; in the case of corporations, they must attach to the application the following 

documentation:

(i) Testimony or certified copy of the public deed attesting to the faculties of the legal 

representative;

(ii) Copy of the resolution certified by the secretary of the board of directors of the applicant 

in which such collegiate body has agreed to their participation in the Exchange;

(iii) Financial statements audited by an independent public accountant for the last three years;

(iv) Monthly financial statements for the last three months;

(v) Name, address, e-mail and telephone numbers of the persons who will be responsible and 

alternates for the duties of: Sales Agent, Operations, Risk Management and Account 

Management;

(vi) General functional plan;

(vii) Project of the manual of policies, trading procedures, risk control and liquidity;

(viii) Detailed report on the account management system;

(ix) Detailed report on the risk control system;

(x) Project of the trust agreement, if applicable;

(xi) Contract that they will use with their Clients for the carrying out of Futures and/or Option 

Contracts, which shall comply with the requirements established in the Prudential 

Provisions; 

(xii) Detailed report on the system for the reception of orders and assignment of trades; and

(xiii) Application for approval as Global Accounts Manager.

Foreign Financial Entities

(i) Written application addressed to the Board of Directors of MexDer, to the attention of the 

Chief Executive Officer; 

(ii) Document issued by the authority or institution of the country of origin of the Foreign 

Entity, that is competent to do so, stating that it carries out trades and/or functions of 

clearing and settlement of derivatives in any of the markets and entities recognized by the 

Exchange ;
(iii) Document stating their willingness to be bound to comply with the standards and other 

provisions issued by the Financial Authorities, by the Exchange itself and by the clearing 

house, as well as the express subjection to the imposition of disciplinary measures by the 

Exchange in case of breaching any obligations under the current regulations.

Liquidity Provider

In order to obtain the approval to act as Liquidity Provider, candidates must meet the following 

requirements:

(i) Submit to the Exchange the corresponding application addressed to the Chief Executive 

Officer, signed by a duly accredited legal representative;

(ii) Indicate the probable date for the start of operations in that capacity; and

(iii) Provide other information that the Exchange determines to be necessary.

NOTE: This information is contained in Title II of MexDer’s Internal Regulations.

As stated on Exhibit b(2)(i), Clearing members and trading members are required to ensure that 

their sales personnel, desk traders (who are responsible for the use and operation of the 

computers and other equipment used to trade on the System), risk managers and account 

administrators are approved, by an accredited certifying agency that has itself been recognized 

by MexDer, to demonstrate that they possess the necessary technical knowledge in derivative 

financial instruments prior to engaging in trading-related activities. They also must certify that 

they have undergone ethics training by an agency that has been approved by MexDer for such 

purposes.

These requirements are waived for sales personnel and desk traders in other countries who have 

demonstrated their proficiency by passing an approved examination in the country in which they 

do business. As an example, the Series 3 examination, a prerequisite to registration with the 

CFTC as an associated person, is recognized by MexDer for this purpose and U.S. registrants 

that have passed the Series 3 are required only to certify that they have familiarized themselves 

with those portions of MexDer’s Manual of Policies and Procedures relating uniquely to the 

MexDer market.

Additional requirements apply to trading members and clearing members that wish to carry 

(“manage”) omnibus accounts, including compliance with the minimum financial requirements 

established under the Mandatory Rules. A trading member that is not a financial institution and 

that seeks to act as a global account manager also must have procedures comparable to those 

required of or applicable to financial institutions under money laundering prevention rules set 

forth in the Criminal Code and the Mandatory Rules.

Individuals employed by Asigna in management positions must at all times be certified as 

account administrators. These certifications must be renewed at least once every three years.

Accreditation will be denied if the applicant has been convicted of certain offenses (including 

crimes against property), expelled from a foreign or domestic stock or derivatives exchange, the 
applicant’s application has previously been denied or the applicant fails to maintain his or her 

proficiency by taking and passing periodic examinations.
17

EXHIBIT B(2)(iii)

A description of the following:

(A) The financial resource requirements, standards, guides or thresholds required of 

members and other participants.

Clearing Members

The Mandatory Rules establish minimum financial requirements for clearing members. A 

proprietary position clearing member – or, more precisely, a proprietary position payment and 

administration trust – must at all times maintain a minimum equity in Mexican Pesos equivalent 

to the greater of 2,500,000 UDIs (approximately US$880,000) or four percent of the total of all 

minimum initial contributions maintained by that clearing member with Asigna. (The UDI is an 

inflation-adjusted unit of funds set by the Central Bank of Mexico according to the variation in 

the Mexican consumer price index. The Mexican credit system uses the UDI rather than the 

peso because of its stability.) Clearing members that settle futures or options contracts for 

customers or other third parties (e.g., third-party position payment and administration trust) must 

at all times maintain a minimum equity equal to the greater of the equivalent in pesos of 

5,000,000 UDIs (approximately US$1,750,000) or eight percent of the total of all margins 

maintained by that clearing member with Asigna. Clearing member contributions to the 

Contributions Fund and the Clearing Fund do not count toward the clearing member’s minimum 

equity.

In the case of clearing members that settle exchange-traded derivative contracts for third 

parties/clients, the minimum equity will be the greater of: (i) the equivalent of national currency 

to 5,000,000 UDIS (approximately US$1,750,000); or (ii) the sum of four percent of all 

minimum initial contributions that he clearing member maintains in the clearing house for each 

third-party open contract.

Clearing members who hold proprietary trades and third-party trades should separate their 

equity, distinguishing the portion for proprietary trading and for third-party trading.

One hundred percent of a clearing member’s minimum equity must be contributed in cash, but 

may be invested in short-term bank deposits, government bonds maturing in less than 90 days, or 

repurchase agreements on those bonds maturing in less than 90 days. In addition, up to thirty 

percent of that equity and any excess may be invested in MexDer shares, Asigna “trust rights 

certificates,” and any other assets that may be approved by the Financial Authorities.

Trading Members

Trading members are required by the Mandatory Rules to maintain minimum capital equivalent 

in pesos to 100,000 UDIs (approximately US$35,000). A trading member that carries global 

accounts must maintain capital equal to at least 1,000,000 UDIs (equivalent to approximately 

US$350,000). This capital must be invested in short-term bank deposits, government securities 

maturing in less than 90 days, or repurchase agreements on those securities maturing in less than 
90 days. Trading members are not required to own shares in MexDer; if they do, those shares 

can be applied against the trading member’s capital requirement. 

These capital requirements apply only to legal entities that are approved as Trading Members 

who are not financial entities (credit institutions or brokerage firms), since financial institutions 

must have and comply higher standards, contained in independent regulations. 

Remote Members

Foreign Trading members are required by the Mandatory Rules to maintain minimum capital 

equivalent in pesos to 100,000 UDIs (approximately US$35,000). 

(B) The manner in which the foreign board of trade evaluates the financial 

resources/holdings of its members or participants.

Applicants must submit audited financial statements, certified by an independent public 

accountant, for the three years preceding its application, as well as monthly financial statements 

for the three months preceding the application. Clearing members and brokers whose 

applications have been approved are required to report the level of their equity to MexDer on a 

daily basis. They are also required to provide same-day, written notice to the Exchange of any 

reduction of capital or equity below the minimum. 

Due to the legal nature of credit institutions and brokerage firms, their capitalization 

requirements are monitored by the CNBV. Thus, in practice, MexDer only verifies compliance 

with the capitalization requirements of the clearing members and those brokers that are not credit 

institutions, brokerage firms or foreign entities. When reported equity is close to the minimum 

amount established by the Mandatory Rules, the Compliance Office validates the daily 

capitalization reports against the participant’s banking documents. Additionally, the information 

is validated against the financial statements provided monthly by the independent brokers and 

quarterly by the clearing members. The Compliance Office also performs audits that include a 

comprehensive review of the financial documentation of the participants.

(C) The process by which applicants demonstrate compliance with financial 

requirements for membership or participation including, as applicable:

(i) Working capital and collateral requirements, and

See response to B(2)(iii)(A).

With respect to collateral, the clearing house monitors the existence and delivery of the margins 

(collateral) and reports to the Exchange any incident of failure of delivery so that Asigna may 

proceed in accordance with its powers under Article 7022.00, sub-paragraph XIII (Order for 

closing positions).

(ii) Risk management mechanisms for members allowing customers to place orders.
Applicants for membership must provide (i) the names, resumes, and contact information for the

individuals within the applicant organization who will be responsible for marketing, trading, risk 

management and account administration, (ii) the applicant’s General Functional Plan, and (iii) its 

Manual of Policies, Procedures, Risk Controls and Liquidity. 

The General Functional Plan must contain the following elements: (i) a description of the manner 

in which the duties of the applicant’s various departments engaged in trading derivatives 

contracts are to be coordinated; (ii) the members of the firm’s board of directors or technical 

committee, as well as that body’s leading executives and employees; (iii) the definition and 

establishment of a program for reviewing objectives, goals, and trading and control procedures 

by the general management of the clearing member or trading member; (iv) systems for 

monitoring whether personnel involved in trading derivatives contracts comply with and abide 

with the rules and regulations promulgated by the Financial Authorities, MexDer and Asigna, as 

well as the clearing member or trading member’s own internal policies; and (v) technical and 

ethical training programs aimed at assuring that responsible personnel obtain the necessary 

certifications. 

A MexDer member’s manual of policies, procedures, risk controls and liquidity must address, 

among other things, the member’s maximum risk tolerance limits; the internal criteria used by 

the member to analyze, evaluate, and establish trading limits for customers; procedures for 

resolving conflicts of interest; a description of the firm’s data processing, risk management and 

account valuation and management systems, including back-up systems; independently validated 

valuation models; new account documentation; and annual audits of the member firm’s internal 

controls. 

The foregoing materials must be accompanied by detailed reports explaining the applicant’s 

account administration and risk control systems. Applicants that seek to act as clearing members 

must additionally submit a copy of their proposed form of customer agreement (including a 

statement advising the customer of the risks associated with derivatives trading), a detailed 

description of the firm’s order routing system, the firm’s trust indenture and, if applicable, an 

application for approval as a global account manager.

The Risk Management Gateway (RMG) is a web-based dashboard used to monitor, configure 

and control Futures and Options “Orders” and “Risk Filters” within the RMG system. Clearing 

Members will be responsible to control and configure those risk filters and view order blotter for 

accounts which they are entitled to see, they should set filters based on a customer account level

(Member - Clearing account).

Pre-Trade Checks

➢ “Quantity” Filter

Reject any order with size bigger than a specified number; this filter applies for any asset class 

product (Futures or Options).

➢ “Quantity per Symbol and Side” Filter

Reject any order with size bigger than a specified number on a specific class and side 
➢ “Symbol, Side, Order Type, Time in Force” Filter”

Reject any order matching a specific combination of symbol, side, order type, time in force and a 

time window (start time and end time). None of the fields are mandatory; the user is not required 

to set each of the 4 fields. 

The user may also set a start time and an end time for this filter. This would allow filters to be 

configured which prevent certain order types during different hours of the trading sessions. 

Any unset fields are essentially ignored. 

➢ “Value” Filter

Reject any order exceeding a specified value (notional value)

Aggregated Checks

➢ Daily Credit Limit Control for Net Long/Short Margin 

Reject any order exceeding the limit margin set by symbol once the aggregated amount has 

reached the set limit.

➢ “Daily Quantity” Filter 

If the aggregated traded volume exceeds the specified value for the day, cancels and or rejects 

the orders resting on the book and the incoming ones. If an order is cancelled, the unfilled 

quantity should be removed from the day’s accumulated quantity. If an order is modified, the 

number of contracts should be added or removed from the day’s aggregated total. The Clearing 

member can optionally set the Side field to only check daily value for a particular side. If Side is 

unset it will be ignored and treated as a wildcard. 

➢ “Daily Quantity per Symbol and Side” Filter 

Reject any order that exceeds the maximum daily quantity for a daily quantity entry. An entry 

consists of a symbol, side, and maximum daily value. Each entry maintains its own limit and 

tracking. When orders exceed a limit on an entry it should only reject orders matching that 

entry. Other entries that have not exceeded their threshold should continue to allow orders 

through. 

➢ “Daily Value” Filter

The RMG will cancel the orders resting on the book and not allow new orders into the trading 

engine if the notional value exceeds the specified value for the day.

If an order is cancelled or modified in size, the change in value will be removed or added to the 

day’s aggregated total. 

➢ “Daily Value per Symbol and Side” Filter 

The RMG will cancel the orders resting on the book and not allow new orders into the trading 

engine if the notional value exceeds the specified value per side for the day.

If an order is cancelled or modified in size, the change in value will be removed or added to the 

day’s aggregated total. 
(iii) Fit and Proper Standards. A description of how the foreign board of trade ensures 

that potential members/other participants meet fit and proper standards.

See the description under Exhibit B(2)(ii).
EXHIBIT C – BOARD AND/OR COMMITTEE MEMBERSHIP
EXHIBIT C(1)

A description of the requirements applicable to membership on the governing board and 

significant committees of the foreign board of trade.

Board of Directors

MexDer is managed by a Board of Directors that is elected by the Shareholders’ Assembly and 

comprised equally of MexDer members and independent members. MexDer’s Bylaws require 

that independent Board members be recognized authorities in the financial field who (i) do not 

own an interest in the capital or equity of the shareholders of MexDer, its clearing members or its 

trading members, or financial institutions that are owners of MexDer clearing members, and (ii)

are not employed or commissioned by any of the foregoing, unless they are independent board 

members of such entities. 

According to the sixth and sixth bis Prudential Provisions, the appointment of board members, 

must be made exclusively among persons with acknowledged technical skills, honorability and 

creditworthiness, with ample knowledge and experience in finance or administration and who:

a) Reside in Mexican territory, in accordance with the provisions of the Federal Tax Code.

b) Have worked for at least five years in offices with high decision making power, requiring 

knowledge and experience on finance and administration.

c) Do not come under any of the following impediments:

i.To have pending litigation with the Exchange in question;

ii. To have been condemned by irrevocable sentence for equity crime, or to be 

ineligible to make commerce or hold any office, employment or commission in the 

Mexican public service or financial system;

iii. To have been declared bankrupt or insolvent without having been reinstated,

iv. To carry out inspection or oversight activities of the Exchange, regarding the 

public management, and

v. In the case of Independent Members, to participate in the capital or equity of 

Brokers, Clearing Members or financial entities that participate in the capital or equity of 

the latter; hold any office, employment or commission in their organizations, except when 

acting as independent members of the Board of Directors of any of the above-mentioned 

financial entities.

d) Are not carrying out Exchange regulation activities in the sphere of public management.

e) Do not have conflicts of interests or any interest opposed to those of the Exchange.

Committees

See Exhibit A-1 (5) c.

