The settlement discipline regime, a key element of the Central Securities Depositories Regulation, has been delayed until 1 February 2021. Emma Johnson explains the changes required of market participants to meet their new post-trade obligations
To achieve this, the regulation provides a set of measures to prevent and address failures in the settlement of securities transactions in Europe. These include: new requirements for allocation and confirmation; cash penalties; mandatory buy-ins; and monitoring and reporting measures to be taken by the central securities depositories (CSDs).1 Market participants should be aware of their obligations and treat these as a ‘call to action’ to be operationally more efficient. From timely and accurate trade bookings through to allocation, confirmation, settlement and inventory management, front, middle and back offices are impacted.