T2S (TARGET2–Securities)

The development of the TARGET2-Securities (T2S) project emerged from a decision of the Governing Council of the European Central Bank (ECB) of 6 July 2006, to analyse and evaluate the market level of acceptance of a new securities settlement service in the euro area (ECB Press Release of 7 July 2006).
 
The T2S project is aimed at the further integration of market structures with harmonisation and efficiency gains and benefiting from the synergies of TARGET2, centralising in the same platform securities and cash settlements against central bank money. The synergy gains will allow, in principle, the reduction of post-trading costs and simultaneously of cross-border settlement costs, lowering them to a level closer to the lower costs of domestic securities settlement, thus promoting an increasing integration of market structures with efficiency gains.
 
On 20 October 2006, the Governing Council of the ECB invited the PSSC – Payment and Settlement Systems Committee to assess the T2S feasibility, concerning the operational, technical, legal and economic aspects (ECB Press Release of 20 October 2006).
 
T2S will be a technical platform for the provision of securities settlement services to the Central Securities Depositories (CSDs) and through them to the final users (CSDs’ participants) against central bank money. The national central banks (NCBs) will not have a direct interface with T2S, having access to the platform through TARGET2 (cash settlement interface in TARGET2).
 
Based on technical, operational, economic and legal feasibility studies, the Governing Council of the ECB concluded on 8 March 2007 that T2S is feasible, and decided to go ahead with the following phase of the project: definition of user requirements – assuming that T2S will be operated on the TARGET2 platform – in cooperation with the interested parties. This phase was completed at the end of 2007 (ECB Press Release of 8 March 2007).
 
As a consequence of this decision, a market public consultation about user requirements was launched on 27 April 2007, simultaneously with the approval of a T2S governance structure for this phase (ECB Press Release of 26 April 2007).
 
The T2S governance structure for this phase of the project development (definition of user requirements) includes an Advisory Group composed of three stakeholder groups (Eurosystem NCBs and ECB, CSDs and other market users), whose prerogatives include the right to make proposals and the direct reporting to the Eurosystem’s decision-making bodies. A coordination group was also set up (comprised of the chairpersons of the Advisory Group and the different technical groups), as well as technical groups and national user groups, that contributed to the preparation of the main documents of the T2S project adopted by the Advisory Group.
 
The National User Group of Portugal (NUG-PT) was set up in July 2007. It is chaired by Banco de Portugal and is composed of representatives of the Comissão do Mercado de Valores Mobiliários (Portuguese Securities Market Commission), INTERBOLSA (National Numbering Agency), Associação Portuguesa de Bancos (Portuguese Banking Association), LCH.Clearnet, SA and several banks operating in the securities market.
 
Simultaneously with the public consultation on T2S user requirements, a public consultation was launched on the development of a common platform for Eurosystem collateral management, called “Collateral Central Bank Management” (CCBM2) – (ECB Press Release of 26 April 2007).
 
The Governing Council of the ECB approved on 17 July 2008 the TARGET2-Securities (T2S) project, representing the Eurosystem contribution for integrated European financial markets (ECB Press Release of 26 April 2007). This is an important public infrastructure in the area of payments associated with securities transactions, having received support from European public authorities, euro area CSDs and main CSD users. T2S will enable investors to access a securities settlement service in central bank money for the whole euro area (and in the currencies of the respective central banks that have adopted T2S). This system is scheduled to go live in 2013.
 
The Governing Council of de ECB set up on the 19 March 2009, the T2S Programme Board to manage T2S project (ECB Decision and Press Release of 26 April 2007).
 
On 23 April 2009, the Governing Council of the ECB appointed members of the T2S Programme Board (ECB Decision and Press Release of 23 April 2009).
 
Eurosystem signed Memorandum of Understanding on T2S with 27 European central securities depositories on 16 July 2009 (Press-Release and Document of Memorandum of Understanding).

The T2S Programme Board approved the T2S General Functional Specifications (version 3) document, which can be downloaded from the ECB site.

The "National User Group" of Portugal (NUG-PT)

The list of participants, as well as the agendas and summaries of the meetings dedicated to the T2S project, are available.