Brussels, 03/08/2005 (Agence Europe) - On 2 August, the Commission published an external study into the negotiation, compensation and delivery versus payment systems. For the first time, this study looks at this sector from the point of view of competition. It describes the main activities of the sector, identifies a few key players and points out various trends at pan-European level, but makes no value judgments. It will feed into the reflection underway within the Commission, which is currently carrying out an impact study on whether there is need for a legislative initiative at European level.
Amongst other things, the study indicates that the consolidation of the market and "after market" infrastructures has speeded up over the last two years. This consolidation has been in evidence mainly at national level, but mergers and alliances have also taken place at pan-European level. It is both horizontal and vertical by nature. The process is far from being completed, as is shown by discussions on a merger underway between Euronext and the London Stock Exchange and between the Deutsche Börse and the London Stock Exchange. The detailed analysis of the negotiation, compensation and delivery versus payment systems shows that currently, and in the vast majority of transferable bond markets in Europe, users cannot choose their service provider. In several Member States (Cyprus, Spain, Greece, Italy, Poland and Slovenia), there is a legal obligation to use a particular infrastructure. The study, which is available on the website of the Directorate General for Competition, provides a detailed overview of the reasons behind the restriction on users' choices.
For the second half of 2005, the Commission is putting together an impact study on the need for a European directive on the field of compensation and delivery versus payment. It is set to take a decision in the first half of 2006. In March 2005, it published the results of the public consultation, during which the majority of the 80 people who took part came out in favour of a legislative initiative (see EUROPE 8914). Further to this consultation, the Commission set up three groups of experts- CESAME, Sécurité Juridique and FISCO- which are looking into the obstacles to cross-border competition in markets which are traditionally organised on a national basis (see EUROPE 8822, 8800 and 8930). In its adoption of the Kauppi report at the beginning of July, the European Parliament stated its view that the EU should only legislate if the compensation and delivery versus payment markets are not working (see EUROPE 8987).