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Central Securities Depositories Regulation

Central Securities Depositories Regulation is an EU regulation aimed at the harmonisation of the regulatory environment of securities settlement and Central Securities Depositories in the Union.

Central Securities Depositories Regulation (CSDR) – what you need to know

  1. The Central Securities Depositories Regulation (CSDR) is a European Union regulation set up to improve the safety and efficiency of securities settlement and settlement infrastructures within the European Economic Area (EEA). 
  2. The scope of CSDR is extraterritorial in nature: the regulation applies to transactions in instruments intended to settle in any of the EEA Central Securities Depositories (CSDs), i.e. authorised entities that operate settlement systems, such as Euroclear (Belgium), Clearstream (Luxembourg) or Monte Titoli (Italy). 
  3. The CSDR is a phased regulation and most of its provisions have already been implemented since it was first introduced in 2014. 

Settlement Discipline Regime (SDR)

The next phase of CSDR defines a Settlement Discipline Regime (SDR) which is due to come into force on 1 February 2022. Its main objective is to incentivise timely settlements by introducing a set of measures to prevent, monitor and address settlement fails. This may include the following: 

  • Process and system enhancements across the EEA CSDs and market participants;
  • The introduction of cash penalties against parties causing settlement fails; 
  • The introduction of mandatory buy-ins, whereby buying parties whose instruments have not been delivered for a set number of days are to be restored to the economic position as if the transaction had settled on time.

To find out more, please read the information below and FAQs to understand the potential implications of CSDR SDR for our HSBC and Global Private Banking clients.

Frequently Asked Questions

Note: The section below concerns the provisions of CSDR in regards to accounts segregation which have been in force since 2019.

For more information

We will periodically update this site to reflect any changes. In the meantime, if you require any further information or guidance, please contact your Relationship Manager.

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