Euroclear consolidates settlement platforms in three EU markets
22 January 2009
Euroclear announces today the successful launch of the ESES (Euroclear Settlement of Euronext-zone Securities) platform. This signifies the first time that market participants in three EU markets (Belgium, France and the Netherlands) can process all fixed-income, equity and other domestic securities transactions using the same platform. Clients no longer have to pay substantially more to settle cross-border transactions between counterparties in these three markets as they now function operationally as one.
With ESES, cross-border transactions between counterparties in Belgium, France and the Netherlands are processed as domestic transactions. As a result, Euroclear is eliminating in the ESES markets the complexities, risks and excess costs of cross-border transactions as identified by the Giovannini Group, the European Commission and many others in the public and private sectors.
Ignace R. Combes, Chairman of Euroclear Belgium, Euroclear France and Euroclear Nederland, said: “ESES is an outstanding achievement both in terms of the client benefits delivered as well as its significance as a multimarket settlement platform initiated by and built in close consultation with users. It also marks the completion of the second of three phases in Euroclear’s settlement infrastructure framework for a ‘domestic market for Europe’, which will ultimately cover more than 65% of the Eurotop 300 equity markets and approximately 50% of all European domestic debt outstanding.”
ESES is key in delivering the full benefits of NYSE Euronext’s Single Order Book for equity transactions on the Amsterdam, Brussels and Paris exchanges by harmonising the settlement of these trades. The Single Order Book creates a single trading line for listed securities in all three Euronext markets, including those listed on more than one Euronext exchange. Jean-François Théodore, Deputy Chief Executive of NYSE Euronext, said: “The launch of ESES and the linked Single Order Book comprise the last phase in the integration plan to provide harmonised cross-border trading, clearing and settlement in the three original Euronext countries, which will deliver significant benefits to our customers. It is an important step in achieving the desired low-cost, efficient post-trade environment that Europe needs in order to be a truly pan-European capital market.”
Consolidation and harmonisation With the successful launch of ESES, effective immediately, the tariffs charged by Euroclear Belgium, Euroclear France and Euroclear Nederland for settlement, custody and related services will be harmonised. Moreover, ESES is the first multi-market transaction-processing platform that applies harmonised market rules and practices across markets. Belgium, France and the Netherlands are the first countries putting into practice the work done by the private sector in removing the barriers identified by the Giovannini Group preventing a more efficient and integrated post-trade environment in Europe.
Upon delivery of Euroclear’s Single Platform and harmonised market practices across all Euroclear group markets in 2011, and including Finland and Sweden thereafter, Euroclear will save clients an estimated EUR 350 million per year. The ESES platform will be integrated within the Single Platform. Euroclear has arranged special support teams to help clients with the transition to ESES.