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Document 02012O0027-20220613
Guideline of the European Central Bank of 5 December 2012 on a Trans-European Automated Real-time Gross settlement Express Transfer system (TARGET2) (recast) (ECB/2012/27) (2013/47/EU)
Consolidated text: Guideline of the European Central Bank of 5 December 2012 on a Trans-European Automated Real-time Gross settlement Express Transfer system (TARGET2) (recast) (ECB/2012/27) (2013/47/EU)
Guideline of the European Central Bank of 5 December 2012 on a Trans-European Automated Real-time Gross settlement Express Transfer system (TARGET2) (recast) (ECB/2012/27) (2013/47/EU)
No longer in force
02012O0027 — EN — 13.06.2022 — 010.001
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GUIDELINE OF THE EUROPEAN CENTRAL BANK of 5 December 2012 on a Trans-European Automated Real-time Gross settlement Express Transfer system (TARGET2) (recast) (ECB/2012/27) (OJ L 030 30.1.2013, p. 1) |
Amended by:
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Official Journal |
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L 333 |
82 |
12.12.2013 |
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L 168 |
120 |
7.6.2014 |
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GUIDELINE (EU) 2015/930 OF THE EUROPEAN CENTRAL BANK of 2 April 2015 |
L 155 |
38 |
19.6.2015 |
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GUIDELINE (EU) 2016/579 OF THE EUROPEAN CENTRAL BANK of 16 March 2016 |
L 99 |
21 |
15.4.2016 |
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GUIDELINE (EU) 2017/2082 OF THE EUROPEAN CENTRAL BANK of 22 September 2017 |
L 295 |
97 |
14.11.2017 |
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GUIDELINE (EU) 2018/1626 OF THE EUROPEAN CENTRAL BANK of 3 August 2018 |
L 280 |
40 |
9.11.2018 |
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GUIDELINE (EU) 2019/1849 OF THE EUROPEAN CENTRAL BANK of 4 October 2019 |
L 283 |
64 |
5.11.2019 |
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GUIDELINE (EU) 2021/1759 OF THE EUROPEAN CENTRAL BANK of 20 July 2021 |
L 354 |
45 |
6.10.2021 |
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GUIDELINE (EU) 2022/311 OF THE EUROPEAN CENTRAL BANK of 17 February 2022 |
L 46 |
142 |
25.2.2022 |
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GUIDELINE (EU) 2022/688 OF THE EUROPEAN CENTRAL BANK of 22 April 2022 |
L 126 |
25 |
29.4.2022 |
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GUIDELINE OF THE EUROPEAN CENTRAL BANK
of 5 December 2012
on a Trans-European Automated Real-time Gross settlement Express Transfer system (TARGET2)
(recast)
(ECB/2012/27)
(2013/47/EU)
SECTION I
GENERAL PROVISIONS
Article 1
Subject matter and scope
Article 1a
TARGET2 transactions
The national central banks (NCBs) shall always use TARGET2 accounts for the following transactions:
open market monetary policy operations within the meaning of Guideline (EU) 2015/510 of the European Central Bank (ECB/2014/60) ( 1 );
settlement of transactions with ancillary systems;
payments between credit institutions.
Article 2
Definitions
For the purposes of this Guideline:
‘Single Shared Platform (SSP)’ means the single technical platform infrastructure provided by the SSP-providing NCBs;
‘TARGET2 component system’ means any of the Eurosystem CBs’ RTGS systems that form part of TARGET2;
‘central bank (CB)’ means a Eurosystem CB and/or a connected NCB;
‘SSP-providing NCBs’ means the Deutsche Bundesbank, the Banque de France and the Banca d’Italia in their capacity as the CBs building and operating the SSP for the Eurosystem’s benefit;
‘ ►M3 TARGET2 network service provider ◄ ’ means a provider of computerised network connections for the purpose of submitting payment messages in TARGET2. Computerised network connections are provided through SWIFT, and additionally for Eurosystem internal communication, through CoreNet;
‘participant’ [or ‘direct participant’] means an entity that holds at least one PM account (PM account holder) and/or one T2S Dedicated Cash Account (T2S DCA holder) and/or one TIPS DCA (TIPS DCA holder) with a Eurosystem CB;
‘Eurosystem CB’ means the ECB or a euro area NCB;
‘Payments Module (PM)’ means an SSP module in which payments of ►M3 PM account holders ◄ are settled on PM accounts;
‘euro area NCB’ means the national central bank (NCB) of a Member State whose currency is the euro;
‘Business Identifier Code (BIC)’ means a code as defined by ISO Standard No 9362;
‘addressable BIC holder’ means an entity which:
holds a BIC;
is not recognised as an indirect participant;
is a correspondent or customer of a PM account holder or a branch of a PM account holder or of an indirect participant, and is able to submit payment orders to and receive payments from a TARGET2 component system via the PM account holder;
‘indirect participant’ means a credit institution established in the European Union or the European Economic Area (EEA), which has entered into an agreement with a PM account holder to submit payment orders and receive payments via such PM account holder, and which has been recognised by a TARGET2 component system as an indirect participant;
‘branch’ means a branch within the meaning of point (17) of Article 4(1) of Regulation (EU) No 575/2013;
◄‘business day’ or ‘TARGET2 business day’ means any day on which TARGET2 is open for the settlement of payment orders, as set out in Appendix V to Annex II, Appendix V to Annex IIa and Appendix III to Annex IIb;
‘certification authorities’ means one or more NCBs designated as such by the Governing Council to act on behalf of the Eurosystem to issue, manage, revoke and renew electronic certificates;
‘electronic certificates’ or ‘certificates’ means an electronic file, issued by the certification authorities, that binds a public key with an identity and which is used for the following: to verify that a public key belongs to an individual; to authenticate the holder; to check a signature from this individual; or to encrypt a message addressed to this individual. Certificates are held on a physical device such as a smart card or USB stick, and references to certificates include such physical devices. The certificates are instrumental in the authentication process of the ►M3 PM account holders ◄ accessing TARGET2 through the internet and submitting payment messages or control messages;
‘certificate holder’ means a named, individual person, identified and designated by a ►M3 PM account holder ◄ as authorised to have internet-based access to the ►M3 PM account holder ◄ ’s TARGET2 account. Their application for certificates will have been verified by the ►M3 PM account holder ◄ ’s home NCB and transmitted to the certification authorities, which will in turn have delivered certificates binding the public key with the credentials that identify the ►M3 PM account holder ◄ ;
‘connected NCB’ means an NCB, other than a euro area NCB, which is connected to TARGET2 pursuant to a specific agreement;
‘AL group’ means a group composed of aggregated liquidity (AL) group members that use the AL mode;
‘AL group member’ means a ►M3 PM account holder ◄ that fulfils the criteria for using the AL mode and which has entered into an AL agreement;
‘AL agreement’ means the multilateral aggregated liquidity agreement entered into by the AL group members and their respective AL NCBs, for the purposes of the AL mode;
‘AL NCB’ means a euro area NCB that is party to an AL agreement and acts as the counterparty for the AL group members which participate in its TARGET2 component system;
‘AL mode’ means the aggregation of available liquidity on PM accounts;
‘available liquidity’ means a credit balance on a participant's account and, if applicable, any intraday credit line granted on the PM account by the relevant euro area NCB in relation to such account but not yet drawn upon, or if applicable, decreased by the amount of any processed reservations of liquidity on the PM account or blocking of funds on the T2S DCA;
‘intraday credit’ means credit extended for a period of less than one business day;
‘AL group manager’ means an AL group member appointed by the other AL group members to manage available liquidity within the AL group during the business day;
‘marginal lending rate’ means the interest rate applicable to the marginal lending facility;
‘marginal lending facility’ means a Eurosystem standing facility which counterparties may use to receive overnight credit from an NCB at the pre-specified marginal lending rate;
‘settlement bank’ means a ►M3 PM account holder ◄ whose PM account or sub-account is used to settle payment instructions submitted by an ancillary system via the ASI;
‘ancillary system’ means a system managed by an entity established in the Union or the EEA that is subject to supervision and/or oversight by a competent authority and complies with the oversight requirements for the location of infrastructures offering services in euro, as amended from time to time and published on the ECB's website ( 2 ), in which payments and/or financial instruments are exchanged and/or cleared or recorded with (a) the monetary obligations settled in TARGET2 and/or (b) funds held in TARGET2, in accordance with this Guideline and a bilateral arrangement between the ancillary system and the relevant Eurosystem CB;
‘Ancillary System Interface (ASI)’ means the technical device allowing an ancillary system to use a range of special, predefined services for the submission and settlement of ancillary system payment instructions; it may also be used by a euro area NCB for the settlement of cash operations resulting from cash deposits and withdrawals;
‘payer’, except where used in Article 23, means a TARGET2 participant whose PM account, T2S DCA or TIPS DCA will be debited as a result of a payment order being settled;
‘payee’, except where used in Article 23, means a TARGET2 participant whose PM account, T2S DCA or TIPS DCA, will be credited as a result of a payment order being settled;
‘Harmonised Conditions’ means the conditions laid down in Annexes II, IIa, IIb or V;
‘core TARGET2 services’ means the processing of payment orders in TARGET2 component systems, the settlement of ancillary system-related transactions, and liquidity pooling features;
‘Home Account’ means an account opened outside the PM by a euro area NCB for a credit institution established in the Union or the EEA;
▼M3 —————
‘managing NCB’ means the AL NCB of the TARGET2 component system in which the AL group manager participates;
‘enforcement event’ means, with regard to an AL group member, any of the following:
any event of default referred to in Article 34(1) of Annex II;
any other event of default or event referred to in Article 34(2) of Annex II in relation to which the CB has decided, taking into account the seriousness of the event of default or event, that a pledge should be enforced in accordance with Article 25b of that Annex, collateral should be enforced in accordance with Article 25c of that Annex or a set-off of claims should be triggered in accordance with Article 26 of that Annex;
any decision to suspend or terminate access to intraday credit;
‘Participant Interface (PI)’ means the technical device allowing direct participants to submit and settle payment orders via the services offered in the PM;
‘insolvency proceedings’ means insolvency proceedings within the meaning of Article 2(j) of Directive 98/26/EC of the European Parliament and of the Council of 19 May 1998 on settlement finality in payment and securities settlement systems ( 3 );
‘Information and Control Module (ICM)’ means the SSP module that allows PM account holders to obtain online information and gives them the possibility to submit liquidity transfer orders, manage liquidity and, if applicable, initiate backup payment orders or payment orders to the Contingency Solution in a contingency;
‘TARGET2 coordinator’ means a person appointed by the ECB to ensure the daily operational management of TARGET2, to manage and coordinate activity in the event of an abnormal situation occurring and to coordinate the dissemination of information to PM account holders and TIPS DCA holders;
‘TARGET2 settlement manager’ means a person appointed by a Eurosystem CB to monitor the operation of its TARGET2 component system;
‘TARGET2 crisis manager’ means a person appointed by a Eurosystem CB to handle, on behalf of that Eurosystem CB, failures of the SSP and/or of the TIPS Platform and/or abnormal external events;
‘technical malfunction of TARGET2’ means any difficulty, defect or failure in the technical infrastructure and/or the computer systems used by the relevant TARGET2 component system, including the SSP or T2S Platform or any other event that makes it impossible to execute and complete the same-business day processing of payments in the relevant TARGET2 component system;
‘non-settled payment order’ means a payment order, with the exception of an instant payment order, positive recall answer and TIPS DCA to PM liquidity transfer order, that is not settled on the same business day as that on which it is accepted;
‘cross-system settlement’ means the real-time settlement of debit instructions under which payments are executed from a settlement bank of one ancillary system using settlement procedure 6 to a settlement bank of another ancillary system using settlement procedure 6 as set out in Annex IV;
‘cash settlement’ means settlement of banknotes and coins;
‘CoreNet’ means the internal Eurosystem network service provided by the ECB and used by the Eurosystem CBs as a contingency network to access the SSP in the event that SWIFT is unavailable and as an alternative network to SWIFT to access the CRSS;
‘Customer-related services system (CRSS)’ provides core and optional services to Eurosystem CBs, i.e. archiving, billing optional services, query and report optional services and customer relationship optional services;
‘deposit facility’ means a Eurosystem standing facility which counterparties may use to make overnight deposits with an NCB at the pre-specified deposit rate;
‘deposit facility rate’ means the interest rate applicable to the deposit facility;
‘T2S Operations’ means harmonised and commoditised delivery-versus-payment settlement services provided in an integrated technical environment with cross-border capabilities through the T2S Platform;
‘TARGET2-Securities (T2S)’ or ‘T2S Platform’ means the set of hardware, software and other technical infrastructure components through which the Eurosystem provides the services to CSDs and Eurosystem CBs that allow core, neutral and borderless settlement of securities transactions on a delivery-versus-payment basis in central bank money;
▼M8 —————
‘T2S Dedicated Cash Account (T2S DCA)’ means an account held by a T2S DCA holder, opened in TARGET2-[insert CB/country reference], and used for cash payments in relation to securities settlement in T2S;
‘Harmonised Conditions for the Opening and Operation of a T2S Dedicated Cash Account (T2S DCA) in TARGET2’ means the conditions that are laid down in Annex IIa;
‘Conditions for Auto-collateralisation Operations’ means the conditions that are laid down in Annex IIIa;
‘payment order’ means a credit transfer order, a liquidity transfer order, a direct debit instruction, a PM to T2S DCA liquidity transfer order, a T2S DCA to PM liquidity transfer order, a T2S DCA to T2S DCA liquidity transfer order, a PM to TIPS DCA liquidity transfer order, a TIPS DCA to PM liquidity transfer order, a TIPS AS technical account to TIPS DCA liquidity transfer order, a TIPS DCA to TIPS AS technical account liquidity transfer order, an instant payment order, or a positive recall answer;
‘T2S DCA to PM liquidity transfer order’ means the instruction to transfer a specified amount of funds from a T2S DCA to a PM account;
‘PM to T2S DCA liquidity transfer order’ means the instruction to transfer a specified amount of funds from a PM account to a T2S DCA;
‘T2S DCA to T2S DCA liquidity transfer order’ means the instruction to transfer a specified amount of funds (a) from a T2S DCA to a T2S DCA linked to the same Main PM account; (b) from a T2S DCA to a T2S DCA held by the same legal entity; or (c) from a T2S DCA to a T2S DCA where one or both are held by the CB;
‘Main PM account’ means the PM account to which a T2S DCA is linked and on which any remaining balance will be automatically repatriated at end-of-day;
‘real-time gross settlement’ means the processing and settlement of payment orders on a transaction by transaction basis in real time;
‘credit transfer order’ means an instruction by a payer to make funds available to a payee by means of a book entry on a PM account;
‘TARGET2 participant’ means any participant in any TARGET2 component system;
‘auto-collateralisation’ means intraday credit granted by the euro area NCB in central bank money triggered when a T2S DCA holder has insufficient funds to settle securities transactions, whereby such intraday credit is collateralised either with the securities being purchased (collateral on flow), or with securities held by the T2S DCA holder in favour of the euro area NCB (collateral on stock);
‘liquidity transfer order’ means a payment order, the main purpose of which is to transfer liquidity between different accounts of the same participant or within a CAI or AL group;
‘credit institution’ means either: (a) a credit institution within the meaning of point (1) of Article 4(1) of Regulation (EU) No 575/2013 of the European Parliament and of the Council ( 4 ) [and, if relevant, insert national law provisions implementing Article 2(5) of Directive 2013/36/EU of the European Parliament and of the Council ( 5 ) ] that is subject to supervision by a competent authority; or (b) another credit institution within the meaning of Article 123(2) of the Treaty that is subject to scrutiny of a standard comparable to supervision by a competent authority;
‘direct debit instruction’ means an instruction from a payee submitted to its CB pursuant to which the CB of the payer debits the payer's account by the amount specified in the instruction, on the basis of a direct debit authorisation;
‘Guarantee Funds’ means funds provided by an ancillary system's participants, to be used in the event of the failure, for whatever reason, of one or more participants to meet their payment obligations in the ancillary system;
‘TARGET Instant Payment Settlement (TIPS) service’ means the settlement in central bank money of instant payment orders on the TIPS Platform;
‘TIPS Platform’ means the single technical platform infrastructure provided by the TIPS Platform-providing NCBs;
‘TIPS Platform-providing NCBs’ means the Deutsche Bundesbank, the Banco de España, the Banque de France and the Banca d'Italia in their capacity as the CBs building and operating the TIPS Platform for the Eurosystem's benefit;
▼M8 —————
‘TIPS Dedicated Cash Account (TIPS DCA)’ means an account held by a TIPS DCA holder, opened in TARGET2 -[insert CB/country reference], and used for the provision of instant payment services to its customers;
‘Harmonised Conditions for the Opening and Operation of a TIPS Dedicated Cash Account in TARGET2’ means the conditions that are laid down in Annex IIb;
‘instant payment order’ means, in line with the European Payments Council's SEPA Instant Credit Transfer (SCT Inst) scheme, a payment instruction which can be executed 24 hours a day any calendar day of the year, with immediate or close to immediate processing and notification to the payer and includes (i) TIPS DCA to TIPS DCA instant payment orders, (ii) TIPS DCA to TIPS AS technical account instant payment orders, (iii) TIPS AS technical account to TIPS DCA instant payment orders and (iv) TIPS AS technical account to TIPS AS technical account instant payment orders;
‘recall request’ means, in line with the SCT Inst scheme, a message from a TIPS DCA holder requesting reimbursement of a settled instant payment order;
‘positive recall answer’ means, in line with the SCT Inst scheme, a payment order initiated by the receiver of a recall request, in response to a recall request, for the benefit of the sender of that recall request;
‘PM to TIPS DCA liquidity transfer order’ means the instruction to transfer a specified amount of funds from a PM account to a TIPS DCA;
‘TIPS DCA to PM liquidity transfer order’ means the instruction to transfer a specified amount of funds from a TIPS DCA to a PM account;
‘Contingency Solution’ means the SSP functionality that processes very critical and critical payments in contingency;
‘European Payments Council's SEPA Instant Credit Transfer (SCT Inst) scheme’ or ‘SCT Inst scheme’ means an automated, open standards scheme providing a set of interbank rules to be complied with by SCT Inst participants, allowing payment services providers in SEPA to offer an automated, SEPA-wide euro instant credit transfer product;
‘TIPS ancillary system technical account (TIPS AS technical account)’ means an account held by an ancillary system or a CB on an ancillary system's behalf in the CB’s TARGET2 component system for use by the ancillary system for the purpose of settling instant payments in its own books;
‘TIPS DCA to TIPS AS technical account liquidity transfer order’ means the instruction to transfer a specified amount of funds from a TIPS DCA to a TIPS AS technical account to fund the TIPS DCA holder’s position (or the position of another participant of the ancillary system) in the books of the ancillary system;
‘TIPS AS technical account to TIPS DCA liquidity transfer order’ means the instruction to transfer a specified amount of funds from a TIPS AS technical account to a TIPS DCA to defund the TIPS DCA holder’s position (or the position of another participant of the ancillary system) in the books of the ancillary system.
