The rapporteur also questions the utility of allowing financial institutions to buy sovereign
CDS on debt of their own Member State as these financial institutions are unlikely to survive in the event of a sovereign default of their own Member State.
Buy in procedures and penalties at T+4
The rapporteur supports the Commission's proposal of automatic buy-in procedures of shares at T+4 in the case of settlement failure accompanied with penalties. The example of the Unites States where such a measure has been applied since 2008 shows clearly that this measure has proven to be efficient to ensure a settlement discipline.
The rapporteur considers that these buy-in procedures should be applied to all transactions, including OTC transactions, and that the nature and the minimum level of the sanctions mechanism should be defined by ESMA so as to avoid competition between trading venues on these regulatory criteria.
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