CFCL Settlement services – Czech Republic

Pre-matching service

The table below summarises CFCL's pre-matching service for external settlement instructions, as well as the pre-matching method and start time in the market. For details of CFCL's pre-matching services, see Pre-matching services for external settlement instructions.

Domestic allegement matching service

Not offered by the market.

Procedures for domestic counterparties

For all securities where the depository remains to be the CNB' department of SKD

Note: The domestic counterparty should quote the CFCL account with UniCredit Bank (2216070000) when pre-matching. Clients are strongly recommended to also indicate the beneficiary account in their settlement instructions.

Specific settlement rules/settlement restrictions

Against payment transactions with domestic counterparties in all eligible securities can be effected in CZK.

Trade date and trade price

Trade date is mandatory in all settlement instructions. Clients are recommended to indicate the trade price, where available, in order to facilitate the fully automated processing of settlement instructions in the domestic market.

Cash payments

For pre-advice of funds, clients are strongly recommended to instruct their CZK cash correspondent bank to send a Swift MT103 or similar credit advice to CFCL's cash correspondent, Citibank Europe Plc Organizacní Složka. Failure to comply with this may lead to delays in clients' accounts being credited.

New issues settlement

Equities

New issues of Czech securities settling in CZK are accepted by CFCL.

Settlement Discipline Regime and related domestic market settlement functionalities

Recycling of pending transactions

CDCP: Unsettled matched instructions will be recycled until settled or bilaterally cancelled, if settlement not achieved by the 20th accounting day the instruction will be automatically cancelled. The 20 accounting days’ time limit applies from the registration of the transfer in the settlement system (settlement date - DEDT) or from the expected settlement date (the later date to be used).

SKD: Unmatched instructions are not recycled. The unsettled matched instructions will be recycled until settled or bilaterally cancelled, if settlement not achieved by the 7th working day the instructions will be automatically cancelled.

Bilateral cancellation

CDCP: Yes, SKD: No
For CDCP, this means that matched instructions can only be cancelled if both domestic counterparties request a cancellation of their instructions. Until the cancellation confirmation is received from the market, the instruction will remain eligible for settlement, that is, the instruction may be provisioned and proposed for settlement and may be subject to cash penalties.

Hold and release

Not available on the market via CFCL.

Partial settlement

CDCP: Yes, SKD: No
For CDCP, partial settlement is available for domestic transactions and the client’s decision to accept for the transaction to settle/not to settle partially will be systematically included in the instruction sent to the local market. Partial settlement will continue as it does today and Clearstream Fund Centre will continue to report partial settlement feedbacks received from the markets.

Cash tolerances

For CDCP, with non-EUR currencies, for settlement amounts equivalent to less than or equal to EUR 100,000, the tolerance level will be equivalent to EUR 2, while for settlement amounts that are equivalent to more than EUR 100,000, the tolerance level will be equivalent to EUR 25. For settlement instructions in currencies other than EUR, CSDs should use the official exchange rates of the European Central Bank (ECB), valid on 1 January of the respective calendar year. For domestic against payment instructions, the maximum discrepancy tolerated in settlement matching varies in accordance with market practice and the conditions of the domestic link.
For SKD: specific matching tolerance:

• For amount lower than CZK 2,500,000 the maximum accepted difference is CZK 50 (matching at seller’s price),
• For amount higher than CZK 2,500,000 the maximum accepted difference is CZK 625 (matching at seller’s price).

Matching information

The trade date is mandatory matching criterion and domestic instructions will follow local market rules.

Cash penalties

Penalties will be calculated and applied on matched settlement instructions that fail to settle, in full or in part, on and after their intended settlement date (ISD), if both the settlement instruction and the relevant financial instrument are subject to cash penalties.

Instruments subject to cash penalties

Any financial instrument listed in the Financial Instruments Reference Data System (FIRDS) database maintained by ESMA will be subject to cash penalties. However, cash penalties will not apply to shares listed in the Short Selling Regulation (SSR) exemption listed in the Short Selling Regulation (SSR) exemption list.