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CROSS-BORDER COOPERATION ARRANGEMENT 

AMONG 

AUTHORITIES OF THE CRISIS MANAGEMENT GROUP 

ON LCH SA 

(“ARRANGEMENT”)

ACPR/Resolution Directorate 
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PREAMBLE

1. In view of enhancing cooperation in resolution, the Authorities hereby enter into this 

LCH SA Cross-Border Cooperation Arrangement (“Arrangement”). 

2. In accordance with the Financial Stability Board’s Key Attributes of Effective 

Resolution Regimes for Financial Institutions (“Key Attributes”, KAs), particularly 

KA 9 (“Institution-specific cross-border cooperation agreements”), Appendix IAnnex 2 (“Essential Elements of Institution-specific cross-border cooperation 

agreements”), and Appendix II-Annex 1 (“Resolution of FMIs and FMI participants”), 

this Arrangement is intended to facilitate the taking of effective resolution measures in 

respect of LCH SA in the event of its failure. 

3. For the purpose of this Arrangement, the “Crisis Management Group for LCH SA” 

(“CMG”) is a permanent, although flexible, structure for cooperation and coordination 

among the Authorities, who are involved in the resolution of LCH SA and its 

affiliates, with the objective to enhance preparedness for, and facilitate resolution of 

LCH SA in the event of its failure. The CMG provides a framework for the home 

Authorities and the key host Authorities to meet the standards of FSB KA 8 (“Crisis 

Management Groups”).

4. Given the ongoing international and EU developments on the composition of CMGs 

for financial market infrastructures (“FMIs”) or other similar cooperation 

arrangements, this CMG will initially focus on the resolution planning and action in 

relation to LCH SA, while those crisis management aspects relating to recovery or 

early intervention must continue to be dealt with by the college established under 

article 18 of Regulation (EU) No 648/2012 (“the EMIR college”) and by each 

Authority. In a similar manner, this CMG will initially be composed following the 

current international standards, in particular the Key Attributes for FMIs which 

determine that: “For any such FMI, the CMG (or equivalent arrangement) should 

include the resolution authorities responsible for the FMI, the authorities that 

participate in the cooperation arrangements adopted in accordance with Responsibility 

E and other relevant authorities, of the jurisdictions where the FMI has operations that 

are material to its resolution.”1

5. The CMG composition may be reviewed, where necessary, once relevant international 

guidance with regard to the composition of CMGs has been finalized, also considering 

the implementation of Responsibility E of CPSS-IOSCO’s Principles for Financial 

Market Infrastructures by the EMIR college. 

6. The Authorities have signed this Arrangement setting out how they will work together 

and cooperate with a view to facilitating institution-specific resolution planning with 

an emphasis on cooperation in the event of LCH SA’s resolution. The provisions of 

this Arrangement are without prejudice to the provisions (i) on other cross-border 

cooperation arrangements including those governing the EMIR college and (ii) on the 

cooperation framework set out in Directives 2013/36/EU, 2014/59/EU, and Regulation 

(EU) No 648/2012 (EMIR), as well as (iii) any future European regulation dealing 

with the resolution framework for central counterparties. 

 

1 Key Attributes, Appendix II-Annex 1 (Resolution of FMIs and FMI participants), paragraph 9.2.
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7. In accordance with KA 9, Appendix I-Annex 1, and Section 9 of Appendix II-Annex 1 

(part I) of the Key Attributes, this Arrangement lays out the basis for cooperation 

among the Authorities and the practical organization of the resolution activities in 

respect of LCH SA in the resolution planning and resolution execution phase. These 

activities include, but are not necessarily limited to, the role of the CMG itself, 

information sharing among Authorities pursuant to this Arrangement, the development 

of the Resolution Plans for LCH SA, and the conduct of resolvability assessments. 

ARTICLE 1: DEFINITIONS 

8. In this Arrangement, unless otherwise specified: 

“Authority” means a signatory to this Arrangement. 

“Confidential Information” means non-public information.