Article 3
TARGET2 component systems
Article 4
Connection of NCBs of Member States whose currency is not the euro
The NCBs of Member States whose currency is not the euro may only connect to TARGET2 if they conclude an agreement with the Eurosystem CBs. Such agreement shall specify that the connected NCBs will comply with this Guideline, subject to any mutually agreed appropriate specifications and modifications.
Article 5
Intra-ESCB transactions
Intra-European System of Central Banks (ESCB) transactions shall be processed through TARGET2, with the exception of payments that the CBs bilaterally or multilaterally agree to process through correspondent accounts, where appropriate.
Article 6
Intra-Eurosystem settlement
SECTION II
GOVERNANCE
Article 7
Governance levels
SECTION III
OPERATION OF TARGET2
Article 8
Harmonised Conditions for the Opening and Operation of a PM account, a T2S DCA or a TIPS DCA in TARGET2
Article 9
Pricing
The Eurosystem CBs shall ensure that:
the fees for core TARGET2 services provided to their indirect participants in the PM and their addressable BIC holders that are eligible to participate in TARGET2 as indirect participants in the PM are higher than the fees for PM account holders specified in paragraph 1(a) of Appendix VI to Annex II;
▼M4 —————
the pricing for all of the following operations and transactions is outside the scope of the fee schedule laid down in Appendix VI to Annex II:
liquidity transfers initiated from and processed within Home Accounts;
operations relating to minimum reserve management and standing facilities;
cash transactions settled on Home Accounts.
▼M3 —————
Article 10
Liquidity pooling arrangements
Article 11
Remuneration of Guarantee Funds
▼M5 —————
Article 12
Intraday credit — Auto-collateralisation
Article 13
Ancillary systems
Bilateral arrangements with ancillary systems that use the ASI shall be in conformity with Annex IV. In addition, the Eurosystem CBs shall ensure that in such bilateral arrangements the following provisions of Annex II apply mutatis mutandis:
Article 8(1) (technical and legal requirements);
Article 8(2) to (5) (application procedure), except that instead of being required to meet the access criteria in Article 4 the ancillary system shall be required to meet the access criteria in the definition of ‘ancillary system’ in Article 1 of Annex II;
the operating schedule in Appendix V;
Article 11 (requirements for cooperation and information exchange), except paragraph 8;
Articles 27 and 28 (business continuity and contingency procedures and security requirements and control procedures), whereby the fee used as the basis for the calculation of the penalty charges for non-compliance with security requirements as laid down in Article 28 of Annex II is the fee referred to in paragraph 18(1)(a) of Annex IV;
Article 31 (liability regime);
Article 32 (evidence rules);
Articles 33 and 34 (duration, termination and suspension of participation), except Article 34(1)(b);
Article 35, where relevant (closure of PM accounts);
Article 38 (confidentiality rules);
Article 39 (Union requirements for data protection, prevention of money laundering and related issues);
Article 40 (requirements for notices);
Article 41 (contractual relationship with the TARGET2 network service provider);
Article 44 (rules for governing law, jurisdiction and place of performance);
Article 45a (1) (transitional clause).
Bilateral arrangements with ancillary systems that use the PI shall be in conformity with both of the following:
Annex II, with the exception of Title V and Appendices VI and VII; and
Article 18 of Annex IV.
For the purposes of point (a), the fee used as the basis for the calculation of the penalty charges for non-compliance with security requirements as laid down in Article 28 of Annex II shall be the fee referred to in paragraph 18(1)(a) of Annex IV.
By derogation from paragraph 3, bilateral arrangements with ancillary systems that use the PI, but only settle payments for the benefit of their customers, shall be in conformity with both of the following:
Annex II, with the exception of Title V, Article 36 and Appendices VI and VII; and
Article 18 of Annex IV.
For the purposes of point (a), the fee used as the basis for the calculation of the penalty charges for non-compliance with security requirements in Article 28 of Annex II shall be the fee referred to in paragraph 18(1)(a) of Annex IV.
Eurosystem CBs shall provide fund transfer services in central bank money for ancillary systems settling instant payments in their own books pursuant to the SCT Inst scheme only in TIPS Platform. Bilateral arrangements for the provision of such fund transfer services shall be in conformity with Annex IVa and shall only allow for the settling of instant payments pursuant to the SCT Inst scheme. In such bilateral arrangements, the following provisions of Annex IIb shall apply mutatis mutandis:
Appendices I, II, and III;
Article 4 (general description of TARGET2);
Article 5 (access criteria), whereby the ancillary system shall be required to meet the access criteria in the definition of ‘ancillary system’ in Article 1 of Annex IIb;
Article 6(1) (technical and legal requirements), except that instead of being required to have adhered to the SCT Inst scheme by signing the SEPA Instant Credit Transfer Adherence Agreement, the ancillary system shall be required to have announced its compliance with the SCT Inst scheme;
Article 6(2) to (5) (application procedure), except that (i) instead of being required to meet the access criteria in Article 5 the ancillary system shall be required to meet the access criteria in the definition of ‘ancillary system’ in Article 1 of Annex IIb and (ii) instead of being required to submit evidence of their adherence to the SCT Inst scheme, the ancillary system shall submit evidence of the announcement of compliance with the SCT Inst scheme;
Article 7 (accessing TIPS Platform);
Article 8 (reachable parties);
Article 9 (network service provider);
Article 11 (TIPS directory);
Article 11a (MPL repository);
Article 12 (obligations of the CBs and the account holders), except paragraph 4;
Article 14 (requirements for cooperation and information exchange);
Article 16 (types of payment orders);
Article 17 (acceptance and rejection of payment orders);
Article 18 (processing of payment orders);
Article 19 (recall request);
Article 20 (moment of entry, moment of irrevocability);
Article 21(security requirements and business continuity);
Article 23 (liability regime);
Article 24 (evidence rules);
Articles 25 and 26 (duration, termination and suspension of participation), except Article 26(1)(b) and except the second subparagraph in paragraph 4 of Article 26;
Article 27, where relevant (closure of accounts);
Article 29 (confidentiality rules);
Article 30 (Union requirements for data protection, prevention of money laundering and related issues);
Article 31 (requirements for notices);
Article 34 (rules for governing law, jurisdiction and place of performance);
Article 35a (transitional clause).
Article 14
Financing and cost methodology
Article 15
Security provisions
Article 16
Audit rules
Audit assessments shall be performed in accordance with the principles and arrangements set out in the Governing Council’s ESCB Audit Policy.
Article 17
Obligations in the event of suspension or termination
Eurosystem CBs shall immediately terminate without prior notice or suspend a participant’s participation in the relevant TARGET2 component system if:
insolvency proceedings are opened in relation to a participant; or
a participant no longer meets the access criteria for the participation in the relevant TARGET2 component system.
If a Eurosystem CB suspends or terminates a participant’s participation in TARGET2 in accordance with paragraph 1 or on the grounds of prudence in accordance with Article 19, it shall immediately notify all other Eurosystem CBs thereof, providing all of the following:
the participant’s name, Monetary Financial Institution code and BIC;
the BIC of any PM accounts linked to the T2S DCA or TIPS DCA of the participant;
the information upon which the euro area NCB based its decision, including any information or opinion obtained from the relevant supervisory authority;
the measure taken and a proposed time-frame for its application.
Each Eurosystem CB shall, if so requested by another Eurosystem CB, exchange information in relation to such participant, including information in relation to payments addressed to it.
A Eurosystem CB that has terminated or suspended the participation of a participant in its TARGET2 component system in accordance with paragraph 1 shall assume liability in relation to the other Eurosystem CBs if it either:
subsequently authorises the settlement of payment orders addressed to participants whose participation it has suspended or terminated; or
does not comply with the obligations in paragraphs 1 and 2.
Article 18
Procedures for the rejection on the grounds of prudence of an application for participation in TARGET2
Where, pursuant to Article 8(4)(c) of Annex II or Article 6(4)(c) of Annex IIa or Article 6(4)(c) of Annex IIb, a Eurosystem CB rejects on the grounds of prudence an application to join TARGET2, that Eurosystem CB shall promptly inform the ECB of such rejection.
Article 19
Procedures for the suspension, limitation or termination on the grounds of prudence of participation in TARGET2, and access to intraday credit and to auto-collateralisation
Article 20
Procedures for cooperation by Eurosystem CBs in connection with administrative or restrictive measures
In connection with the implementation of Article 39(3) of Annex II, Article 28(3) of Annex IIa and Article 30(3) of Annex IIb:
any Eurosystem CB shall promptly share with all potentially affected CBs all information that it receives in connection with a proposed payment order, with the exception of payment orders concerning the transfer of liquidity between different accounts of the same participant;
any Eurosystem CB that receives from a participant evidence of notification having been made to, or consent having been received from, any competent authority shall promptly transmit such evidence to any other CB acting as the payment service provider of the payer or payee as appropriate;
the Eurosystem CB acting as payment service provider of the payer shall then promptly inform the payer that it can enter a relevant payment order into TARGET2.
Article 21
Business continuity
Article 22
Treatment of claims under the TARGET2 compensation scheme
►M6 Within nine weeks following a technical malfunction of TARGET2, the CB of the PM account holder or T2S DCA holder submitting the claim shall: ◄
prepare a preliminary assessment report containing the CB’s assessment of the claims received; and
submit the preliminary assessment report to the ECB and all other CBs concerned.
Article 23
Treatment of losses caused by a technical malfunction of TARGET2
In the event of a technical malfunction of TARGET2:
On the payer’s side, any CB with which a payer has placed a deposit benefits from certain financial gains which amount to the difference between the Eurosystem’s main refinancing operations rate and the deposit rate applied to the marginal increase in the use of the Eurosystem’s deposit facility for the period of the technical malfunction of TARGET2 and up to the amount of the non-settled payment orders. Where the payer is left with non-remunerated surplus funds, the financial gains amount to the Eurosystem’s main refinancing operations rate, applied to the amount of the non-interest-bearing surplus funds for the period of the technical malfunction of TARGET2 and up to the amount of the non-settled payment orders.
On the payee’s side, the CB from whom the payee has borrowed by using the marginal lending facility benefits from certain financial gains which amount to the difference between the marginal lending rate and the Eurosystem’s main refinancing operations rate, applied to the marginal increase in the use of the marginal lending facility for the period of the technical malfunction of TARGET2 and up to the amount of the non-settled payment orders.
The ECB’s financial gains amount to:
the earnings in relation to the connected NCBs arising from the different remuneration of end-of-day balances of those connected NCBs in relation to the ECB; and
the amount of penalty interest the ECB receives from connected NCBs whenever one of those connected NCBs imposes a penalty on a participant for a failure to reimburse intraday credit on time, as provided for in the agreement between the Eurosystem CBs and the connected NCBs.
Article 24
Security rights in relation to funds on sub-accounts and intra-Eurosystem guarantee
SECTION IV
TRANSITIONAL AND FINAL PROVISIONS
Article 25
Dispute resolution and applicable law
Article 26
Entry into force and application
Article 27
Miscellaneous provisions
Accounts opened outside the PM, outside the T2S Platform and outside the TIPS Platform by a euro area NCB for credit institutions and ancillary systems shall be governed by the rules of such euro area NCB, subject to the provisions of this Guideline which relate to Home Accounts and other decisions of the Governing Council. Accounts opened outside the PM, outside the T2S Platform and outside the TIPS Platform by a euro area NCB for entities other than credit institutions and ancillary systems shall be governed by the rules of such euro area NCB.
Article 27a
Transitional provision
Eurosystem CBs may provide fund transfer services in central bank money for ancillary systems settling instant payments in their own books pursuant to the SCT Inst scheme using the Ancillary Systems Interface until 25 February 2022.