See attached organization chart.
In accordance with the Bylaws of MexDer the committees are subject to the following 

requirements:

• For a person to be appointed as a member of a committee, the person must have 

knowledge related to the committee’s area of expertise, and they must not have been 

convicted of crime against property;

• Members must refrain from participating in any deliberation or decision when they have 

conflicts of interest;

• Members must attend meetings. The Board of Directors must dismiss members of any 

committee if, in the opinion of the Board, they fail to attend two meetings without 

justification; and

• The chairman of each committee must report regularly to the Board of Directors of the 

activities of the committee, or when events or actions arise that are of such significance 

that in his opinion requires it.

The Board of Directors shall issue the operating rules of the committees, which will be contained 

in the Internal Operating and Organizational Regulations.
EXHIBIT C(2)

A description of the process by which the foreign board of trade ensures that potential 

governing board and committee members/other participants meet these standards.

MexDer’s internal audit is responsible for determining whether potential members of the Board 

of Directors and MexDer’s committees meet the eligibility criteria prior to the start of their 

functions and throughout their term of office. (Article Twenty Six of the Bylaws and Articles 20, 

23, 25, 28, 30, 32, 34 and 36 of the Internal Operating and Organizational Regulations of 

MexDer)

As part of the evaluation of members of the Board of Directors and MexDer’s committees, 

internal audit considers the general rules for compliance with the requirements to be met by 

persons who hold positions, jobs or commissions in financial institutions such as MexDer and 

Asigna, which were issued by the CNBV and published in the Diario Oficial de la Federación 

(Federal Official Journal) on March 1, 2002 (the “General Rules”). The General Rules oblige

MexDer to verify that the Board of Directors’ members are in compliance with the requirements 

regarding satisfactory credit history, credit eligibility and honorability, as well as the absence of 

legal impediments for members of the Board of Directors to continue in their duties. In addition, 

MexDer must establish internal controls to verify that the actions of the persons designated as 

members of the Board of Directors are ethical, professional and with full respect for the law. 

MexDer must inform the CNBV of the appointment of the Board within five business days. 

Further MexDer must inform CNBV of MexDer’s compliance with the General Rules by 

January 15 of each year.

To verify the qualifications of Board members, MexDer takes into account their knowledge of 

the Exchange and the knowledge required for Board duties. MexDer takes into account 

education and work experience of members in its evaluation. MexDer may also take into 

account records of certification of technical capacity issued by self-regulatory organizations 

recognized by the CNBV.

With regard to the verification of experience in financial, legal or administrative matters and, 

where appropriate, professional prestige, the Exchange will consider the member’s performance 

in high-level, decision-making positions for at least five years. As for the verification of 

satisfactory credit history or credit eligibility, a report provided by credit information companies 

containing a history of at least five years preceding the date on which the person will hold the 

office must be obtained. In any case, the Exchange must obtain the consent of the person to be 

appointed as member in order to request a credit history report.

As for honorability, the Exchange will consider that the persons who are going to be appointed 

as members: 

• Have not been convicted by irrevocable sentence of any intentional crime for which there

may be imposed a penalty of over a year in prison; and in case of intentional crimes 

against property, whatever the penalty may have been; 
• Are not at the time of the appointment, disqualified or suspended administratively or, 

where appropriate, criminally, for the performance of commercial acts or of any 

employment, job or commission in the public service or in the Mexican financial system;

and 

• Have a good public reputation or moral solvency. Those persons who have been subject 

to procedures of inquiry or administrative investigation for serious infractions or criminal 

investigation for violations of financial laws (national or foreign) that have concluded 

with any kind of resolution or agreement expressly involving the acceptance of guilt or 

liability, or a final conviction sentence, will be considered as not having a good public 

reputation or moral solvency.

In addition to the aforementioned, prior to the appointment of independent members of the Board 

of Directors, the Exchange must seek to obtain a letter signed by the applicant stating under oath 

that he/she: (a) will comply with the independence requirements of the laws relating to the 

Mexican financial system and (b) does not maintain employment or business with the external 

auditor of the Exchange.
EXHIBIT C(3)

A description of the provisions to minimize and resolve conflicts of interest with respect to 

membership on the governing board and significant committees of the foreign board of 

trade.

In accordance with MexDer’s Bylaws, a member of the Board of Directors that has a personal or 

opposite interest to the Exchange in any matter to be addressed must disclose it to the other 

members and refrain from any deliberation and resolution. A member of the Board of Directors 

who does comply with this requirement is liable for damages caused to MexDer.

Additionally, MexDer’s Internal Regulations establish that to avoid conflicts of interest and 

preferential treatment, members of the Exchange’s committees must refrain from participating in 

any deliberation or decision when they have opposite interests. If a member of a committee 

excuses himself for this or any other cause, the Board will appoint a substitute for that member. 
7

EXHIBIT C(4)

A description of the rules with respect to the disclosure of material non-public information 

obtained as a result of a member’s or other participant’s performance on the governing 

board or significant committee.

In accordance with MexDer’s Bylaws, the members of the Board must maintain absolute 

confidentiality regarding all actions, facts or events that have not been made public, including 

any discussions by the Board.

In addition, MexDer’s Internal Regulations establish that members of the Exchange’s 

committees must maintain absolute confidentiality regarding the information submitted to them 

or to which they have access because of their participation in the committees.
EXHIBIT D – THE AUTOMATED TRADING SYSTEM
1

EXHIBIT D-1(1)

A description of (or where appropriate, documentation addressing) the following, separately 

labeling each description:

(1) The order matching/trade execution system, including a complete description of all 

permitted ways in which members or other participants (or their customers) may connect to 

the trade matching/execution system and the related requirements (for example, 

authorization agreements).

MexDer has been using the MoNeT (acronym for “Motor de Negociación Transaccional” 

[Transactional Trading Engine]) as trading system which has been developed in-house at the 

Exchange (the “System”) since April 2013. All trading on the Exchange works electronically, 

through the routing of buy and sell orders to the System. 

The System is designed to provide “high availability” through the use of a dual-host system 

(maintaining the data on two different engines in a host-host configuration) that directs the data to 

MexDer’s high-throughput and low-latency local network and a mirror engine in MexDer’s 

disaster recovery site (which is 135 miles from its main data center). There are two matching 

engines (one active and one passive in a “host-host” configuration) that have the same 

configuration and are set up so that all transactions are processed simultaneously through both 

systems. The active system transmits the results to the outgoing systems and the messages are 

archived in a central repository.

The trading engine is deployed in a server configuration that allows recovery of one of the servers 

in case of failure. MoNeT will be deployed in groups of servers where each group will trade a set 

of contracts and each of those groups has a redundant backup that will start working in case of 

failure in the primary server. This allows horizontal scalability and redundant servers in case of 

failure.

The MoNeT system is designed to receive messages through our FIX gateway, which is based on 

the standard Financial Information eXchange (“FIX”) protocol. As discussed further below, 

members can connect to MoNeT, via an application programming interface (“API”) known as 

MexFix, using the member’s own front-end trading application or a trading application that has 

been developed by an ISV (Independent Software Vendor) to access to the System. Thus, the 

System architecture is designed to provide parity for all orders, without regard to their origin.

MoNeT supports futures, options and swaps. MexDer has configured MoNeT to accept limit 

orders. A limit order executes a trade once it matches the price stated, unless otherwise specified, 

any residual volume remains in the central order book until it is withdrawn, traded or canceled at 

the end of the session. To prevent erroneous orders, there are pre-trade risk controls in place 

defined by the Exchange. MoNet has internal quantity filters to prevent fat finger mistakes from 

the traders. Besides, every product has price filters with a percentage variation based on the last 

trade price. 

The orders are matched by the trading host in the central order books according to a price and 

time priority. The orders are time stamped upon arrival to the trading host. When an order has 
2

been executed, MoNeT notifies both sides of the trade, without identifying the counterparty. 

Asigna is notified at the same time and is responsible for clearing and settle every trade through 

its own systems.

Orders can be deleted at any time, as long as they have not been executed and the market remains 

opened. All unexecuted orders are automatically canceled at 5 pm, 2 hours after the market close. 

The system has also a “kill switch” mechanism that deletes all existing orders in a single message.

MexDer has shown his commitment and will keep committed with the Principles for the Oversight 

of Screen-Based Trading Systems for Derivative Products developed by the Technical Committee 

of the International Organization of Securities Commissions (“IOSCO Principles”). MexDer also 

has accomplished the policies of the CNBV, which has endorsed the IOSCO Principles such as 

facilities and technology infrastructure. MexDer commits that it will continue complying with the 

IOSCO Principles in the provision for electronic trading facilities.
3

EXHIBIT D-1(2)

The architecture of the systems, including hardware and distribution network, as well as any 

pre- and post-trade risk-management controls that are available to system users.

MexDer acquired the MexFix, a FIX protocol interface for direct connection to the exchange, 

through which traders can send FIX orders and receive market information in real time. The 

MexFix interface was launched on production environment in February 7, 2006.

In March 2018, MexDer release a new version of MexFix with functionality enhancements, such 

as new FIX tags and latency improvements. 
4

MexDer provides detailed specifications to enable members and ISVs to develop software 

according to MexFix API. The members can test their own software in UAT environment which 

can be accessed using a virtual private network via Internet or using MexDer’s financial network

(WAN). The test environment’s network is encrypted and has security mechanisms guaranteeing

that only authorized personnel can access the network and that the transmitted information would 

not be intercepted. Once the testing of the trading application has been completed, the member

must notify MexDer via email and certify their own trading system with the exchange.

As with testing, the connection to the system via MexFix may be carried out via Internet, through 

a virtual private network, via a private direct line, or using MexDer’s financial WAN. Customers 

not located in Mexico could connect via BT Radianz or MexDer’s Node (Bestel provider).

MoNeT consists of one main component, the trading host in a high availability configuration, 

which provides the order matching services. The primary features of the system are, automated 

trading through intelligent terminals connected to the two central servers, and reconnection 

mechanisms that cover the possibility of failure in communications lines, allowing alternative 

communication media. The system also can be configured to distribute data to high availability 

clusters (internally called “partitions”) as required, allowing horizontal scalability.

MoNeT uses a FIX gateway which translates all incoming orders into a proprietary message that 

is sent to MoNeT. The only way to send messages to the system is via the FIX gateway.

MexDer has pre-trade risk management controls for size and price limits (fat finger limits) 

established at the MexFix level as well as at the two trading engine levels. This allows MexDer 

to configure general limits at a session level coming through MexFix and specific limits at member 

level in the two trading engines.

In accordance with MexDer rules, all members are requested to configure fat finger controls for 

each trader with access to the market. Also, MoNeT has built in circuit breakers an alert for 

deviations from the reference price.

MexDer implemented a pre-trade Risk Control Gateway (RCG) which allows the Clearing 

Members to filter every order sent to the Exchange. The filters available in the RCG are: 

• Size limits

• Position limits

• Daily Volume
5

EXHIBIT D-1(3)

The security features of the systems.

Data security on MoNeT is provided through a dual host that directs the data along a dedicated 

line with transparent backup along a backup line. There are two host machines set up so that all 

transactions are processed simultaneously.

Testing of a trading application is accomplished utilizing MexDer’s specialized testing 

environment, which may be accessed by using a virtual private network via the Internet. The 

testing system employs encryption and security mechanisms to help ensure that only authorized 

personnel can access the network.

The Mexican Stock Exchange’s (“BMV’s”) financial network provides high quality, reliability, 

stability and security in the transfer of information, all of this through the fulfillment of the 

following characteristics:

1) Handling a scheme point to point, which is not part of a cloud, it is exclusive for BMV

and the group of entities it controls, including MexDer, thus ensures high levels of security.

2) The connections for users have been configured with routing and filters to reach specific 

nodes, thus have access only to certain parts of the network.

3) The traffic is controlled through firewalls that review each packet entry/exit information 

from the network and controls which one could be allowed to access.

To assure that access to the System is limited to authorized individuals, each user has a confidential 

electronic signature consisting of a user name and an individual password which must be changed 

by the user on a regular basis. Specifically, upon the written request of a clearing member or 

trading member, MexDer assigns to the clearing member or trading member a “registration code” 

for the System, delivering the registration code to the individual who made the request. 

Additionally, each time a clearing member or trading member complies with all requirements to 

commence trading on the Exchange, or accredits a desk trader with the Exchange, MexDer will 

supply the clearing member, trading member and/or desk trader an “access code” for the System. 

(Access codes for the testing environment offered by MexDer to members and ISVs for purposes 

of determining whether front-end trading applications conform to MexFix are distinct from those 

production environment access codes used to trade via the System and must be requested and 

obtained from MexDer). 

MexDer’s trading members request the creation of a new user in Valdi Trader by email. If the 

Exchange Trader user is already created in the server then the Valdi Site Manager only uses the 

script to assign the default permissions for the user. If the Exchange Trader is not already created 

in the server, Trading Help Desk must send the requisite information to the Valdi Trader 

Administrator, which must create the Exchange Trader new user access. 
6

When the setup has been completed in the Valdi Site Manager, the user and password is sent by 

email to the MexDer broker that requested the setup of the new user.

When connections are established without a VPN, i.e., directly to our financial WAN or private 

networks, either during tests or normal operations, the regular security features on the application 

level are provided, and the physical security to establish connectivity to the private WAN or private 

lines is established by our network carriers.
7

EXHIBIT D-1(4)

The length of time such systems have been operating.

MoNeT is the new unified single trading platform and has been used by MexDer since April 2013.
8

EXHIBIT D-1(5)

Any significant system failures or interruptions.

Regarding the different methods of access, as well as the MoNeT trading engine, there have been 

no significant failures that prevent MexDer from trading.
9

EXHIBIT D-1(6)

The nature of any technical review of the order matching/trade execution system performed 

by the foreign board of trade, the home country regulator, or a third party.

The technical architecture of MoNeT was evaluated by the Software Engineering Institute of 

Carnegie Mellon University using the ATAM® (Architecture Tradeoff Analysis Method). This 

evaluation was done during March 2010. The ATAM is an eight-step process used to analyze the 

system architecture and helps to identify risks to be fixed.

The ATAM® did not discover any potential risk theme to be analyzed or redesigned. 

Additionally, the system’s matching and trading functionality is shared with the equity market, the 

Mexican Stock Exchange, and the whole system has received input from different consulting firms 

to make sure the system executes orders/matches under the rules specified in requirements.
10

EXHIBIT D-1(7)

Trading hours.

Trading schedule on MexDer is from 7:30 a.m. to 3:00 p.m. Mexico City time (GMT-6). If 

MexDer changes its hours, it will be published in the MexDer Daily Bulletin (the “Bulletin”) three 

business days before the change takes effect.
11

EXHIBIT D-1(8)

Types and duration of orders accepted.

MoNeT supports limit orders and orders at Settlement Price. All orders expire at the end of the 

trading session.
12

EXHIBIT D-1(9)

Information that must be included on orders.

