The following Financial Services guidance note provides comprehensive and up to date legal information covering:
Central securities depositories (CSDs) hold securities in a dematerialised form and provide a clearing and settlement service for market participants. In most EU Member States, there is generally only one CSD. In the UK the CSD is Euroclear UK and Ireland Limited, which operates CREST. Given that CSDs are of systemic importance for the functioning of securities markets, in the aftermath of the financial crisis the European Commission introduced a legislative proposal in March 2012 for a Regulation to improve securities settlement and regulate CSDs. Following on from this proposal, on 28 August 2014, the Central Securities Depositories Regulation (EU) 909/2014 (the CSDR) was published in the Official Journal of the EU, and it entered into force on 17 September 2014. The aim of the CSDR is to ensure that financial transactions in securities are settled and cleared in a safe and timely fashion.
The Commission noted that the number of settlement fails is higher for cross-border transactions and, therefore, considered that harmonisation of certain processes throughout the EU would help improve this situation and reduce the number of settlement fails. The Commission identified a number of areas that it considered contributed to these issues. The length of the settlement process differed from country to country in the EU and some securities were still held in
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