Article 28
Addressees, implementing measures and annual reports
ANNEX I
TARGET2 GOVERNANCE ARRANGEMENTS
|
Level 1 — Governing Council |
Level 2 — Technical and operational management body |
Level 3 — SSP-providing NCBs and TIPS Platform-providing NCBs |
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0. General provisions |
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Level 1 has final competence in relation to domestic and cross-border TARGET2 issues and is responsible for safeguarding the public function of TARGET2 |
Level 2 conducts technical and operational management tasks in relation to TARGET2. |
Level 3 takes decisions on the daily running of the Single Shared Platform (SSP) and the TIPS Platform on the basis of the service levels defined in the agreements referred to in Article 7(6) of this Guideline |
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1. Cost and pricing policy |
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— Deciding on common cost methodology — Deciding on single price structure |
— Deciding on pricing of additional services and/or modules |
(Not applicable) |
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2. Service level |
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— Deciding on core services |
— Deciding on additional services and/or modules |
— Delivering input according to Level 1/Level 2 needs |
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3. Risk management |
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— Deciding on the general framework for risk management and acceptance of remaining risks |
— Conducting the actual risk management — Conducting risk analysis and follow-up |
— Providing the necessary information for risk analysis according to Level 1/Level 2 requests |
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4. Governance and financing |
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— Defining rules for decision-making and financing of the SSP and the TIPS Platform — Establishing and ensuring adequate implementation of the European System of Central Bank's legal framework for TARGET2 |
— Drawing up the rules on governance and financing decided at Level 1 — Drawing up the budget, its approval and implementation — Having control of the application — Collecting funds and remuneration of services |
— Providing cost figures to Level 2 for the service provision |
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5. Development |
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— Being consulted by Level 2 on the location of the SSP and the TIPS Platform — Approving the overall project plan |
— Deciding on the initial design and development of the SSP and the TIPS Platform — Deciding on establishing from scratch against establishing on the basis of an existing platform — Deciding on the choice of the SSP operator and the TIPS Platform operator — Establishing, in agreement with Level 3, the service levels of the SSP and the TIPS Platform — Deciding on the location of the SSP and the TIPS Platform after consultation of Level 1 — Approving the specification process methodology and the ‘deliverables’ of Level 3 deemed appropriate in order to specify and, later on, test and accept the product (in particular general and detailed user specifications) — Establishing a milestone project plan — Evaluating and accepting the deliverables — Establishing test scenarios — Central banks' and users' test coordination, in close cooperation with Level 3 |
— Proposing the initial design of the SSP and the TIPS Platform — Proposing whether to establish from scratch or establish on the basis of an existing platform — Proposing the location of the SSP and the TIPS Platform — Drafting the general and the detailed functional specifications (internal detailed functional specifications and user detailed functional specifications) — Drafting the detailed technical specifications — Providing initial and ongoing input for milestone project planning and control — Technical and operational support for tests (performing tests on the SSP and the TIPS Platform, input on SSP-related test scenarios and on TIPS Platform-related test scenarios, supporting Eurosystem CBs in their SSP and TIPS Platform test activities) |
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6. Implementation and migration |
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— Deciding on the migration strategy |
— Preparing and coordinating migration to the SSP and the TIPS Platform, in close cooperation with Level 3 |
— Providing input on migration issues in accordance with Level 2 requests — Performing SSP- and TIPS Platform-related migration work; additional support for joining NCBs |
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7. Operation |
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— Managing severe crisis situations — Authorising establishment and operation of TARGET2 Simulator — Appointing certification authorities for internet-based access — Specifying security policies, requirements and controls for the SSP and the TIPS Platform — Specifying principles applicable to security of certificates used for internet-based access |
— Maintaining contacts with users at European level (subject to the sole responsibility of Eurosystem CBs for the business relationship with their customers) and monitoring daily user activity from a business perspective (Eurosystem CB task) — Monitoring business developments — Budgeting, financing, invoicing (Eurosystem CB task) and other administrative tasks |
— Managing the system on the basis of the agreements referred to in Article 7(6) of this Guideline |
ANNEX II
HARMONISED CONDITIONS FOR THE OPENING AND OPERATION OF A PM ACCOUNT IN TARGET2
TITLE I
GENERAL PROVISIONS
Article 1
Definitions
For the purposes of these Harmonised Conditions (hereinafter the ‘Conditions’), the following definitions apply:
▼M7 —————
where the participant no longer meets the access criteria laid down in Article 4 or the requirements laid down in Article 8(1)(a)(i);
the opening of insolvency proceedings in relation to the participant;
the submission of an application relating to the proceedings referred to in point (b);
the issue by the participant of a written declaration of its inability to pay all or any part of its debts or to meet its obligations arising in relation to intraday credit;
the entry of the participant into a voluntary general agreement or arrangement with its creditors;
where the participant is, or is deemed by its CB to be, insolvent or unable to pay its debts;
where the participant's credit balance on its PM account, T2S DCA, or TIPS DCA, or all or a substantial part of the participant's assets are subject to a freezing order, attachment, seizure or any other procedure that is intended to protect the public interest or the rights of the participant's creditors;
where participation of the participant in another TARGET2 component system and/or in an ancillary system has been suspended or terminated;
where any material representation or pre-contractual statement made by the participant or which is implied to have been made by the participant under the applicable law is incorrect or untrue;
the assignment of all or a substantial part of the participant's assets,
a composition of credit institutions included in the consolidated financial statements of a parent company where the parent company is obliged to present consolidated financial statements under International Accounting Standard 27 (IAS 27), adopted pursuant to Commission Regulation (EC) No 1126/2008 ( 10 ) and consisting of either: (i) a parent company and one or more subsidiaries; or (ii) two or more subsidiaries of a parent company; or
a composition of credit institutions as referred to in subparagraph (a)(i) or (ii), where a parent company does not present consolidated financial statements in accordance with IAS 27, but may be able to satisfy the criteria defined in IAS 27 for inclusion in consolidated financial statements, subject to the verification of the CB of the ►M3 PM account holder ◄ or, in the case of an AL group, the managing NCB;
a bilateral or multilateral network of credit institutions that is: (i) organised through a statutory framework determining the affiliation of credit institutions to such a network; or (ii) characterised by self-organised mechanisms of cooperation (promoting, supporting and representing the business interests of its members) and/or economic solidarity going beyond the ordinary cooperation usual between credit institutions whereby such cooperation and solidarity are permitted by credit institutions’ by-laws or articles of incorporation or established by virtue of separate agreements;
authorised and supervised by a recognised competent authority, which has been designated as such under Directive 2014/65/EU; and
entitled to carry out the activities referred to under [insert national law provisions implementing items 2, 3, 6 and 7 of Section A of Annex I to Directive 2014/65/EU],
submit payment orders or receive payments via TARGET2; and
settle such payments with such CB,
▼M8 —————
Article 1a
Scope
The present Conditions govern the relationship between the relevant euro area NCB and its PM account holder as far the opening and the operation of the PM account is concerned.
Article 2
Appendices
The following Appendices form an integral part of these Conditions:
Article 3
General description of TARGET2
The following transactions are processed in TARGET2-[insert CB/country reference]:
transactions directly resulting from or made in connection with Eurosystem monetary policy operations;
settlement of the euro leg of foreign exchange operations involving the Eurosystem;
settlement of euro transfers resulting from transactions in cross-border large-value netting systems;
settlement of euro transfers resulting from transactions in euro retail payment systems of systemic importance;
settlement of the cash leg of securities transactions;
T2S DCA to T2S DCA liquidity transfer orders, T2S DCA to PM liquidity transfer orders and PM to T2S DCA liquidity transfer orders;
instant payment orders;
positive recall answers;
TIPS DCA to PM liquidity transfer orders and PM to TIPS DCA liquidity transfer orders;
TIPS DCA to TIPS AS technical account liquidity transfer orders and TIPS AS technical account to TIPS DCA liquidity transfer orders; and
any other transactions in euro addressed to TARGET2 participants.
TITLE II
PARTICIPATION
Article 4
Access criteria
The following types of entities are eligible for direct participation in TARGET2-[insert CB/country reference]:
credit institutions established in the Union or the EEA, including when they act through a branch established in the Union or the EEA;
credit institutions established outside the EEA, provided that they act through a branch established in the Union or the EEA;
NCBs of Member States and the ECB;
provided that the entities referred to in ►M6 points (a) and (b) ◄ are not subject to restrictive measures adopted by the Council of the European Union or Member States pursuant to Article 65(1)(b), Article 75 or Article 215 of the Treaty, the implementation of which, in the view of [CB/country reference] after informing the ECB, is incompatible with the smooth functioning of TARGET2.
The [insert name of the CB] may, at its discretion, also admit the following entities as direct participants:
treasury departments of central or regional governments of Member States;
public sector bodies of Member States authorised to hold accounts for customers;
investment firms established in the Union or the EEA, including when they act through a branch established in the Union or the EEA; and
investment firms established outside the EEA, provided that they act through a branch established in the Union or the EEA;
entities managing ancillary systems and acting in that capacity; and
credit institutions or any of the entities of the types listed ►M6 in points (a) to (d) ◄ , in both cases where these are established in a country with which the Union has entered into a monetary agreement allowing access by any of such entities to payment systems in the Union subject to the conditions set out in the monetary agreement and provided that the relevant legal regime applying in the country is equivalent to the relevant Union legislation.
Article 5
Direct participants
Multi-addressee access through branches may be provided as follows:
a credit institution within the meaning of Article 4(1)(a) or (b) of this Annex which has been admitted as a PM account holder may grant access to its PM account to one or more of its branches established in the Union or the EEA in order to submit payment orders and/or receive payments directly, provided that [insert name of the CB] has been informed accordingly;
where a branch of a credit institution has been admitted as a PM account holder, the other branches of the same legal entity and/or its head office, in both cases provided that they are established in the Union or the EEA, may access the branch’s PM account, provided that it has informed the [insert name of CB].
Article 6
Indirect participants
Article 7
►M3 PM account holder ◄ ’s responsibility
Article 8
Application procedure
To join TARGET2-[insert CB/country reference], applicant participants shall:
fulfil the following technical requirements:
install, manage, operate and monitor and ensure the security of the necessary IT infrastructure to connect to ►M6 the SSP ◄ and submit payment orders to it. In doing so, applicant participants may involve third parties, but retain sole liability. In particular, applicant participants shall enter into an agreement with the ►M3 TARGET2 network service provider ◄ to obtain the necessary connection and admissions, in accordance with the technical specifications in Appendix I; and
have passed the tests required by the [insert name of CB]; and
fulfil the following legal requirements:
provide a capacity opinion in the form specified in Appendix III, unless the information and representations to be provided in such capacity opinion have already been obtained by the [insert name of CB] in another context; and
for the entities referred to in Article 4(1)(b) and in Article 4(2)(c)(ii), provide a country opinion in the form specified in Appendix III, unless the information and representations to be provided in such country opinion have already been obtained by the [insert name of CB] in another context.
Applicants shall apply in writing to the [insert name of CB], as a minimum enclosing the following documents/information:
completed static data collection forms as provided by [insert name of CB];
the capacity opinion, if required by the [insert name of CB]; and
the country opinion, if required by the [insert name of CB].
The [insert name of CB] shall reject the application to participate if:
access criteria referred to in Article 4 are not met;
one or more of the participation criteria referred to in paragraph 1 are not met; and/or
in the [insert name of CB]’s assessment, such participation would endanger the overall stability, soundness and safety of TARGET2-[insert CB/country reference] or of any other TARGET2 component system, or would jeopardise the [insert name of CB]’s performance of its tasks as described in [refer to relevant national law] and the Statute of the European System of Central Banks and of the European Central Bank, or poses risks on the grounds of prudence.
Article 9
TARGET2 directory
The TARGET2 directory is the database of BICs used for the routing of payment orders addressed to:
►M3 PM account holders ◄ and their branches with multi-addressee access;
indirect participants of TARGET2, including those with multi-addressee access; and
addressable BIC holders of TARGET2.
It shall be updated weekly.
TITLE III
OBLIGATIONS OF THE PARTIES
Article 10
Obligations of the [insert name of CB] and the participants
Article 11
Cooperation and information exchange
Participants shall inform the [insert name of CB] of:
any new indirect participant, addressable BIC holder or entity with multi-addressee access which they register; and
any changes to the entities listed in paragraph (a).
TITLE IV
MANAGEMENT OF PM ACCOUNTS AND PROCESSING OF PAYMENT ORDERS
Article 12
Opening and management of PM accounts
PM accounts and their sub-accounts shall either be remunerated at zero per cent or at the deposit facility rate, whichever is lower, unless they are used to hold any of the following:
minimum reserves;
excess reserves;
government deposits as defined in Article 2, point (5) of Guideline (EU) 2019/671 (ECB/2019/7).
In the case of minimum reserves, the calculation and payment of remuneration of holdings shall be governed by Council Regulation (EC) No 2531/98 ( 16 ) and Regulation (EU) 2021/378 of the European Central Bank (ECB/2021/1) ( 17 ).
In the case of excess reserves, the calculation and payment of remuneration of holdings shall be governed by Decision (EU) 2019/1743 (ECB/2019/31) ( 18 ).
In the case of government deposits, the remuneration of holdings shall be governed by the provisions relating to those government deposits as set out in Article 4 of Guideline (EU) 2019/671 (ECB/2019/7) ( 19 ).
Article 13
Types of payment orders
The following are classified as payment orders for the purposes of TARGET2:
credit transfer orders;
direct debit instructions carried out under a direct debit authorisation;
liquidity transfer orders;
PM to T2S DCA liquidity transfer orders; and
PM to TIPS DCA liquidity transfer orders.
Article 14
Acceptance and rejection of payment orders
Payment orders submitted by participants are deemed accepted by the [insert name of CB] if:
the payment message complies with the rules established by the ►M3 TARGET2 network service provider ◄ ;
the payment message complies with the formatting rules and conditions of TARGET2-[insert CB/country reference] and passes the double-entry check described in Appendix I; and
in cases where a payer or a payee has been suspended, the suspended participant’s CB’s explicit consent has been obtained.
Article 15
Priority rules
Instructing participants shall designate every payment order as one of the following:
normal payment order (priority class 2);
urgent payment order (priority class 1);
highly urgent payment order (priority class 0).
If a payment order does not indicate the priority, it shall be treated as a normal payment order.
Highly urgent payment orders may only be designated by:
CBs; and
participants, in cases of payments to and from CLS Bank International, with the exception of payments related to the CLS CCP and the CLSNow services, and liquidity transfers in relation to ancillary system settlement using the ASI.
All payment instructions submitted by an ancillary system through the ASI to debit or credit the participants' PM accounts and all PM to T2S DCA liquidity transfer orders and PM to TIPS DCA liquidity transfer orders submitted shall be deemed to be highly urgent payment orders.
Article 16
Liquidity limits
Article 17
Liquidity reservation facilities
Article 17a
Standing instructions for liquidity reservation and dedication of liquidity
Article 18
Predetermined settlement times
Article 19
Payment orders submitted in advance
Article 20
Settlement of payment orders in the entry disposition
Funding may be provided by:
the available liquidity on the PM account; or
incoming payments from other TARGET2 participants, subject to the applicable optimisation procedures.
Article 21
Settlement and return of queued payment orders
Article 22
Entry of payment orders into the system and their irrevocability
TITLE V
LIQUIDITY POOLING
Article 23
Liquidity pooling modes
The [insert name of CB] shall offer a consolidated account information (CAI) mode and an aggregated liquidity (AL) mode.
Article 24
Consolidated account information mode
The following may use the CAI mode:
a credit institution and/or its branches (whether or not such entities participate in the same TARGET2 component system), provided that the entities concerned have several PM accounts identified by different BICs; or
two or more credit institutions which belong to the same group and/or their branches, each having one or more PM accounts identified by different BICs.
