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ESMA updates Q&As on the implementation of the CSDR


On 3 August 2022, the European Securities and Markets Authority (ESMA) updated its Q&As on the implementation of the Central Securities Depositories Regulation (CSDR).

The updated Q&As amend settlement discipline question 3 – cash penalties. The question has now been updated to include answers to the following:

  • Article 3(2) of Commission Delegated Regulation 2017/389 provides that “The reference price referred to in paragraph 1 shall be used to calculate the level of cash penalties for all settlement fails, irrespective of whether the settlement fail is due to a lack of securities or cash.” What should be the basis for calculating cash penalties in cases where the settlement instruction does not include any securities or when its security component is not related to its cash component (e.g. when two separate and opposite transactions between two participants result in a settlement instruction that consists in a delivery with payment or a payment free of delivery)?
  • Is it admissible for Member States or CSDs to apply cash penalties rates that would differ from the penalty rates set in Commission Delegated Regulation (EU) 2017/389?

Furthermore, the updated Q&As include settlement discipline question 10 – Bilateral cancellation facility. Which includes answers to the following questions:

  • According to Article 7 of the RTS on settlement discipline, CSDs shall set up a bilateral cancellation facility that enables participants to bilaterally cancel matched settlement instructions that form part of the same transaction. Can this cancellation facility be contractually waived by the participants, e.g. for settlement instructions already matched by a trading venue (and subject to multilateral settlement) or transactions centrally cleared by a CCP?
  • Is it possible for matched settlement instructions to be cancelled automatically by the CSD if on settlement date for any reason settlement is not possible (i.e. securities, cash is not available) or does this require bilateral cancellation from the participants submitting the instructions?



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