28 April 2004

Commission communication on Clearing and Settlement

The Commission published a communication defining the key policy objectives that the Commission has taken into account in proposing future action at the EU level. It includes an action plan outlining the various initiatives that need be undertaken to achieve an integrated, safe and efficient securities clearing and settlement environment in the EU.

The Communication proposes the preparation of a framework Directive on Clearing and Settlement aiming to increase competition and efficiency. It would set up a common regulatory framework covering the functions performed by the various players in clearing and settlement, thus allowing the mutual recognition of clearing and settlement systems across the EU, protecting investors and further enhancing the integration of national systems.

The Commission suggests setting up an advisory and monitoring group composed of high-level representatives, the ESCB and CESR. This group would advise on, promote and monitor the progress to bring down the so-called 'Giovannini barriers' and to promote the overall integration of EU securities clearing and settlement systems.

The Communication also proposes setting up separate expert groups on legal and tax matters relating to clearing and settlement, to consider and evaluate these complex issues and, if necessary, to suggest appropriate solutions.

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