Under the CAI mode, each member of the CAI group and their respective CBs are provided with the list of PM accounts of the group members and the following additional information consolidated at the level of the CAI group:
intraday credit lines (if applicable);
balances, including balances on sub-accounts;
turnover;
settled payments;
queued payment orders.
The CAI group manager and its respective CB shall have access to information on each of the above items in relation to any PM account of the CAI group.
Information referred to in this paragraph is provided via the ICM.
Article 25
Aggregated liquidity mode
The following may use the AL mode:
a credit institution and/or its branches (whether or not such entities participate in the same TARGET2 component system), provided that the entities concerned are established in the euro area and have several PM accounts identified by different BICs;
branches established in the euro area (whether or not such branches participate in the same TARGET2 component system) of a credit institution established outside the euro area, provided that such branches have several PM accounts identified by different BICs; or
two or more credit institutions referred to in subparagraph (a) and/or branches referred to in subparagraph (b) which belong to the same group.
In each case referred in subparagraphs (a) to (c) it shall also be a requirement that the entities concerned have established intraday credit arrangements with the respective euro area NCB.
[Insert if applicable:
Article 25a
Pledge/enforcement
[If applicable and if required under the laws of the relevant jurisdiction:
Article 25b
Enforcement of the pledge
Upon the occurrence of an enforcement event, the [insert name of CB] shall have an unrestricted right to realise the pledge without any prior notice. [Insert if deemed appropriate under the laws of the relevant jurisdiction: in accordance with [insert relevant national law provisions governing enforcement of the pledge].]
[If applicable and if required under the laws of the relevant jurisdiction:
Article 25c
Enforcement of collateral
Upon occurrence of the enforcement event, the [insert name of the CB] shall have the right to realise collateral under Article 36.]
Article 26
Set-off of claims under Article 36(4) and (5)
On the occurrence of an enforcement event, any claim of the [insert name of CB] against such AL group member shall be automatically and immediately accelerated and shall be subject to Article 36(4) and (5) of these Conditions.
TITLE VI
SECURITY REQUIREMENTS AND CONTINGENCY ISSUES
Article 27
Business continuity and contingency procedures
Article 28
Security Requirements and Control Procedures
The [insert name of CB] may impose the following measures of redress on participants whose level of compliance was assessed as minor or major non-compliance, in increasing order of severity:
enhanced monitoring: the participant shall provide the [insert name of CB] with a monthly report, signed by a senior executive, on their progress in addressing the non-compliance. The participant shall additionally incur a monthly penalty charge for each affected account equal to its monthly fee as set out in paragraph 1 of Appendix VI excluding the transaction fees. This measure of redress may be imposed in the event the participant receives a second consecutive assessment of minor non-compliance or an assessment of major non-compliance;
suspension: participation in TARGET2-[insert CB/country reference] may be suspended in the circumstances described in Article 34(2)(b) and (c) of this Annex. By way of derogation from Article 34 of this Annex, the participant shall be given three months’ notice of such suspension. The participant shall incur a monthly penalty charge for each suspended account of double its monthly fee as set out in paragraph 1 of Appendix VI, excluding the transaction fees. This measure of redress may be imposed in the event the participant receives a second consecutive assessment of major non-compliance;
termination: participation in TARGET2-[insert CB/country reference] may be terminated in the circumstances described in Article 34(2)(b) and (c) of this Annex. By way of derogation from Article 34 of this Annex, the participant shall be given three months’ notice of such termination. The participant shall incur an additional penalty charge of EUR 1 000 for each terminated account. This measure of redress may be imposed if the participant has not addressed the major non-compliance to the satisfaction of [insert name of CB] following three months of suspension.
TITLE VII
THE INFORMATION AND CONTROL MODULE
Article 29
Use of the ICM
The ICM:
allows participants to access information relating to their accounts and to manage liquidity;
may be used to initiate liquidity transfer orders, TIPS DCA to PM liquidity transfer orders, PM to TIPS DCA liquidity transfer orders, PM to T2S DCA liquidity transfer orders and, when the ICM is used in combination with the T2S value added services, T2S DCA to PM liquidity transfer orders; and
allows participants to initiate backup liquidity redistribution and backup contingency payments or payment orders to the Contingency Solution in the event of a failure of the participant’s payment infrastructure.
TITLE VIII
COMPENSATION, LIABILITY REGIME AND EVIDENCE
Article 30
Compensation scheme
If a payment order cannot be settled on the same business day on which it was accepted due to a technical malfunction of TARGET2, the [insert name of CB] shall offer to compensate the direct participants concerned in accordance with the special procedure laid down in Appendix II.
Article 31
Liability regime
The [insert name of CB] shall not be liable:
to the extent that the loss is caused by the participant; or
if the loss arises out of external events beyond the [insert name of CB]’s reasonable control (force majeure).
Article 32
Evidence
TITLE IX
TERMINATION OF PARTICIPATION AND CLOSURE OF ACCOUNTS
Article 33
Duration and ordinary termination of participation
Article 34
Suspension and extraordinary termination of participation
A ►M3 PM account holder ◄ ’s participation in TARGET2-[insert CB/country reference] shall be immediately terminated without prior notice or suspended if one of the following events of default occurs:
the opening of insolvency proceedings; and/or
the ►M3 PM account holder ◄ no longer meets the access criteria laid down in Article 4.
For the purposes of this paragraph, the taking of crisis prevention measures or crisis management measures within the meaning of Directive 2014/59/EU of the European Parliament and of the Council ( 21 ) against a PM account holder shall not automatically qualify as the opening of insolvency proceedings.
The [insert name of CB] may terminate without prior notice or suspend the ►M3 PM account holder ◄ ’s participation in TARGET2-[insert CB/country reference] if:
one or more events of default (other than those referred to in paragraph 1) occur;
the ►M3 PM account holder ◄ is in material breach of these Conditions;
the ►M3 PM account holder ◄ fails to carry out any material obligation to the [insert name of CB];
the ►M3 PM account holder ◄ is excluded from, or otherwise ceases to be a member of, a TARGET2 CUG;
any other ►M3 PM account holder ◄ -related event occurs which, in the [insert name of CB]’s assessment, would threaten the overall stability, soundness and safety of TARGET2-[insert CB/country reference] or of any other TARGET2 component system, or which would jeopardise the [insert name of CB]’s performance of its tasks as described in [refer to relevant national law] and the Statute of the European System of Central Banks and of the European Central Bank, or poses risks on the grounds of prudence; and/or
an NCB suspends or terminates the ►M3 PM account holder ◄ ’s access to intraday credit pursuant to paragraph 12 of Annex III.
In the event that the [insert name of CB] suspends or terminates a PM account holder's participation in TARGET2-[insert CB/country reference] under paragraph 1 or 2, the [insert name of CB] shall immediately inform, by means of an ICM broadcast message or a T2S broadcast message, that PM account holder, other CBs and PM account holders and ►M6 T2S DCA holders ◄ in all of the TARGET2 component systems of such suspension or termination. Such message shall be deemed to have been issued by the home CB of the PM account holder and ►M6 T2S DCA holder ◄ that receives the message. ◄
▼M4 —————
Once such an ICM broadcast message has been received by the ►M3 PM account holders ◄ , the latter shall be deemed informed of the termination/suspension of a ►M3 PM account holder ◄ ’s participation in TARGET2-[insert CB/country reference] or another TARGET2 component system. The ►M3 PM account holders ◄ shall bear any losses arising from the submission of a payment order to ►M3 PM account holders ◄ whose participation has been suspended or terminated if such payment order was entered into TARGET2-[insert CB/country reference] after receipt of the ICM broadcast message.
Article 35
Closure of PM accounts
On termination of participation, pursuant to either Article 33 or 34, the [insert name of CB] shall close the PM accounts of the participant concerned, after having:
settled or returned any queued payment orders; and
made use of its rights of pledge and set-off under Article 36.
TITLE X
FINAL PROVISIONS
Article 36
The [insert name of CB]’s rights of pledge and set-off
On the occurrence of:
an event of default, referred to in Article 34(1); or
any other event of default or event referred to in Article 34(2) that has led to the termination or suspension of the participant’s participation, notwithstanding the commencement of any insolvency proceedings in respect of a participant and notwithstanding any assignment, judicial or other attachment or other disposition of or in respect of the participant’s rights, all obligations of the participant shall be automatically and immediately accelerated, without prior notice and without the need for any prior approval of any authority, so as to be immediately due. In addition, the mutual obligations of the participant and the [insert name of CB] shall automatically be set off against each other, and the party owing the higher amount shall pay to the other the difference.
Article 37
Security rights in relation to funds on sub-accounts
Article 38
Confidentiality
Article 39
Data protection, prevention of money laundering, administrative or restrictive measures and related issues
Participants, when acting as the payment service provider of a payer or payee, shall comply with all requirements resulting from administrative or restrictive measures imposed pursuant to Article 75 or 215 of the Treaty to which they are subject, including with respect to notification and/or the obtaining of consent from a competent authority in relation to the processing of transactions. In addition:
when the [insert name of CB] is the payment service provider of a participant that is a payer:
the participant shall make the required notification or obtain consent on behalf of the central bank that is primarily required to make notification or obtain consent, and shall provide the [insert name of CB] with evidence of having made a notification or having received consent;
the participant shall not enter any payment order for the transfer of funds to an account held by an entity different than the participant, into TARGET2 until it has obtained confirmation from the [insert name of CB] that the required notification has been made or the consent has been obtained by or on behalf of the payment service provider of the payee;
when the [insert name of CB] is a payment service provider of a participant that is a payee, the participant shall make the required notification or obtain consent on behalf of the central bank that is primarily required to make notification or obtain consent, and shall provide the [insert name of CB] with evidence of having made a notification or having received consent.
For the purposes of this paragraph, the terms ‘payment service provider’, ‘payer’ and ‘payee’ shall have the meanings ascribed to them in the applicable administrative or restrictive measures.
Article 40
Notices
Article 41
Contractual relationship with ►M3 TARGET2 network service provider ◄
Article 42
Amendment procedure
The [insert name of CB] may at any time unilaterally amend these Conditions, ►M6 including the Appendices ◄ . Amendments to these Conditions, ►M6 including the Appendices ◄ , shall be announced by means of [insert relevant means of announcement]. Amendments shall be deemed to have been accepted unless the participant expressly objects within 14 days of being informed of such amendments. In the event that a participant objects to the amendment, the [insert name of CB] is entitled immediately to terminate that participant’s participation in TARGET2-[insert CB/country reference] and close any of its PM accounts.
Article 43
Third party rights
Article 44
Governing law, jurisdiction and place of performance
Article 45
Severability
If any provision in these Conditions is or becomes invalid, this shall not prejudice the applicability of all the other provisions of these Conditions.
Article 45a
Transitional provisions
Article 46
Entry into force and binding nature
Appendix I
TECHNICAL SPECIFICATIONS FOR THE PROCESSING OF PAYMENT ORDERS
In addition to the Harmonised Conditions, the following rules shall apply to the processing of payment orders:
1. Technical requirements for participation in TARGET2-[insert CB/country reference] regarding infrastructure, network and formats
(1) TARGET2 uses SWIFT services for the exchange of messages. Each participant therefore needs a connection to SWIFT’s Secure IP Network. Each participant’s PM account shall be identified by an eight- or 11-digit SWIFT BIC. Furthermore, each participant shall pass a series of tests to prove its technical and operational competence before it may participate in TARGET2-[insert CB/country reference].
(2) For the submission of payment orders and the exchange of payment messages in the PM the SWIFTNet FIN Y-copy service shall be used. A dedicated SWIFT Closed User Group (CUG) shall be set up for this purpose. Payment orders within such TARGET2 CUG shall be directly addressed to the receiving TARGET2 participant by entering its BIC in the header of the SWIFTNet FIN message.
(3) For the information and control services the following SWIFTNet services may be used:
SWIFTNet InterAct;
SWIFTNet FileAct; and/or
SWIFTNet Browse.
(4) The security of the message exchange between participants shall rely exclusively on SWIFT’s Public Key Infrastructure (PKI) service. Information on the PKI service is available in the documentation provided by SWIFT.
(5) The ‘bilateral relationship management’ service provided by SWIFT’s Relationship Management Application (RMA) shall only be used with the central destination BIC of the SSP and not for payment messages between TARGET2 participants.
2. Payment message types
(1) The following SWIFTNet FIN/SWIFT system message types are processed:
|
Message Type |
Type of use |
Description |
|
MT 103 |
Mandatory |
Customer payment |
|
MT 103+ |
Mandatory |
Customer payment (Straight Through Processing) |
|
MT 202 |
Mandatory |
Bank-to-bank payment |
|
MT 202COV |
Mandatory |
Cover payment |
|
MT 204 |
Optional |
Direct debit payment |
|
MT 011 |
Optional |
Delivery notification |
|
MT 012 |
Optional |
Sender notification |
|
MT 019 |
Mandatory |
Abort notification |
|
MT 900 |
Optional |
Confirmation of debit/Credit line change |
|
MT 910 |
Optional |
Confirmation of credit/Credit line change |
|
MT 940/950 |
Optional |
(Customer) statement message |
MT 011, MT 012 and MT 019 are SWIFT system messages.
(2) When they register with TARGET2-[insert CB/country reference], direct participants shall declare which optional message types they will use, with the exception of MT 011 and MT 012 messages in relation to which direct participants shall decide from time to time whether or not to receive them with reference to specific messages.
(3) Participants shall comply with the SWIFT message structure and field specifications, as defined in the SWIFT documentation and under the restrictions set out for TARGET2, as described in Chapter 9.1.2.2 of the User Detailed Functional Specifications (UDFS), Book 1.
(4) Field contents shall be validated at the level of TARGET2-[insert country/CB reference] in accordance with the UDFS requirements. Participants may agree among each other on specific rules regarding the field contents. However, in TARGET2-[insert country/CB reference] there shall be no specific checks as to whether participants comply with any such rules.
(5) MT 202COV messages shall be used for making cover payments, i.e. payments made by correspondent banks to settle (cover) credit transfer messages which are submitted to a customer’s bank by other, more direct means. Customer details contained in MT 202COV shall not be displayed in the ICM.
3. Double-entry check
(1) All payment orders shall pass a double-entry check, the aim of which is to reject payment orders that have been submitted more than once by mistake.
(2) The following fields of the SWIFT message types shall be checked:
|
Details |
Part of the SWIFT message |
Field |
|
Sender |
Basic header |
LT address |
|
Message type |
Application header |
Message type |
|
Receiver |
Application header |
Destination address |
|
Transaction reference number (TRN) |
Text block |
:20 |
|
Related reference |
Text block |
:21 |
|
Value date |
Text block |
:32 |
|
Amount |
Text block |
:32 |
(3) If all the fields described in subparagraph 2 in relation to a newly submitted payment order are identical to those in relation to a payment order that has already been accepted, the newly submitted payment order shall be returned.
4. Error codes
If a payment order is rejected, the instructing participant shall receive an abort notification (MT 019) indicating the reason for the rejection by using error codes. The error codes are defined in Chapter 9.4.2 of the UDFS.
5. Predetermined settlement times
(1) For payment orders using the Earliest Debit Time Indicator, the codeword ‘/FROTIME/’ shall be used.
(2) For payment orders using the Latest Debit Time Indicator, two options shall be available.
Codeword ‘/REJTIME/’: if the payment order cannot be settled by the indicated debit time, the payment order shall be returned.