“BRRD” means Directive 2014/59/EU of the European Parliament and of the Council 

establishing a framework for the recovery and resolution of credit institutions and 

investment firms within the European Union. 

“Recovery Plan” means the plan for the recovery of LCH SA as drawn up and 

maintained by LCH SA. 

“Resolution Plan” means the plan drafted by the ACPR for the resolution of LCH SA. 

“Home Authority” means the Autorité de Contrôle Prudentiel et de Résolution 

(ACPR) as the home resolution authority. 

“Key Attributes” means the Financial Stability Board’s guidance presented in Key 

Attributes of Effective Resolution Regimes for Financial Institutions, and its Annexes. 

“KA” means an individual key attribute within that document. 

“SSM” means the single supervisory mechanism established by Regulation (EU) No 

1024/2013 pursuant to which credit institutions in the participating Member States: 

(i) are supervised directly by the European Central Bank (“ECB”), if they are 

significant in accordance with criteria defined therein, or 

(ii) are supervised indirectly by the ECB and directly by the national competent 

authorities if they are less significant. At the time of signature of this Arrangement,

LCH SA belongs to the latter category.

“SSMR” means Regulation (EU) 1024/2013 of the European Parliament and of the 

Council of 15 October 2013, conferring specific tasks on the ECB concerning policies 

relating to the prudential supervision of credit institutions. 

“SRMR” means Regulation (EU) no. 806/2014 of the European Parliament and of the 

Council of 15 July 2014 establishing uniform rules and a uniform procedure for the 

resolution of credit institutions and certain investment firms in the framework of a 

Single Resolution Mechanism (SRM) and a Single Resolution Fund. 
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“SRM” means the single resolution mechanism established under the SRMR pursuant 

to which: 

(i) the Single Resolution Board (SRB) is responsible for resolution planning and 

crisis management of credit institutions which are supervised by the ECB 

within the SSM and of other cross-border groups, and 

(ii) the national resolutions authorities are responsible for resolution planning and 

crisis management of the other credit institutions in accordance with rules 

established by the SRB. At the time of signature of this Arrangement, LCH SA 

belongs to the latter category. 

ARTICLE 2: LCH SA

9. LCH SA is a central counterparty (CCP) incorporated in France. In accordance with 

the Monetary and Financial Code (article L440-1), it is licensed as a credit institution. 

10. On 22 May 2014, LCH SA was licensed as a CCP pursuant to Regulation (EU) No 

648/2012 (EMIR). 

11. LCH SA is subject to regulatory regimes in and outside Europe based on its 

registration status in such other jurisdictions. 

12. A chart of the organizational structure of LCH SA and the LCH Group is attached to 

this Arrangement (Annex 1).

ARTICLE 3: PRINCIPLES AND OBJECTIVES OF COOPERATION 

3.1 PRINCIPLES 

13. The following principles apply to this Arrangement: 

 the Arrangement intends to be consistent with the Key Attributes, Directives 

2013/36/EU, 2014/59/EU, Regulation (EU) No 648/2012 (EMIR), and with the 

applicable laws and regulations of the Authorities; 

 multilateral cooperation among the Authorities with respect to resolution planning 

and resolution action in relation to LCH SA takes place through the CMG, whose 

organization reflects the activities and the legal structure of LCH SA and LCH Group; 

bilateral cooperation takes place between Authorities for matters of relevance to the 

respective Authorities; 

 the Authorities acknowledge that resolution powers are entrusted to the competent 

authorities by the relevant EU and/or national legislation or regulation; 

 while the CMG does not have legal personality and does not have decision-making 

powers, it plays a role in the coordination of relevant resolution activities and 

enhancement of resolution planning and cooperation with regard to LCH SA. 
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3.2. OBJECTIVES 

14. The objectives of the Arrangement are the following: 

a. For the event of the failure or resolution of LCH SA, to pursue financial stability 

and facilitate the maintenance of those functions carried out by LCH SA which 

have been identified as critical functions by the Home Authority, while minimizing 

the use of public funds; 

b. to facilitate the exchange of information, views and assessments, to the extent 

permitted by the Authorities’ respective laws, among Authorities in order to allow 

for more efficient and effective resolution planning and timely resolution action in 

crisis situations; 

c. to coordinate resolution planning and establish resolution processes, both during 

business as usual periods and in times of crisis, with a view to facilitating, as 

necessary, an orderly resolution of LCH SA, including its restructuring, assets 

sales, liquidation or wind-down, where appropriate, in the event of any crisis 

affecting it. 