The following information is required in an order:

• Order Origination Firm

• Trader Id

• Order Type 

• Side (Buy or Sell)

• Class and Series of the contract

• Order Quantity

• Price (for limit orders, but not for orders at settlement price)

• Clearing Account
13

EXHIBIT D-1(10)

Trade confirmation and error trade procedures.

When an order has been executed, MoNeT sends a trade confirmation to the Trading Members

and the respective Clearing Member of both sides of the trade without revealing their counterparty. 

Asigna is also notified at the same time and it is responsible for clearing and settling all trades 

through its own systems.

MexDer’s regulations contain the Cancellation of Transactions Policy, which consists in enabling 

the operations area to cancel trades that disrupt the normal conditions of the market, due to errors 

from Trading Members while closing a trade with a wrong price. 

To cancel a trade in MexDer because of an error, a Trading Member must request its cancellation 

to the Exchange within the next 10 minutes after the trade was registered on the Electronic Trading 

System. 

MexDer will determine if a trade is subject to a review, considering the market conditions in the 

moment the trade was done. 

If a reported trade is subject to review, MexDer will send a message through the Electronic Trading 

System indicating that a trade is being reviewed. 

MexDer shall review and validate if the Price of the Trade is within the “Non-Reviewable” range 

defined in the Cancellation of Transactions Policy published in its website. To decide if a Trade 

can be cancelled, MexDer will consider the last price, the previous day Settlement Price or the 

theoretical value in the moment the trade was done. 

1.- If the Price is within the “Non-Reviewable” range, MexDer will notify to the market 

that the trade will not be canceled. 

2.- If the Price is outside the “Non-Reviewable” range, MexDer will cancel the trade in the 

Electronic Trading System and will send a notification to both Trading Members, the 

Clearing Members of both sides of the trade, the Clearing House and notify the decision to 

the market. 

Notices mentioned above will be done through the Electronic Trading System.

Once a Trade has been canceled, MexDer’s decision will be considered as final and irrevocable.

In addition, subject to the provisions of MexDer’s Internal Regulations, the Exchange will accept 

and proceed to cancel a Trade, even if the Price is within the “Non-Revisable” range, when both 

sides of the Trade agree so and request the trade cancellation through their respective Trading 

Members. 
14

EXHIBIT D-1(11)

Anonymity of participants.

The parties of a transaction and their clearing members are notified electronically upon execution 

of a trade on the System. MexDer maintains the confidentiality of the trading member who sends, 

modifies or cancels orders via the System, unless the Exchange is required to disclose such 

information to the authority regulators or compliance officer.
15

EXHIBIT D-1(12)

Trading system connectivity with clearing system.

Asigna has an in-house built system called CLEAR-MX which receives all trades from MexDer 

in real time and immediately calculates positions. Clearing members indicate if their transactions 

are either “open” or “close” and also identify their trades using the “Cuenta Derivados” account 

number.

Asigna also has a module of the CLEAR-MX system that calculates real-time operational risks. 

The module receives trades in real time, calculates the market risk per participant and per clearing 

member, validates that participants and clearing members are within their position limits and 

triggers alerts if they are not.
16

EXHIBIT D-1(13)

Response time.

MoNeT has a response time of 100 micro seconds measured from the time the order request arrives 

until it is acknowledged by the system. Network latency from a member will be added to the 

response time and this varies depending on the network type, vendor, network protocol, distance 

and any intermediate hardware or software component added by the member, carrier or other; it 

also depends on the configuration used by the member.
17

EXHIBIT D-1(14)

Ability to determine depth of market.

MoNeT operates in real time. Through the MoNeT system, traders can monitor buy and sell orders

in the system, watch market depth (10 levels per side) and identify crossing opportunities. 
18

EXHIBIT D-1(15)

Market continuity provisions.

Each order is simultaneously processed in 3 servers, two in the Primary Data Center and one in

the Secondary Data Center.

MexDer is fully committed to anticipating and controlling crisis and disaster recovery situations 

that may arise. Therefore, MexDer has adopted and implemented a coordinated strategy for 

restoring the critical functions of its systems, operations and data in the event of a disaster or other 

situation that may cause a material failure or degradation of the performance of MexDer’s 

technological infrastructure. MexDer’s Business Continuity Plan includes detailed procedures for 

re-establishing operations at the primary or an alternate site and, if necessary during brief 

emergencies, run processes manually. Each of these procedures is designed (i) to help ensure 

continuity of MexDer’s basic business functions with a minimum of interruption, and (ii) in the 

event of such an occurrence, to advise market participants and the Financial Authorities of any 

delays in opening the market or the suspension of trading.

MexDer currently maintains a back-up system for each of its primary technological systems

(including MoNeT) in the alternate site. Each backup system is configured and ready to handle

operations in the event of a contingency. The alternate site is equipped with emergency power, air 

conditioning, sprinkler systems and other important environmental controls, all of which are of a 

level at least comparable to those power supplies and environmental control systems utilized at 

MexDer’s primary data center. MexDer maintains data backup in both sites and also maintains 

redundant communications links between the two sites.

To carry out MexDer’s disaster recovery procedures, MexDer has agreed with Corporativo 

Mexicano del Mercado de Valores (“CMMV”), an affiliated company whose personnel provide, 

among other services, technology services (“IT Personnel”) for MexDer and the Mexican Stock 

Exchange, to operate systems at the alternate site in accordance with specifications provided by 

the Derivatives Exchange. MexDer has additionally assigned specific disaster recovery tasks to 

MexDer employees, and both MexDer and IT personnel have been trained to handle the disaster 

recovery tasks that have been assigned to them. 
19

MexDer, Asigna and IT Personnel performs periodic testing of MexDer’s business continuity 

procedures. Specifically, MexDer and IT Personnel test the disaster recovery procedures at least 

once a year, utilizing both MexDer’s primary and alternate sites as data processing centers. 

MexDer’s plan additionally includes testing remote trading. The results of each testing session 

are analyzed and any updates to the contingency procedures suggested by such testing are planned 

to be developed and implemented.
20

EXHIBIT D-1(16)

Reporting and recordkeeping requirements.

Trading members and clearing members are separately required to record, report as appropriate, 

and retain for five years, information relating to all orders and trades. In particular, trading 

members and clearing members must report, for all orders and transactions, the account identifier, 

transaction ID number, quantity, price and time, and whether the order or transaction is for a 

proprietary or customer account. 
21

EXHIBIT D-2(1)

Algorithm. The trade matching algorithm matches trades fairly and timely.

Orders are matched by the MoNeT system in the central order book according to a price and datetime priority algorithm. Priority is given to the order having the best price. Then, where two or 

more orders are entered at the same price, priority is given to the oldest standing order. Orders are 

given priority as they enter in the Matching Engine.
22

EXHIBIT D-2(2)

IOSCO Principles. The trading system complies with the Principles for the Oversight of 

Screen-Based Trading Systems for Derivative Products developed by the Technical 

Committee of the International Organization of Securities Commissions (IOSCO Principles). 

Provide a copy of any independent certification received or self-certification performed and 

identify any system deficiencies with respect to the IOSCO Principles.

MexDer has employed the best available expertise in the design, building and implementation of 

the MoNeT system and updates thereof to ensure that the system infrastructure follows best 

industry practice and quality standards. In developing MoNeT and operating the System, MexDer 

represents that it has adhered to, and will continue to comply with, the Principles for the Oversight 

of Screen-Based Trading Systems for Derivative Products developed by the Technical Committee 

of the International Organization of Securities Commissions (“IOSCO Principles”). MexDer also 

has met expectations of the CNBV, which has endorsed the IOSCO Principles, that the features 

and facilities provided by the System, as well as the use of System’s technology, are satisfactory 

considering the IOSCO Principles. MexDer fully commits that it will continue to comply with the 

IOSCO Principles in the provision of electronic trading facilities and the operation of the System.
23

EXHIBIT D-2(3)

Audit Trail.

(i) The audit trail timely captures all relevant data, including changes to orders.

MexDer’s trading system — MoNeT — captures a broad range of information for every order or 

trade. These include the contract Class, Serie, trading member unique identification code, folio 

number, price, order quantity, transaction side (i.e., buy or sell), date and time of each order or

trade and the identification code for each clearing member.

(ii) Audit trail data is securely maintained and available for an adequate period time.

All audit trail data is saved by MexDer for five years.
24

EXHIBIT D-2(4)

Public Data. Adequate and appropriate trade data is available to users and the public.

A range of information on futures, options and swaps is available to members and the public via 

different data vendors. Many of these data vendors offer this information to subscribers in the 

United States. The available information at MexDer web page for every Class and Series is:

• Exercise price and expiration month.

• Current bid and offer.

• Last price.

• Aggregate open interest as of the previous day’s close.

• Settlement prices.
25

EXHIBIT D-2(5)

Reliability. The trading system has demonstrated reliability.

Data security on the MoNeT system is provided through a high availability system (maintaining 

the data on two different engines) that directs the data along a dedicated line with transparent 

backup along a backup line. In case of a failure of the primary system, the backup system takes 

over the operation seamlessly.

Additionally, all messages are also sent to MexDer’s secondary data center which processes all the 

incoming messages as well and is ready to become the active system when a contingency is 

declared.

MexDer’s FIX gateways are also setup in high availability configuration, as well as our network 

infrastructure. In case of failure of any of these components, the system will automatically fail 

over to the backup component.

There have been no significant failures of the MoNeT system since it was implemented.
26

EXHIBIT D-2(6)

Secure Access. Access to the trading system is secure and protected.

See Exhibit D-1(3).
27

EXHIBIT D-2(7)

Emergency Provisions. There are adequate provisions for emergency operations and disaster 

recovery.

See Exhibit D-1(15).
28

EXHIBIT D-2(8)

Data Loss Prevention. Trading data is backed up to prevent loss of data.

As noted in Exhibit D-1(15) (Market Continuity Provisions), MexDer currently maintains a backup system for each of its primary technological systems, including MoNeT, at MexDer’s alternate 

site. Each backup system is configured and ready to conduct operations in the event of a 

contingency. The alternate site is equipped with emergency power, air conditioning, sprinkler 

systems and other important environmental controls, all of which are of a level at least comparable 

to those power supplies and environmental control systems utilized at MexDer’s primary data 

center. MexDer maintains data backup at both its alternate and primary sites and maintains 

redundant communications links between the two sites.
29

EXHIBIT D-2(9)

Contracts Available. Mechanisms are available to ensure that only those futures, option or 

swap contracts that have been identified by the Commission as part of the application or be 

allowed for trading by direct access pursuant to the procedures set forth in § 48.10 are made 

available for trading by direct access.

The systems allow to the MexDer administration to set permissions at a member level if necessary. 

This allows the Exchange to ensure that the members are exclusively trading the products that have 

been identified and approved by the Commission for direct access.
30

EXHIBIT D-2(10)

Predominance of the Centralized Market. Mechanisms are available that ensure a 

competitive, open, and efficient market and mechanism for executing transactions.

The market structure of MexDer allows a competitive, open and efficient market and mechanism 

for executing transactions. Please see Exhibit D-2(1).
1

EXHIBIT E – THE TERMS AND CONDITIONS OF CONTRACTS PROPOSED TO BE 

MADE AVAILABLE IN THE UNITED STATES
2

EXHIBIT E-1

A description of the terms and conditions of futures, option or swap contracts intended to be 

made available for direct access. With respect to each contract, indicate whether the contract 

is regulated or otherwise treated as a futures, option or swap contract in the regulatory 

regime(s) of the foreign board of trade’s home country.

See Exhibit-A-4, above. See also attached charts.

[Note: Not all of the contracts listed in MexDer and mentioned in the PDF file will be 

available. The contracts that will be available for direct access are the ones contained listed 

in Exhibit A-4 above.]
3

EXHIBIT E-2

Demonstrate that the contracts are not prohibited from being traded by United States 

persons, i.e., the contracts are not prohibited security futures or single stock contracts or 

narrow-based index contracts. For non-narrow based stock index futures contracts, 

demonstrate that the contracts have received Commission certification pursuant to the 

procedures set forth in § 30.13 and Appendix D to part 30 of this chapter.

On August 24, 2006, the Office of General Counsel of the U.S. Commodity Futures Trading 

Commission issued a no-action letter which granted MexDer a relief for the offer and sale in the 

United States of its Futures Contract Based on the Mexican Stock Exchange’s Price and Quotation 

Index.

Pursuant to Commission regulation 30.13(n), on May 15th, 2012, MexDer as a foreign board of 

trade, requested grandfathered relief for its Futures Contract Based on the Mexican Stock 

Exchange’s Price and Quotation Index (“IPC Futures Contract”) and its Options Contract over the 

IPC Futures Contract.

Pursuant to Commission regulation 30.13(n), on February 12th, 2014, MexDer as a foreign board 

of trade, requested grandfathered relief for its Future Contract of the MINI Mexican Stock 

Exchange’s Price and Quotation Index (“MINI IPC Futures Contract”).
4

EXHIBIT E-3

Demonstrate that the contracts are required to be cleared.

MexDer is the only authorized derivatives exchange in Mexico. MexDer executed an agreement 

with Asigna (the only authorized clearing house in Mexico) that governs clearing and settlement 

of MexDer contracts. This agreement remains in force. See Exhibit A-3(2) of Supplement S-1.
5

EXHIBIT E-4

Identify any contracts that are linked to a contract listed for trading on a United Statesregistered entity, as defined in section 1a(40) of the Act. A linked contract is a contract that 

settles against any price (including the daily or final settlement price) of one or more 

contracts listed for trading on such registered entity.

The yellow corn future Contract is the only linked contract listed in MexDer, which underlying 

asset is the Yellow Corn quality US#2 and was notified to this Commission at July 8th 2013 along 

with the yellow corn futures option Contract (listing is pending). The yellow corn future contract 

is not yet available for US Persons. With the exception of the peso and bond contracts, which are 

settled by delivery, all contracts are settled in cash (in Mexican pesos). The peso/dollar and 

peso/euro contracts are settled through agent banks with offices in México and in the United States 

and Europe, respectively. The bond contracts are settled through S.D. Indeval by the delivery of 

bonds corresponding to the specifications set out in MexDer’s Internal Regulations and payment 

therefor. Thus, with the exception of the peso/dollar contract that is settled by the exchange of 

dollars for pesos, none of these contracts has any nexus to the United States.
6

EXHIBIT E-5

Identify any contracts that have any other relationship with a contract listed for trading on 

a registered entity, i.e., both the foreign board of trade’s and the registered entity’s contract 

settle to the price of the same third party-constructed index.

At the present time, MexDer does not have any listed contracts with such characteristics.
7

EXHIBIT E-6

Demonstrate that the contracts are not readily susceptible to manipulation. In addition, for 

each contract to be listed, describe each investigation, action, proceeding or case involving 

manipulation and involving such contract in the three years preceding the application date, 

whether initiated by the foreign board of trade, a regulatory or self-regulatory authority or 

agency or other government or prosecutorial agency. For each such action, proceeding or 

case, describe the alleged manipulative activity and the current status or resolution thereof.

