T2S wave 3: Impact on Clearstream Banking services – cutover details

12.08.2016

Effective

Monday 12 September 2016

the third wave of TARGET2-Securities (T2S) will be launched.

For Belgium (Euroclear Belgium), Denmark (VP Securities), France (Euroclear France), Luxembourg (VP Lux) and Netherlands (Euroclear Nederland), please find below the cutover details for the handling of pending transactions for Clearstream Banking1 customers.

Please refer to Announcement A16045, dated 12 August 2016 for instruction specifications.

Belgium, France, Netherlands – (ESES platform, Euroclear)

Matched and unmatched instructions with requested settlement date (SD) up to and including 9 September 2016 and SD 12 September 2016 or later released to ESES.

All T2S eligible transactions that are in matched or unmatched status and that have been released to ESES by 16:30 CET on Friday 9 September 2016 will be migrated to T2S by ESES.

No action is required from Clearstream Banking customers

Pending  instructions with requested settlement date (SD) up to and including 9 September and SD 12 September 2016 or later not released to ESES.

Pending T2S eligible transactions in an unmatched status, but not yet released to BP2S by 16:20 CET on Friday 9 September 2016, will be stored by CBL and released to BP2S and subsequently to T2S only after confirmation of the successful migration of ESES to T2S.

Customers must instruct all T2S eligible instructions in the correct format to avoid settlement delays.

The transactions may subsequently remain unmatched, matched or be settled or rejected. Customers will be informed of the status upon receipt from BP2S.

Reminder:  The usage of the Data Source Scheme in field  :95R::DEAG/REAG for Creation via SWIFT/CreationDirect and via Creation Online is not a valid T2S format and should not be used if instructions are sent to Clearstream after 16:20 CET on Friday September 2016.  Otherwise, such instructions will be rejected.

Matching note: Post migration, it is recommended to use the additional matching fields Opt-out and Cum/Ex indicators only if it is ensured that the counterparty indicates the same Opt-out and Cum/ex indicator at instruction level. Otherwise, the instructions will not match. If no agreement with the counterparty is in place on the usage of the Opt-out and Cum/Ex indicators, we recommend that they are left blank in order to avoid matching issues.

Settlement cut off time

In order to facilitate the start of the migration process on 9 September 2016, ESES has shortened the end of day cut-off deadline. However, there is no change to the current Clearstream Banking settlement deadlines in the ESES markets:

Against payment in EUR: 15:45 CET

Free of payment: 15:45 CET.

Income and custody events

Market claims and transformations

Euroclear will cancel all  market claims and transformations that are pending at close of business on  9 September 2016.

Market claims and transformation detection period

For  instructions impacted by an event with a Record Date on or after 9 September 2016, market claims and transformations will be generated with the new T2S rules.

From Monday 12 September 2016,  Euroclear will no longer detect market claims and transformations when the Record Date is before 9 September 2016. This will impact back value trades instructed post migration.

Clearstream customers are requested to liaise with their counterparty to compensate the proceeds of market claims or transformations bilaterally.

Denmark  - VP Securities

Matched and unmatched instructions with requested settlement date (SD) up to and including 9 September 2016 and SD 12 September 2016 or later released to VP Securities.

All T2S eligible transactions that are in matched status and that have been released to VP Securities  by 14:15 (VP batch 50) CET Friday 9 September 2016 will be migrated to T2S by VP Securities.

Unmatched instructions will not be migrated by VP Securities. Clearstream Banking will cancel any pending unmatched instructions prior to the start of the migration process and customers will need to reinstruct in the correct T2S format.

Pending  instructions with requested settlement date (SD) up to and including 9 September 2016 and SD 12 September 2016 or later not released to VP Securities

T2S eligible transactions in an unmatched status, but not yet released to VP by 14:15 CET on Friday 9 September, will be stored by CBL and released to Danske Bank and subsequently to T2S only after confirmation of the successful migration of VP Securities to T2S.

Customers must instruct all T2S eligible instructions in the correct format to avoid settlement delays.

The transactions may subsequently remain unmatched, matched or be settled or rejected. Customers will be informed of the status upon receipt from Danske Bank.

Settlement cut off time

There is no change to the current Clearstream Banking settlement deadline for VP Securities eligible securities on Friday 9 September 2016  and it remains as follows:

Against payment in EUR: 11:45 CET

Income and custody events

There is no impact on income events (interest or dividend) on VP Securities eligible securities. Furthermore, no impact is expected on corporate events over the migration weekend.

No action is required from Clearstream Banking or its customers.

Luxembourg – VP LUX

Matched and unmatched instructions with requested settlement date (SD) up to and including 9 September 2016 and SD 12 September 2016 or later released to VP LUX.

All T2S eligible transactions that are in matched or unmatched status and that have been released to VP LUX by 18:00 CET Friday 9 September 2016 will be migrated to T2S by VP LUX.

No action is required from Clearstream Banking customers.

Pending  instructions with requested settlement date (SD) up to and including 9 September and SD 12 September 2016 or later not released to VP LUX.

T2S eligible transactions in an unmatched status, but not yet released to VP LUX by 18:00 CET on Friday 9 September 2016 will be stored by CBL and released to VP LUX and subsequently to T2S only after confirmation of the successful VP LUX migration to T2S.

Customers must instruct all T2S eligible instructions in the correct format to avoid settlement delays.  

The transactions may subsequently remain unmatched, matched or be settled or rejected. Customers will be informed of the status upon receipt from VP LUX.

Settlement cut off time

There is no change to the current Clearstream Banking settlement deadlines for VP LUX eligible securities on Friday 9 September 2016 and they remain as follows:

Against payment in EUR: 16:15 CET

Free of payment: 18:00 CET

Income and custody events

There is no impact on income events (interest or dividend) on VP LUX eligible securities. Furthermore, no impact is expected on corporate events over the migration weekend.

Further information

For further information, customers may contact Client Services or their Relationship Officer.

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1. Clearstream Banking refers collectively to Clearstream Banking AG, registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500, and Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248.