On 11 December 2015, we blogged that HM Treasury had published a consultation paper on implementing the Central Securities Depositories Regulation (CSDR).

The Government has decided to publish its response to the consultation in two stages. The Government has now published a document that sets out its final decisions in relation to the Central Securities Depositories Regulations 2017 (the Regulations). A response focussing on the Uncertificated Securities (Amendment) Regulations 2017 will be published in due course.

The Regulations will be laid before Parliament in due course.

The HM Treasury consultation paper did not address article 3(1) CSDR that requires issuers of transferable securities admitted to trading or traded on trading venues to arrange for those securities to be “represented in book-entry form as immobilisation or subsequent to a direct issuance in dematerialised form.” This requirement will instead be addressed in a separate consultation from the Department for Business, Energy and Industrial Strategy.

Among other things the HM Treasury response document states that:

• the FCA will be designated as the competent authority for supervising investment firms under the Regulations;
• the FCA will also be the relevant competent authority in relation to participants in securities settlement systems for the purposes of monitoring and enforcing article 38(5) and (6) of the CSDR;
• the Bank of England (BoE) is designated as the competent authority for enforcing the requirements of the CSDR in relation to settlement internalisers and central counterparties;
• the BoE will have powers under section 166 and 166A of the Financial Services and Markets Act 2000 in its role as the competent authority for settlement internalisers; and
• respondents agreed with the proposed approach of creating a new recognised body category – a recognised central securities depository.

View HM Treasury response on Central Securities Depositories Regulation 2017, 11 September 2017