ARTICLE 4: COOPERATION FRAMEWORK 

15. The Home Authority takes the lead in coordinating the activities covered by the 

Arrangement. 

16. The Home Authority will coordinate and chair the CMG, and decide which other 

relevant authorities participate in a meeting or in an activity of the CMG. On the basis 

of legal developments and the operational capabilities of the CMG, the Home 

Authority will incorporate, if need be, those other relevant authorities in the CMG, on 

a best efforts basis, through the process established in paragraph 20(a) of this 

Arrangement. Such participation will follow any relevant FSB guidance. 

17. The Home Authority will keep all Authorities fully informed, in advance, of the CMG 

meetings, of the main issues to be discussed and the activities to be considered. The 

Home Authority will also keep the Authorities who chose not to attend a meeting fully 

informed, in a timely manner, of the actions agreed in that meeting and will keep all 

Authorities informed of the measures carried out after CMG meetings. 

4.1 COMPOSITION AND FUNCTIONING OF THE CMG

18. The CMG facilitates the activities described in the Key Attributes and provides a 

framework within which the Authorities carry them out. 

19. Given the ongoing international and EU developments on the composition of CMGs 

for FMIs or other similar cooperation arrangements, the CMG will initially focus on 

the resolution planning and action in relation to LCH SA, while crisis management 

aspects relating to early intervention or recovery will be dealt with by the EMIR 

college and by each Authority. In a similar manner, the CMG will initially be 
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composed following the current international standards and therefore will comprise

the following Authorities: 

(i) The Home Authority; 

(ii) National supervisory or oversight authorities of LCH SA; 

(iii) Central bank of issue of the most material currencies, based upon products 

cleared and cash collateral; 

(iv) Supervisors and resolution authorities of material resolution entities in the same 

group; 

(v) Supervisors and resolution authorities of interoperating CCPs; 

(vi) European Banking Authority (“EBA”); 

(vii) European Securities and Markets Authority (“ESMA”) in accordance with 

Article 24 of EMIR. 

20. The Home Authority may from time to time: 

a. Invite additional regulatory authorities and/or entities to join the CMG, provided 

that they meet one of the conditions set forth in paragraph 19 (or subsequent 

international standards for CMGs for FMIs) and sign a copy of this Arrangement 

(as amended from time to time) and that the Authorities, notified by written notice 

of the identity of such additional parties at least 30 days in advance of the 

invitation, explicitly agree on their participation, and/or 

b. Remove members of the CMG who no longer meet the conditions of Paragraph 

19 or subsequent international standards for CMGs for FMIs. 

21. By invitation of the Home Authority, non-European Economic Area relevant 

authorities can be parties to this Arrangement where they satisfy the conditions set 

forth in paragraph 19 and are subject to confidentiality requirements that are consistent 

with Article 5. 

22. Any of the Authorities may request an ad-hoc meeting of the CMG, giving a specific 

reason. Depending on the circumstances such as the urgency or the relevance to other 

Authorities, CMG meetings may take place via teleconference. 

23. The Authorities will nominate contact persons who will represent them in the 

activities covered by the Arrangement and will participate in the CMG. A list with 

their contact details is attached to this Arrangement (Annex 2). This list includes at 

least direct phone numbers and emails of the contact persons. 

4.2 BILATERAL COOPERATION OUTSIDE THE CMG 

24. In light of the relevant FSB Guidance on Central Counterparty Resolution and 

Resolution Planning, the Home Authority has the responsibility to keep informed, if 

need be, authorities that are not members of the CMG, of developments regarding the 

CMG’s work. 