Demonstrate that the contracts are not readily susceptible to manipulation.

Overview

MexDer, along with the Clearing House and local financial Authorities, develop a full analysis 

before listing new products to guarantee the correct fulfillment of the obligations generated by the 

Derivatives Contracts. Likewise, MexDer has many procedures and controls to determine daily 

settlement prices and fixings at expiration dates with the objective to avoid the possibility of 

manipulation from market participants. These procedures are published in the Contract Specs of 

each derivatives product.

The above-mentioned procedures and controls are the following:

Procedure of Listing New Derivatives Contracts

MexDer along with the Clearing House must follow many steps prior to listing new Derivatives 

Contracts. Those steps are the following:

• First of all, MexDer explores and consults with market participants their views, opinions 

and possible demand of the new product, measuring their exposure to the underlying cash 

market and the need of hedging vehicles that can offer stability and risk mitigation. The 

idea of this point is to prevent listing products with no demand. MexDer considers 

important that many potential participants are interested in the new product, so this can 

help to an efficient price discovery once the product is listed. 

MexDer also conducts research regarding the underlying cash market behavior, mainly its 

liquidity, daily valuations and outstanding amounts. It is very important that the underlying 

asset shows good depth and liquidity to assure that the Derivatives Contract price will not 

be susceptible to be manipulated on a daily basis and at expiration.

In order to prevent a price manipulation, MexDer also analyses if the new product must be 

settled in cash or physically. 

• After gathering positive market participants opinions, MexDer starts to develop the 

Contract Specs, which is the document where all the characteristics of the product are 

defined, including a brief explanation of the underlying, contract size, maturity and 

delivery dates, minimum price fluctuations, daily settlement prices procedures, settlement 

at expiration, trading hours, among others.
The Contract Specs are carefully designed with best practices used in local and foreign 

markets, with the final goal of permitting participants to hedge their risks and to guarantee 

the price convergence at expiration of the Derivatives Contract and the underlying cash 

market.

• Once the Contract Specs are designed, MexDer calls for an “Admission and New Products 

Committee” (CANP for its acronym in Spanish) meeting, which is composed of traders, 

Clearing Members and institutional investors. One of the principal responsibilities of the 

CANP is to validate and approve the proposed Contract Specs and to make any possible 

correction or improvement to them.

• Simultaneously, the Clearing House calls for a “Risk Committee” meeting to present and 

validate the margin methodology and the initial margin for the contract.

• After getting the approval of the CANP, MexDer discloses the Contract Specs in its website 

to give the opportunity to all market participants to know and review the product and to 

send comments if any. This allows MexDer to hear different opinions other than the CANP

and determine possible improvements to the product.

• Five (5) business days after disclosing the Contract Specs, MexDer integrates all the 

received comments to it and then presents the proposed Contract Specs to its Board, which 

must give the approval prior to send it to the Mexican Financial Authorities.

• After getting MexDer ́s Board approval, the Contract Specs are sent to the following 

Mexican Financial Authorities:

o Banco de México (Central Bank)

o National Banking and Securities Commission (CNBV)

These Authorities validate all the product characteristics and assure that once the new 

product is listed, all the daily and at expiration settlement procedures will guarantee fair 

market conditions and that the Derivatives Contract prices nor the underlying cash market 

prices are not going to be able to be manipulated.

• Once the Authorities give their approval of the new Derivatives Contract, MexDer can 

proceed with the listing, publishing the Contracts Specs on its website, including trading 

and clearing fees, and Initial Margin by the Clearing House and the Position Limits.

Daily Settlement Price Determination Process

The ways in which MexDer determines the Daily Settlement Price for each product is provided in 

each Contract Specs and has many hierarchical steps, and considers the following:

1. Volume weighted average price of all the trades executed in a determined period near to 

the market close. For some products, MexDer considers the trades executed during the last 
five (5) minutes of the trading session and for some other products, MexDer uses a random 

period which prevents market participants from knowing whether or not a trade will be 

considered in the Daily Settlement Price determination process.

This random period is the same that the cash market uses to value the product underlying 

the Derivative Contract and is reported by the local Price Vendors after the market closes. 

2. If no trades are performed during the above-mentioned period, MexDer considers a crossed 

volume weighted average of the bids at the best price and the offers at the best price that 

remain on the market after the market close.

3. If no bid and offer (both) remain on the market as mentioned above for a particular Series 

that has Open Interest, MexDer runs a 5 minute auction in which all participants can send 

orders. After this auction, MexDer applies previous rules 1 and 2 to determine the Daily 

Settlement Price.

4. If no trades are performed and no bid and offer remain in the market after the above 

mentioned auction, MexDer uses the theoretical price to set the Daily Settlement Price. 

This theoretical price is calculated using a formula that is detailed and explained in the 

relevant Contract Specs.

If the Daily Settlement price was determined using previous rules 1, 2 or 3, but a market participant 

believes that the price does not reflect current appropriate market conditions, this participant is 

able to challenge the price and request MexDer to review. To do this, the market participant has 

to fill a form and send it to MexDer, which keeps it as a backup and forwards it to the CNBV for 

any further inquiry. 

After receiving the form, MexDer reviews the Price and takes a final and irrevocable decision of 

the challenge:

• If the challenge proceeds, the Daily Settlement Price is calculated with previous rule 4, 

using the theoretical price formula.

• If the challenge does not proceed, the Daily Settlement Price remains as it was calculated 

originally.

MexDer’s final decision is communicated to the participant that requested the challenge, to all other 

market participants and to the CNBV.

Position Limits for Physical Delivery Contracts

For physically settled derivatives products (Government Development Bonds and individual 

securities1) in which the available amount of the delivered underlying asset is considered as finite 

and limited, the Clearing House set limits on the maximum amount of contracts that a client may 

have and is defined as follows in the rulebook: “The Position limit is the maximum number of 

1 MexDer does not provide direct market access to US Persons to trade derivatives products on 

individual securities. 
Open contracts of the same Series and/or Class, as appropriate depending on the type of 

Derivatives Contract, that a Client can maintain open”.

The objective of defining Position Limits is to avoid that the underlying cash market of the 

Derivatives Contract could become not liquid and deep enough to satisfy physical delivery at 

expiration and to prevent participants to concentrate big amounts of the Contract Open Interest 

that could motivate them to try to manipulate the settlement prices.

This Position Limits are calculated considering the deliverable supply of the underlying asset in 

the cash market to guarantee that it will exist sufficient available amounts at expiration of the 

Derivatives Contract.

It is also important to note that the Clearing House sets different Position Limits for those 

participants that can prove that they are using the Derivatives Contracts as a risk hedge of their 

underlying exposure.

Another important thing to consider is that when the Derivatives Contract enters into the expiration 

month, the Position Limits are reduced with the goal to minimize even more the liquidity risk at 

delivery for both speculative and hedging positions. 

Limit Price Filter

To prevent traders to send orders with out-of-the-market prices, MexDer sets different pre-trade 

filters which allow prices to be maximum a predefined percentage away from a “reference”, which 

is the last traded price of the instrument. This percentage is set electronically and depends on the 

volatility and characteristics of each particular product. MexDer reviews at least every six months 

the defined percentage for each contract and is able to adjust it depending on market conditions.

An important consideration of this filter is that MexDer rejects buying orders with a better price 

than the predefined percentage added to the reference. In the same way, MexDer rejects selling 

orders with a better price than the predefined percentage subtracted to the reference. In this 

meaning, worst prices are allowed.

If due to market conditions during a trading session, reference prices become outdated, MexDer is 

able to intraday update them manually and start allowing orders that consider the filter with a new 

reference. However, the predefined percentage will remain the same during the whole trading 

session. After manually update it, if a trade is executed in the Contract, the new reference price 

will be again the last traded price.

If market volatility increases during the trading session, MexDer is also able to increase the 

predefined percentage of the filter.

Additionally, MexDer sets another price filter in which the reference price during the whole trading 

session remains fixed at the previous day Settlement Price and defines a percentage to allow orders 

against the reference. The goal of this filter is to stop algorithmic traders to swipe all the market in 

case of an error or wrong set up that could trigger trades with out-of the-market prices.

Error Trades Cancelation Policy
MexDer has a policy that allows the CEO to cancel a trade that is reported as a mistake by one of 

the parties involved in it even if the counterparty is not willing to cancel it. To do so, the trade 

price must be out of a predefined range considering the last traded price and must be reported as a 

mistake within the following 10 minutes after the trade was done. If so, MexDer reviews current 

market conditions and confirms that the reported trade fits the cancelation requirements. After that, 

MexDer takes the final and irrevocable decision, which must be communicated immediately to 

both parties and to the market.

The goal of this policy is to protect participants in case of trading by an obvious mistake at an outof-the-market price and to avoid distortions of the current market conditions that could drive to 

alterations or manipulations of the prices.

MexDer’s Internal Regulations contain provisions that empower the Exchange to take corrective 

actions to prevent attempts of manipulation or possible error in the calculation of the daily 

settlement prices of the contracts that the Exchange has listed. MexDer has the following powers:

• Ability to suspend a bid or a transaction in the System as a precautionary measure (Article 

7018.00 F. V).

• Ability to suspend a broker or clearing member (Article 7024.00).

• Ability to cancel a bid or a transaction in the System (Article 7028.03).

• In emergency situations, ability to correct or otherwise modify the daily settlement price 

or the settlement price at expiration or make changes to the general terms of a contract. 

(Article 7033.00). 

MexDer is not aware of any investigations or actions concerning manipulation initiated by any of 

the authorities that regulate MexDer.

Surveillance for manipulation is carried out in MexDer’s Compliance Office through a system 

called Vigia MexDer (MexDer Watch). MexDer watch is a specialized module for the daily 

monitoring of the MexDer market. The module selects trades for analysis according to parameters 

defined by the Compliance Office. This process is described in greater detail in section G-2 (3) of 

this application.

The Compliance Office has defined the parameters for determining when a behavior by a market 

participant should be more thoroughly reviewed and whether an investigation is warranted. 
1

EXHIBIT F – THE REGULATORY REGIME GOVERNING THE FOREIGN BOARD 

OF TRADE IN ITS HOME COUNTRY1 OR COUNTRIES

1 Where multiple foreign boards of trade subject to the same regulatory regime/authority 

and are similarly regulated are applying for registration at the same time, a single Exhibit 

E-1 may be submitted as part of the application for all such foreign boards of trade either 

by one of the applicant foreign boards of trade or by the regulatory regime/authority with 

responsibility to oversee each of the multiple foreign boards of trade applying for 

registration. Where an FBOT applying for registration is located in the same jurisdiction 

and subject to the same regulatory regime as a registered FBOT, the FBOT applying for 

registration may include by reference, as part of its application, information about the 

regulatory regime that is posted on the Commission’s website. The FBOT applying for 

registration must certify that the information thus included in the application is directly 

applicable to it and remains current and valid.
2

EXHIBIT F(1)

The following (including, where appropriate, an indication as to whether the applicable 

regulatory regime is dependent on the home country’s classification of the product being 

traded on the foreign board of trade as a future, option, swap, or otherwise, and a 

description of any difference between the applicable regulatory regime for each product 

classification type):

A description of the regulatory regime/authority’s structure, resources, staff, and scope of 

authority; the regulatory regime/authority’s authorizing statutes, including the source of 

its authority to supervise the foreign board of trade; the rules and policy statements issued 

by the regulator with respect to the authorization and continuing oversight of markets, 

electronic trading systems, and clearing organizations; and the financial protections 

afforded customer funds.

MexDer and its members are subject to a comprehensive regulatory regime that establishes 

financial and other criteria for Exchange members and other industry participants; reporting and 

record keeping requirements; procedures governing the treatment of customer funds and 

property; sales practice and other conduct of business standards; measures designed to protect 

the integrity of the markets; and statutory prohibitions on fraud, abuse and market manipulation.

The CNBV, in consultation with the Ministry of Finance and the Central Bank, has jointly 

promulgated Mandatory Rules for corporations and trusts participating in the establishment and 

operation of a market for Exchange traded futures and options (the “Mandatory Rules”). The 

Mandatory Rules are supplemented by the Prudential Provisions to which market participants 

must be subject to in their trading with exchange traded derivatives contracts (the “Prudential 

Provisions”), which were also promulgated by the CNBV, the Ministry of Finance and the 

Central Bank. The Mandatory Rules set forth, among other things, requirements for the 

establishment and approval of futures and options exchanges, the implementation of its internal 

regulations and manuals of policies and procedures containing self-regulatory standards and 

procedures to govern the exchanges’ operations, each in accordance with the Prudential 

Provisions. The Prudential Provisions further elaborate upon the Mandatory Rules and establish 

additional requirements with which MexDer, Asigna and their respective members must comply.

The Ministry of Finance is an agency of the Centralized Public Administration and its purpose is 

to propose, direct and control the Federal Government’s economic policy in finance, tax, 

expenditure, income and debt, as well as statistics, geography and information. The area 

responsible for the surveillance of MexDer is the unit of Banking, Securities and Savings, which 

falls within the purview of the Under Secretary of Finance.

The Central Bank is an autonomous constitutional agency intended to provide the economy of 

the country with currency and its prime objective is to ensure the stability of the purchasing 

power of such currency. Additionally, is responsible for promoting the healthy development of 

the financial system and encouraging the proper functioning of payment systems. The area 
responsible for the surveillance of MexDer is the General Direction of Central Banking 

Operations.

The CNBV is an agency of the Ministry of Finance and its purpose is to safeguard the stability 

and integrity of the Mexican financial system and promote its efficiency and development. The 

area responsible for the surveillance of MexDer is the General Direction of Supervision of 

Securities Entities which falls within the purview of the Vice Presidency of Securities 

Supervision. MexDer, Brokers and Clearing Members are charged fees for the surveillance 

services provided by the CNBV.

The supervision of corporations (exchanges and brokers) and trusts (clearing members and 

clearing houses) referred to in the Mandatory Rules is conducted by the CNBV.

The Mandatory Rules require the bylaws of exchange and brokers, and the trust agreements for 

clearing members and the clearing house to provide that – when in the opinion of the CNBV, the 

Exchange, clearing members, the clearing house or the brokers present irregularities of any kind 

that affect its stability or solvency, or endanger the public interest or creditors – the CNBV may 

immediately replace the board of directors or the technical committee of the Exchange, clearing 

members, the clearing house or broker concerned.

In addition, the legal instruments of the Exchange, the clearing house, clearing members and, 

where appropriate, brokers, must provide for the obligation to remove members of board of 

directors, the CEO, commissioners, the compliance officer, directors and managers, members of 

the technical committees and trust delegates upon the request of the CNBV.

