Investment Operations

ESMA Proposes to Further Postpone CSDR Settlement Discipline

The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, has today published a final report on draft regulatory technical standards (RTS) definitively postponing the date of entry into force of the Commission Delegated Regulation (EU) 2018/1229 (RTS on settlement discipline) until February 1, 2022.

ESMA said the postponement is due to the impact of the COVID-19 pandemic on the implementation of regulatory projects and IT deliveries by Central Securities Depositaries and a wide range of market participants and follows a request from the European Commission (EC).

The measure is additional to the Commission Delegated Regulation (EU) 2020/1212 , based on ESMA’s proposal to amend the RTS on settlement discipline to postpone its date of entry into force from September 13, 2020 to February 1, 2021.

The RTS on settlement discipline cover measures to prevent and address settlement fails, including:

  • rules for the trade allocation and confirmation process;
  • cash penalties on failed transactions;
  • mandatory buy-ins; and
  • monitoring and reporting of settlement fails.

Next steps

Following the endorsement of the RTS by the EC, ESMA said the Delegated Regulation will then be subject to the non-objection of the European Parliament and of the Council.

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