25. Confidential Information exchanged in the context of the CMG must not be shared 

with authorities that are not parties to this Arrangement without having obtained the 

prior and express consent of the Authority that produced or provided the Confidential 
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Information (the “Producing Authority”) in accordance with paragraphs 53 and 54 of 

this Arrangement. 

4.3 GENERAL COMMITMENTS TO COOPERATE 

26. The Authorities agree to cooperate in the resolution planning process and to share all 

relevant information to the extent permitted by their respective laws in order to ensure, 

in particular, that the plans are consistent and to help prepare for a coordinated 

resolution of LCH SA. 

27. Subject to the Authorities’ legal and regulatory remit, the Authorities endeavor to 

work together to devise a resolution strategy that is aimed at pursuing financial 

stability and allowing for the maintenance of those functions carried out by LCH SA 

which have been identified as critical functions by the Home Authority, while 

minimizing the use of public funds, duly considering the potential impact of their 

resolution actions on financial stability of other jurisdictions. 

4.4 RESOLUTION PLANS 

28. The Home Authority will elaborate and maintain a detailed resolution plan for LCH 

SA either, to the extent required by the legal framework governing the Home 

Authority, in the context of the resolution of LCH Group Ltd as a whole or at entity 

level. 

29. The Resolution Plan should consider such plan’s overall effect on financial stability in 

other jurisdictions concerned, subject to the Authorities’ legal and regulatory remit.

30. The Resolution Plan should include credible options to cope with a range of severe 

stress or crisis scenarios. It should also identify broad strategies available to the 

Authorities to resolve LCH SA. Subject to the Authorities’ legal and regulatory remit, 

the Authorities should aim to develop, as part of the Resolution Plan, an exit strategy 

in accordance with Section 11.6 (vi) of the Key Attributes. 

31. The Authorities should exchange views on the potential impact of any strategies and 

proposed actions on the real economy, on financial stability in the home and other 

jurisdictions concerned, and on the global financial system. 

32. Where Authorities have material concerns regarding the Resolution Plan, they should 

submit them in writing to the Home Authority, setting out proposed remedies. 

33. Within the CMG, the Authorities should review, whenever necessary, any other 

arrangements, strategies, processes and mechanisms implemented by LCH SA to 

ensure that those arrangements, strategies, process and mechanisms comply with 

relevant resolution requirements. 

34. The Authorities should also, under the Home Authority’s leadership, assess LCH SA’s 

resolvability, using existing FSB guidance, especially the Resolvability Assessments

section contained in Appendix II-Annex 1, and BRRD rules, as well as LCH SA’s 

demonstrated ability, as part of the resolution planning process, to produce the 

essential information needed to support an effective resolution in a timely fashion. 
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Based on such an assessment, the Home Authority should draw LCH SA’s attention to 

any potential impediments to an orderly resolution that have been identified and 

require it to submit for review the corrective actions it intends to take to remove the 

impediments to its resolvability that have been identified.

35. The CMG will consider LCH SA’s Recovery Plan, taking into account the assessment 

of the EMIR college and in line with the Committee on Payments and Market 

Infrastructures and the International Organization of Securities Commissions (CPMIIOSCO) guidance on recovery of Financial Market Infrastructures

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.

36. The Authorities are committed to participating through representation on the CMG at 

an appropriately senior level and to nominating, if need be, an additional 

representative, at the level of top officials, to contribute to the review of LCH SA’s 

overall resolution strategy, which will be conducted at least annually. 

37. The Authorities will promptly inform each other of any material changes to their 

resolution frameworks. 

4.5 COOPERATION AND COORDINATION DURING BUSINESS AS USUAL 

38. The Authorities should strive to reach a common view on the CMG in case of 

divergent views regarding the application of the Key Attributes to a matter related to 

the resolution of LCH SA in a cross-border context. 

39. Subject to the relevant Authority’s legal and regulatory remit, each Authority will 

work with the other Authorities to identify and, to the extent possible, to address any 

legal and operational impediments to the effective cross-border resolution of LCH SA

under the existing legal and operational frameworks relating to resolution in a crossborder context. 

