CSDR

The CentralSecurities Depositories Regulation (CSDR), in the wake of the MiFID and EMIR regulations, aims to regulate European market infrastructures and to harmonize the rules and conduct imposed on them. In 2014, the European Union (CSDR) tackled the regulation of a key sector of market infrastructures, the central securities depositories (CSDs), the definition of which was clarified in the text. Thus, CSDR is in line with the various European regulations aimed at ensuring investor protection and improving the securities settlement system in the European Economic Area (EEA). However, contrary to what its title would suggest, CSDR is not only attacking the regulation of central securities depositories, but also investors by establishing rules on the dematerialization of securities and settlement periods. CSD participants are therefore also indirectly impacted. The initial objective being, in the legacy of the 2008 crisis, to limit the number of settlement defaults within the European unified market, while facilitating cross-border settlements through CSD operations, to improve the efficiency and security of securities settlements and associated infrastructure.

After being set up in 2014 to harmonize and regulate the securities settlement system in Europe, and in doing so, the central depositories, CSDR has undergone a particular overhaul with the entry into force of CSDR Refit in January 2024.

Then, following ESMA's consultation in the fourth quarter of 2024, aimed at reducing the settlement period, set by Article 5 of the CSDR at T+2, T+1 or T+0 for certain transactions, the Commission introduced, on 12^th February 2025, an amendment to CSDR Refit, setting this obligation for 11^th October 2027.

CSDR is based on 4 main pillars which are broken down by different measures:

• Infrastructure: Create a unified and harmonized framework for European Central Securities Depositories (CSDs), in particular through the clear definition of the conditions for being recognized as a CSD, the facilitation of cross-border CSD operations.
• Investor protection: Introduction of asset segregation within CSD accounts, supervision of operations and new rules for CSDs that provide securities settlement banking services.
• Improvement of the securities settlement system: shortening of the settlement period and its harmonization to T+2 and then T+1 (October 2027), strengthening of the settlement obligation and implementation of a penalty system.
• Transparency: Reporting to the regulator, introduction of the LEI obligation for all CSD participants, strict organisational rules for CSDs.

Useful links & documents

To find out more, download our CSDR Q&A document

For retails clients, please refer to our CSDR Notice to Retail Clients.

For all other clients, to view our terms which apply to the relationship between us in connection with CSDR, please refer to this CSDR Notice.