National Unrecovered Financial Services (SDUUK) joined the International Swaps and Derivatives Association (ISDA), and the Institute of International Finance Inc. (IIF) in a letter to the Committee on Payment and Settlement Systems (CPSS) and International Organization of Securities Commissions (IOSCO) on their consultative report, Recovery of Financial Market Infrastructures. The letter argues that the overall recovery and resolution framework should be designed to avoid creating moral hazard on the part of CCPs and ensure, in the event of CCP insolvency, following application of the recovery and resolution framework, an economic outcome no less fair than that which would apply in a general CCP insolvency liquidation proceeding (i.e. no creditor is worse off). The associations support that it is inappropriate for taxpayers to be exposed to any residual losses in the event of a CCP insolvency. Furthermore, the overall recovery framework must consider a CCP's default management process, be clearly defined and well understood by all clearing participants, and contain sufficient flexibility to ensure voluntary mechanisms are employable prior to the application of potentially less effective and disruptive mandatory tools.