40. In particular, the Authorities will work together, subject to the relevant Authority’s 

legal and regulatory remit, to: 

(i) assess in the resolution planning process the impact of various resolution options 

in the relevant jurisdictions as a result of different legal frameworks; 

(ii) identify the actions that may be taken by the Authorities to mitigate such impact; 

and

(iii) identify procedural requirements for the cross-border recognition of resolution 

measures. 

4.6 COOPERATION AND COORDINATION IN CRISIS TIME 

41. Subject to the relevant Authority’s legal and regulatory remit, the Authorities commit 

themselves to informing and consulting each other in a timely manner before taking 

any resolution measures. 

42. The Home Authority and the National supervisory and oversight Authorities of LCH 

SA commit themselves to alert other Authorities without undue delay: 

a. if supervisory early intervention measures are taken in response to financial stress; 

 

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 http://www.bis.org/cpmi/publ/d121.pdf 
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b. if LCH SA is likely to enter, or actually enters, into the resolution regime. 

43. The Authorities will apply processes defined in the CMG to keep other Authorities 

informed of such developments.

44. Subject to the Authorities’ legal and regulatory remit, in taking resolution actions, 

each party other than the Home Authority will endeavor not to preempt resolution 

actions by the Home Authority, whilst reserving the right to act on its own initiative if 

necessary to achieve domestic financial stability in the absence of effective action by 

the Home Authority. 

45. Where necessary, subject to the Authorities’ legal and regulatory remit, the Authorities 

will work together towards a coordinated resolution of LCH SA. 

ARTICLE 5: INFORMATION SHARING AND CONFIDENTIALITY

46. The Authorities will exchange information relevant to the resolution planning and 

implementation of resolution measures for LCH SA in connection with the CMG and 

may share Confidential Information, as provided for in this Arrangement and to the 

extent permitted by the respective laws of the Authorities. 

5.1 PROCEDURES FOR INFORMATION SHARING 

47. The Home Authority will facilitate the gathering of information from all the 

Authorities and its sharing with all the Authorities in the CMG. To the extent that the 

laws of an Authority permit the sharing of Confidential Information only upon 

request, any requests for Confidential Information to such an Authority will be made 

in writing, to the extent practicable in the situation. The requesting Authority should 

specify the information sought, the Authority from whom the information is requested, 

the purpose and the urgency of the request. 

48. The Authority that receives a request for Confidential Information will, to the extent it 

is permitted to share such information under its domestic laws, make all reasonable 

efforts to respond in a timely manner, taking into consideration the urgency of the 

request. 

49. Information responding to a request for Confidential Information, as well as any 

subsequent communication between the Authorities, may be transmitted 

electronically. Any electronic transmission should use means that are appropriately 

secure in light of the confidentiality of the information being transmitted. For the 

exchange of Confidential Information the Authorities commit themselves to using 

secured methods of communication.

5.2 CONFIDENTIALITY 

50. Confidential Information obtained by an Authority under this Arrangement will be 

used solely for lawful supervisory, regulatory and resolution purposes, in accordance 

with the purpose(s) identified in the request for information, any applicable laws or 
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regulations, any limitations placed by the providing Authority, and the provisions of 

this Article 5.2. 

51. The Authorities agree to inform each other of the laws, regulations and procedures 

governing the confidentiality of information to be shared pursuant to this 

Arrangement. 

52. The Authorities agree that any Confidential Information obtained under this 

Arrangement will be subject, without any time limit, to confidentiality requirements in 

this Article 5. Moreover, each Authority is required to comply with legal requirements 

in its own jurisdiction that impose confidentiality requirements. It is recognized that 

information pertaining to the Recovery Plan and the Resolution Plan is commercially 

and market sensitive. Access at each Authority should be restricted to those staff who 

have a direct and genuine need for such access, and Confidential Information should 

be used for the sole purpose for which it was required. 

53. Except as provided below in paragraph 54, before an Authority discloses any 

Confidential Information obtained pursuant to this Arrangement to any person other 

than an Authority, including another governmental entity that is not a signatory to this 

Arrangement, the Authority seeking to disclose such Confidential Information will 

request and obtain prior written consent from the Producing Authority. 

