The aim of the regulation is to stabilise market infrastructures and markets in times of crisis. The CSDR affects both the central securities depositories (CSDs) themselves and the trading partners carrying out transactions involving CSDs.
The regulatory framework provides for the following:
The implementation of the CSD regulations has been underway since 2014 and is expected to continue until 2025. Due to a planned 12-month postponement, the regulations regarding settlement discipline will now only come into force in February 2022.
From then on, custodians will be obliged to process transactions faster and pass on penalties to their customers.
The implementation of CSDR-compliant processes and IT structures requires close cooperation and a definition of market practices by all parties involved.
Above all, it is important to find solutions that help to process transactions promptly and to minimize fines and buy-in costs. In order to optimise transaction processing at an early stage and to ensure that the prescribed introduction period is adhered to, we recommend introducing the system as early as 2020/2021.