The Mandatory Rules also provide that members or trustees of the Exchange or the clearing 

house must agree to modify the contracts of the Exchange or clearing house (and/or other 

documents) upon the request of the authorities. 

Paragraph (m) of the Twentieth Mandatory Rule sets forth the obligation of the clearing house 

(in coordination with the Exchange) to set position limits for each type of exchange-traded 

derivative contract executed by a clearing member. The Exchange may reduce the limit in 

accordance with the volume that has been transacted in the market that day. The clearing house 

also may define the operating limits that apply for each exchange-traded derivatives contract.

The Thirty-Third Mandatory Rule requires the Exchange to prevent market concentration by the 

clearing members and brokers in each type of exchange-traded derivatives contract.

The Thirty-Eighth Mandatory Rule requires the Exchange and the clearing house to strictly 

monitor for distortions in the price formation process or activities that deviate from sound market 

practices any time clearing members and brokers (directly through a broker or a desk trader) 

effect transactions with themselves, execute off-exchange trades or are counterparty to a client 

with respect to exchange-traded derivatives contracts. 

The Fortieth Mandatory Rule provides that the Exchange (in accordance with MexDer’s Internal 

Regulations) may suspend temporarily or permanently the operations of any client, broker or 

clearing member on the Exchange when such operations are not carried out in accordance with 

applicable regulations. Furthermore, the CNBV (or the clearing house in the terms established in 
its internal regulations) may instruct the Exchange to suspend temporarily or permanently such 

operations. 

Additionally, the Prudential Provisions establish that the Exchange will monitor the activities of 

the brokers, clearing members, clearing houses and clients with respect to the execution of trades 

of derivatives contracts.
5

EXHIBIT F(2)

A description of and, where applicable, copies of the laws, rules, regulations and policies 

applicable to:2

(i) The authorization, licensure or registration of the foreign board of trade.

Please see Exhibit A-7, above, for the MexDer Authorization and an English language 

translation.

In accordance with the Third and Forty-Third Mandatory Rules, a written request for official 

authorization as an exchange must be submitted to the Ministry of Finance, who will grant 

permission at its discretion after hearing the opinion of the CNBV and the Central Bank.

In accordance with the Fourth Mandatory Rule, the written request for authorization must be 

accompanied by the following documentation:

a) Draft Articles of Incorporation;

b) A list of the legal entities or persons who will create the corporation and the capital each

one of them will contribute, as well as a list of board members and managers to be 

appointed;

c) Draft internal organizational and functional regulations;

d) Requirements for prospective, Exchange legal entities or persons who will contribute to 

its Equity (“Exchange Partners”);

e) The rights and obligations that Exchange Partners, brokers and desk traders will have;

f) A draft contract that will govern operations between the Exchange and the clearing house 

and between the Exchange, brokers and clearing members;

g) Draft internal regulations, containing self-regulatory standards and procedures that will 

determine how the Exchange will operate, prepared in accordance with the prudential 

standards, established by the CNBV;

h) Manuals of operating policies and procedures elaborated in accordance with the 

prudential standards established by the CNBV;

i) A description of audit programs to be implemented for brokers and clearing members;

and 

2 To the extent that any such laws, rules, regulations or policies were provided as part of 

Exhibit A-5, they need not be duplicated. They may be cross-referenced.
j) A description of surveillance programs to verify that price formation processes are 

carried out with transparency, accuracy, and integrity.

(ii) The regulatory regime/authority’s program for the ongoing supervision and 

oversight of the foreign board of trade and the enforcement of its trading rules.

Market participants are subject to the Mandatory Rules. According to the Thirty-Ninth 

Mandatory Rule, the CNBV, after hearing the opinion of the Ministry of Finance and the Central 

Bank, issues prudential rules designed to preserve liquidity, solvency and market stability on 

exchange-traded derivatives contracts.

The CNBV oversights the Exchange, the clearing house, brokers and clearing members. This 

includes the supervisory power to require and review all books and records or other

documentation related to trading on MexDer or foreign recognized derivatives markets.

The Fortieth Mandatory Rule requires the bylaws of the Exchange and brokers and the 

agreements for clearing members and the clearing house to provide that the CNBV may 

immediately replace the board of directors or the technical committee of the Exchange, clearing 

members, the clearing house or broker concerned.

The compliance officer of the Exchange is designated by the bylaws of the Exchange and 

approved by the CNBV. The compliance officer is responsible for: (1) monitoring for 

compliance with the Mandatory Rules, Prudential Provisions, self-regulatory rules issued by the 

Exchange and the clearing house and other provisions applicable to the market issued by the 

authorities, and (2) proposing amendments to the rules of self-regulation to the board of 

directors.

The Mandatory Rules set forth the obligations of the compliance officer, including:

a) Ensuring the observance of the Mandatory Rules, internal regulations and self-regulatory rules 

issued by the Exchange, and other applicable provisions issued by the market authorities.

b) Reviewing reports or opinions from statutory auditors and external auditors and presenting an 

opinion (in writing) to the board of directors.

c) Proposing amendments to the self-regulatory rules issued by the Exchange in order to 

establish measures to prevent conflicts of interest and avoid the misuse of information.

The Compliance Officer reports to the board of directors and is liable for the breach of any of 

his/her obligations.

(iii) The financial resource requirements applicable to the authorization, licensure or 

registration of the foreign board of trade and the continued operations thereof.

According to the Sixth Mandatory Rule, the Exchange must maintain a minimum equity

equivalent to four million UDIs (investment units) (approximately US$1,412,000), which must 

be completely paid and represented by shares with no right to withdrawal. 
(iv) The extent to which the IOSCO Principles are used or applied by the regulatory 

regime/authority, in its supervision and oversight of the foreign board of trade or are 

incorporated into its rules and regulations and the extent to which the regulatory 

regime/authority reviews the applicable trading systems for compliance therewith.

In Mexico, the regulations applicable to the trading systems of the derivatives market are

contained in the Prudential Provisions issued by the CNBV. The Prudential Provisions also 

govern the transactions of derivatives contracts traded on the Exchange. In response to the 

IOSCO Principles, the Prudential Provisions set certain standards for equal access to trading

systems.

With respect to equality of access, the Prudential Provisions obligate the Exchange to have 

trading systems that allow the brokers and the clearing members to have equal access to the 

electronic systems, as well as in the information of bids, executed trades and the market in 

general. With respect to internal control systems, the Exchange must have internal control 

systems capable of capturing accurate information of each trade, which can identify the 

following information: the broker, clearing member, date and time of execution, price and 

amount of the trade, class and type of derivative contract, underlying asset, and settlement 

information. In addition MexDer must maintain records of the number of open contracts and 

overall contract volume.

Additionally, the system must have strict security measures for access to order and trade

databases. MexDer must have systems that ensure continuity in the capture and recording of 

information, as well as updates and backups thereof.

Clearing members or brokers are required to develop order entry capability in accordance with 

the standards established by the Exchange. The Exchange verifies that the connectivity means to 

the system of the clearing member or broker is compatible with the established standards.

Also, the clearing members and the brokers are responsible for the misuse of the system and for 

the failure to comply with the procedures and specifications established by the Exchange for the 

proper operation of the system.

The access to the system is controlled through the Exchange’s registration and access codes.

The Exchange denies access to participants if the access codes used are not valid.

(v) The extent to which the regulatory regime/authority reviews and/or approves the 

trading rules of the foreign board of trade prior to their implementation.

In accordance with the Fourth and Forty-Third Mandatory Rules, MexDer must request that the 

Ministry of Finance approve MexDer’s Internal Regulations and any amendments.

(vi) The extent to which the regulatory regime/authority reviews and/or approves 

futures, option or swap contracts prior to their being listed for trading.

In accordance with the Fifth Mandatory Rule and the Fifty-Fifth Prudential Provision, at 

MexDer’s request, the Financial Authorities will approve the terms and conditions of derivative 
contracts prior to listing, as was well as some amendments thereto. Amendments to the 

following will not require approval by the authorities:

1) Series

2) Ticker or trading symbol

3) Unit quoted

4) Tick (minimum price fluctuation)

5) Tick value

6) Maximum and minimum price fluctuation

7) Grammatical and numerical inaccuracies

(vii) The regulatory regime/authority’s approach to the detection and deterrence of 

abusive trading practices, market manipulation, and other unfair trading practices or 

disruptions of the market.

The Ministry of Finance and the CNBV have issued Mandatory Rules which apply to the market 

participants of exchange-traded derivatives contracts, and Prudential Provisions which apply to 

the trading activity of market participants of exchange-traded derivatives contracts.

Because of the self-regulatory nature of the Exchange, the authority of the Exchange’s regulator 

to detect and deter unfair practices, manipulation and other unsound market practices is limited 

to oversight of the surveillance that the Exchange and the clearing house perform with respect to 

their participants. See Thirty-Ninth Mandatory Rule. The CNBV exercises its supervisory 

powers over the market by conducting inspections of the Exchange every two years. During the 

inspections, the CNBV reviews the Exchange’s technology and its compliance with the operating 

processes according to approved regulations and activities performed by the compliance office 

and the trading desk of the Exchange.

The Mandatory Rules and Prudential Provisions establish the function of surveillance of the 

market as an activity of the Exchange itself in various provisions. See Fifth, Fifteenth, Twentieth 

and Thirty-Eighth Mandatory Rule; and Eighth, Ninth, Eleventh and Twelfth Prudential 

Provisions. In addition, the Prudential Provisions contemplate the existence of a compliance 

officer who is the responsible for ensuring that the Exchange and clearing house, as well as the 

brokers and clearing members comply with the regulations applicable to the market. The Eighth 

Prudential Provision establishes the power of monitoring compliance with the Mandatory Rules, 

Prudential Provisions, self-regulatory standards issued by the Exchange in which it participates 

and other provisions issued by the authorities that are applicable to the market.

As mentioned throughout EXHIBIT G, through the daily observation of the market, the 

compliance office is responsible for performing activities related to the detection and dissuasion 

of unfair practices, manipulation and other unsound market practices.
9

EXHIBIT F(3)

A description of the laws, rules, regulations and policies that govern the authorization and 

ongoing supervision and oversight of market intermediaries who may deal with members 

and other participants located in the United States participants, including:

Market participants may be brokerage firms and credit institutions formed as corporations to 

participate on the exchange-traded derivatives market. The Exchange must establish 

requirements for market participants (see Twenty-Third Mandatory Rule). This provision 

applies only to those brokers that are not credit institutions and brokerage firms. Credit 

institutions and brokerage firms must meet the requirements established by special laws, i.e., 

Credit Institutions Law (“LIC”) and Securities Market Law (“LMV”).

Credit institutions must be authorized by the Federal Government. See LIC, Article 8, below. 

Development banking institutions may be created as a matter of law. See LIC, Article 30, below. 

Meanwhile, securities brokerage firms require authorization from the CNBV.

LIC

Article 8.

Multiple Banking Institutions require authorization of the Federal Government, issued 

by the National Banking and Securities Commission, prior approval of its board of 

directors, and the favorable opinion of the Central Bank. These authorizations shall 

not be transferable.

Within five days after the date the board of directors of the National Banking and 

Securities Commission granted the authorization referred above, such Commission 

shall notify the resolution, as well as the favorable opinion for the bylaws draft, to 

start the process toward the constitution, or the applicable organizational and 

operation changes. The applicant, within ninety days after such notice, must submit to 

the Commission, for its authorization, the public document in which the bylaws are 

established, and later, proceed to sign it in the Public Registry of Commerce without 

any need of judicial advice.

The authorization granted under this article shall be subject to the authorization to 

start operations in the terms of article 46 Bis of this law, which must be requested 

within one hundred eighty days after the approval of the public document referred to 

in the previous paragraph. When making the public registration of the bylaws, it is 

necessary to emphasize that the authorization to organize and operate as a multiple 

banking institution is subject to the proper registration.

The Authorizations for organizing and operating as multiple banking institution, and 

its changes will be published, at the cost of the mentioned institution, in the official 

journal of the federation and two newspapers with wide distribution in the institution 

place of business.
Article 30.

Development Banking Institutions are entities of the Federal Public Administration, 

with legal personality and equity, established as National Credit Companies, in 

accordance of this law and its own legal framework.

The Ministry of Finance will issue the Rules of each entity, in this rules will be 

established the organizational and operational basis for the performance of its 

agencies.

Development Banking Institutions ́ object is to facilitate access funding to natural 

persons and corporations, as well as to provide them technical assistance and training 

in accordance of its own legal framework. In the development of the referred 

institutions it is necessary to preserve and maintain its equity, ensuring sustainability 

of operations by directing efficiently, prudently and transparently the correspondent 

resources.

Development Banking Institutions are not subject to the Acquisition, Leases and 

Services of the Public Service Law, when they hire the services required 

accomplishing the services and operations mentioned in this law.

The contracts of the Development Banking Institutions on materials and supplies, 

general services, and physical properties investments, in accordance to the article 30 

of the Regulation of the budget and responsibility federal law, will be subject to the 

Leases and Services of the Public Service Law.

For the purposes of the provisions above mentioned, the Ministry of Finance will be 

responsible for issuing general guidelines pursuant to this article, as well as for 

answering specific questions about hiring, favoring efficiency, effectiveness and due 

opportunity in the services provided by the Development Bank.

The internal legal framework and its changes must be published in the Official Journal 

of the Federation and sign it in the Public Registry of Commerce.

The law governing credit institutions and brokerage firms, as well as the secondary legislation 

issued by the Financial Authorities cover broad issues related to detailed rules of organization 

and operation, corporate governance, definition of the services, basic guidelines for service 

delivery, standards of protection for users, information disclosure to the authorities and specific 

provisions to prevent money laundering. In addition, in the case of user complaints, legislation 

contemplates the submission of credit institution and brokerage firms to the administrative 

procedures of the National Commission for the Protection and the Defense of Financial Services 

Users.

In addition, the CNBV is in charge of the supervision of credit institutions and brokerage firms

(see LMV, Articles 113 and 350).
LMV

Article 113.

The stock market intermediaries are:

I. Brokerage firms.

II. Credit institutions.

III. Managing companies of investment corporations and fund managers for retirement.

IV. Distribution companies of shares of investment corporations and financial 

institutions authorized to operate with the said character of distributor.

Brokerage firms, in its organization and operation shall comply with the provisions of 

this Law.

Credit institutions, managing companies of investment corporations, fund management 

for retirement, distribution companies of shares of investment corporations and 

financial institutions authorized to operate with the character of distributor, in its 

organization and operation shall comply with the provisions of the laws of the financial 

system and other provisions governing them.”

“Article 350.

The Commission will have powers of supervision, in terms of its Law, in respect of 

securities market intermediaries, self-regulatory organizations, brokerage firms, 

companies that manage systems to facilitate transactions in securities, central securities 

depository, central counterparties for securities market, securities rating institutions 

and prices providers.

