Towards a convergence of CSD account segregation practices?

Abstract

This paper looks at recent trends in account segregation practices at central securities depositories (CSDs). Despite a regulatory push for segregated accounts as a means to enhance investor protection, the author argues that the trend towards more segregation primarily affects intermediaries. European financial market infrastructures face specific challenges, with recent public initiatives discouraging mandatory segregation at the CSD level and promoting cross-border access to CSDs via the use of omnibus accounts. Given the current diversity in segregation practices at the national level, the recent introduction of the notion of ‘investor choice’ in European legislation marks an important milestone and could pave the way for a progressive convergence of CSD account segregation practices across Europe.