On 11 August 2023, there was published in the Official Journal of the EU, Commission Delegated Regulation (EU) 2023/1626 of 19 April 2023 on amending the regulatory technical standards laid down in Delegated Regulation (EU) 2018/1229 as regards the penalty mechanism for settlement fails relating to cleared transactions submitted by central counterparties (CCPs) for settlement.

The Commission Delegated Regulation removes the separate process established in Article 19 of Commission Delegated Regulation 2018/1229 on settlement discipline for the collection and distribution of the cash penalties in relation to settlement fails relating to cleared transactions to put central securities depositories in charge of the entire process of collection and distribution of penalties according to Articles 16, 17 and 18 of the same regulation. The Commission Delegated Regulation also specifies that in case of imbalanced positions in respect of cleared transactions the CCPs may allocate the remaining penalties’ amount, credit or debit, to their clearing members and should establish relevant mechanism in their rules to that effect.

The Delegated Regulation enters into force on the twentieth day following its publication in the OJ.

It applies from 2 September 2024.