CSDR and SDR
The Central Securities Depository Regulation (CSDR) is an EU regulation that impacts securities settlement and complements EMIR and MiFIR.
The Focus of CSDR
The focus of CSDR is to harmonize the authorization and supervision of Central Securities Depositories (CSDs). Next to that CSDR improves the safety and efficiency of the securities settlement systems operated by CSDs across the European Economic Area (EEA).
While CSDR imposes obligations on CSDs, the regulation also addresses the other actors in the settlement chain via Settlement Discipline Regime (SDR), which impacts amongst others the buy-side, sell-side, investors, custodians.
The key goal of SDR is to encourage market participants to settle transactions on the intended settlement date by improving confirmation and settlement procedures, invoke cash penalties for late matching and settlement, mandate buy-in for failed settlements and regulatory monitoring.