The Frontier Clearing Corporation B.V. (“FCC”) is the active company issuing guarantees and is a limited liability company incorporated in The Netherlands and is a wholly owned subsidiary of Frontclear Management B.V. (‘FM”). FCC is funded through the issuance of profit participating notes (“PPNs”) to the different Frontier Clearing Funds (collectively “FCFs”).
Each Frontier Clearing Fund (“FCF”) is a Dutch FGR (fonds voor gemene rekening or fund for joint account) that invests in the notes issued by FCC. FCF Subordinated invests in Subordinated Notes, FCF Junior invests in Junior Notes and FCF Senior invests in Senior Notes.
The diagram below summarizes the organization and legal structure of Frontclear.
The Frontier Clearing Funds are investment funds (beleggingsfonds) as referred to in article 1:1 of the FMSA (the Dutch Financial Markets Supervision Act – Wet op het financieel toezicht). FM is registered as manager of investment institutions under the Alternative Investment Fund Managers Directive (“AIFMD”) by the AFM (the Dutch non-bank financial market regulator – Autoriteit Financiele Markten) but relies on paragraphs 1 and 2 of article 2:66a of the FMSA which exempts FM and FCFs from the supervision by the AFM and/or DNB (the Dutch Central Bank – De Nederlandsche Bank N.V.) and therefor is not regulated under article 2:65 of the FMSA.