Codeword ‘/TILTIME/’: if the payment order cannot be settled by the indicated debit time, the payment order shall not be returned but shall be kept in the relevant queue.
Under both options, if a payment order with a Latest Debit Time Indicator is not settled 15 minutes prior to the time indicated therein, a notification shall automatically be sent via the ICM.
(3) If the codeword ‘/CLSTIME/’ is used, the payment shall be treated in the same way as a payment order referred to in subparagraph 2(b).
6. Settlement of payment orders in the entry disposition
(1) Offsetting checks and, if appropriate, extended offsetting checks (both terms as defined in paragraphs 2 and 3) shall be carried out on payment orders entered into the entry disposition to provide quick, liquidity-saving gross settlement of payment orders.
(2) An offsetting check shall determine whether the payee’s payment orders that are at the front of the highly urgent or, if inapplicable, the urgent queue are available to be offset against the payer’s payment order (hereinafter ‘offsetting payment orders’). If an offsetting payment order does not provide sufficient funds for the respective payer’s payment order in the entry disposition, it shall be determined whether there is sufficient available liquidity on the payer’s PM account.
(3) If the offsetting check fails, the [insert name of CB] may apply an extended offsetting check. An extended offsetting check determines whether offsetting payment orders are available in any of the payee’s queues regardless of when they joined the queue. However, if in the queue of the payee there are higher priority payment orders addressed to other TARGET2 participants, the FIFO principle may only be breached if settling such an offsetting payment order would result in a liquidity increase for the payee.
7. Settlement of payment orders in the queue
(1) The treatment of payment orders placed in queues depends on the priority class to which it was designated by the instructing participant.
(2) Payment orders in the highly urgent and urgent queues shall be settled by using the offsetting checks described in paragraph 6, starting with the payment order at the front of the queue in cases where there is an increase in liquidity or there is an intervention at queue level (change of queue position, settlement time or priority, or revocation of the payment order).
(3) Payments orders in the normal queue shall be settled on a continuous basis including all highly urgent and urgent payment orders that have not yet been settled. Different optimisation mechanisms (algorithms) are used. If an algorithm is successful, the included payment orders will be settled; if an algorithm fails, the included payment orders will remain in the queue. Three algorithms (1 to 3) shall be applied to offset payment flows. By means of Algorithm 4, settlement procedure 5 (as defined in Chapter 2.8.1 of the UDFS) shall be available for the settlement of payment instructions of ancillary systems. To optimise the settlement of highly urgent ancillary system transactions on participants’ sub-accounts, a special algorithm (Algorithm 5) shall be used.
Under Algorithm 1 (‘all-or-nothing’) the [insert name of CB] shall, both for each relationship in respect of which a bilateral limit has been set and also for the total sum of relationships for which a multilateral limit has been set:
calculate the overall liquidity position of each TARGET2 participant’s PM account by establishing whether the aggregate of all outgoing and incoming payment orders pending in the queue is negative or positive and, if it is negative, check whether it exceeds that participant’s available liquidity (the overall liquidity position shall constitute the ‘total liquidity position’); and
check whether limits and reservations set by each TARGET2 participant in relation to each relevant PM account are respected.
If the outcome of these calculations and checks is positive for each relevant PM account, the [insert name of CB] and other CBs involved shall settle all payments simultaneously on the PM accounts of the TARGET2 participants concerned.
Under Algorithm 2 (‘partial’) the [insert name of CB] shall:
calculate and check the liquidity positions, limits and reservations of each relevant PM account as under Algorithm 1; and
if the total liquidity position of one or more relevant PM accounts is negative, extract single payment orders until the total liquidity position of each relevant PM account is positive.
Thereafter, the [insert name of CB] and the other CBs involved shall, provided there are sufficient funds, settle all remaining payments (except the extracted payment orders) simultaneously on the PM accounts of the TARGET2 participants concerned.
When extracting payment orders, the [insert name of CB] shall start from the TARGET2 participant’s PM account with the highest negative total liquidity position and from the payment order at the end of the queue with the lowest priority. The selection process shall only run for a short time, to be determined by the [insert name of CB] at its discretion.
Under Algorithm 3 (‘multiple’) the [insert name of CB] shall:
compare pairs of TARGET2 participants’ PM accounts to determine whether queued payment orders can be settled within the available liquidity of the two TARGET2 participants’ PM accounts concerned and within the limits set by them (by starting from the pair of PM accounts with the smallest difference between the payment orders addressed to each other), and the CBs involved shall book those payments simultaneously on the two TARGET2 participants’ PM accounts; and
if, in relation to a pair of PM accounts as described under point (i), liquidity is insufficient to fund the bilateral position, extract single payment orders until there is sufficient liquidity. In this case the CBs involved shall settle the remaining payments, except the extracted ones, simultaneously on the two TARGET2 participants’ PM accounts.
After performing the checks specified under subparagraphs (i) to (ii), the [insert name of CB] shall check the multilateral settlement positions (between a participant’s PM account and other TARGET2 participants’ PM accounts in relation to which a multi-lateral limit has been set). For this purpose, the procedure described under subparagraphs (i) to (ii) shall apply mutatis mutandis.
Under Algorithm 4 (‘partial plus ancillary system settlement’) the [insert name of CB] shall follow the same procedure as for Algorithm 2, but without extracting payment orders in relation to the settlement of an ancillary system (which settles on a simultaneous multilateral basis).
Under Algorithm 5 (‘ancillary system settlement via sub-accounts’) the [insert name of CB] shall follow the same procedure as for Algorithm 1, subject to the modification that the [insert name of CB] shall start Algorithm 5 via the ASI and shall only check whether sufficient funds are available on participants’ sub-accounts. Moreover, no limits and reservations shall be taken into account. Algorithm 5 shall also run during night-time settlement.
(4) Payment orders entered into the entry disposition after the start of any of Algorithms 1 to 4 may nevertheless be settled immediately in the entry disposition if the positions and limits of the TARGET2 participants’ PM accounts concerned are compatible with both the settlement of these payment orders and the settlement of payment orders in the current optimisation procedure. However, two algorithms shall not run simultaneously.
(5) During daytime processing the algorithms shall run sequentially. As long as there is no pending simultaneous multilateral settlement of an ancillary system, the sequence shall be as follows:
Algorithm 1;
if Algorithm 1 fails, then algorithm 2;
if Algorithm 2 fails, then Algorithm 3, or if Algorithm 2 succeeds, repeat Algorithm 1.
When simultaneous multilateral settlement (‘procedure 5’) in relation to an ancillary system is pending, Algorithm 4 shall run.
(6) The algorithms shall run flexibly by setting a pre-defined time lag between the application of different algorithms to ensure a minimum interval between the running of two algorithms. The time sequence shall be automatically controlled. Manual intervention shall be possible.
(7) While included in a running algorithm, a payment order shall not be reordered (change of the position in a queue) or revoked. Requests for reordering or revocation of a payment order shall be queued until the algorithm is complete. If the payment order concerned is settled while the algorithm is running, any request to reorder or revoke shall be rejected. If the payment order is not settled, the participant’s requests shall be taken into account immediately.
8. Use of the ICM
(1) The ICM may be used for obtaining information and managing liquidity. SWIFT’s Secure IP Network (SIPN) shall be the underlying technical communications network for exchanging information and running control measures.
(2) With the exception of warehoused payment orders and static data information, only data in relation to the current business day shall be available via the ICM. The screens shall be offered in English only.
(3) Information shall be provided in ‘pull’ mode, which means that each participant has to ask to be provided with information.
(4) The following modes shall be available for using the ICM:
Application-to-application mode (A2A)
In A2A, information and messages are transferred between the PM and the participant’s internal application. The participant therefore has to ensure that an appropriate application is available for the exchange of XML messages (requests and responses) with the ICM via a standardised interface. Further details are contained in the ICM User Handbook and in Book 4 of the UDFS.
User-to-application mode (U2A)
U2A permits direct communication between a participant and the ICM. The information is displayed in a browser running on a PC system (SWIFT Alliance WebStation or another interface, as may be required by SWIFT). For U2A access the IT infrastructure has to be able to support cookies. Further details are described in the ICM User Handbook.
(5) Each participant shall have at least one SWIFT Alliance WebStation, or another interface, as may be required by SWIFT, to have access to the ICM via U2A.
(6) Access rights to the ICM shall be granted by using SWIFT’s ‘Role Based Access Control’. The SWIFT ‘Non-repudiation of emission’ (NRE) service, which may be used by participants, allows the recipient of an XML message to prove that such message has not been altered.
(7) If a participant has technical problems and is unable to submit any payment order, it may generate preformatted backup liquidity redistribution and backup contingency payments by using the ICM. The [insert name of CB] shall open such functionality upon request of the participant.
(8) Participants may also use the ICM to transfer liquidity:
[insert if applicable] from their PM account to their account outside the PM;
between the PM account and the participant’s sub-accounts; and
from the PM account to the technical account managed by the ancillary system using settlement procedure 6 real-time;
by means of a PM to T2S DCA liquidity transfer order or, when the ICM is used in combination with the T2S value added services, a T2S DCA to PM liquidity transfer order; and
by means of a PM to TIPS DCA liquidity transfer order or a TIPS DCA to PM liquidity transfer order.
9. The UDFS and the ICM User Handbook
Further details and examples explaining the above rules are contained in the UDFS and the ICM User Handbook, as amended from time to time and published on the [insert name of CB]’s website and the ECB’s website in English.
Appendix II
TARGET2 COMPENSATION SCHEME
1. General principles
(a) If there is a technical malfunction of TARGET2, direct participants may submit claims for compensation in accordance with the TARGET2 compensation scheme laid down in this Appendix.
(b) Unless otherwise decided by the ECB’s Governing Council, the TARGET2 compensation scheme shall not apply if the technical malfunction of TARGET2 arises out of external events beyond the reasonable control of the CBs concerned or as a result of acts or omissions by third parties.
(c) Compensation under the TARGET2 compensation scheme shall be the only compensation procedure offered in the event of a technical malfunction of TARGET2. Participants may, however, use other legal means to claim for losses. If a participant accepts a compensation offer under the TARGET2 compensation scheme, this shall constitute the participant’s irrevocable agreement that it thereby waives all claims in relation to the payment orders concerning which it accepts compensation (including any claims for consequential loss) it may have against any CB, and that the receipt by it of the corresponding compensation payment constitutes full and final settlement of all such claims. The participant shall indemnify the CBs concerned, up to a maximum of the amount received under the TARGET2 compensation scheme, in respect of any further claims which are raised by any other participant or any other third party in relation to the payment order or payment concerned.
(d) The making of a compensation offer shall not constitute an admission of liability by the [insert name of CB] or any other CB in respect of a technical malfunction of TARGET2.
2. Conditions for compensation offers
(a) A payer may submit a claim for an administration fee and interest compensation if, due to a technical malfunction of TARGET2 a payment order was not settled on the business day on which it was accepted.
(b) A payee may submit a claim for an administration fee if due to a technical malfunction of TARGET2 it did not receive a payment that it was expecting to receive on a particular business day. The payee may also submit a claim for interest compensation if one or more of the following conditions are met:
in the case of participants that have access to the marginal lending facility: due to a technical malfunction of TARGET2, a payee had recourse to the marginal lending facility; and/or
in the case of all participants: it was technically impossible to have recourse to the money market or such refinancing was impossible on other, objectively reasonable grounds.
3. Calculation of compensation
(a) With respect to a compensation offer for a payer:
the administration fee shall be EUR 50 for the first non-settled payment order, EUR 25 for each of the next four such payment orders and EUR 12,50 for each further such payment order. The administration fee shall be calculated separately in relation to each payee;
interest compensation shall be determined by applying a reference rate to be fixed from day to day. This reference rate shall be the lower of the euro overnight index average (EONIA) rate and the marginal lending rate. The reference rate shall be applied to the amount of the payment order not settled as a result of the technical malfunction of TARGET2 for each day in the period from the date of the actual or, in relation to payment orders referred to in paragraph 2(b)(ii), intended submission of the payment order until the date on which the payment order was or could have been successfully settled. Any interest or charges resulting from the placing of any non-settled payment orders on deposit with the Eurosystem shall be deducted from, or charged to, the amount of any compensation, as the case may be; and
no interest compensation shall be payable if and in so far as funds resulting from non-settled payment orders were placed in the market or used to fulfil minimum reserve requirements.
(b) With respect to a compensation offer for a payee:
the administration fee shall be EUR 50 for the first non-settled payment order, EUR 25 for each of the next four such payment orders and EUR 12,50 for each further such payment order. The administration fee shall be calculated separately in relation to each payer;
the method set out in subparagraph (a)(ii) for calculating interest compensation shall apply except that interest compensation shall be payable at a rate equal to the difference between the marginal lending rate and the reference rate, and shall be calculated on the amount of any recourse to the marginal lending facility occurring as a result of the technical malfunction of TARGET2.
4. Procedural rules
(a) A claim for compensation shall be submitted on the claim form available on the website of the [insert name of CB] in English (see [insert reference to website of CB]). Payers shall submit a separate claim form in respect of each payee and payees shall submit a separate claim form in respect of each payer. Sufficient additional information and documents shall be provided to support the information indicated in the claim form. Only one claim may be submitted in relation to a specific payment or payment order.
(b) Within four weeks of a technical malfunction of TARGET2, participants shall submit their claim forms to the [insert name of CB]. Any additional information and evidence requested by the [insert name of CB] shall be supplied within two weeks of such request being made.
(c) The [insert name of CB] shall review the claims and forward them to the ECB. Unless otherwise decided by the ECB’s Governing Council and communicated to the participants, all received claims shall be assessed no later than 14 weeks after the technical malfunction of TARGET2 occurs.
(d) The [insert name of CB] shall communicate the result of the assessment referred to in subparagraph (c) to the relevant participants. If the assessment entails a compensation offer, the participants concerned shall, within four weeks of the communication of such offer, either accept or reject it, in respect of each payment or payment order comprised within each claim, by signing a standard letter of acceptance (in the form available on the website of the [insert name of CB] (see [insert reference to website of CB]). If such letter has not been received by the [insert name of CB] within four weeks, the participants concerned shall be deemed to have rejected the compensation offer.
(e) The [insert name of CB] shall make compensation payments on receipt of a participant’s letter of acceptance of compensation. No interest shall be payable on any compensation payment.
Appendix III
TERMS OF REFERENCE FOR CAPACITY AND COUNTRY OPINIONS
Terms of reference for capacity opinions for participants in TARGET2
[Insert name of CB]
[address]
Participation in the [name of the system]
[location]
[date]
Dear Sir or Madam,
We have been asked to provide this Opinion as [in-house or external] legal advisers to [specify name of Participant or branch of Participant] in respect of issues arising under the laws of [jurisdiction in which the Participant is established; hereinafter the ‘jurisdiction’] in connection with the participation of [specify name of Participant] (hereinafter the ‘Participant’) in the [name of the TARGET2 component system] (hereinafter the ‘System’).
This Opinion is confined to the laws of [jurisdiction] as they exist as on the date of this Opinion. We have made no investigation of the laws of any other jurisdiction as a basis for this Opinion, and do not express or imply any opinion in this regard. Each of the statements and opinions presented below applies with equal accuracy and validity under the laws of [jurisdiction], whether or not the Participant acts through its head office or one or more branches established inside or outside of [jurisdiction] in submitting payment orders and receiving payments.
