The European Union has published new rules on settlement discipline that set out how European markets will prepare for the move to T+1 on 11 October 2027.
Commission Delegated Regulation (EU) 2026/1536 appeared in the Official Journal on 14 October. It amends the regulatory technical standards (RTS) on settlement discipline in Delegated Regulation (EU) 2018/1229, which supplements the Central Securities Depositories Regulation (CSDR). The changes are based on standards drafted by the European Securities and Markets Authority (ESMA).
The requirements will apply in three phases:
Allocations and confirmations (7 December 2026): this phase covers when allocations and confirmations must be sent, the means and open communication standards used to send them, and professional clients’ reference data. It also covers alignment with settlement instruction fields, making the place of settlement (PSET) a mandatory field, and the transaction type.
Monitoring and reporting of settlement fails (1 July 2027): Reporting will cover top failing participants, buy-sell-back and sell-buy-back transactions, the reasons for fails and how long they last, and the place of trading. CSDs will also have to make fuller public disclosure. The annual report on fails will be dropped.
Settlement processes (11 October 2027): This phase takes effect on transition date and covers deadlines for sending settlement instructions, hold and release, auto-partial settlement, auto-collateralisation, and RTGS and/or batch settlement.
In a LinkedIn post, Andrea Gentilini, who chairs ESMA’s CSDR Task Force and the Post-Trading Working Group (PTWG), said the provisions draw on the recommendations of the EU T+1 Industry Committee and industry best practice, adding that the rules were designed with simplification and burden reduction in mind. In his words, they build on what the market already treats as good practice “rather than adding new layers of complexity.”