---
kind: "section"
citation: "17 C.F.R. § 242.823"
title: "17"
number: "242.823"
heading: "Core Principle 6—Financial integrity of transactions."
url: "https://uscodex.org/cfr/17/242.823"
---

# §242.823. Core Principle 6—Financial integrity of transactions.

- (a) **General.** The security-based swap execution facility shall establish and enforce rules and procedures for ensuring the financial integrity of security-based swaps entered on or through the facilities of the security-based swap execution facility, including the clearance and settlement of security-based swaps pursuant to [section 3C(a)(1)](/cfr/17/3C.md?p=a-1) of the Act.
- (b) **Required clearing.** Transactions executed on or through the security-based swap execution facility that are required to be cleared under section 3C(a)(1) of the Act or are voluntarily cleared by the counterparties shall be cleared through a registered clearing agency or a clearing agency that has obtained an exemption from clearing agency registration to provide central counterparty services for security-based swaps.
- (c) **General financial integrity.** A security-based swap execution facility shall provide for the financial integrity of its transactions:
  - (1) By establishing minimum financial standards for its members, which shall, at a minimum, require that each member qualify as an eligible contract participant;
  - (2) **For transactions cleared by a registered clearing agency—**
    - (i) By ensuring that the security-based swap execution facility has the capacity to route transactions to the registered clearing agency in a manner acceptable to the clearing agency for purposes of clearing; and
    - (ii) By coordinating with each registered clearing agency to which it submits transactions for clearing, in the development of rules and procedures to facilitate prompt and efficient transaction processing.
- (d) **Monitoring for financial soundness.** A security-based swap execution facility shall monitor its members to ensure that they continue to qualify as eligible contract participants.

## Notes

### Source

Source: 88 FR 87285, Dec. 15, 2023, unless otherwise noted.

### Authority

Authority: 15 U.S.C. 77g, 77q(a), 77s(a), 78b, 78c, 78c-4, 78g(c)(2), 78i(a), 78j, 78k-1(c), 78 l, 78m, 78n, 78 o (b), 78 o (c), 78 o (g), 78q(a), 78q(b), 78q(h), 78w(a), 78dd-1, 78mm, 80a-23, 80a-29, 80a-37, and 8343.

### Source

Source: 62 FR 544, Jan. 3, 1997, unless otherwise noted.