Delegated regulation 2018/1229 - Supplement to Regulation 909/2014 with regard to regulatory technical standards on settlement discipline - Main contents
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official title
Commission Delegated Regulation (EU) 2018/1229 of 25 May 2018 supplementing Regulation (EU) No 909/2014 of the European Parliament and of the Council with regard to regulatory technical standards on settlement discipline (Text with EEA relevance.)| Legal instrument | delegated regulation |
|---|---|
| Number legal act | Delegated regulation 2018/1229 |
| CELEX number i | 32018R1229 |
| Document | 25-05-2018; Date of adoption |
|---|---|
| Publication in Official Journal | 13-09-2018; OJ L 230 p. 1-53 |
| Effect | 01-02-2022; Entry into force See Art 42 And 32021R0070 02-11-2025; Application Partial application See Art 42 |
| Deadline | 02-11-2025; See Art 41a |
| End of validity | 31-12-9999 |
13.9.2018 |
EN |
Official Journal of the European Union |
L 230/1 |
COMMISSION DELEGATED REGULATION (EU) 2018/1229
of 25 May 2018
supplementing Regulation (EU) No 909/2014 of the European Parliament and of the Council with regard to regulatory technical standards on settlement discipline
(Text with EEA relevance)
THE EUROPEAN COMMISSION,
Having regard to the Treaty on the Functioning of the European Union,
Having regard to Regulation (EU) No 909/2014 of the European Parliament and of the Council of 23 July 2014 on improving securities settlement in the European Union and on central securities depositories and amending Directives 98/26/EC and 2014/65/EU and Regulation (EU) No 236/2012 (1), and in particular Article 6(5) and Article 7(15) thereof,
Whereas:
(1) |
The provisions in this Regulation are closely linked, since they deal with measures to prevent and address settlement fails and to encourage settlement discipline, by monitoring settlement fails, collecting and distributing cash penalties for settlement fails and by specifying the operational details of the buy-in process. To ensure coherence between those provisions, and to facilitate a comprehensive view of and a compact access to them by persons subject to the obligations, it is appropriate to include them in a single Regulation. |
(2) |
In view of the global nature of financial markets, due regard should be given to the Principles for Financial Market Infrastructures, which have been issued by the Committee on Payment and Settlement Systems and the International Organization of Securities Commissions (‘CPSS-IOSCO Principles’) in April 2012 and which serve as a global benchmark for regulatory requirements for central securities depositories (‘CSDs’). The Recommendations for Securities Settlement Systems, issued by the Committee on Payment and Settlement Systems and the International Organisation of Securities Commissions, covering trade confirmation, settlement cycles, and securities lending, should also be taken into account. |
(3) |
In order to ensure the consistent application of Regulation (EU) No 909/2014 and to specify the technical terms necessary to apply this Regulation, a number of terms should be defined. |
(4) |
Investment firms should ensure that they have all the necessary settlement information in time to allow for an effective and efficient settlement of transactions. In particular, investment firms that do not have the necessary settlement information should communicate with their clients to obtain the information relevant for an efficient settlement, including the standardised data needed for the settlement process. |
(5) |
Straight-through processing (‘STP’) should be encouraged, since market-wide use of STP is essential both for maintaining high settlement rates as volumes increase and for ensuring timely settlement of cross-border trades. Moreover, both direct and indirect market participants should have the internal automation in place that is necessary to take full advantage of the available STP solutions. In this respect, investment firms should offer their professional clients the possibility of sending confirmations and allocation details electronically, in particular by using international open communication procedures and standards for messaging and reference data. Furthermore, CSDs should facilitate STP and, when processing settlement instructions, should use processes designed to work on an automated basis by default. |
(6) |
CSDs should offer matching possibilities throughout the day to promote early settlement on the intended settlement date. |
(7) |
CSDs should require that participants to their securities settlement systems use a list of mandatory matching fields for the matching of settlement instructions to facilitate settlement and to ensure... |
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