EuroCCP would like to inform its clearing participants (CP’s) that a Settlement Agent Power of Attorney (PoA) will be made mandatory in Sweden, with effect from Trade Date 3 April 2018, with the aim of improving settlement efficiency in the Swedish market.
The mandatory PoA will allow EuroCCP to send settlement instructions directly to the local settlement agent and will cover all types of instructions i.e. the initial instruction of the netted settlement and any cancellations and new instructions that are created as a result of splitting.
The Power of Attorney (Settlements) must be signed by the CP and the settlement agent.
The implementation of the PoA will provide the following benefits:
1. It will streamline the overall settlement process as both instructions will be sent by EuroCCP with matching guaranteed on Trade Date.
2. It will improve settlement efficiency as the splitting process will be automated which will allow an increased number of splits intra-day (receipts and deliveries).
3. It will strengthen contingency arrangements.
As this is a Settlement Agent PoA only those CP’s that use a settlement agent will be impacted. Those CP’s that do not use a settlement agent will not be impacted as Euroclear Sweden currently does not have a CSD PoA functionality.
EuroCCP’s Client Services will contact those CP’s impacted in due course to discuss the implementation of the settlement agent PoA and testing arrangement will be made available where required.