EC Publishes Regulatory Technical Standards on Settlement Discipline
The Commission Delegated Regulation (EU) 2018/1229, which supplements the Central Securities Depositories (CSD) Regulation (EU Regulation No 909/2014) with regard to the regulatory technical standards on settlement discipline, has been published in the Official Journal of the European Union. The regulatory technical standards, including all mandatory buy-in requirements, will enter into force on September 13, 2020.
The provisions in EU Regulation 2018/1229 deal with measures to prevent and address settlement fails and to encourage settlement discipline, by monitoring settlement fails, by collecting and distributing cash penalties for settlement fails, and by specifying the operational details of the buy-in process. This regulation also defines a number of terms, in an effort to ensure the consistent application of CSD Regulation. This regulation is based on the draft regulatory technical standards submitted by ESMA to EC, pursuant to the procedure in Article 10 of Regulation (EU) No 1095/2010. ESMA has conducted open public consultations on these draft regulatory technical standards, analyzed the potential related costs and benefits, requested the opinion of the Securities and Markets Stakeholder Group, and worked in close cooperation with the members of the European System of Central Banks for developing these regulatory standards.
The key objective of the CSD Regulation is to increase the safety and efficiency of securities settlement and settlement infrastructures (CSDs) in EU by providing, among others, for the following:
- Shorter settlement periods
- Settlement discipline measures (mandatory cash penalties and ‘buy-ins’ for settlement fails)
- An obligation regarding dematerialization for most securities
- Strict prudential and conduct of business rules for CSDs
- Strict access rights to CSD services
- Increased prudential and supervisory requirements for CSDs and other institutions providing banking services ancillary to securities settlement
Related Links
Effective Date: September 13, 2020
Keywords: Europe, EU, PMI, Securities, CSDR, CSD, Regulatory Technical Standards, Regulation 2018/1229, EC
Previous Article
ESMA Reports Diversity in Markets for Structured Retail ProductsRelated Articles
EC Adopts Financial Reporting Changes Arising from Benchmark Reforms
EC published Regulation 2021/25 that addresses amendments related to the financial reporting consequences of replacement of the existing interest rate benchmarks with alternative reference rates.
BIS Bulletin Examines Key Elements of Policy Response to Cyber Risk
BIS published a bulletin, or a note, that examines the cyber threat landscape in the context of the pandemic and discusses policies to reduce risks to financial stability.
HMT Updates List of Post-Brexit Equivalence Decisions in UK
HM Treasury, also known as HMT, has updated the table containing the list of the equivalence decisions that came into effect in UK at the end of the transition period of its withdrawal from EU.
EBA Issues Erratum for Technical Package on Reporting Framework 3.0
EBA published an erratum for technical package on phase 1 of the reporting framework 3.0.
APRA Publishes FAQ on Measurement of Credit Risk Weighted Assets
APRA updated a frequently asked question (FAQ), for authorized deposit-taking institutions, on the measurement of credit risk weighted assets.
EBA Publishes Risk Dashboard for Third Quarter of 2020
EBA published the quarterly risk dashboard, along with the results of the Risk Assessment Questionnaire survey among 60 banks and 15 market analysts.
ECB Analysis Shows Privacy as Biggest Concern in Use of Digital Euro
ECB concluded the public consultation on the introduction of a digital euro in EU.
ECB Finalizes Guide on Supervisory Approach to Bank Consolidation
ECB published a guide that sets out the supervisory approach to consolidation in the banking sector.
SRB Chair Outlines Work Priorities for 2021
The SRB Chair Elke König published an article setting out work priorities for 2021.
FDIC Selects Companies to Compete in Final Phase of Tech Sprint
FDIC has selected 11 technology companies—including BearingPoint, Fed Reporter, Inc, and S&P Global Market Intelligence, LLC—for inclusion in the third and final phase of the rapid prototyping competition.