The Commission may conduct inspections at any of the entities identified, and require, 

within the time and in such manners the Commission itself established, all information 

and documentation necessary to verify compliance with this Law and compliance with 

the general provisions that arise from it.

The entities referred to in this article shall submit the information and documentation, 

that within the scope of their powers the Commission, the Ministry of Finance and the 

Central Bank request then, and within the terms, conditions and other characteristics 

that may be established therein.

Under the terms stated in this Law, the Commission shall carry out supervision of 

financial institutions referred to in this article, even if they are in liquidation, 

dissolution or bankruptcy have been declared.

In terms of this Law, the Commission, as a result of its monitoring powers, may make 

comments and, where appropriate, order the adoption of measures to correct the 

irregular acts or omissions detected because of its monitoring functions.”

Moreover, the Central Bank has specific powers over credit institutions and brokerage firms to 

establish additional control and to monitor their compliance with respect to certain services, as in 
the case of credit institutions’ and brokerage firms’ participation in derivative trades in 

proprietary accounts (see LIC, Article 46, section XXV).

LIC

“Article 46.

Credit institutions may only perform the following operations:

...

XXV. Perform derivatives trades, subject to the technical and operational rules issued 

by the Central Bank, which establish the nature of these trades, such as types, terms, 

partners, underlying collateral and settlement forms;

...”

Clearing members are trusts and may be created through credit institutions or brokerage firms in 

their capacity as trustee. At present, clearing members have been established by credit 

institutions or brokerage firms (see Seventh and Ninth Mandatory Rule). 

Clearing members must be approved not only by the Exchange and the clearing house, but by the 

Ministry of Finance, after submitting for approval the basics of its operation (see Tenth 

Mandatory Rule). Additionally, clearing members must maintain minimum equity based on their

current obligations to the clearing house (see Twelfth Mandatory Rule). Both the equity level 

and compliance with the investment regime is monitored daily by the clearing house and the 

information is sent regularly to the CNBV. Given that Mexican law provides that trusts may only 

be administered by credit institutions or brokerage firms, the aforementioned Rules apply not 

only to clearing members, but also to their trustee credit institutions or brokerage firms.

The Prudential Provisions issued by the CNBV contain the minimum requirements that clearing 

members and brokers must satisfy to participate in the organized derivatives market. These 

requirements include the systems that participants must use for the processing and 

documentation of the services they provide to their customers and their proprietary trades (see

Twenty-Fourth and Thirty-Fourth Prudential Provisions).

Finally, Title Two of MexDer’s Internal Regulations set forth the procedures and requirements 

for each type of participant in the Exchange. The clearing house also provides a number of 

conditions for clearing members and brokers that will serve as “Global Account Managers,”

most of them the same or similar to those required by the Exchange.

Because of the self-regulatory character of the Exchange and the clearing house, brokers are 

subject to monitoring and supervision (regarding their activities in the derivatives market) by the 

Exchange, clearing members and the clearing house. All entities in the derivatives market are 

subject to the supervision of the CNBV (see Thirty-Ninth Mandatory Rule, 2nd paragraph).

In practice, clearing members and brokers receive inspection visits by the CNBV, while MexDer

and Asigna (in the case of clearing members and brokers accredited as Global Account 

Managers) conduct regular audits by MexDer’s compliance office. Moreover, MexDer monitors

daily participation in the market. Meanwhile, the clearing house is responsible for a daily 

monitoring process that tracks the adequacy of capital resources and margin contributions, limits 
and settlement process compliance. The Central Bank makes a validation of the compliance 

requirements imposed upon brokerage firms and credit institutions when they execute 

proprietary trades.

(i) Recordkeeping requirements.

The Fifty-Third Prudential Provision establishes the requirement that each and every one of the 

activities, exchange-traded derivative contracts or trades carried out by brokers, clearing 

members, clearing houses and Exchanges must be recorded in its accounting. The books and 

related documents in any case must be kept for a period of five years counted from the date the 

activity, contract or trade was performed.

Observance with this obligation is verified in the audits that the compliance office conducts.

(ii) The protection of customer funds.

The funds of clients must be kept on deposit with the clearing members in segregated accounts in 

which the clients are identified as an individual client account or a global account. Although 

currently there are brokers that manage global accounts, brokers deposit the margin amounts 

with the clearing member who does not know the identity of the final client.

The basic rules for the protection of client’s assets are contained in the Mandatory Rules, 

particularly in the Sixteenth Mandatory Rule which states that a clearing member will not use the 

assets of a third party clearing member to cover its losses in the event the clearing member has 

losses in proprietary trades.

For the clearing members that maintain proprietary accounts as well as client accounts, the 

regulation requires that – in the event that the clearing member has losses as a result of client’s 

trades – the clearing member must cover those losses with its funds in the proprietary account, 

but the clearing member may not use funds from client accounts to settle obligations for 

proprietary trades.

See also section (iii), below. 

(iii) Procedures for dealing with the failure of a market intermediary in order to 

minimize damage and loss to investors and to contain systemic risk.

The Thirty-Seventh through Thirty-Ninth Prudential Provisions set the minimum safeguards in 

the market network in the following cases: (1) when a client fails to deliver daily settlements and 

extraordinary settlements; (2) when a Global Account client defaults regardless of which entity is 

managing the account, a Broker or a clearing member; (3) the failure of a clearing member that

settles exclusively proprietary trades. From these Prudential Provisions, Asigna (the clearing 

house) has established the detailed procedures in its internal regulations (“Asigna’s Internal 

Regulations”). Chapter Nine of Asigna’s Internal Regulations specifically regulate the 

implementation of the safety network to address the following:
• Safety Net of Brokers accredited as Global Accounts Manager

• Safety Net for clearing members accredited as Global Accounts Manager

• Safety Net for clearing members

• Safety Net for the clearing house.
15

EXHIBIT F(4)

A description of the regulatory regime/authority’s inspection, investigation and 

surveillance powers; and the program pursuant to which the regulatory regime/authority 

uses those powers to inspect, investigate, and enforce rules applicable to the foreign board 

of trade.

In accordance with the Thirty-Ninth Mandatory Rule, the CNBV has the authority to supervise 

the Exchange. The CNBV’s power of supervision includes the power to request and review all 

books, documental or electronic records generated by the Exchange in both the trades executed

in the national market and the ones verified in Foreign Recognized Derivatives Markets, where 

appropriate.

The CNBV carries out inspection visits to the Exchange every two years in which administrative, 

operational and technological matters are audited. Based on these inspection visits, the CNBV

delivers to the Exchange in writing, where appropriate, the observations that it requires the 

Exchange to address. The Exchange must respond to the written observations and state the 

manner in which it will address each of the observations received. The CNBV evaluates whether 

the Exchange’s proposed measures are sufficient. Any follow-up with respect to the 

implementation and realization of improvements is carried out by MexDer’s Internal Audit area 

in conjunction with the Compliance Office.
16

EXHIBIT F(5)

For both the foreign board of trade and the clearing organization (unless addressed in 

Supplement S-1), a report confirming that the foreign board of trade and clearing 

organization are in regulatory good standing, which report should be prepared subsequent 

to consulting with the regulatory regime/authority governing the activities of the foreign 

board of trade and any associated clearing organization. The report should include:

(i) Confirmation of regulatory status (including proper authorization, licensure and 

registration) of the foreign board of trade and clearing organization.

(ii) Any recent oversight reports generated by the regulatory regime/authority that are, 

in the judgment of the regulatory regime/authority, relevant to the foreign board of trade’s 

status as a registered foreign board of trade,

(iii) Disclosure of any significant regulatory concerns, inquiries or investigations by the 

regulatory regime/authority, including any concerns, inquiries or investigations with 

regard to the foreign board of trade’s arrangements to monitor trading by members or 

other participants located in the United States or the adequacy of the risk management 

controls of the trading or of the clearing system.

(iv) A description of any investigations (formal or informal) or disciplinary actions 

initiated by the regulatory regime/authority or any other self-regulatory, regulatory or 

governmental entity against the foreign board of trade, the clearing organization or any of 

their respective senior officers during the past year.

This Exhibit will be delivered to the CFTC directly by MexDer’s surveillance authority, the 

National Banking and Securities Commission. 

[Information needed]
17

EXHIBIT F(6)

Both the foreign board of trade and the clearing organization (unless addressed in 

Supplement S-1), a confirmation that the regulatory regime/authority governing the 

activities of the foreign board of trade and the clearing organization agree to cooperate 

with a Commission staff visit subsequent to submission of the application on an “as needed 

basis,” the objectives of which will be to, among other things, familiarize Commission staff 

with supervisory staff of the regulatory regime/authority; discuss the laws, rules and 

regulations that formed the basis of the application and any changes thereto; discuss the 

cooperation and coordination between the authorities, including, without limitation, 

information sharing arrangements; and discuss issues of concern as they may develop from 

time to time (for example, linked contracts or unusual trading that may be of concern to 

Commission surveillance staff).

This Exhibit will be delivered to the CFTC directly by MexDer’s surveillance authority, the 

National Banking and Securities Commission.

[Information needed]
1

EXHIBIT G – THE RULES OF THE FOREIGN BOARD OF TRADE AND 

ENFORCEMENT THEREOF
2

EXHIBIT G-1

A description of the foreign board of trade’s regulatory or compliance department, 

including its size, experience level, competencies, duties and responsibilities.

The Compliance Office performs monitoring and surveillance activities with respect to the 

Exchange, the clearing house and the market participants. 

The Compliance Officer must be appointed in accordance with the Sixth Prudential Provision 

and the other requirements established for the appointment of directors and the chief executive 

officer. The Compliance Officer must be a person who has recognized expertise in the legal 

field and who does not (1) have an ownership interest in a broker, clearing member or financial 

institution, (2) hold an office or other position at a broker, clearing member or financial 

institution, and (3) sit on the board of any such institution. 

The Compliance Officer is in charge of coordinating the activities of the Compliance Office and 

participates in establishing new regulations of the clearing house. In addition, the Compliance 

Officer participates in the clearing house committees (non-voting), and reports to the Board of 

Directors.

Currently, the Compliance Officer is a lawyer with 14 years experience at the Mexican Stock 

Exchange and its subsidiaries (BMV Group). The Compliance Officer of MexDer previously 

worked in the legal department of the Mexican Stock Exchange as legal deputy director of the 

central deposit of securities for the equity market, as well as in the development of the selfregulatory rules and the constitution of the securities central counterparty. He has two legal

degrees: one in Mexican financial law and the other in international financial law. His role is 

supervising the audits and surveillance of the market as well as reviewing trading activity subject 

to possible disciplinary action.

The Compliance Deputy Director is an accounting graduate who has nine years of experience in 

the auditing area. He is in charge of coordinating and executing audits of market participants, as 

well as reviewing various periodic information received by the Compliance Office.

The Audit Manager is a public accountant with eight years of experience in the BMV Group, 

who previously worked in a recognized accounting firm specializing in auditing. He is in charge 

of coordinating and implementing audit activities, as well as tracking the follow-up activities of 

the audits. He is in charge of reviewing the financial information that is periodically received 

from the participants.

The Surveillance Manager has six years of experience in compliance and previously worked in 

the financial and operations area. The Surveillance Manager designed the surveillance system 

currently used by the Compliance Office for monitoring the market. He is in charge of the daily 

supervision of the market and identifying areas requiring special investigations. Additionally, he 

is in charge of coordinating the review and processing of information periodically received by 

the Compliance Office.
The specialists and analysts that make up the rest of the staff have educational backgrounds 

related to their roles.
4

EXHIBIT G-2

A description of the foreign board of trade’s trade practice rules, including but not limited 

to rules that address the following –

(1) Capacity of the foreign board of trade to detect, investigate, and sanction persons 

who violate foreign board of trade rules.

Currently the Compliance Office has two areas dedicated to the task of detecting and 

investigating possible violations of the market rules: Market Surveillance and Audit.

Market Surveillance conducts its monitoring activities through the system VIGIA MexDer and 

its own applications using as comparison criteria the theoretical prices and the price of the last 

trade, as described in paragraph G-2 (3) of this section.

Audit performs an annual schedule of audits, which aims to review the participants’ operations

and their compliance with the Exchange’s regulations.

In general terms, the audits performed by the Compliance Office of market participants cover

legal, administrative, operational, customer, systems and financial areas. The audits are 

performed on a sample basis and seek to validate a member firm’s compliance with the 

operational and regulatory obligations of MexDer. Once an audit is completed, the Compliance 

Office will address any noncompliance issues, and if appropriate, bring disciplinary measures.

The Seventh Prudential Provision provides that the Board of Directors of the Exchange may 

impose sanctions for infractions of the Exchange’s rules or it may delegate the task to individuals 

named by the Board. In Title Seven “Disciplinary Measures, Precautionary Measures And 

Procedures,” MexDer’s Internal Regulations establish basic guidelines for the imposition of 

disciplinary measures as well as the rules to delegate to the Chief Executive Officer and the 

Committee on Disciplinary Measures and Arbitration of the Exchange the power to impose 

disciplinary actions. 

Disciplinary cases can be initiated: (1) automatically when the Exchange detects any alleged 

violation and the Compliance Officer has the sufficient evidence, derived from any audit or 

investigation; or (2) based on a referral which provides the Compliance Officer with sufficient 

reason to initiate an investigation.

(2) Prohibition of fraud and abuse, as well as abusive trading practices including, but 

not limited to, wash sales and trading ahead, and other market abuses.

The Thirteenth Prudential Provision establishes the general principle that standards regulating 

the conduct of Brokers, clearing members, Desk Traders and the clearing house will be designed 

to ensure that the exercise of their activities is conducted honestly and diligently to protect the 

interests of the public and the integrity of the Market; the aforementioned, without prejudice,

may also apply to clients.
The Thirteenth Prudential Provision also establishes the following acts and omissions as serious 

defaults:

• Use of margin for other than permitted purposes.

• Acting with bad faith in the execution of exchange traded derivatives.

• The intentional disclosure of false, inaccurate or misleading information relating to the 

underlying asset to which a derivatives contract listed on the Exchange is linked, that 

affects its price, or the concealment of material facts that may influence the 

aforementioned price.

• Activities that attempt to manipulate or in fact manipulate the price of any underlying 

asset.

• The misuse of material non-public information, whether for personal gain or for the 

benefit of a third party, for the purpose of trading derivatives listed on the Exchange or 

entering into transactions with the underlying assets linked to them.

• Failure to maintain accurate trade records.

• Executing client orders that were not authorized.

• Failing to appear before the board or any committee in the course of an investigation, and 

failure to submit the information requested for that purpose.

• Allowing unauthorized personnel to access the trading system.

• Effecting trades that do not comply with the sound market practices.

• The execution of trades off the Exchange. 

• Trading on a proprietary basis without maintaining competitive bids and failing to give 

equal treatment to clients.

• The performance of any act that is detrimental to the Exchange and the market in general.

