Investment Operations

UK Treasury Recommends T+1 by 2027

Europe T+1 Settlement

In December 2022, the government appointed Charlie Geffen to chair the independent Accelerated Settlement Taskforce (AST). The taskforce was asked to examine the potential for the UK to move to faster settlement of securities trades – in particular, whether the UK could move to a ‘T+1’ standard settlement period. Mr Geffen has now submitted his report to government.

HM Treasury said the report is a key step forward in supporting the competitiveness and modernization of our financial markets; more important, the government has accepted all the recommendations Geffen has made.

In particular, the government agrees that the UK should move to T+1. The report highlights how a move to T+1 could improve market resilience, bring cost savings for investors and reduce the risks associated with having an extended period between trading and settlement. Treasury said it also has to consider how harmonised settlement cycles across major financial centres could be beneficial for market participants.

The report recommends that the UK should aim to move to T+1 no later than the end of 2027. The government fully endorses this: this timeline acknowledges the need for firms to have sufficient time to prepare for the transition to T+1 while ensuring we maintain momentum for this important project.

The report also proposes that the UK should engage with other European jurisdictions to explore whether coordinating a move to T+1 is possible, and if this can be done within a suitable timeframe it could align their timetable for the transition to T+1. The government said it looks forward to engaging with theirEuropean partners – in particular the EU and Switzerland – to see if the UK can align their work on this.

Finally, and in line with the report, the government said it was establishing a Technical Group to take forward the implementation of the UK move to T+1. The group will be chaired by Andrew Douglas and will be comprised of industry experts. Douglas is asked, working with his group, to develop the technical and operational changes necessary for the UK to transition to T+1, and to set out how these should be implemented. The group will also determine the appropriate timing for mandating these changes, which should be a date in 2025, and the overall ‘go-live’ date for T+1. A Terms of Reference for the group has also been published.