Agenda item 6: CSD Restrictions Rules 10th HSG meeting 22nd – 23rd October 2013 T2S Programme Office European Central Bank

Background During its 9th meeting (10.06.13) the HSG discussed the topic of CSD restriction rules in T2S. According to the HSG… ….XMAP should analyse the inventory of the CSDs rules (expected to be ready by the CSG in September 2013) …XMAP would some appropriate time to analyse their impact on cross-border settlement in T2S. The exact time needed is difficult to define at this stage, prior to any reliable information on the exact number of the CSD restriction rules and their impact on cross-border activity ….XMAP should report the outcome of its analysis to the HSG, including possible harmonisation proposals if required. The report and the proposal will be reviewed by the HSG and subsequently the AG for any further action. The XMAP chairman should also send the report to the CSG in parallel.

Key Statistics – T2S Restriction Rules By Business Process By MSA usage By CSD / Market By Domestic versus Cross CSD Settlement Impact Note: The statistics presented in the graphs have been sourced from the CSG documentation (September 2013)

Restriction Rules Analysis - Approach Consensus amongst the XMAP sub-group members for analysis of the restriction rules by business processes Benefits Ease in comparison of T2S adapted process models across T2S CSD community Facilitates identification of cross border settlement issues Ascertain need and possibility for adopting harmonised approach for adapting processes across markets

Restriction Rules Analysis - Organisation Agreement amongst the XMAP sub-group members to adopt the ‘Group Review Approach’ wherein, all restriction rules will be collaboratively reviewed by all XMAP members XMAP members analysed the statistics and agreed upon the business processes to be analysed for the next XMAP meeting Corporate Actions Position Types Registration Fiscal / Tax Obligations Collateral / Custody Review of T2S restriction rules by Business Process

Restriction Rules Analysis - Timelines Currently, the group does not have a view on the timelines for completion of analysis and delivery of recommendation report Based on the analysis of the identified business processes (planned for the November meeting), the group expects to develop a view on the complexity of analysis and need to interact with the CSD experts and other stakeholders XMAP plans to define a concrete plan on the analysis of business processes and completion of recommendation report, and update HSG

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