Brussels, 18/09/2007 (Agence Europe) - EU finance ministers and governors of central banks, meeting in informal session in Oporto, have taken stock of four on-going matters related to what are known as post trading transactions: - standards set out by the Committee of European Banking Supervisors (CEBS) and the European Securities Committee (ESC); - the implementation by the industry of the compensation and settlement and clearing of securities code of conduct (see EUROPE 9470 and 9301); - work carried out to remove the judicial and fiscal barriers identified in the “Giovannini” group report (see EUROPE 8446); - the “Target2-Securities” initiative of the European Central Bank (ECB). “We emphasised the importance of strengthening integration” in transactions in the post-trading sector, said Ecofin Council Chairman Fernando Teixeira dos Santos on Saturday 15 September.
Standards. Since 2001, the CEBS and the ESC have been drawing up security standards for compensation and settlement and clearing transactions. There are two main stumbling blocks to the definitive adoption of these standards: the status of central securities depositories and the regulatory treatment of custodian banks. Germany is against these standards since they would be harmful to Deutsche Börse.
Code. European Internal Market Commissioner Charlie McCreevy felt that the implementation of the code of conduct by the industry was going well, with “real progress” making itself felt in terms of the transparency of tariffs, access to infrastructure and interoperability. A paper from the Economic and Financial Committee (EFC), which was used as the basis for discussions between ministers and governors, argued, however, for improvement of the assessment methodology to endure that transparency resulted in comparable information on prices. The EFC said that the “access/interoperability” chapter was the “crucial” section of the code of conduct but could prove to be insufficient. The EFC suggested additional measures to remove judicial and fiscal barriers imposed on suppliers.
Barriers. “We stressed the need to remove” the “Giovannini” barriers said Teixeira dos Santos, saying that the Commission would have to make concrete proposals. In its report, the EFC said that, while the private sector had made good progress towards removing barriers, progress in the public sector was still limited. Believing that the main challenges in this area were in the differences in fiscal procedures and legislation, the Committee called for legislative initiatives to be launched rapidly.
T2S. “I gave a progress report” on the ECB's Target2-Securities project, said the Bank's President Jean-Claude Trichet. This project, which aims to put in place a single technological platform for securities settlement in the euro area, would not, he said, replace central securities depositories, but would help them, by means of a single regulation tool, provide new services to investors. He said that the consultation exercise had demonstrated “wide support” for the T2S project. Further ECB decisions on the next steps in the project are expected for the spring of 2008, to be implemented in 2013. (mb)