The European Commission is proposing a framework Directive on clearing and settlement with the aim of removing regulatory and competitive impediments to improved efficiency and lower costs in cross border securities trading.
The Commission says the proposed Directive will aim to achieve access to all EU markets for all EU operators, mutual recognition by Member States' of each other's rules and full transparency allowing users to compare the quality and costs of the various services available.
Much of the meat of the document centres on the removal of legal and regulatory restrictions to a unified system through the establishment of common regulatory framework. This would cover the functions performed by the various players in clearing and settlement and enable mutual recognition of clearing and settlement systems across the EU.
Internal Market Commissioner Frits Bolkestein says: "There will be no real single securities market in the EU unless we can make cross-border clearing and settlement as efficient, safe and cost-effective as at national level."
He says the Commission will keep a weather eye on competition policy to address any current or emerging restrictive market practices and to monitor further industry consolidation.
The Commission is inviting all interested parties to comment on its proposals with a deadline for responses of 30 July 2004.