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11 July 2006

Speech McCreevy: Clearing and settlement - The way forward

Commissioner McCreevy confirmed that there will be no EU regulation on clearing and settlement procedures in stock exchanges for the time being. Speaking before the European Parliament's ECON Committee he said that “a regulation now would be a distraction to market participants.” Instead, industry should adopt a voluntary code of conduct.

He justified his decision with the many changes and challenges ahead, mentioning the takeover/mergers of Exchanges that are currently under way as well as the impact of the MiFiD Directive, and the work on the renewal of the “Giovannini Barriers”.

Also, the European Central Banks’ intention to explore further cooperation with central securities depositories and other market participants, the setting up of a new service for securities settlement in the euro area have to be considered, he said.

The code of conduct will contain the following issues and timetable:

  • By the end of this year a series of measures to improve price transparency will be in place.
  • By 30 June next year agreement on a roadmap and conditions for ensuring effective rights of access on a fair, transparent, non-discriminatory basis, so that the conditions are set for implementing interoperability between Exchanges/CCPs/CSDs etc as soon as possible thereafter.
  • By 30 December 2007, there will be separate accounting of the main clearing and settlement activities.
  • By the same date there will be price unbundling of the main services and activities.

    Speaking to reporters after the speech, McCreevy said there would be no plans to publish prices in order to encourage transparency, and that reduced prices for financial transactions were a 'logical consequence' of increased competition.

    Full speech

    © European Commission

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