MexDer’s Internal Regulations (Article 7004.01) establish a catalog of specific violations that 

are considered serious and the sanctions for such violations.

The legal provisions applicable to money laundering cases are not directly supervised by the 

Exchange because clearing members are trusts managed by trustees (credit institutions and 

brokerage firms) that are governed by specific regulation in this area and are supervised by the 

CNBV. The exception is participants that manage global accounts. These participants are 

required to submit to the Exchange a manual containing the policies and procedures they must 

observe to prevent, detect and report acts, omissions or transactions that might aid terrorism

(Article 139 of the Federal Criminal Code) or money laundering (Article 400 of the Federal 

Criminal Code).

(3) A trade surveillance system appropriate to the foreign board of trade and capable of 

detecting and investigating potential trade practice violations.

The Market Surveillance area evaluates trades daily in real-time through the VIGIA MexDer 

system, using as benchmarks the prices of the market itself and the theoretical price of the 

futures contracts for each underlying asset. The system provides the Compliance Office with 
potential violative trades according to the parameters set by different types of alerts. The 

parameters defined by the Compliance Office to generate alerts are based on risk factors that the 

clearing house calculates in order to reflect a degree of severity. The alerts are addressed by the 

market surveillance area and a daily report with the results of such reviews is issued, as well as a 

brief analysis of the economic and operating conditions that affect the market.

See Exhibit G-4.

(4) An audit trail that captures and retains sufficient order and trade-related data to 

allow the compliance staff to detect trading and market abuses and to reconstruct all 

transactions within a reasonable period of time.

The Exchange has the legal obligation to maintain an audit trail of quotes and transactions for 

five years, which allows the Exchange to reconstruct the trading on MexDer.

(5) Appropriate resources to conduct real-time supervision of trading.

As mentioned in Exhibit G-2(3), some trade monitoring is performed in real-time. The real-time 

monitoring of market activities is carried out by the Exchange’s Compliance Officer. The 

Compliance Officer has systems with real-time alerts that allow the Exchange to detect errors in 

bids and transactions.

(6) Sufficient compliance staff and resources, including those outsourced or delegated 

to third parties, to fulfill regulatory responsibilities.

See Exhibit G-1 and Exhibit G-4.

(7) Rules that authorize compliance staff to obtain, from market participants, 

information and cooperation necessary to conduct effective rule enforcement and 

investigations.

The Exchange’s authority to request information from members comes from the third paragraph 

of the Thirty-Sixth Mandatory Rule.

Article 6001.00 of MexDer’s Internal Regulations authorizes the Exchange to require 

information from members. Furthermore, Article 6004.00 provides that information requests 

may consist of a request for documents that relate to the activities of clients, clearing members, 

brokers and the clearing house and allow the Exchange to verify compliance with the applicable 

laws and regulations. The information requested by MexDer must be supplied by the members

within the time period specified by the Exchange. Additionally, Articles 6006.00 and 6007.00 of 

MexDer’s Internal Regulations provide that the clearing members, brokers and the clearing 

house are subject to inspection and oversight by the Exchange. 

The authority for Exchange requests can found in the following Articles:

• Articles 6027.00 to 6030.00 – Information requirements for members and the obligation

to obtain client agreement that such information may be provided to the Exchange.
• Articles 6031.00 to 6033.00 – Obligation for members to submit operating information.

• Articles 6034.00 and 6035.00 – Obligation for members to submit financial and 

accounting information.

• Articles 6036.00 to 6037.01 – Obligation for members to submit legal information.

• Article 6038.00 to 6041.00 – Obligation for members to submit information to the

clearing house.

(8) Staff investigations and investigation reports demonstrating that the compliance 

staff investigates suspected rule violations and prepares reports of their finding and 

recommendations.

(9) Rules determining access requirements with respect to the persons that may trade 

on the foreign board of trade, and the means by which they connect to it.

The provisions relating to access to MexDer’s System are contained in MexDer’s Internal 

Regulations, Title X, Chapter I, Part 2 (see articles 10005.00 to 10010.00). MexDer’s Internal 

Regulations are attached to Exhibit A-5.

(10) The requirement that market participants submit to the foreign board of trade’s 

jurisdiction as a condition of access to the market.

In accordance with Article 2005.00(I)(c) of MexDer’s Internal Regulations, applications for 

admission must be accompanied by a corporate certification in which the applicant has agreed to 

its participation in the Exchange and specified its willingness to abide by all the rules and other 

provisions issued by the Financial Authorities, the Exchange and the Clearinghouse. 
8

EXHIBIT G-3

A description of the foreign board of trade’s disciplinary rules, including but not limited to 

rules that address the following —

(1) Disciplinary authority and procedures that empower staff to recommend and 

prosecute disciplinary actions for suspected rule violations and that provide the authority 

to fine, suspend, or expel any market participant pursuant to fair and clear standards.

Chapter Seven of MexDer’s Internal Regulations authorize the Board of Directors, through the 

Chief Executive Officer or the Disciplinary Committee of the Exchange, to impose disciplinary 

measures for violations of MexDer’s Internal Regulations (See Article 7000.00). MexDer’s 

Internal Regulations empower the Chief Executive Officer, the Disciplinary Committee or the 

Board of Directors to impose disciplinary measures according to the seriousness of the breaches 

or violations (See Articles 7001.00, 7005.00, 7007.00, 7016.00).

The Exchange’s procedures for imposing disciplinary sanctions depend on the severity of the 

behavior. For infractions that are not considered serious, the Exchange follows a simplified 

procedure. Under this process, the Compliance Officer issues a summons to the member as set 

forth in Article 7001.01. The summons must provide the member with a reasonable timeframe 

for a response. Article 7001.02 establishes the power of the Compliance Officer to evaluate the

member’s response and, based on that evaluation, dismiss the breach or request that the Chief 

Executive Office impose the appropriate disciplinary measures. Chapter Three of Title Seven 

(Articles 7039.00 to 7050.00) establishes the procedure by which the members subject to a 

disciplinary measure of this type may file an appeal for reconsideration before the Chief 

Executive Office.

The procedure for serious disciplinary matters is governed by title Seven of the Internal 

Regulations (Chapter Four, Part Three). Serious disciplinary matters require the Compliance 

Officer to issue a complaint against the member. The member is entitled to a hearing before a 

disciplinary panel. Once the disciplinary panel issues its findings, the member is entitled to 

appeal the panel's findings. (See Articles 7058 - 7083).

(2) The issuance of warning letters and/or summary fines for specified rule violations.

Please refer to MexDer’s Internal Regulations, Title Seven, Chapter One (see articles 7000.00 

through 7016.00). MexDer’s Internal Regulations are attached to Exhibit A-5.

(3) The review of investigation reports by a disciplinary panel or other authority for 

issuance of charges or instructions to investigate further, or findings that an insufficient 

basis exists to issue charges.

Please refer to MexDer’s Internal Regulations, Title Seven, Chapter Four (see articles 7051.00 

through 7083.00). MexDer’s Internal Regulations are attached to Exhibit A-5.

(4) Disciplinary committees of the foreign board of trade that take disciplinary action 

via formal disciplinary processes.
The Disciplinary Committee is comprised of 3 to 5 members appointed by the Board of 

Directors. At least two members of the committee must be attorneys. 

The Disciplinary Committee is responsible for:

• Assembling a disciplinary panel to consider and resolve disciplinary cases in question;

• Hearing appeals for review;

• Arbitrating controversies between clearing members and Brokers and between clients and

clearing members or Brokers; and

• If necessary, reporting its activities to the Board of Directors every six months.

(5) Whether and how the foreign board of trade articulates its rationale for disciplinary 

decisions.

The rationale for disciplinary decisions is articulated to members; however, such decisions are 

made publicly available only with respect to serious offenses.

See also Exhibit G-2 (1).

(6) The sanctions for particular violations and a discussion of the adequacy of sanctions 

with respect to the violations committed and their effectiveness as a deterrent to future 

violations.

The disciplinary measures provided for in MexDer’s Internal Regulations consist of warnings, 

financial penalties, suspensions, and restrictions on members.

Warnings are imposed for a first offense that is not considered severe. Financial penalties and 

other disciplinary measures are imposed where the first offense is considered serious. A member 

will be considered a repeat offender when the member has two or more offenses of the same 

type.

According to MexDer’s Internal Regulations, the CEO may impose suspensions on members in 

cases in which it is clear that a clearing member or broker failed to meet any of the obligations 

for which it is responsible with respect to the Exchange’s System (see Articles 10004.02, 

10004.03, 10004.04 or 10004.05).

In addition to the imposition of financial penalties, the Exchange may deny continued 

membership for clearing members and brokers that have committed serious offenses.

Based on the Prudential Provisions, the Exchange considers the following acts and omissions as 

serious offenses:

• Use of margin for other than permitted purposes.

• Acting with bad faith in the execution of exchange traded derivatives.
• The intentional disclosure of false, inaccurate or misleading information relating to the 

underlying asset to which a derivatives contract listed on the Exchange is linked, that 

affects its price, or the concealment of material facts that may influence the 

aforementioned price.

• Activities that attempt to manipulate or in fact manipulate the price of any underlying 

asset.

• The misuse of material non-public information, whether for personal gain or for the 

benefit of a third party, for the purpose of trading derivatives listed on the Exchange or 

entering into transactions with the underlying assets linked to them.

• Failure to maintain accurate trade records.

• Executing client orders that were not authorized.

• Failing to appear before the board or any committee in the course of an investigation, and 

failure to submit the information requested for that purpose.

• Allowing unauthorized personnel to access the trading system.

• Effecting trades that do not comply with the sound market practices.

• The execution of trades off the Exchange. 

• Trading on a proprietary basis without maintaining competitive bids and failing to give 

equal treatment to clients.

• The performance of any act that is detrimental to the Exchange and the market in general.
11

EXHIBIT G-4

A description of the market surveillance program (and any related rules), addressing the 

following –

The dedicated market surveillance department or the delegation or outsourcing of that 

function, including a general description of the staff; the data collected on traders’ market 

activity; data collected to determine whether prices are responding to supply and demand; 

data on the size and ownership of deliverable supplies; a description of the manner in 

which the foreign board of trade detects and deters market manipulation; for cash-settled 

contracts, methods of monitoring the settlement price or value; and any foreign board of 

trade position limit, position management, large trader or other position reporting system.

The monitoring activities of the Compliance Office are summarized as follows:

• Capitalization levels of brokers and global account managers (reported by members

daily).

• Capitalization levels of clearing members (reported by members daily). 

• Review of position limits. 

• Review of accredited personnel of members for compliance with MexDer requirements.

• Daily reviews of market surveillance.

• Special investigations of members.

• Annual revision of the administrative and control processes and procedures of the 

clearing house.

• Audits of members.

• Monthly review of financial information of brokers and clearing members.

• Review of audited financial statements of all members.

• Review of questionnaires to all the participants.

Daily surveillance

The Market Surveillance area of the Compliance Office evaluates trades daily through use of the 

VIGIA MexDer system, using as benchmarks the prices of the market itself and the theoretical 

price of the futures contracts for each underlying asset. The system provides the Compliance 

Office with potential violative trades according to the parameters set by different types of alerts. 

The parameters defined by the Compliance Office to generate alerts are based on risk factors that 

the clearing house calculates to reflect a degree of severity. Market Surveillance documents it 

reviews in a daily report along with a brief analysis of the economic and operating conditions 

that affect the market.

To determine if the prices established on MexDer are reasonable, the Market Surveillance area 

has external information sources, such as “Infosel” where the futures and the underlying asset 

prices are captured in the cash market. Market surveillance calculates the theoretical price to 

determine the reasonableness of the prices of the transactions. Physical delivery applies only to 

bonds, rate swaps, stocks and dollars. 
The clearing house monitors for compliance with settlement obligations. Any defaults by 

clearing members are reported to this Compliance Office for monitoring and possible imposition 

of disciplinary measures.

Extraordinary situations

Additionally, MexDer has the power to replace the daily settlement prices of futures and option 

contracts with the theoretical prices when, based on market conditions, MexDer determines that 

the prices are not in line with market conditions.

Special investigations

The Market Surveillance area performs special investigations as needed. Such investigations 

may be initiated by a formal complaint of a participant, or, by Market Surveillance if market 

Surveillance believes that the investigation is warranted to determine if a violation has occurred.

Bimonthly surveillance report

Every two months, the Compliance office prepares a report of all the alerts generated by the 

VIGIA MexDer. This document includes a brief description of the analysis applied to all alerts, 

according to defined criteria, as well as the actions following the analysis. 

Position Limits

The Compliance Office assists the Risk Committee of the clearing house when the Risk 

Committee sets the position limits for derivatives contracts. Additionally, the Compliance 

Officer performs a random check every month on the open positions of members. If they exceed 

the limits set by the clearing house, the Compliance Office follows up with the member to 

determine the cause of the position limit violation.
1

EXHIBIT H – INFORMATION SHARING AGREEMENTS AMONG THE 

COMMISSION, THE FOREIGN BOARD OF TRADE, THE CLEARING 

ORGANIZATION, AND RELEVANT REGULATORY AUTHORITIES
2

EXHIBIT H(1)

A description of the arrangements among the Commission, the foreign board of trade, the 

clearing organization, and the relevant foreign regulatory authorities that govern the 

sharing of information regarding the transactions that will be executed pursuant to the 

foreign board of trade’s registration with the Commission and the clearing and settlement 

of those transactions. This description should address or identify whether and how the 

foreign board of trade, clearing organization, and the regulatory authorities governing the 

activities of the foreign board of trade and clearing organization agree to provide directly 

to the Commission information and documentation requested by Commission staff that 

Commission staff determines is needed:

(i) To evaluate the continued eligibility of the foreign board of trade for registration.

(ii) To enforce compliance with the specified conditions of the registration.

(iii) To enable the CFTC to carry out its duties under the Act and Commission 

regulations and to provide adequate protection to the public or registered entities.

(iv) To respond to potential market abuse associated with trading by direct access on the 

registered foreign board of trade.

(v) To enable Commission staff to effectively accomplish its surveillance responsibilities 

with respect to a registered entity where Commission staff, in its discretion, determines 

that a contract traded on a registered foreign board of trade may affect such ability.

Among other things, MexDer is a signatory to the companion memorandum to the Declaration 

on Cooperation and Supervision of International Futures Markets and Clearing Organizations 

(commonly referred to as the “Boca Declaration”). As such, MexDer supports the sharing of 

relevant information between certain derivatives exchanges and clearing organizations in order 

to combat potential hazards to the stability, safety and soundness of the international financial 

markets. Under Mexican law, MexDer may not disclose the beneficial ownership of an account, 

but is otherwise permitted to disclose directly to the CNBV (and the general public) aggregated 

information related to transactions effected on MexDer.

