PIMFA
CSD REgulation
CSDR, or regulation (EU) No 909/2014 of the European Parliament and Council, dated 23 July 2014, was introduced with a view to improving securities settlement in the EU and on central securities depositories. It was published in the EU’s Official Journal on 28 August 2014, and entered into force on 17 September 2014. The EU CSD regulation appears here.
- main objectives
The key aim of CSDR was to increase the safety and efficiency of the securities settlement and settlement infrastructures (CSDs) in the EU, by providing shorter settlement periods, settlement discipline measures, the obligation to dematerialise most securities, strict prudential and conduct of business rules for CSDs, strict access rights to CSD services, and increased prudential and supervisory requirements for CSDs and ancillary services providers.
- impact of brexit
The UK was in the process of implementing CSDR when it left the European Union – some CSDR rules were fully implemented, others were not. For example, the CSDR settlement discipline regime, which was due to come into force in February 2021, was not implemented in the UK. Nor were the CSDR rules on dematerialisation of securities, although the Digitisation Taskforce under Chairman Sir Douglas Flint, is due to report later this year on how this could be achieved in the UK. The Digitisation Taskforce’s reports appear here.
The CSDR objective of reducing the settlement cycle to T+1 was also not carried across, but this was identified in the Edinburgh Reforms, and is being tackled as part by the Accelerated Settlement Taskforce, under Chairman Charlie Geffen. The Accelerated Settlement Taskforce’s reports appear here.
However, the CSDR rules governing internalised settlement reporting to the Bank of England, which came into effect in July 2019, were implemented in the UK. Details of the Bank of England’s internalised settlement report requirements appear here.
