The Swiss Securities Post-Trade Council (swissSPTC) recommends that the transition to a T+1 Settlement Cycle for the domestic markets in Switzerland and Liechtenstein should occur in October 2027.

It is assumed that the EU and UK will adopt the same migration date as a combined migration of CH/FL, EU and UK.

This is the preferred solution of the swissSPTC and in the interests of the markets and users concerned. In the event of a delay in one jurisdiction, domestic markets will seek to align their timeline with the “first mover”, provided the migration occurs no earlier than October 2027. This approach ensures consistency with the agreed schedule while accommodating any necessary adjustments.

The aforementioned recommendation is acknowledged by the Swiss State Secretariat for International Finance (SIF). SIX also acknowledges this recommendation and will commence the process of seeking approval to adjust the Rule Book of SIX Swiss Exchange to accommodate the change of the settlement cycle at the appropriate time.

The swissSPTC Task Force T+1 will now commence detailed assessments on specific proposals and produce recommendations for the transition.

It is further recommended that the Swiss and Liechtenstein market participants continue to drive forward their internal planning to adopt a shorter settlement cycle and ensure their preparedness for an effective migration.

The swissSPTC thanks all members and in particular the members of the T+1 Task Force for their commitment and support to achieve this objective.

On behalf of the swissSPTC,
Florentin Soliva
CHAIRMAN SWISSSPTC

Source: swissSPTC

Simon Belser, head of international custody at SIX, said in an email :

“The announcement from swissSPTC recommending a coordinated migration to T+1 with both the EU and UK marks a significant step forward. The biggest challenge for Europe in making a smooth transition to a shorter settlement cycle was the costly scenario of misalignment between the EU, UK, and Switzerland. With a joint October 2027 transition now looking more certain, SIX, as the main market infrastructure operator in Switzerland, will work together with the Swiss market to ensure all market participants are prepared. SIX will begin the process of seeking approval to amend the Rule Book of SIX Swiss Exchange to accommodate the change in the settlement cycle at the appropriate time.”

New Governance Structure Introduced for EU T+1 Transition

The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, the European Commission (EC) and the European Central bank (ECB) launched a new governance structure to support the transition to the T+1 settlement cycle in the European Union.

Following ESMA’s report with recommendations on the shortening of the settlement cycle, the new governance structure has been designed to oversee and manage the operational, regulatory and technological aspects of this transition. Given the high level of interconnectedness within the EU capital market, a coordinated approach across the EU, involving authorities, market participants, financial market infrastructures and investors, is desirable. The key elements of the new governance model include:

• An Industry Committee, composed of senior leaders and representatives from market players. The Committee will be chaired by Giovanni Sabatini. Giovanni has a long-standing experience working in securities markets both in the private and public sector. He has served as a member of the European Economic and Social Committee and held roles within IOSCO, EBF and ECSDA.
• Several technical workstreams, operating under the Industry Committee, focusing on the technological operational adaptations needed in the areas concerned by the transition to T+1 (i.e. trading, matching, clearing, settlement, securities financing, funding and FX, asset management, corporate events, settlement efficiency). In addition, two more general workstreams will review the scope and the legal and regulatory aspects of these adaptations.
• A Coordination Committee, chaired by ESMA and with representation from the EC, the ECB, ESMA and the chair of the Industry Committee. This committee will ensure coordination between the authorities and the industry, advising on challenges that may arise during the transition.

Shortening the trade settlement cycle from the current T+2 framework to one business day should enable faster execution, clearing, and settlement of securities transactions, as well as international alignment, benefiting the entire EU financial ecosystem.The Commission is currently considering the merits of a legislative change mandating a potential transition to a shorter settlement cycle.

Next Steps

ESMA has recommended 11 October of 2027 as the optimal date for the transition to T+1 in the EU. In its Report ESMA concluded that the transition to T+1 should be implemented in phases, with key milestones including technology upgrades, stakeholder engagement and regulatory alignment.

Further details regarding the governance set-up and participating organisations will be published in the coming days.Industry representatives interested in contributing to the upcoming work are advised to contact the T+1 Industry Secretariat here.

The first meeting of the Coordination Committee will take place on 6 February.

Source: ESMA

Chair of EU T+1 Industry Committee welcomes official launch of governance structure for transition to T+1 settlement cycle

The European Securities and Markets Authorities (ESMA) hosted the T+1 Governance Launch Meeting to present the arrangements for driving the move to the reduction of default settlement cycles to T+1 for EU securities markets.

The reduction of the settlement cycle for securities transactions can help reduce counterparty credit risks, improve market efficiency, and address issues arising from the current lack of alignment between the settlement cycles of Europe and other major global markets, which creates costs and inefficiencies for investors, issuers, intermediaries, and market infrastructures.

Aware of the benefits and costs that this transition entails, members of the Industry Committee have welcomed the ESMA report, which identified a pathway and also suggested a date for the transition to the T+1 settlement cycle.

In line with the recommendations of that report, and in coordination with the public authorities, the industry has established an appropriate governance framework to guide the transition process with the aim of moving to T+1 in a manner and timing also coordinated with the UK and Swiss markets.

At the meeting on January 22 organised by ESMA, the independent chair of the T+1 Industry Committee, Giovanni Sabatini, presented the Terms of Reference for the T+1 Industry Committee, the committee’s composition, and the organisation of work across the various identified Technical Workstreams, along with an initial draft of the work plan.

The principles underpinning the composition of the committee and its activities are representativeness, inclusivity, transparency, consensus-seeking, and efficiency. In this regard, the committee’s work may build upon the work already completed by the European industry in the October 2024 report, as well as the ESMA report and the UK recommendations, US Playbook, and upcoming Swiss report, when relevant.

The Chair of the Industry Committee, Giovanni Sabatini, commented: ‘The T+1 project is a collective effort of the financial industry based on good faith and credibility. Establishing a robust, balanced, and inclusive governance framework is key to ensuring broad acceptance and support while avoiding overcomplexity. A coordinated move to T+1 will support the efficiency, liquidity, and competitiveness of EU financial markets. Constructive, transparent, and continuous cooperation with European Authorities will be key to ensuring the success of the project.’”

See also:

•  More information on the EU T+1 Industry Committee

Source: ICMA