The CNBV is also entitled to receive information regarding market participants directly from the 

financial entities in Mexico. In particular, Mexican law authorizes the CNBV to obtain 

information from clearing members and trading members and to provide that information to

foreign regulatory agencies, such as the Commission. Mexican law additionally authorizes 

CNBV to assist international bodies performing market surveillance and to furnish information 

to these foreign authorities pursuant to exchange of information agreements, such as the 

Memoranda of Understanding discussed in Exhibit H(3).
3

EXHIBIT H(2)

A statement as to whether and how the foreign board of trade has executed the 

International Information Sharing Memorandum of Understanding and Agreement.

MexDer is not a signatory of the International Information Sharing Memorandum of 

Understanding and Agreement. Information sharing will be possible according to what it is 

explained in Exhibits H1 and H4.
4

EXHIBIT H(3)

A statement as to whether the regulatory authorities governing the activities of the foreign 

board of trade and clearing organization are signatories to the International Organization 

of Securities Commissions Multilateral Memorandum of Understanding. If not, describe 

any substitute information-sharing arrangements that are in place.

The Commission and CNBV entered into a Memorandum of Understanding on Consultation, 

Technical Assistance, and Mutual Assistance for the Exchange of Information (“MOU”) on May 

11, 1995. The MOU addresses information sharing and is intended to assist both the Commission 

and CNBV in regulating and preventing fraud and abuse in the financial markets. The MOU 

remains in effect, and contemplates CNBV and the Commission providing the fullest measure of 

mutual assistance to facilitate their respective futures market oversight functions and to enforce 

the laws and regulations applicable to futures markets. In addition, CNBV is a signatory to the 

IOSCO Multilateral Memorandum of Understanding Concerning Consultation and Cooperation 

and the Exchange of Information (the “MMOU”), which promotes mutual cooperation and 

consultation among IOSCO Members (including both the Commission and CNBV) to ensure 

compliance with, and enforcement of, their securities and derivatives laws and regulations. The 

CNBV has confirmed to the Commission that it is committed to fulfill the scope of assistance 

established in Article 7 of the MMOU and that the information-sharing terms of the MMOU will 

extend to information requested by the Commission regarding the activities conducted pursuant 

to any no-action relief granted to MexDer.
5

EXHIBIT H(4)

A statement as to whether the regulatory authorities governing the activities of the foreign 

board of trade and clearing organization are signatories to the Declaration on Cooperation 

and Supervision of International Futures Exchanges and Clearing Organizations. If not, a 

statement as to whether and how they have committed to share the types of information 

contemplated by the International Information Sharing Memorandum of Understanding 

and Agreement with the Commission, whether pursuant to an existing memorandum of 

understanding or some other arrangement.

MexDer is a signatory to the Declaration on Cooperation and Supervision of International 

Futures Exchanges and Clearing Organizations, its regulators are not signatories of such 

Declaration. However, pursuant to the MOU and MMOU, the CNBV has the commitment to 

share information with the CFTC. 

Description of how the CNBV will share information with the CFTC will be delivered directly 

by the CNBV.
1

SYSTEM SAFEGUARDS TESTING REQUIREMENTS

Pursuant to rule Thirteenth of the “Prudential Provisions to which the Participants of the 

Derivatives Contracts Market must be subject to” issued by the National Securities and 

Banking Commission (“CNBV” by its acronym in Spanish), MexDer as a derivatives

exchange must implement a Business Continuity Plan (“BCP”). 

The Chief Executive Officer with the aim of the continuity and IT personnel develop the BCP 

and all the documents that are part of it, based on the Disaster Recovery International 

Institute best practices and international standards such as ISO 22301. Afterwards, the BCP 

is submitted to the consideration of the Audit Committee members to finally be submitted to 

the Board of Directors for its approval.

Prior to the development of the Business Continuity Plan, MexDer conducted a Risk 

Continuity Analysis, which provides the level of risk of the threats to which MexDer’s critical 

processes are exposed, and a business impact analysis (“BIA”) that together with the 

Continuity Risk Analysis and Evaluation allow MexDer to identify the business subprocesses 

and to prioritized them to determine the most appropriate recovery strategies.

The Continuity Risk Analysis is updated at least once a year, in order to identify and evaluate 

the risks that endanger operational continuity. This document is based on the Business Risk 

Management and Controls Manual and Methodology of BMV Group. The Continuity Risk 

Analysis is presented as part of the Business Continuity Plan to the various corporate bodies 

and the corresponding authorities at least once a year.

MexDer’s BCP includes an Incident Management Plan that aims to restore the normal 

operation of critical services as soon as possible, minimizes the adverse impact on business 

operations and ensures maintenance of the best levels of quality and availability.

In order to meet regulatory requirements, MexDer ́s BCP must implement adequate 

procedures to inform the National Banking and Securities Commission and the Central Bank 

of any Operative Contingencies that arise in any of its systems or channels for attention to 

the public and which result in a trading halt. Related notices to both Authorities, must be 

made within sixty minutes after identifying the beginning of the Operative Contingency 

through any communication means. Such notices must state at least: (i) the date and time 

in which the Operative Contingency started; whether the Operative Contingency continues 

or has concluded and its duration; and (iii) a description of the event that occurred. MexDer’s 

CEO shall send to the Commission the description of such contingency, an analysis of the 

causes that led to it, the impairment caused in qualitative and quantitative terms, the 

processes, systems and channels affected, as well as the actions to be implemented to 

minimize the impact or damage in subsequent similar situations, within fifteen calendar days 

after the conclusion of the Operative Contingency. 

In this regard and derived from the threats identified in the Risk Analysis and Evaluation, 

MexDer’s BCP provides the general contingency scenarios that affect the business 

operation of MexDer.
2

Along with the BIA, the Disaster Recovery Plan (DRP) is part of the BCP too. MexDer’s DRP 

provide a set of preventive and responsive procedures that allow MexDer to ensure 

continuity of its systems and services that support critical processes during contingency 

situations that affect the use of or the infrastructure housed in the Main Data Center.

The main objectives of MexDer’s DRP are: (i) to address the RTO of the critical applications 

identified in the BIA; (ii) to document the technical procedures that will be executed to 

activate and deactivate the DRP (Backup Data Center); (iii) to document the technical 

procedures that will be executed to activate Production (Main Data Center); (iv) to avoid 

confusion in contingency situations, through the establishment and execution of the 

technical procedures described in the DRP.

Pursuant to sections I. f) and g) of rule Thirteenth and sections I. f) and g) of rule Thirty Eight 

of the CNBV provisions, MexDer and its Clearing House provide that the RTO of critical 

processes, shall not exceed thirty minutes counted from the moment in which MexDer 

identifies the operative contingency and that the RPO must be equal to zero, considering 

that the information on the transactions already conducted cannot be lost in any scenario. 

MexDer performs DRP’s testings, with different scenarios and different personnel involved 

in each testing.

Section II. vi) of rule Thirteenth provides that MexDer’s CEO is responsible for informing the 

board of directors and the CNBV of the results of the tests. 

For physical security and environmental controls, MexDer’s, principal and back up, 

technological infrastructures, are installed in the facilities of a third party provider. 

The controls enabled for the protection of telecommunications are the following:

• Telecommunications are carried out through the Backbone Network of MexDer and 

through the Financial Network that is the way through for the Customers to access

MexDer's applications. 

• For the Telecommunications equipment management MexDer uses a AAA 

(Authentication, Authorization and Accounting) access control tool. These tools

permits to audit all the activities of the network administrators.

• MexDer uses a control access tool to the network.

• A security architecture that includes, some additional tools aside from the traditional 

antivirus, antispam, etc.

To protect the system and information integrity MexDer has a security architecture that 

performs protection against malware in the Corporate Center, the Main Data Center and the 

Backup Data Center.

MexDer’s Information Security framework is aligned to the ISO 27001: 2013 standard, that 

defines best practices in the field of Information Security through 13 different domains.

Our framework includes an institutional policy and 13 Standards:

1) Institutional Information Security Policy

2) Standard of Information Security Management
3

3) Standard of Human Resources Security: 

4) Standard of Information Asset Management

5) Standard of Logic Access Control

6) Standard of Phisycal Enviroment and Safety

7) Standard of Security in Operations

8) Standard of Security in Communications

9) Standard of security in Adquisition, Development and Maintenance of information 

systems

10) Standard of Security Related with Third Parties

11) Standard of Information Security Incident Management

12) Standard of Requirements of Information Security in Bussines Continuity Management

13) Standard of Compliance in Information Security 

14) Standard of Vulnerability Assessment & Penetration Testing

These standards are reviewed and updated every two years, as a regulatory required by the 

authorities or corporate governance and must be approved by a multi-disciplinary group 

formed by different business areas and technology areas.

It is important to point out that MexDer’s Information Security framework meets the CNBV 

and other regulatory bodies requirements.

In particular, the “Standard of Vulnerability Assessment & Penetration Testing” provides the 

need to execute this type of tests at least once a year. The Information Security area is 

responsible for performing such tests with a specialized external provider, which seeks to 

emulate an attacker who, using tools, techniques, tactics and procedures, intends to 

compromise the principles of security (confidentiality, integrity and availability).

The tests are proposed to include all levels of the Systems and IT infrastructure, that is, the 

following layers:

1) Physical.- missions to test the access controls to the building and specific areas.

2) Operating Systems.- Vulnerability analysis and penetration tests on samples of PC 

equipment, Laptops and Servers.

3) Databases.- Identification of the different instances, sensitive tables and run tests to 

escalate privileges.

4) Applications.- Review of dynamic code to different applications.

5) Network.- A traditional ethical hacking scan is executed in order to identify known 

vulnerabilities and to validate the correct configuration of the equipment.

6) Human Resources.- (Social engineering) Phishing campaigns by email and phone 

calls.
4

The tests include white, black and gray box scenarios; and different attack vectors are 

raised, to validate that IT systems and infrastructure are adequately protected.

Once the vulnerabilities or configuration aspects have been identified, remediation activities 

are coordinated with the Technology and Business Areas according to their criticality, which 

is measured based on the CVSS (Common Vulnerability Scoring System), that is a system 

of score designed to provide an open and standard method that allows estimating the impact 

derived from identified vulnerabilities, in other words, it helps to quantify the severity that 

these vulnerabilities can represent.

Finally, it is important to point out as a reference, that there are technological tools, 

cybersecurity structures and processes that permanently monitor suspicious events and 

possible security incidents, which are periodically tested to validate their effectiveness.

To ensure adequate scalable capacity of its systems, MexDer has a Capacity Plan that is 

updated every year, which considers the following points:

1) Identify Service Configuration components

2) Identify Capacity requirements

3) Identify Legal and Regulatory Framework

4) Identify Contractual and Organizational Aspects

5) Define monitoring tools

6) Measurement and Evaluation of Capacities

6.1. Define Capability Test Scenarios

6.2. Perform First Capacity Test 

6.3. Perform Second Capacity Test 

6.4. Generate Current Capacity Report 

6.5. Generate Current Capacity Report 

6.6. Generate Capacity Scenarios Report

6.7. Measure and Evaluate Configuration Components

7) Analyze and Perform Estimates

7.1. Analyze PBA trends

7.2. Analyze and Estimate PBA Vs Current Capacity

8) Manage Capacity Risks

9) Manage Capacity Service Levels

As security awareness training in security information matters, MexDer implements a 

continuous program which includes, among others:

1) Evaluations according to the level of security awareness of each user.

2) Phishing tests.

3) Newsletters and recommendations by email and by the different media such as the 

screens on each floor.

4) During the Security Information week MexDer raises awareness and evaluates all 

users in the field of information security.

Technology and business personnel are responsible for the systems operations. The system 

maintenance is performed by the technology team in charge of software development based 

on business and / or technical requirements.
5

Software development and maintenance is carried out through a procedure to have a 

framework for managing projects, producing satisfactory results, ensuring quality and 

managing changes appropriately. This procedure involves technical and business key areas 

and stakeholders.

The Technology area also has a configuration management procedure which aims to: (i) 

ensure that the CI’s of the CMDB configuration have necessary attributes, precise 

relationships and information to guarantee reliability, integrity and availability; and (ii) 

Reliably safeguard and manage the latest versions of software configuration items and any 

related documents through the establishment of a definitive media library (DML).

The Technology Department has established SLA’s of the critical MexDer systems, which 

are periodically reviewed and evaluated. There is a service desk which attends incidents 

related to MexDer systems either by application, mail or by phone.

The Technology Department has a group of Business Partners who make the elicitation of 

business requirements, a Software Engineering group which is responsible for research and 

establishing coding guidelines, tools and best practices. Finally, there is a development 

responsible for building the systems. Agile methodologies are followed, and continuous 

integration processes are carried out. Secure and collaborative coding guidelines are 

established.

There is also a quality assurance area (QA) which is responsible for designing test cases 

and applying them, it counts with automated tools for testing. Finally end users validates 

functionality in an UAT environment before the functionality is deployed in production.

Provision Thirty Nine of the "Rules that the Derivatives Contracts Market Participants shall 

be subject to” issued by the Mexican Ministry of Finance (“SHCP”), the CNBV and the 

Mexican Central Bank entitles, the CNBV as the competent authority to perform MexDer’s 

oversight. Within the scope of its authority, the CNBV practices audits to MexDer every two 

years in which the CNBV verifies MexDer compliance with applicable law. 

Regarding system safeguards-related books and records and pursuant to rule Sixty Five of 

the CNBV’s Provisions, MexDer must provide information to the CNBV to demonstrate that 

MexDer’s IT systems comply with the following: (i) continued performance of the functions 

for which they were designed, developed or acquired; (ii) proper documentation of the IT 

systems applications and processes, including its development methodology and, where 

appropriate, the records of the systems changes; (iii) the use of quality control mechanisms 

to perform execution tests before implementing a new IT system or when it is modified or 

updated; (iv) software licensing or authorization to use the corresponding systems; (v) 

backup mechanisms and information recovery procedures to minimize the risk of interruption 

of the operation; (vi) maintenance of audit logs, including detailed information on the 

operation or activity carried out by users, database administrators and operating system; 

(vii) performance of tests designed to detect vulnerabilities of the electronic media, 

processing, telecommunications and automated equipment that prevent the unauthorized 

access and use, including all its technological infrastructure, at least once a year or when 

making substantive changes to the technological infrastructure; and (viii) preservation of the 

confidentiality, integrity and availability of the information generated, stored and transmitted, 

observing controls on: (a) access to the information, authenticating users and granting them 
6

permissions according to their profile; (b) protection of the information processed, 

transmitted and stored in the IT systems, considering, in the case of remote accesses, 

encryption mechanisms of information; (c) record of the accesses and the activity of the 

users in audit logs, as well as mechanisms for their periodic review; and e) control schemes 

of applications versions to ensure there is no unauthorized functionality in the IT systems.

CNBV is entitled to require additional information from MexDer who is compelled to comply 

with such requirement. 

* * * * *