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| fxdemo:07-part:10-relationship-to-cost-recovery-compensation-and-settlement:10-5-under-compliance-and-non-performance-visibility:start [2026/06/29 11:25] – created nick_dido | fxdemo:07-part:10-relationship-to-cost-recovery-compensation-and-settlement:10-5-under-compliance-and-non-performance-visibility:start [2026/07/18 12:33] (current) – external edit 127.0.0.1 |
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| ====== 10.4 Settlement Instructions ====== | ====== 10.5 Under-Compliance and Non-Performance Visibility ====== |
| [[fxdemo:07-part:10-relationship-to-cost-recovery-compensation-and-settlement:start|Go up to Relationship to Cost Recovery, Compensation, and Settlement]] | [[fxdemo:07-part:10-relationship-to-cost-recovery-compensation-and-settlement:start|Go up to Relationship to Cost Recovery, Compensation, and Settlement]] |
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| Settlement Instructions express the settlement treatment that follows recognised governed work, validated compensation eligibility, applicable [[fxdemo:99_part_annexes:annex-b-terms-and-definitions:c:cost_rule | Cost Rules]], and supporting evidence. | [[dido:99_annexes:annex-b-terms-and-definitions:u:under-compliance]] and [[dido:99_annexes:annex-b-terms-and-definitions:n:non-performance_indicator| Non-Performance Visibility]] ensure that the Governed Node Service Market does not reward incomplete, deficient, unauthorised, or non-conforming governed work. |
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| The Governed Node Service Market does not define the payment rail, payment method, accounting system, legal payment obligation, tax treatment, or FX settlement mechanism. The market identifies the assigned work, the eligible [[fxdemo:99_part_annexes:annex-b-terms-and-definitions:q:qualified_node], the accountable [[qualified_service_provider]], the applicable Cost Rule, the supporting evidence, and the compensation treatment. The [[fxdemo:99_part_annexes:annex-b-terms-and-definitions:c:cost_recovery_compensation_and_settlement_plane]] uses those records to produce [[fxdemo:99_part_annexes:annex-b-terms-and-definitions:s:settlement_instruction | Settlement Instructions]]. | Under-Compliance occurs when a [[dido:99_annexes:annex-b-terms-and-definitions:q:qualified_node]], [[dido:99_annexes:annex-b-terms-and-definitions:q:qualified_service_provider]], assignment, claim, or settlement treatment fails to satisfy an applicable obligation for governed work. Non-Performance occurs when assigned governed work is not performed, not completed, not evidenced, not performed within the required service-level expectation, or not performed by the recognised Qualified Node. |
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| Settlement Instructions support traceability between governed work and economic recognition. They identify the compensation treatment associated with a [[fxdemo:99_part_annexes:annex-b-terms-and-definitions:c:compensation_claim]] after review against the applicable assignment record, [[fxdemo:99_part_annexes:annex-b-terms-and-definitions:w:work_performed_event]], [[fxdemo:99_part_annexes:annex-b-terms-and-definitions:e:evidence_reference]], [[fxdemo:99_part_annexes:annex-b-terms-and-definitions:q:qualification_profile]], [[fxdemo:99_part_annexes:annex-b-terms-and-definitions:c:cost_rule]], policy constraint, service-level expectation, and market integrity rule. | The Governed Node Service Market must make Under-Compliance and Non-Performance visible to the authorized participants that need the information for selection, compensation review, audit, governance, suspension, restoration, dispute handling, or market integrity review. Visibility does not require unrestricted disclosure of transaction content or full evidence payloads. Evidence References, Non-Performance Indicators, classification metadata, assignment records, claim records, and settlement records may provide sufficient reviewability when Content Minimization applies. |
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| [[fxdemo:99_part_annexes:annex-b-terms-and-definitions:s:settlement_instruction | Settlement Instructions]] also preserve the separation between transaction settlement and service compensation. In an FX context, the settlement of the underlying FX transaction remains distinct from compensation for governed services performed by Qualified Nodes. A Qualified Node receives service compensation for governed work, such as validation, screening, evidence recording, policy evaluation, or settlement-support processing, not for the value of the FX transaction itself. | Under-Compliance and Non-Performance Visibility protect disciplined competition. A lower-cost provider does not represent a valid competitor when the lower cost results from omitted evidence, reduced policy enforcement, weakened security, poor reliability, missed service-level expectations, invalid qualification, or improper substitution. |
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| Settlement Instructions may support payment, accounting, reconciliation, dispute handling, adjustment, rejection, or non-performance treatment in accordance with the applicable governance and settlement rules. | Under-Compliance and Non-Performance Visibility also support corrective action. The market may reject a Compensation Claim, adjust compensation treatment, suspend a Qualified Node, require additional [[dido:99_annexes:annex-b-terms-and-definitions:q:qualification_evidence]], initiate review, record a [[dido:99_annexes:annex-b-terms-and-definitions:n:non-performance_indicator]], or route future work to another eligible Qualified Node. |
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| ===== Example ===== | ===== Example ===== |
| A Qualified Node performs policy evaluation for an FX transaction and records the required Work Performed Event and Evidence Reference. The accountable Qualified Service Provider submits a Compensation Claim. After applying the relevant Cost Rule and reviewing the supporting evidence, the Cost Recovery, Compensation, and Settlement Plane produces a Settlement Instruction that identifies the compensation treatment for the governed service work. The instruction does not represent the settlement of the underlying FX transaction. | A Qualified Node receives an assignment for sanctions screening but fails to record the required Evidence Reference within the required service-level interval. The Cost Recovery, Compensation, and Settlement Plane does not treat the related Compensation Claim as automatically valid. The market records a Non-Performance Indicator, exposes the issue to authorized review processes, and prevents the failure from appearing as a lower-cost compliant service. |
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