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Review of the EU post-trade legislation: Draft regulation to amend CSDR and regulation on a DLT pilot regime for markets infrastructures
Journal of Securities Operations & Custody,
15
(2),
134-145
(2023)
Abstract
This paper aims to examine the two most recent EU initiatives to update the existing regulatory framework for central securities depositories (CSDs). First, it analyses and evaluates the draft regulation released on 16th March, 2022, which amends the existing CSDs Regulation (CSDR) of 2014, including simplifying the passporting process and enhancing cooperation among competent and relevant authorities. It also establishes a more targeted scope for the CSDR's settlement discipline regime. The proposed simplification measures indeed appear timely, but it remains to be seen whether they will increase competition and improve settlement efficiency. Secondly, it assesses the challenges of the existing EU legal framework for digitalising post-trade activities. It concludes that the existing framework does not permit the full tokenisation of the settlement of token securities, and thus it requires adaptation. Against this backdrop, the paper fully supports the stepwise regulatory approach followed by the EU. The recently adopted regulation creating a pilot regime to test Distributed Ledger Technology (DLT) market infrastructures and allow them to be exempted from some existing requirements temporarily will help identify possible medium-term options for a suitable legal framework. Meanwhile, users should remain alert to the fact that exemptions remain proportionate and are conducive to improving CSDs' efficiency.
Keywords: central security depositories; draft regulation 2022 amending CSDR; pilot regime; distributed ledger technology; market infrastructures
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Author's Biography
Pierre Marsal has been an attorney at law since late 1998. A French national with German parentage, Pierre Marsal graduated in Law from the University of Paris. He holds an MBA degree from the HEC School of Management, Paris and received a Doctorate in Law from the University of Artois. Called to the Lille Bar, then to the Brussels Bar in 2001 and transferred from the Lille to the Paris Bar in 2002, Pierre Marsal has extensive experience in the representation of European companies and trade associations vis-à-vis European institutions and in structuring international projects, with specific emphasis on European and international law. Pierre Marsal is currently working with, among others, the Association Nationale des Sociétés par Actions (ANSA — a founding member of Europeanissuers) as a consultant on European law. Before being called to the Bar, Pierre Marsal worked for the European Commission, where, inter alia, he was a member of the private office of Industry and Research Commissioner Karl-Heinz Narjes, and for several multinational entities, including the Chicago-based FMC Corporation where he served as Regional Vice-President for Europe and the Swiss-based company Holderbank (now Holcim) where he was Director, European Legal Affairs. Pierre Marsal has been a professor at the University of Artois, where he taught community law and international organisations law. Pierre Marsal has been part of the expert team gathered by the College of Europe to carry out a study commissioned by the European Commission on Internet law.
