(10)The primary rules applicable to COs complemented by their internal rules and procedures deliver substantial results equivalent to the effects of the rules contained in Title IV of Regulation (EU) No 648/2012. In particular, the legally binding requirements applicable to COs regarding the number of defaults to be covered by total financial resources require COs clearing more than 95 % of the volumes cleared in Japan to cover the default of at least the two clearing members to which they have the largest exposures under extreme but plausible market conditions (the ‘cover 2 principle’). That requirement ensures an equivalent degree of risk mitigation to that pursued by the requirements set out under Title IV of Regulation (EU) No 648/2012 and therefore should be considered equivalent.