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Operational wind-down of Eurex STS following regulatory changes

Datum: 28. Mär 2022 | Eurex

Operational wind-down of Eurex STS following regulatory changes


Eurex Securities Transactions Services GmbH (Eurex STS) will wind down its services with effect from 30 June 2022. Eurex STS is thus responding to the “Refit” draft of the Central Securities Depository Regulation (CSDR) published by the European Commission on 16 March 2022, which proposes to remove mandatory buy-ins for not settled securities deliveries.

Deutsche Börse founded Eurex STS in 2019 to support both the financial industry and the regulatory agenda with a workable solution for mandatory buy-ins and to address settlement fails. These are significantly higher within the EU than in other regions and were identified as a risk to the financial market in the aftermath of the financial crisis.

Since its initial proposal in 2012, the CSDR and its Settlement Discipline Regime (SDR) provided for cash penalties in case a transaction fails to settle and a mandatory buy-in procedure as a final backstop. Originally planned for September 2020 and postponed several times, the SDR finally came into force in February 2022, albeit without the mandatory buy-in component.

The decision by the European Commission to propose the removal of the buy-in obligation from the SDR for an indefinite time renders the business proposition of Eurex STS unviable.