I. DOCUMENTS EXAMINED
For the purposes of this Opinion, we have examined:
a certified copy of the [specify relevant constitutional documents] of the Participant such as is/are in effect on the date hereof;
[if applicable] an extract from the [specify relevant company register] and [if applicable] [register of credit institutions or analogous register];
[to the extent applicable] a copy of the Participant’s licence or other proof of authorisation to provide banking, investment, funds transfer or other financial services in [jurisdiction];
[if applicable] a copy of a resolution adopted by the board of directors or the relevant governing body of the Participant on [insert date], [insert year], evidencing the Participant’s agreement to adhere to the System Documents, as defined below; and
[specify all powers of attorney and other documents constituting or evidencing the requisite power of the person or persons signing the relevant System Documents (as defined below) on behalf of the Participant];
and all other documents relating to the Participant’s constitution, powers and authorisations necessary or appropriate for the provision of this Opinion (hereinafter the ‘Participant Documents’).
For the purposes of this Opinion, we have also examined:
the [insert reference to the arrangements implementing the ►M3 Harmonised Conditions for the Opening and Operation of a PM account in TARGET2 ◄ ] for the System dated [insert date] (hereinafter the ‘Rules’); and
[…].
The Rules and the […] shall be referred to hereinafter as the ‘System Documents’ (and collectively with the Participant Documents as the ‘Documents’).
II. ASSUMPTIONS
For the purposes of this Opinion we have assumed in relation to the Documents that:
the System Documents with which we have been provided are originals or true copies;
the terms of the System Documents and the rights and obligations created by them are valid and legally binding under the laws of [insert reference to the Member State of the System] by which they are expressed to be governed, and the choice of the laws of [insert reference to the Member State of the System] to govern the System Documents is recognised by the laws of [insert reference to the Member State of the System];
the Participant Documents are within the capacity and power of and have been validly authorised, adopted or executed and, where necessary, delivered by the relevant parties; and
the Participant Documents are binding on the parties to which they are addressed, and there has been no breach of any of their terms.
III. OPINIONS REGARDING THE PARTICIPANT
The Participant is a corporation duly established and registered or otherwise duly incorporated or organised under the laws of [jurisdiction].
The Participant has all the requisite corporate powers to execute and perform the rights and obligations under the System Documents to which it is party.
The adoption or execution and the performance by the Participant of the rights and obligations under the System Documents to which the Participant is party will not in any way breach any provision of the laws or regulations of [jurisdiction] applicable to the Participant or the Participant Documents.
No additional authorisations, approvals, consents, filings, registrations, notarisations or other certifications of or with any court or govern-mental, judicial or public authority that is competent in [jurisdiction] are required by the Participant in connection with the adoption, validity or enforceability of any of the System Documents or the execution or performance of the rights and obligations thereunder.
The Participant has taken all necessary corporate action and other steps necessary under the laws of [jurisdiction] to ensure that its obligations under the System Documents are legal, valid and binding.
This Opinion is stated as of its date and is addressed solely to [insert name of CB] and the [Participant]. No other persons may rely on this Opinion, and the contents of this Opinion may not be disclosed to persons other than its intended recipients and their legal counsel without our prior written consent, with the exception of the European Central Bank and the national central banks of the European System of Central Banks [and [the national central bank/relevant regulatory authorities] of [jurisdiction]].
Yours faithfully,
[signature]
Terms of reference for country opinions for non-EEA participants in TARGET2
[Insert name of CB]
[address]
[name of the system]
[location],
[date]
Dear Sir or Madam,
We have been asked as [external] legal advisers to [specify name of Participant or branch of Participant] (the ‘Participant’) in respect of issues arising under the laws of [jurisdiction in which the Participant is established; hereinafter the ‘jurisdiction’] to provide this Opinion under the laws of [jurisdiction] in connection with the participation of the Participant in a system which is a component of TARGET2 (hereinafter the ‘System’). References herein to the laws of [jurisdiction] include all applicable regulations of [jurisdiction]. We express an opinion herein under the law of [jurisdiction], with particular regard to the Participant established outside [insert reference to the Member State of the System] in relation to rights and obligations arising from participation in the System, as presented in the System Documents defined below.
This Opinion is confined to the laws of [jurisdiction] as they exist on the date of this Opinion. We have made no investigation of the laws of any other jurisdiction as a basis for this Opinion, and do not express or imply any opinion in this regard. We have assumed that there is nothing in the laws of another jurisdiction which affects this Opinion.
1. DOCUMENTS EXAMINED
For the purposes of this Opinion, we have examined the documents listed below and such other documents as we have deemed necessary or appropriate:
the [insert reference to the arrangements implementing the ►M3 Harmonised Conditions for the Opening and Operation of a PM account in TARGET2 ◄ ] for the System dated [insert date] (hereinafter the ‘Rules’); and
any other document governing the System and/or the relationship between the Participant and other participants in the System, and between the participants in the System and the [insert name of CB].
The Rules and the […] shall be referred to hereinafter as the ‘System Documents’.
2. ASSUMPTIONS
For the purposes of this Opinion we have assumed in relation to the System Documents that:
the System Documents are within the capacity and power of and have been validly authorised, adopted or executed and, where necessary, delivered by the relevant parties;
the terms of the System Documents and the rights and obligations created by them are valid and legally binding under the laws of [insert reference to the Member State of the System], by which they are expressed to be governed, and the choice of the laws of [insert reference to the Member State of the System] to govern the System Documents is recognised by the laws of [insert reference to the Member State of the System];
the participants in the System through which any payment orders are sent or payments are received, or through which any rights or obligations under the System Documents are executed or performed, are licensed to provide funds transfer services, in all relevant jurisdictions; and
the documents submitted to us in copy or as specimens conform to the originals.
3. OPINION
Based on and subject to the foregoing, and subject in each case to the points set out below, we are of the opinion that:
3.1. Country-specific legal aspects [to the extent applicable]
The following characteristics of the legislation of [jurisdiction] are consistent with and in no way set aside the obligations of the Participant arising out of the System Documents: [list of country-specific legal aspects].
3.2. General insolvency and crisis management issues
Types of insolvency and crisis management proceedings
The only types of insolvency proceedings (including composition or rehabilitation) which, for the purpose of this Opinion, shall include all proceedings in respect of the Participant’s assets or any branch it may have in [jurisdiction] to which the Participant may become subject in [jurisdiction], are the following: [list proceedings in original language and English translation] (together collectively referred to as ‘Insolvency Proceedings’).
In addition to Insolvency Proceedings, the Participant, any of its assets, or any branch it may have in [jurisdiction] may become subject in [jurisdiction] to [list any applicable moratorium, receivership, or any other proceedings as a result of which payments to and/or from the Participant may be suspended, or limitations can be imposed in relation to such payments, or similar proceedings, including crisis prevention and crisis management measures equivalent to those defined in Directive 2014/59/EU, in original language and English translation] (hereinafter collectively referred to as ‘Proceedings’).
Insolvency treaties
[jurisdiction] or certain political subdivisions within [jurisdiction], as specified, is/are party to the following insolvency treaties: [specify, if applicable which have or may have an impact on this Opinion].
3.3. Enforceability of System Documents
Subject to the points set out below, all provisions of the System Documents will be binding and enforceable in accordance with their terms under the laws of [jurisdiction], in particular in the event of the opening of any Insolvency Proceedings or Proceedings with respect to the Participant.
In particular, we are of the opinion that:
3.3.a. Processing of payment orders
The provisions on processing of payment orders [list of sections] of the Rules are valid and enforceable. In particular, all payment orders processed pursuant to such sections will be valid, binding and will be enforceable under the laws of [jurisdiction]. The provision of the Rules which specifies the precise point in time at which payment orders submitted by the Participant to the System become enforceable and irrevocable ([add section of the Rules]) is valid, binding and enforceable under the laws of [jurisdiction].
3.3.b. Authority of the [insert name of CB] to perform its functions
The opening of Insolvency Proceedings or Proceedings in respect of the Participant will not affect the authority and powers of the [insert name of CB] arising out of the System Documents. [Specify [to the extent applicable] that: the same opinion is also applicable in respect of any other entity which provides the Participants with services directly and necessarily required for participation in the System, e.g. ►M3 TARGET2 network service provider ◄ ].
3.3.c. Remedies in the event of default
[Where applicable to the Participant, the provisions contained in [list of sections] of the Rules regarding accelerated performance of claims which have not yet matured, the set-off of claims for using the deposits of the Participant, the enforcement of a pledge, suspension and termination of participation, claims for default interest, and termination of agreements and transactions ([insert other relevant clauses of the Rules or the System Documents]) are valid and enforceable under the laws of [jurisdiction].]
3.3.d. Suspension and termination
Where applicable to the Participant, the provisions contained in [list of sections] of the Rules (in respect of suspension and termination of the Participant’s participation in the System on the opening of Insolvency Proceedings or Proceedings or other events of default, as defined in the System Documents, or if the Participant represents any kind of systemic risk or has serious operational problems) are valid and enforceable under the laws of [jurisdiction].
3.3.e. Penalty regime
Where applicable to the Participant, the provisions contained in [list of sections] of the Rules in respect of penalties imposed on a Participant which is unable to reimburse intraday credit or overnight credit, where applicable, on time are valid and enforceable under the laws of [jurisdiction].
3.3.f. Assignment of rights and obligations
The rights and obligations of the Participant cannot be assigned, altered or otherwise transferred by the Participant to third parties without the prior written consent of the [insert name of CB].
3.3.g. Choice of governing law and jurisdiction
The provisions contained in [list of sections] of the Rules, and in particular in respect of the governing law, the resolution of a dispute, competent courts, and service of process are valid and enforceable under the laws of [jurisdiction].
3.4. Voidable preferences
We are of the opinion that no obligation arising out of the System Documents, the performance thereof, or compliance therewith prior to the opening of any Insolvency Proceedings or Proceedings in respect of the Participant may be set aside in any such proceedings as a preference, voidable transaction or otherwise under the laws of [jurisdiction].
In particular, and without limitation to the foregoing, we express this opinion in respect of any payment orders submitted by any participant in the System. In particular, we are of the opinion that the provisions of [list of sections] of the Rules establishing the enforceability and irrevocability of payment orders will be valid and enforceable and that a payment order submitted by any participant and processed pursuant to [list of sections] of the Rules may not be set aside in any Insolvency Proceedings or Proceedings as a preference, voidable transaction or otherwise under the laws of [jurisdiction].
3.5. Attachment
If a creditor of the Participant seeks an attachment order (including any freezing order, order for seizure or any other public or private law procedure that is intended to protect the public interest or the rights of the Participant’s creditors) — hereinafter referred to as an ‘Attachment’ — under the laws of [jurisdiction] from a court or governmental, judicial or public authority that is competent in [jurisdiction], we are of the opinion that [insert the analysis and discussion].
3.6. Collateral [if applicable]
3.6.a. Assignment of rights or deposit of assets for collateral purposes, pledge and/or repo
Assignments for collateral purposes will be valid and enforceable under the laws of [jurisdiction]. Specifically, the creation and enforcement of a pledge or repo under the [insert reference to the relevant arrangement with the CB] will be valid and enforceable under the laws of [jurisdiction].
3.6.b. Priority of assignees’, pledgees’ or repo purchasers’ interest over that of other claimants
In the event of Insolvency Proceedings or Proceedings in respect of the Participant, the rights or assets assigned for collateral purposes, or pledged by the Participant in favour of the [insert reference to CB] or other participants in the System, will rank in priority of payment above the claims of all other creditors of the Participant and will not be subject to priority or preferential creditors.
3.6.c. Enforcing title to security
Even in the event of Insolvency Proceedings or Proceedings in respect of the Participant, other participants in the System and the [insert name of CB] as [assignees, pledgees or repo purchasers as applicable] will still be free to enforce and collect the Participant’s rights or assets through the action of the [insert name of CB] pursuant to the Rules.
3.6.d. Form and registration requirements
There are no form requirements for the assignment for collateral purposes of, or the creation and enforcement of a pledge or repo over the Participant’s rights or assets and it is not necessary for the [assignment for collateral purposes, pledge or repo, as applicable], or any particulars of such [assignment, pledge or repo, as applicable,] to be registered or filed with any court or governmental, judicial or public authority that is competent in [jurisdiction].
3.7. Branches [to the extent applicable]
3.7.a. Opinion applies to action through branches
Each of the statements and opinions presented above with regard to the Participant applies with equal accuracy and validity under the laws of [jurisdiction] in situations where the Participant acts through its one or more of its branches established outside [jurisdiction].
3.7.b. Conformity with law
Neither the execution and performance of the rights and obligations under the System Documents nor the submission, transmission or receipt of payment orders by a branch of the Participant will in any respect breach the laws of [jurisdiction].
3.7.c. Required authorisations
Neither the execution and performance of the rights and obligations under the System Documents nor the submission, transmission or receipt of payment orders by a branch of a Participant will require any additional authorisations, approvals, consents, filings, registrations, notarisations or other certifications of or with any court or governmental, judicial or public authority that is competent in [jurisdiction].
This Opinion is stated as of its date and is addressed solely to the [insert name of CB] and the [Participant]. No other persons may rely on this Opinion, and the contents of this Opinion may not be disclosed to persons other than its intended recipients and their legal counsel without our prior written consent, with the exception of the European Central Bank and the national central banks of the European System of Central Banks [and [the national central bank/relevant regulatory authorities] of [jurisdiction]].
Yours faithfully,
[signature]
Appendix IV
BUSINESS CONTINUITY AND CONTINGENCY PROCEDURES
1. General provisions
(a) This Appendix sets out the arrangements between the [insert name of CB] and participants, or ancillary systems, if one or more components of the SSP or the telecommunications network fail or are affected by an abnormal external event, or if the failure affects any participant or ancillary system.
(b) All references to specific times in this Appendix are to the local time at the seat of the ECB, i.e. Central European Time (CET ( 22 )).
2. Measures of business continuity and contingency processing
(a) In the event that an abnormal external event occurs and/or there is a failure of the SSP or the telecommunications network which affects the normal operation of TARGET2, the [insert name of CB] shall be entitled to adopt business continuity and contingency processing measures.
(b) The following main business continuity and contingency processing measures shall be available in TARGET2:
relocating the operation of the SSP to an alternative site;
changing the SSP’s operating hours; and
initiating contingency processing of very critical and critical payments, as defined in paragraph 6(c) and (d) respectively.
(c) In relation to business continuity and contingency processing measures, the [insert name of CB] shall have full discretion regarding whether and which measures are adopted to settle payment orders.
3. Incident communication
(a) Information about the failure of the SSP and/or an abnormal external event shall be communicated to participants through the domestic communication channels, the ICM and T2IS. In particular, communications to participants shall include the following information:
a description of the event;
the anticipated delay in processing (if known);
information on the measures already taken; and
the advice to participants.
(b) In addition, the [insert name of CB] may notify participants of any other existing or anticipated event which has the potential to affect the normal operation of TARGET2.
4. Relocation of the operation of the SSP to an alternative site
(a) In the event that any of the events referred to in paragraph 2(a) occurs, the operation of the SSP may be relocated to an alternative site, either within the same region or in another region.
(b) In the event that the operation of the SSP or the T2S Platform is relocated from one region (Region 1) to another region (Region 2), the participants shall endeavour to reconcile their positions up to the point of the failure or the occurrence of the abnormal external events and provide to the [insert name of CB] all relevant information in this respect.
(c) Where a ►M6 PM to T2S DCA liquidity transfer order ◄ is debited on the participant's PM account on the SSP in Region 1, but, after reconciliation, is not shown as debited on the SSP in Region 2, the CB responsible for the participant shall debit the participant's PM account in Region 2 to return the participant's PM account balance to the level it had prior to the relocation.
