for Securities Settlement Systems
Committee on Payment and Settlement Systems
Technical Committee of the International Organization of Securities Commissions
Legal risk 法規風險
1. Legal framework法規架構
Securities settlement systems should have a well founded, clear and transparent legal basis in the relevant jurisdictions.
2. Trade confirmation交易確認
Confirmation of trades between direct market participants should occur as soon as possible after trade execution, but no later than trade date (T+0). Where confirmation of trades by indirect market participants (such as institutional investors) is required, it should occur as soon as possible after trade execution, preferably on T+0, but no later than T+1.
3. Settlement cycles清算週期
Rolling settlement should be adopted in all securities markets. Final settlement should occur no later than T+3. The benefits and costs of a settlement cycle shorter than T+3 should be evaluated.
4. Central counterparties (CCPs) 集中交易對手
The benefits and costs of a CCP should be evaluated. Where such a mechanism is introduced, the CCP should rigorously control the risks it assumes.
5. Securities lending借券
Securities lending and borrowing (or repurchase agreements and other economically equivalent transactions) should be encouraged as a method for expediting the settlement of securities transactions. Barriers that inhibit the practice of lending securities for this purpose should be removed.
6. Central securities depositories (CSDs)
Securities should be immobilised or dematerialised and transferred by book entry in CSDs to the greatest extent possible.
7. Delivery versus payment (DVP) 款券同步交割
CSDs should eliminate principal risk by linking securities transfers to funds transfers in a way that achieves delivery versus payment.
8. Timing of settlement finality清算終局效力確定時點
Final settlement should occur no later than the end of the settlement day. Intraday or real-time finality should be provided where necessary to reduce risks.
9. CSD risk controls to address
participants’ failures to settle
CSDs that extend intraday credit to participants, including CSDs that operate net settlement systems, should institute risk controls that, at a minimum, ensure timely settlement in the event that the participant with the largest payment obligation is unable to settle. The most reliable set of controls is a combination of collateral requirements and limits.
10. Cash settlement assets
Assets used to settle the ultimate payment obligations arising from securities transactions should carry little or no credit or liquidity risk. If central bank money is not used, steps must be taken to protect CSD members from potential losses and liquidity pressures arising from the failure of the cash settlement agent whose assets are used for that purpose.
Operational risk 作業風險
11. Operational reliability作業可靠性
Sources of operational risk arising in the clearing and settlement process should be identified and minimised through the development of appropriate systems, controls and procedures. Systems should be reliable and secure, and have adequate, scalable capacity. Contingency plans and backup facilities should be established to allow for timely recovery of operations and completion of the settlement process.
12. Protection of customers’
Entities holding securities in custody should employ accounting practices and safekeeping procedures that fully protect customers’ securities. It is essential that customers’ securities be protected against the claims of a custodian’s creditors.
13. Governance 治理
Governance arrangements for CSDs and CCPs should be designed to fulfil public interest requirements and to promote the objectives of owners and users.
CSDs and CCPs should have objective and publicly disclosed criteria for participation that permit fair and open access.
While maintaining safe and secure operations, securities settlement systems should be cost-effective in meeting the requirements of users.
16. Communication procedures and
Securities settlement systems should use or accommodate the relevant international communication procedures and standards in order to facilitate efficient settlement of cross-border transactions.
CSDs and CCPs should provide market participants with sufficient information for them to identify and evaluate accurately the risks and costs associated with using the CSD or CCP services.
18. Regulation and oversight監理與監管
Securities settlement systems should be subject to transparent and effective regulation and oversight. Central banks and securities regulators should cooperate with each other and with other relevant authorities.
19. Risks in cross-border links跨國聯結風險
CSDs that establish links to settle cross-border trades should design and operate such links to reduce effectively the risks associated with cross-border settlements.