Compensation

The compensation ( clearing in English) is a mechanism allowing at Banques and financial institutions to carry out transactions. A transaction always has a Débiteur and a Créditeur. The compensation is materialized by the play of entry which materializes the transaction. It is said that the credit on the account of the creditor compensates for the flow on the account of the debtor.

Clearing house

An organization, known as clearing house ( clearing house in English) serves as méta-banks in order to guarantee the transaction. The goal of the mechanism being to gather all the financial actors within a unified system. Instead of having N interlocutors, an organization has only one and single contact point which is used as counterpart in the transactions.

In France, the Banque de France is used as clearing house for all the transactions between French banks, in particular the cashing of the Chèque S of bank at bank.

The clearing houses can be also used to keep (conservation or guarding, custody in English) the debentures (actions, obligations, etc) which are exchanged on the market ( settlement for “payment”, in English).

Mechanism of the compensation

A bank has wishes the transfer of x€ account of Alfred towards the account of Bob at the bank B via a clearing house C.
  • has contacts C and x€ towards the account from Bob at B.
  • C indicates to him to transfer contacts B to know if the transaction is possible after checking of the provisioning of the account of A.
  • C outputs x€ account of has and credits x€ on the account with B and confirms with has and B the realization of the transaction.
  • has outputs the account of Alfred of x€.
  • B credits with x€ the account of Bob.
Actually the mechanism is more complex and not inevitably in this order in order to guarantee the safety of the transaction, but what it should be retained it is that the clearing house serves as méta-banks at the financial institutions. For the debentures, it is the same thing, instead of having x€ one has X actions of the company S.

The remuneration of C is carried out with the placements carried out with the x€.

Remarks on the bank secrecy

In a general way the Bank secrecy is valid only insofar as one cannot find the titular of an account. Indeed, it is enough to supervise the clearing houses to supervise the whole of the financial affairs in the world. The USA made pass in this direction a law which prohibits the US banks from working with financial institutions not cooperating with the American authorities: the USA Patriot Act.

Clearing houses

2 principal international clearing houses:

Others intervening of a chain of compensation

Stock Exchange or exchanges actions

  • EURONEXT (NL)
  • The London Stock Exchange (the U.K.)
  • NYSE (the USA)
  • XETRA (OF)

Stock Exchange or exchange of derivative products

  • LIFFE (the U.K.)
  • EUREX (OF)
  • MEFF (ES)
  • IDEM (IT)
  • ADEX (GR.)
  • CBOT (Chicago Board Off Trade), CBOE (Chicago Board Options Exchange), CME (Luxembourg]]) == Enquête == Following [[the business Clearstream 1|Clearstream business]], two Belgian senators, [[Isabelle Lasting]] and [[Jean Cornil]], proposed a law in 2004 to create a commission of national survey in Belgium. This one would have been charged to inquire into the use of the accounts auprès “with the companies of [[clearing]] and [[routing]] financial” at ends of [[tax evasion]] and/or of [[money laundering]]. That is to say an investigation on the whole of [[companies of compensation]], of which [[Clearstream]]. == == Particular case In the medium of the music publishing, the clearing of one [[sample]] is financial equalization following the use of this sample in a new production. == Other articles == * [[Trans European Automated Real Time Large Settlement Transfer Express train|TARGET]] * [[Individual Euro Payments Area|SEPA]] * [[Society for Worldwide Interbank Financial Telecommunication|SWIFT]] * [[Exchange, compensation and payment]] == external Lien == * {{Fr}} [http://www.banque-france.fr Banque de France] {{Multi stringcourse|gate economy|Gate Finances}} [[Category: General topics of finance]] [[Category: System of payment]] [[of: Clearing]] [[in: Clearing (finance)]] [[eo: Kliringo]] [[id: Kliring]] [[lt: Kliringas]] [[nl: Clearing]] [[pl: Clearing]] [[Ru: Клиринг]] [[the U.K.: Кліринг]] [[zh: 清算
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