European Multilateral Clearing Facility N.V.

European Multilateral Clearing Facility N.V. (EMCF) was a Netherlands-based clearing house created during the opening of European securities-market infrastructure to competition. Its formation followed the European Union’s Markets in Financial Instruments Directive (MiFID), which was implemented in November 2007 and changed how trading venues and order-flow providers operated. Among other effects, MiFID encouraged trading to take place on competing exchanges and multilateral trading facilities and supported the development of competitive post-trade services rather than leaving clearing tied to a single national exchange infrastructure. EMCF was established to act as a central counterparty for equity transactions executed on European exchanges and alternative trading venues. In that role, it interposed itself between buyers and sellers, helping manage counterparty risk and the settlement of trades. Its commercial proposition was based on serving multiple venues and competing with incumbent clearing organizations in individual European markets. Competition among clearing houses contributed to repeated reductions in European clearing fees, while the use of a cross-border provider supported the growth of pan-European trading platforms. The company’s early customers and connected venues included Chi-X Europe, which appointed EMCF as its central counterparty in 2007. The company later provided services for or was associated with venues and market infrastructures including BATS Europe, Burgundy AB, CATS, First North Securities, Nasdaq OMX Nordic markets in Denmark, Finland and Sweden, Quote MTF, and TOM. These relationships placed EMCF within the expansion of alternative trading systems and the broader European effort to make trading and clearing more interoperable across national borders. EMCF’s ownership and institutional context changed during the financial crisis. In 2008, Nasdaq acquired a 22 percent equity interest from Fortis Bank Nederland Holding N.V. The near-collapse and subsequent nationalization of Fortis by the Dutch government also affected EMCF’s corporate setting; the clearing house became part of ABN AMRO. During this period, the European Central Counterparty was reported as offering to clear trades that had previously been handled by EMCF, illustrating the operational and ownership pressures affecting financial-market infrastructure after the crisis. EMCF ultimately did not remain an independent clearing-house brand. In 2013–2014, it merged with EuroCCP, creating a new company that also used the EuroCCP name. The merger ended EMCF’s separate operating identity. The company is therefore best understood as a defunct European market-infrastructure provider whose principal historical significance was its role in introducing competition into equity-trade clearing after MiFID.

European Multilateral Clearing Facility N.V. emerged from the European Union’s effort to make securities trading and related infrastructure more competitive. The Markets in Financial Instruments Directive, implemented in November 2007, encouraged trading venues to compete for order flow and required market participants to seek best execution. The resulting expansion of exchanges and multilateral trading facilities created demand for clearing providers that could serve trades across national borders rather than relying exclusively on an incumbent clearing house associated with each domestic exchange. EMCF was established in the Netherlands in 2007 and based in Amsterdam. It operated as a central counterparty for equity transactions executed on European stock exchanges and alternative trading venues. By becoming the counterparty to both sides of a trade, it supported the management of counterparty exposure and the processing of post-trade obligations. Its entry increased the number of clearing options available to European venues and contributed to pressure on established providers to reduce fees. EMCF and competing clearing houses reportedly lowered charges several times as the market developed. One of EMCF’s earliest and most significant relationships was with Chi-X Europe, which appointed it as central counterparty in 2007. The company subsequently offered services to or was connected with a range of European venues, including BATS Europe, Burgundy AB, CATS, First North Securities, Nasdaq OMX Nordic markets in Denmark, Finland and Sweden, Quote MTF, and TOM. These relationships reflected the company’s role in the growth of pan-European alternative trading and the increasing separation of trading, clearing, and settlement functions. The financial crisis created complications for EMCF’s ownership and operating environment. In 2008, Nasdaq purchased a 22 percent stake from Fortis Bank Nederland Holding N.V. Fortis later came close to failure and was nationalized by the Dutch government. EMCF subsequently became part of ABN AMRO. The same period saw the European Central Counterparty offer to clear trades instead of EMCF, indicating that the company faced competition and institutional uncertainty while the financial system was under severe stress. EMCF eventually ceased to exist as an independent entity. In 2013–2014 it merged with EuroCCP, producing a successor company that retained the EuroCCP name. The merger closed the separate chapter of EMCF’s operations. Historically, the company is associated with the post-MiFID opening of European clearing markets, lower clearing costs, and the development of cross-border central-counterparty services for equity venues.

1. 2013Merger with EuroCCP

   EMCF merged with EuroCCP during 2013–2014, resulting in a successor company operating under the EuroCCP name.

   Source
2. 2008Nasdaq takes a minority stake

   Nasdaq acquired a 22 percent equity stake in EMCF from Fortis Bank Nederland Holding N.V.

   Source
3. 2008EMCF enters the ABN AMRO context

   After Fortis’s near-collapse and nationalization by the Dutch government, EMCF became part of ABN AMRO.

   Source
4. 2007EMCF is established

   The Dutch clearing house was established in the context of the implementation of MiFID and the resulting competition among European trading and clearing providers.

   Source
5. 2007Chi-X Europe selects EMCF

   Chi-X Europe appointed EMCF as its central counterparty, providing the new clearing house with an important relationship with a major alternative trading venue.

   Source

A cross-border European clearing provider positioned as a lower-cost competitor to established national clearing houses.

• European equity central-counterparty clearingClearing services2007

  EMCF’s core service was central-counterparty clearing for equity trades executed on European stock exchanges and multilateral trading facilities. The service placed EMCF between buyers and sellers, helping standardize post-trade processing and manage counterparty risk. Its cross-border model allowed venues to use a clearing provider other than the incumbent organization associated with a particular national market.

• 2013EMCF merges with EuroCCPM&A

  European clearing markets were consolidating after a period of rapid competition and pressure on clearing fees.

  What changed. EMCF combined with EuroCCP to create a new clearing company using the EuroCCP name.

  Aftermath. EMCF ceased to operate as a separate brand and legal identity, while the successor continued under EuroCCP.

  Source
• 2008Nasdaq acquires a 22 percent stake in EMCFM&A

  EMCF was operating in a newly competitive European clearing market, while Nasdaq was expanding its relationship with trading and post-trade infrastructure.

  What changed. Nasdaq purchased a 22 percent equity interest in EMCF from Fortis Bank Nederland Holding N.V.

  Aftermath. The investment connected EMCF with Nasdaq, although the later Fortis crisis changed the company’s ownership context and EMCF became part of ABN AMRO.

  Source

• 2013EMCF merges with EuroCCP

  EMCF merged with EuroCCP during 2013–2014, forming a new company under the EuroCCP name and ending EMCF as a separate clearing-house brand.

  M&A
  Source
• 2008Nasdaq acquires a minority stake in EMCF

  Nasdaq acquired a 22 percent equity interest in EMCF from Fortis Bank Nederland Holding N.V., linking the clearing house to a major international exchange operator.

  M&A
  Source
• 2008Fortis crisis changes EMCF’s ownership context

  Following Fortis’s financial distress and nationalization by the Dutch government, EMCF became part of ABN AMRO. The European Central Counterparty was also reported to have offered to clear trades handled by EMCF.

  M&AOther
  Source
• 2007Chi-X Europe appoints EMCF as central counterparty

  Chi-X Europe selected EMCF to provide central-counterparty clearing for trades executed on its European trading platform, giving the newly established clearing house an important early venue relationship.

  Other
  Source

1. European Multilateral Clearing Facility N.V.