54. In the event that an Authority is required by statute, law or legal process, including a 

legally enforceable demand, to disclose Confidential Information, it will, to the extent 

permitted by its laws, inform the Producing Authority about disclosure, in advance of 

disclosing such Confidential Information. If that Producing Authority does not consent 

to such disclosure, the Authority will take reasonable steps, to the extent permitted by 

its laws, to resist disclosure, including by asserting all legal exemptions or privileges 

as may be available to challenge the requirement or demand to disclose such 

Confidential Information. 

55. In the event of a breach of the provisions set out above, the Producing Authority may 

suspend the cooperation under this Arrangement with immediate effect. Such 

suspension will not affect the obligation of confidentiality concerning the Confidential 

Information already exchanged. 

56. The protection of confidentiality extends to analyses, evaluations and work products 

derived from the information shared under the Arrangement. 

57. No privileges or confidentiality associated with information provided by any 

Authority are waived as a result of sharing or disclosing information as contemplated 

by this Arrangement. 

ARTICLE 6: EXTERNAL COMMUNICATION

58. The arrangements undertaken herein among the Authorities for the resolution 

activities and planning in respect of LCH SA will be communicated to the LCH 

Group, when appropriate, during the CMG meetings. 
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59. The Home Authority is responsible for communicating with LCH SA about the 

CMG’s work, including the main findings of the resolvability assessment and any 

agreed views. 

60. LCH SA may be invited by the Home Authority to attend CMG meetings. 

61. In the event of a resolution action, the Authorities will coordinate with each other to 

ensure consistency of external communications both at the time of the resolution and

in the period following its execution.

ARTICLE 7: FINAL PROVISIONS 

62. The Authorities may have existing bilateral arrangements (e.g., Memoranda of 

Understanding) or may execute bilateral arrangements in the future. This 

Arrangement is not intended to amend or supersede pre-existing arrangements or limit 

the terms of any future arrangement. 

63. This Arrangement is not legally binding and not legally enforceable. Its provisions do 

not give rise to any legal claim on behalf of any Authority or third parties. This 

Arrangement should be interpreted and implemented in a manner that is permitted by, 

and consistent with, the laws and requirements applicable to each Authority. Nothing 

in this Arrangement affects the competence of the supervisory, resolution or 

regulatory authority of the Authorities under their respective laws. 

64. The existence of this Arrangement may be publicly disclosed. If an Authority 

discloses any part of this Arrangement, it will inform the Home Authority, which will 

inform the other Authorities.

65. The operational working language to be used in the CMG is English. 

7.1 IMPLEMENTATION OF THE ARRANGEMENT 

66. Any modification to this Arrangement (including any addition to the list of Authorities 

which are parties to this Arrangement) should be explicitly agreed in writing by all 

Authorities.

67. The Authorities will inform each other in the event of any material changes in their 

relevant laws including any applicable final opinions rendered by a court of competent 

jurisdiction. The Authorities will revise and update this Arrangement and its annexes 

when necessary to appropriately reflect any material changes in the overall structure of 

their cooperation procedures. 

68. In the event of disagreement regarding the interpretation of this Arrangement, the 

Authorities will venture to discuss the differing interpretations and seek to find a 

common interpretation. 

69. This Arrangement will remain in effect indefinitely from the date it is signed by all 

Authorities.
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70. Should an Authority wish to terminate its participation to this Arrangement, it must 

give written notice to the other Authorities as soon as possible. In any case, the 

confidentiality provisions in this Arrangement will continue in effect with respect to 

any Confidential Information disclosed. 

71. The confidentiality provisions will continue to apply to all Confidential Information in 

the possession of any Authority even if the Authority is no longer a party to this 

Arrangement. 

7.2 SUCCESSOR 

72. Any entity becoming successor, or assuming the functions, powers and duties of an 

Authority will become a party of this Arrangement.
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ANNEX 1: LCH SA and LCH Group Ltd organizational structure 
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ANNEX 2 OMITTED
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