What Is the Risk of a 'Netting Set' Being Challenged in Court? ▴ Learn

What Is the Risk of a ‘Netting Set’ Being Challenged in Court?

The risk is that in the event of a member's insolvency, a court or administrator might challenge the legal enforceability of the netting agreement. If successful, the CCP would have to settle all obligations on a gross basis, leading to massive, unexpected losses and potentially CCP failure.

Legal certainty is paramount.

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