If you don't have enough shares in your CDP Direct Account to meet your delivery obligation on the intended settlement date (T+2, the second market day after the trade date), CDP will conduct a buy-in on the afternoon of intended settlement date (T+2, the second market day after the trade date ). If the buy-in isn't successful by the end of the settlement date, it will continue on the next trading day. Successfully bought-in securities will fulfill your delivery obligation on the next business day.
CDP has the absolute discretion to increase the bid price by two minimum bids until the securities are bought in or delivered to CDP. If the securities can't be acquired in the market or the sell trade remains unsettled by the end of intended settlement date +5 (T+7), CDP will cash settle the outstanding sell trade.
For potential fees and penalties:
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CDP charges a processing fee of S$75.00 plus GST for each failed contract.
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A brokerage rate of 0.75% of the contract value plus GST applies to each buy-in contract.
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SGX may levy a penalty of S$1,000 or 5% of the contract value, whichever is higher, for failed delivery.
These are in addition to usual commissions and fees.
