The European Council agreed its negotiating mandate on a European Commission proposal to shorten the standard settlement cycle for transactions in transferable securities executed on EU trading venues, such as shares and bonds, from two business days after the trade date (T+2) to one business day (T+1). The Council’s mandate amends the Commission proposal by exempting securities financing transactions (SFTs) from the T+1 settlement-cycle requirement, on the basis that SFTs are non-standardised and may require bespoke settlement periods agreed between the parties. To limit circumvention risk, the exemption would apply only where SFTs are documented as single transactions composed of two linked operations. The Council presidency will begin trilogue negotiations with the European Parliament, and once a common position is agreed the new rules would apply from 11 October 2027.
European Council 2025-05-07
European Council approves negotiating mandate to move EU securities settlement to T+1 with an exemption for securities financing transactions
The European Council set its negotiating mandate on the European Commission's proposal to reduce the standard settlement cycle for transferable securities on EU trading venues from T+2 to T+1. Securities financing transactions are exempt due to their non-standardized nature if documented as single transactions with two linked operations. Trialogue negotiations with the European Parliament will begin, with new rules expected from 11 October 2027.