It is our intention to continue providing services in respect of Irish securities and euro settlement following Brexit, including in a no-deal scenario, for as long as we are permitted to do so. We have been engaging with domestic and European authorities to seek this continuity of service provision.
We welcome the publication, on 19 December 2018, by The European Commission of its UK CSD equivalence implementing decision. In a no-deal scenario, the decision provides for equivalence of UK CSD arrangements for a period of 24 months from March 2019, and is a positive step towards enabling The European Securities Market Authority (ESMA) to recognise Euroclear UK & Ireland as a ‘third country CSD’.
We are preparing our application for EU third country CSD recognition and are engaging with ESMA regarding this process. Subject to this application process, regulatory approvals and circumstances which remain outside of our control, we expect this recognition would be granted and become effective in the event of a no-deal Brexit. This would ensure that Euroclear UK & Ireland could continue to settle Irish securities after 29 March 2019.
We continue to engage with the relevant authorities regarding the continued provision of euro settlement services.
In parallel and following Euronext’s announcement that Euroclear Bank is its preferred solution for long term settlement of Irish corporate securities, Euroclear Bank is starting a detailed consultation to finalise the operating model for Euroclear Bank, with the aim of having the long term solution in place by the expiry of the equivalence period.