SWIFT communication protocol for European securities clearing and settlement

03 April 2006

SWIFT released the final recommendation for the communication protocol designed to eliminate Giovannini Barrier 1 in the European securities Clearing & Settlement market. Barrier 1 relates to national differences in information technology and interfaces used by clearing and settlement providers. These differences impose substantial (back-office) costs on investors by requiring investment in multiple technologies and often a higher level of manual input in transactions.

The second Giovannini report released in 2003 stated that:
“National differences in the information technology and interfaces used by clearing and settlement providers should be eliminated via an EU-wide protocol. SWIFT should ensure the definition of this protocol through the Securities Market Practice Group (SMPG). Once defined, the protocol should be immediately adopted by the ESCB in respect of its operations. This barrier should be removed within a period of two years from the initiation of this project.”

The majority of institutions and infrastructures indicated their intent to implement the protocol over the specified 5 year time horizon. The project will now move into the implementation phase with the proposed creation of an infrastructure roadmap showing how compliance will be achieved.

Press release
Protocol

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