Default Management Testing Summary 2022

Clearstream Default Management


The aim of the default management testing is to test, at least annually, the soundness and effectiveness of the Clearstream default management process. The testing activity is also performed following any substantive changes to the default rules and procedures or upon request from the regulators and it is achieved by involving all relevant internal and external stakeholders, also using their feedback for further development.

The default management testing activity includes several types of test (involving internal or external stakeholders), which are conducted in accordance with the following regulatory framework:

  • CPSS-IOSCO Principle 13, Participant default rules and procedures;
  • Regulation (EU) No 909/2014 (CSDR) Article 41 (3): Participant default rules and procedures;
  • ESMA guidelines on CSD participants default rules and procedures (ESMA70-151-294).

In 2022, all the default management tests that have been conducted were successfully performed, allowing Clearstream to validate its default management process under different angles, which are mainly: governance, decision making, securities liquidation procedure, portfolio liquidation, technical connectivity, internal and external communication procedures. As a result of the testing performed, there were no requirements to change the default rules and procedures.