5. Change of operating hours
(a) The daytime processing of TARGET2 may be extended or the opening time of a new business day may be delayed. During any extended operating time of TARGET2, payment orders shall be processed in accordance with the [insert reference to arrangements implementing the Harmonised Conditions], subject to the modifications contained in this Appendix.
(b) Daytime processing may be extended and the closing time thereby delayed if an SSP failure has occurred during the day but has been resolved before 18.00. Such a closing time delay shall in normal circumstances not exceed two hours and shall be announced as early as possible to participants. If such a delay is announced before 16.50, the minimum period of one hour between the cut-off time for customer and interbank payment orders shall remain in place. Once such a delay is announced it may not be withdrawn.
(c) The closing time shall be delayed in cases where an SSP failure has occurred before 18.00 and has not been resolved by 18.00. The [insert name of CB] shall immediately communicate the delay of closing time to participants.
(d) Upon recovery of the SSP, the following steps shall take place:
the [insert name of CB] shall seek to settle all queued payments within one hour; this time is reduced to 30 minutes in the event that the SSP failure occurs at 17.30 or later (in cases where the SSP failure was on-going at 18.00);
participants’ final balances shall be established within one hour; this time shall be reduced to 30 minutes in the event that the SSP failure occurs at 17.30 or later, in cases where the SSP failure was on-going at 18.00;
at the cut-off time for interbank payments, the end-of-day processing, including recourse to the Eurosystem standing facilities shall take place;
(e) ancillary systems that require liquidity in the early morning need to have established means to cope with cases where the daytime processing cannot be started in time due to an SSP failure on the previous day.
6. Contingency processing
(a) If [insert name of CB] deems it necessary to do so, it shall initiate the contingency processing of payment orders using the Contingency Solution of the SSP. In such cases, only a minimum service level shall be provided to participants and ancillary systems. The [insert name of CB] shall inform its participants and ancillary systems of the start of contingency processing by any available means of communication.
(b) In contingency processing, payment orders shall be submitted by the participants and authorised by the [insert name of CB]. In addition, the ancillary systems may submit files containing payment instructions, which may be uploaded into the Contingency Solution by [insert name of CB].
(c) The following payments shall be considered as ‘very critical’ and the [insert name of CB] shall use best efforts to process them in contingency situations:
CLS Bank International-related payments, with the exception of payments related to the CLS CCP and the CLSNow services;
end-of-day settlement of EURO1;
central counterparty margin calls.
(d) Payments required to avoid systemic risk shall be considered as ‘critical’ and the [insert name of CB] may decide to initiate contingency processing in relation to them.
(e) Participants shall submit payment orders for contingency processing directly into the Contingency Solution and information to payees shall be provided through [insert communication means]. Ancillary systems shall submit files which contain payment instructions to [insert name of CB] for uploading into the Contingency Solution and which authorise [insert name of CB] to do so. [insert name of CB] may, exceptionally, also manually input payments on behalf of participants. Information concerning account balances and debit and credit entries may be obtained via the [insert name of CB].
(f) Payment orders that have already been submitted to TARGET2-[insert CB/country reference], but are queued, may also undergo contingency processing. In such cases the [insert name of CB] shall endeavour to avoid the double processing of payment orders, but the participants shall bear the risk of such double processing if it occurred.
(g) for contingency processing of payment orders, participants shall provide eligible assets as collateral. During contingency processing, incoming contingency payments may be used to fund outgoing contingency payments. For the purposes of contingency processing, participants’ available liquidity may not be taken into account by the [insert name of CB].
7. Failures linked to participants or ancillary systems
(a) In the event that a participant has a problem that prevents it from settling payments in TARGET2 it shall be its responsibility to resolve the problem. In particular, a participant may use in-house solutions or the ICM functionality, i.e. backup liquidity redistribution payments and backup contingency payments (e.g. CLS, EURO1).
(b) If a participant decides to use the ICM functionality for making backup liquidity redistribution payments, the [insert name of CB] shall, if the participant so requests, open this functionality via the ICM. If the participant so requests, the [insert name of CB] shall transmit an ICM broadcast message to inform other participants about the participant’s use of backup liquidity redistribution payments. The participant shall be responsible for sending such backup liquidity redistribution payments exclusively to other participants with which it has bilaterally agreed on the use of such payments and for any further steps in relation to such payments.
(c) If the measures referred to in subparagraph (a) are exhausted or if they are inefficient, the participant may request support from the [insert name of CB].
(d) In the event that a failure affects an ancillary system, that ancillary system shall be responsible for resolving the failure. If the ancillary system so requests, the [insert name of CB] may act on its behalf. The [insert name of CB] shall have discretion to decide what support it gives to the ancillary system, including during the night-time operations of the ancillary system. The following contingency measures may be taken:
the ancillary system initiates clean payments, i.e. payments that are not linked to the underlying transaction, via the Participant Interface;
the [insert name of CB] creates and/or processes XML instructions/files on behalf of the ancillary system; and/or
the [insert name of CB] makes clean payments on behalf of the ancillary system.
(e) The detailed contingency measures with respect to ancillary systems shall be contained in the bilateral arrangements between the [insert name of CB] and the relevant ancillary system.
8. Other provisions
(a) In the event that certain data are unavailable because one of the events referred to in paragraph 3(a) has occurred, the [insert name of CB] is entitled to start or continue processing payment orders and/or operate TARGET2-[insert CB/country reference] on the basis of the last available data, as determined by the [insert name of CB]. If so requested by the [insert name of CB], participants and ancillary systems shall resubmit their FileAct/Interact messages or take any other action deemed appropriate by the [insert name of CB].
(b) In the event of a failure of the [insert name of CB], some or all of its technical functions in relation to TARGET2-[insert CB/country reference] may be performed by other Eurosystem CBs or ►M6 the operational team of the SSP ◄ .
(c) The [insert name of CB] may require that the participants participate in regular or ad hoc testing of business continuity and contingency processing measures, training or any other preventative arrangements, as deemed necessary by the [insert name of CB]. Any costs incurred by the participants as a result of such testing or other arrangements shall be borne solely by the participants.
Appendix V
OPERATING SCHEDULE
1. TARGET2 is open on all days, except Saturdays, Sundays, New Year’s Day, Good Friday and Easter Monday (according to the calendar applicable at the seat of the ECB), 1 May, Christmas Day and 26 December.
2. The reference time for the system is the local time at the seat of the ECB, i.e. CET.
3. The current business day is opened during the evening of the previous business day and operates to the following schedule:
|
Time |
Description |
|
6.45-7.00 |
Business window to prepare daytime operations (1) |
|
7.00-18.00 |
Daytime processing |
|
17.00 |
Cut-off time for customer payments, i.e. payments where the originator and/or the beneficiary of a payment is not a direct or indirect participant as identified in the system by the use of an MT 103 or MT 103+ message |
|
18.00 |
Cut-off time for interbank payments, i.e. payments other than customer payments Cut-off time for liquidity transfers between TARGET2 and TIPS |
|
Shortly after 18.00 |
Completion of last algorithms in TARGET2 |
|
Upon completion of last algorithms |
TARGET2 sends message to TIPS to initiate change of business day in TIPS |
|
Shortly after completion of last algorithms |
End-of-day files (General Ledger) received from TIPS |
|
18.00-18.45 (2) |
End-of-day processing |
|
18.15 (2) |
General cut-off time for the use of standing facilities |
|
(Shortly after) 18.30 (3) |
Data for the update of accounting systems are available to CBs |
|
18.45-19.30 (3) |
Start-of-day processing (new business day) |
|
Provision of liquidity on the PM account |
|
|
19.30 (3) |
‘Start-of-procedure’ message and settlement of the standing orders to transfer liquidity from the PM accounts to the subaccounts/technical account (ancillary system-related settlement) Start of liquidity transfers between TARGET2 and TIPS |
|
19.30 (3)-22.00 |
Execution of additional liquidity transfers via the ICM for settlement procedure 6 real time; execution of additional liquidity transfers via the ICM before the ancillary system sends the ‘start of cycle’ messages for settlement procedure 6 interfaced; settlement period of night-time ancillary system operations (only for ancillary system settlement procedure 6 real-time and settlement procedure 6 interfaced) |
|
22.00-1.00 |
Technical maintenance window |
|
1.00-7.00 |
Settlement procedure of night-time ancillary system operations (only for ancillary system settlement procedure 6 real-time and settlement procedure 6 interfaced) Liquidity transfers between TARGET2 and TIPS |
|
(1)
‘Daytime’ operationsmeans daytime processing and end-of-day processing.
(2)
Ends 15 minutes later on the last day of the Eurosystem reserve maintenance period.
(3)
Starts 15 minutes later on the last day of the Eurosystem reserve maintenance period. |
|
4. The ICM is available for liquidity transfers from 19.30 ( 23 ) until 18.00 the next day, except during the technical maintenance period from 22.00 until 1.00.
5. The operating hours may be changed in the event that business continuity measures are adopted in accordance with paragraph 5 of Appendix IV.
6. Up-to-date information on the SSP's operational status shall be available on the TARGET2 Information System (T2IS) on a dedicated webpage on the ECB's website. The information on the SSP's operational status on T2IS and the ECB's website shall only be updated during normal business hours.
Appendix VI
FEE SCHEDULE AND INVOICING
Fees for direct participants
1. The monthly fee for the processing of payment orders in TARGET2-[insert CB/country reference] for direct participants, depending on which option the direct participant has chosen, shall be either:
EUR 150 per PM account plus a flat fee per transaction (debit entry) of EUR 0,80; or
EUR 1 875 per PM account plus a fee per transaction (debit entry) determined as follows, based on the volume of transactions (number of processed items) per month:
|
Band |
From |
To |
Price |
|
1 |
1 |
10 000 |
EUR 0,60 |
|
2 |
10 001 |
25 000 |
EUR 0,50 |
|
3 |
25 001 |
50 000 |
EUR 0,40 |
|
4 |
50 001 |
100 000 |
EUR 0,20 |
|
5 |
Above 100 000 |
— |
EUR 0,125 |
Liquidity transfers between a participant's PM account and its sub-accounts shall not be subject to a charge.
PM to T2S DCA liquidity transfer orders or PM to TIPS DCA liquidity transfer orders sent from a participant's PM account and T2S DCA to PM liquidity transfer orders or TIPS DCA to PM liquidity transfer orders received on a participant's PM account shall be charged according to the pricing option (a) or (b) above chosen for that PM account.
2. The monthly fee for multi-addressee access shall be EUR 80 for each 8-digit BIC address other than the BIC of the direct participant's account.
3. There shall be an additional monthly fee for direct participants who do not wish the BIC of their account to be published in the TARGET2 directory of EUR 30 per account.
4. The monthly fee for each registration by a direct participant of an indirect participant in the TARGET2 directory shall be EUR 20.
5. The one-time fee for each registration in the TARGET2 directory of an addressable BIC holder, for branches of direct and indirect participants, branches of correspondents and addressable BIC holders that are members of the same group, as defined in Article 1, shall be EUR 5.
6. The monthly fee for each registration in the TARGET2 directory of an addressable BIC holder for a correspondent shall be EUR 5.
7. The monthly fee for direct participants subscribing to the TARGET2 value-added services for T2S shall be EUR 50 for those participants which have opted for option (a) in paragraph 1 above, and EUR 625 for those participants which have opted for option (b) in paragraph 1 above.
Fees for liquidity pooling
8. For the CAI mode, the monthly fee shall be EUR 100 for each account included in the group.
9. For the AL mode, the monthly fee shall be EUR 200 for each account included in the AL group. If the AL group uses the CAI mode, accounts not included in the AL mode shall pay the CAI monthly fee of EUR 100 per account.
10. For both the AL mode and the CAI mode, the degressive transaction fee structure set out in the table in paragraph 1(b) shall apply to all payments by the participants in the group, as if these payments were sent from one participant's account.
11. The monthly fee of EUR 1 875 referred to in paragraph 1(b) shall be paid by the relevant group manager, and the monthly fee of EUR 150 referred to in paragraph 1(a) shall be paid by all other members of the group. If an AL group is part of a CAI group, and the AL group manager is the same as the CAI group manager, the monthly fee of EUR 1 875 shall only be paid once. If the AL group is a part of a CAI group and the CAI group manager is different from the AL group manager, then the CAI group manager shall pay an additional monthly fee of EUR 1 875 . In such cases the invoice for the total fees for all the accounts in the CAI group (including the AL group accounts) shall be sent to the CAI group manager.
Fees for Main PM account holders
12. In addition to the fees set out above in this Appendix, a monthly fee of EUR 250 for each linked ►M6 T2S DCA ◄ shall be charged to Main PM account holders.
13. The Main PM account holders shall be charged the following fees for T2S services connected with the linked ►M6 T2S DCA(s) ◄ . These items shall be billed separately.
|
Tariff items |
Price |
Explanation |
|
Settlement services |
||
|
T2S DCA to T2S DCA liquidity transfer orders |
14,1 euro cent |
per transfer |
|
Intra-balance movement (i.e. blocking, unblocking, reservation of liquidity etc.) |
9,4 euro cent |
per transaction |
|
Information services |
||
|
A2A reports |
0,4 euro cent |
Per business item in any A2A report generated |
|
A2A queries |
0,7 euro cent |
Per queried business item in any A2A query generated |
|
U2A queries |
10 euro cent |
Per executed search function |
|
U2A queries downloaded |
0,7 euro cent |
Per queried business item in any U2A query generated and downloaded |
|
Messages bundled into a file |
0,4 euro cent |
Per message in a file |
|
Transmissions |
1,2 euro cent |
Per transmission |
Fees for Linked PM account holders
13a. The holder of the Linked PM account shall be charged the following fees for the TIPS service connected with the TIPS DCAs linked to that PM account.
|
Tariff items |
Price |
Explanation |
|
Settlement services |
||
|
Instant payment order |
0,20 euro cent |
To be charged also for unsettled transactions |
|
Recall request |
0,00 |
|
|
Negative recall answer |
0,00 |
|
|
Positive recall answer |
0,20 euro cent |
To be charged to the holder of the Linked PM account associated with the TIPS DCA to be credited (also for unsettled transactions) |
13b. Up to the first ten million instant payment orders and positive recall answers, cumulatively, received by the TIPS Platform by the end of 2019, shall be free of charge. The [insert name of CB] shall charge Linked PM account holders for any further instant payment orders and positive recall answers received by the TIPS Platform by the end of 2019, in the following year.
Invoicing
14. In the case of direct participants, the following invoicing rules apply. The direct participant (the AL group or CAI group manager in the event that the AL or CAI modes are used) shall receive the relevant invoices for the previous month specifying the fees to be paid, no later than on the ninth business day of the following month. ►M6 Payments shall be made no later than the 14th business day of that month to the account specified by [insert name of CB] or shall be debited from an account specified by the PM account holder. ◄
Appendix VII
AGGREGATED LIQUIDITY AGREEMENT — VARIANT A
Template for use of the AL mode by more than one credit institution
Article 1
Effectiveness of this agreement
This agreement and any amendment made hereto shall only be effective when the managing NCB, after having obtained any information or documents that it deems appropriate, confirms in writing that this agreement or amendments thereto comply with the requirements laid down in the respective conditions for participation in the TARGET2 component systems.
