18 December 2003

EFR urges implementation of European framework for Clearing and Settlement

The Euroopean Financial Services Roundtable (EFR) releases a report on the Securities Clearing and Settlement in Europe. The EFR suggests that the regulation of clearing and settlement infrastructures are regarded as a priority for future legislative activity.

The EFR believes that the revised Investment Services Directive does not establish a harmonised framework for clearing and settlement. Stipulating free access for investment firms to clearing and settlement systems on its own will not substantially contribute to a more efficient cross-border clearing and settlement arrangement.

A single Central Counterparty should be established to provide its services irrespective of the types of securities (equities and bonds) or markets (cash and derivatives, regulated markets, ECN and OTC). The EFR also shares the view of the Giovannini Group that European authorities should promptly intervene to enforce the general interest criteria in the field of Clearing and Settlement if necessary, that is cost efficiency and avoidance of systemic risk.

Full paper

© EFR - European Financial Services Round Table