Article 2
Mutual interest of AL group members and of AL NCBs
Article 3
AL group members’ rights and obligations
The AL group members shall ensure that there is an internal agreement between them containing inter alia:
the rules of internal organisation of the AL group;
the conditions under which the AL group manager has a duty to report to the AL group members;
the costs of the AL mode (including their allocation between AL group members); and
the fees to be paid as remuneration between the AL group members for the services under the AL agreement and the rules for calculating the financial consideration.
With the exception of subparagraph (d), the AL group members may decide whether or not to disclose this internal agreement or parts of it to the AL NCBs. The AL group members shall disclose information referred to in subparagraph (d) to the AL NCBs.
Article 4
AL NCBs’ rights and obligations
Article 5
Designation and role of the AL group manager
The AL group manager shall have power of attorney over the PM accounts of the AL group members and, in particular, shall act as agent of the AL group members in respect of the following operations:
any ICM operations in respect of the AL group members’ PM accounts, including, but not limited to, any change in priority of a payment order, revocation, change of settlement time, liquidity transfers (including from and to sub-accounts), reordering of queued transactions, reservation of liquidity in respect of the AL group, and setting and changes of limits in respect of the AL group;
all end-of-day liquidity transactions between the PM accounts of the AL group members ensuring that all balances of the AL group members’ PM accounts are levelled out, so that none of these accounts have a debit balance at the end of the day or, where applicable, a debit balance not secured by eligible collateral (hereinafter such procedure is referred to as ‘levelling out’);
general instructions according to which automatic levelling out shall be performed, i.e. defining the sequence of AL group members’ PM accounts with available liquidity to be debited within the levelling out;
in the absence of any explicit instructions by the AL group manager, as set out in subparagraphs (b) and (c), automatic levelling out shall be performed starting with the PM account with the highest credit balance towards the PM account with the highest debit balance.
The same criteria as defined in subparagraphs (c) and (d) shall be used if an enforcement event, as defined in [insert reference to the relevant provisions in the arrangements implementing the Harmonised Conditions], occurs.
Article 6
Role of the managing NCB
Article 7
Duration and termination of this agreement
This agreement or the participation of any AL group member in this agreement, as the case may be, shall automatically be terminated without prior notice and with immediate effect if one or more of the following events occurs:
modification or ending of the links between all AL group members needed to comply with the definition of a group, as laid down in the [insert reference to the arrangements implementing the Harmonised Conditions], or affecting one or more AL group members; and/or
any other requirements for using the AL mode, as described in the [insert reference to the arrangements implementing the Harmonised Conditions] are no longer met by all AL group members, or one or more AL group members.
Article 8
Amendment procedure
Any change to this agreement, including the extension of the AL group to other participants, shall only be valid and enforceable if expressly agreed to by all parties in writing.
Article 9
Governing law
This agreement shall be governed, construed and implemented in accordance with the [insert reference to the law governing the PM account of the AL group manager held with the managing NCB]. This shall be without prejudice to:
the relationship between an AL group member and its respective AL NCB governed by the law of the respective AL NCB; and
the rights and obligations between the AL NCBs governed by the law of the AL NCB which maintains the PM account of the AL group member whose available liquidity is used as collateral.
Article 10
Application of the [insert reference to the arrangements implementing the Harmonised Conditions]
Made, in as many copies as there are parties, the […date….]
AGGREGATED LIQUIDITY AGREEMENT — VARIANT B
Template for use of the AL mode by one credit institution
Article 1
Effectiveness of this agreement
This agreement and any amendment made hereto shall only be effective when the managing NCB, after having obtained any information or documents that it deems appropriate, confirms in writing that this agreement or amendments thereto comply with the requirements laid down in the respective conditions for participation in TARGET2 component systems.
Article 2
Mutual interest of AL NCBs
The AL NCBs have a mutual interest in providing intraday credit to the AL group members, as this promotes the overall efficiency of settling payments in TARGET2. The intraday credit is collateralised in accordance with Article 18 of the Statute of the European System of Central Banks and of the European Central Bank since the debit balance resulting from the execution of a payment order is covered by the available liquidity on the PM accounts held by the AL group members with their respective AL NCBs, which are collateralised for the discharge of the obligations owed by the AL group members to the AL NCBs.
Article 3
AL group members’ rights and obligations
Article 4
AL NCBs’ rights and obligations
Article 5
Designation and role of the AL group manager
The AL group manager shall have power of attorney over all PM accounts of the AL group members and, in particular, shall conduct the following operations:
any ICM operations in respect of the AL group members’ PM accounts, including, but not limited to, any change in priority of a payment order, revocation, change of settlement time, liquidity transfers (including from and to sub-accounts), reordering of queued transactions, reservation of liquidity in respect of the AL group, and setting and changes of limits in respect of the AL group;
all end-of-day liquidity transactions between the PM accounts of the AL group members ensuring that all balances of the AL group members’ PM accounts are levelled out, so that none of these accounts have a debit balance at the end of the day or, where applicable, a debit balance not secured by eligible collateral (hereinafter such procedure is referred to as ‘levelling out’);
general instructions according to which an automatic levelling out shall be performed, i.e. defining the sequence of AL group members’ PM accounts with available liquidity to be debited within the levelling out;
in the absence of any explicit instructions by the AL group manager, as set out in subparagraphs (b) and (c), an automatic levelling out shall be performed starting with the PM account with the highest credit balance towards the PM account with the highest debit balance.
The same criteria as defined in subparagraphs (c) and (d) shall be used if an enforcement event, as defined in [insert reference to the relevant provisions in the arrangements implementing the Harmonised Conditions], occurs.
Article 6
Role of the managing NCB
Article 7
Duration and termination of this agreement
Article 8
Amendment procedure
Any change to this agreement, including the extension of the AL group to other participants, shall only be valid and enforceable if expressly agreed to by all parties in writing.
Article 9
Governing law
This agreement shall be governed, construed and implemented in accordance with the [insert reference to the law governing the PM account of the AL group manager]. This shall be without prejudice to:
the relationship between the AL group members and their respective AL NCBs governed by the law of the respective AL NCB; and
the rights and obligations between the AL NCBs governed by the law of the AL NCB which maintains the PM account in which available liquidity is used as collateral.
Article 10
Application of the [insert reference to the arrangements implementing the Harmonised Conditions]
Made, in as many copies as there are parties, the […date….]
Appendix VIII
Requirements regarding information security management and business continuity management
Information security management
These requirements are applicable to each participant, unless the participant demonstrates that a specific requirement is not applicable to it. In establishing the scope of application of the requirements within its infrastructure, the participant should identify the elements that are part of the Payment Transaction Chain (PTC). Specifically, the PTC starts at a Point of Entry (PoE), i.e. a system involved in the creation of transactions (e.g. workstations, front-office and back-office applications, middleware), and ends at the system responsible to send the message to SWIFT (e.g. SWIFT VPN Box) or Internet (with the latter applicable to Internet-based Access).
Requirement 1.1: Information security policy
The management shall set a clear policy direction in line with business objectives and demonstrate support for and commitment to information security through the issuance, approval and maintenance of an information security policy aiming at managing information security and cyber resilience across the organisation in terms of identification, assessment and treatment of information security and cyber resilience risks. The policy should contain at least the following sections: objectives, scope (including domains such as organisation, human resources, asset management etc.), principles and allocation of responsibilities.
Requirement 1.2: Internal organisation
An information security framework shall be established to implement the information security policy within the organisation. The management shall coordinate and review the establishment of the information security framework to ensure the implementation of the information security policy (as per Requirement 1.1) across the organisation, including the allocation of sufficient resources and assignment of security responsibilities for this purpose.
Requirement 1.3: External parties
The security of the organisation’s information and information processing facilities should not be reduced by the introduction of, and/or the dependence on, an external party/parties or products/services provided by them. Any access to the organisation’s information processing facilities by external parties shall be controlled. When external parties or products/services of external parties are required to access the organisation’s information processing facilities, a risk assessment shall be carried out to determine the security implications and control requirements. Controls shall be agreed and defined in an agreement with each relevant external party.
Requirement 1.4: Asset management
All information assets, the business processes and the underlying information systems, such as operating systems, infrastructures, business applications, off-the-shelf products, services and user-developed applications, in the scope of the Payment Transaction Chain shall be accounted for and have a nominated owner. The responsibility for the maintenance and the operation of appropriate controls in the business processes and the related IT components to safeguard the information assets shall be assigned. Note: the owner can delegate the implementation of specific controls as appropriate, but remains accountable for the proper protection of the assets.
Requirement 1.5: Information assets classification
Information assets shall be classified in terms of their criticality to the smooth delivery of the service by the participant. The classification shall indicate the need, priorities and degree of protection required when handling the information asset in the relevant business processes and shall also take into consideration the underlying IT components. An information asset classification scheme approved by the management shall be used to define an appropriate set of protection controls throughout the information asset lifecycle (including removal and destruction of information assets) and to communicate the need for specific handling measures.
Requirement 1.6: Human resources security
Security responsibilities shall be addressed prior to employment in adequate job descriptions and in terms and conditions of employment. All candidates for employment, contractors and third party users shall be adequately screened, especially for sensitive jobs. Employees, contractors and third party users of information processing facilities shall sign an agreement on their security roles and responsibilities. An adequate level of awareness shall be ensured among all employees, contractors and third party users, and education and training in security procedures and the correct use of information processing facilities shall be provided to them to minimise possible security risks. A formal disciplinary process for handling security breaches shall be established for employees. Responsibilities shall be in place to ensure that an employee’s, contractor’s or third party user’s exit from or transfer within the organisation is managed, and that the return of all equipment and the removal of all access rights are completed.
Requirement 1.7: Physical and environmental security
Critical or sensitive information processing facilities shall be housed in secure areas, protected by defined security perimeters, with appropriate security barriers and entry controls. They shall be physically protected from unauthorised access, damage and interference. Access shall be granted only to individuals who fall within the scope of Requirement 1.6. Procedures and standards shall be established to protect physical media containing information assets when in transit.
Equipment shall be protected from physical and environmental threats. Protection of equipment (including equipment used off-site) and against the removal of property is necessary to reduce the risk of unauthorised access to information and to guard against loss or damage of equipment or information. Special measures may be required to protect against physical threats and to safeguard supporting facilities such as the electrical supply and cabling infrastructure.
Requirement 1.8: Operations management
Responsibilities and procedures shall be established for the management and operation of information processing facilities covering all the underlying systems in the Payment Transaction Chain end-to-end.
As regards operating procedures, including technical administration of IT systems, segregation of duties shall be implemented, where appropriate, to reduce the risk of negligent or deliberate system misuse. Where segregation of duties cannot be implemented due to documented objective reasons, compensatory controls shall be implemented following a formal risk analysis. Controls shall be established to prevent and detect the introduction of malicious code for systems in the Payment Transaction Chain. Controls shall be also established (including user awareness) to prevent, detect and remove malicious code. Mobile code shall be used only from trusted sources (e.g. signed Microsoft COM components and Java Applets). The configuration of the browser (e.g. the use of extensions and plugins) shall be strictly controlled.
Data backup and recovery policies shall be implemented by the management; those recovery policies shall include a plan of the restoration process which is tested at regular intervals at least annually.
Systems that are critical for the security of payments shall be monitored and events relevant to information security shall be recorded. Operator logs shall be used to ensure that information system problems are identified. Operator logs shall be regularly reviewed on a sample basis, based on the criticality of the operations. System monitoring shall be used to check the effectiveness of controls which are identified as critical for the security of payments and to verify conformity to an access policy model.
Exchanges of information between organisations shall be based on a formal exchange policy, carried out in line with exchange agreements among the involved parties and shall be compliant with any relevant legislation. Third party software components employed in the exchange of information with TARGET2 (like software received from a Service Bureau in scenario 2 of the scope section of the TARGET2 self-certification arrangement document) must be used under a formal agreement with the third-party.
Requirement 1.9: Access control
Access to information assets shall be justified on the basis of business requirements (need-to-know ( 26 )) and according to the established framework of corporate policies (including the information security policy). Clear access control rules shall be defined based on the principle of least privilege ( 27 ) to reflect closely the needs of the corresponding business and IT processes. Where relevant, (e.g. for backup management) logical access control should be consistent with physical access control unless there are adequate compensatory controls in place (e.g. encryption, personal data anonymisation).
Formal and documented procedures shall be in place to control the allocation of access rights to information systems and services that fall within the scope of the Payment Transaction Chain. The procedures shall cover all stages in the lifecycle of user access, from the initial registration of new users to the final deregistration of users that no longer require access.
Special attention shall be given, where appropriate, to the allocation of access rights of such criticality that the abuse of those access rights could lead to a severe adverse impact on the operations of the participant (e.g. access rights allowing system administration, override of system controls, direct access to business data).
Appropriate controls shall be put in place to identify, authenticate and authorise users at specific points in the organisation’s network, e.g. for local and remote access to systems in the Payment Transaction Chain. Personal accounts shall not be shared in order to ensure accountability.
For passwords, rules shall be established and enforced by specific controls to ensure that passwords cannot be easily guessed, e.g. complexity rules and limited-time validity. A safe password recovery and/or reset protocol shall be established.
A policy shall be developed and implemented on the use of cryptographic controls to protect the confidentiality, authenticity and integrity of information. A key management policy shall be established to support the use of cryptographic controls.
There shall be policy for viewing confidential information on screen or in print (e.g. a clear screen, a clear desk policy) to reduce the risk of unauthorised access.
When working remotely, the risks of working in an unprotected environment shall be considered and appropriate technical and organisational controls shall be applied.
Requirement 1.10: Information systems acquisition, development and maintenance
Security requirements shall be identified and agreed prior to the development and/or implementation of information systems.
Appropriate controls shall be built into applications, including user-developed applications, to ensure correct processing. These controls shall include the validation of input data, internal processing and output data. Additional controls may be required for systems that process, or have an impact on, sensitive, valuable or critical information. Such controls shall be determined on the basis of security requirements and risk assessment according to the established policies (e.g. information security policy, cryptographic control policy).
The operational requirements of new systems shall be established, documented and tested prior to their acceptance and use. As regards network security, appropriate controls, including segmentation and secure management, should be implemented based on the criticality of data flows and the level of risk of the network zones in the organisation. There shall be specific controls to protect sensitive information passing over public networks.
Access to system files and program source code shall be controlled and IT projects and support activities conducted in a secure manner. Care shall be taken to avoid exposure of sensitive data in test environments. Project and support environments shall be strictly controlled. Deployment of changes in production shall be strictly controlled. A risk assessment of the major changes to be deployed in production shall be conducted.
Regular security testing activities of systems in production shall also be conducted according to a predefined plan based on the outcome of a risk-assessment, and security testing shall include, at least, vulnerability assessments. All of the shortcomings highlighted during the security testing activities shall be assessed and action plans to close any identified gap shall be prepared and followed-up in a timely fashion.
Requirement 1.11: Information security in supplier ( 28 ) relationships
To ensure protection of the participant’s internal information systems that are accessible by suppliers, information security requirements for mitigating the risks associated with supplier’s access shall be documented and formally agreed upon with the supplier.
Requirement 1.12: Management of information security incidents and improvements
To ensure a consistent and effective approach to the management of information security incidents, including communication on security events and weaknesses, roles, responsibilities and procedures, at business and technical level, shall be established and tested to ensure a quick, effective and orderly and safely recover from information security incidents including scenarios related to a cyber-related cause (e.g. a fraud pursued by an external attacker or by an insider). Personnel involved in these procedures shall be adequately trained.
Requirement 1.13: Technical compliance review
A participant’s internal information systems (e.g. back office systems, internal networks and external network connectivity) shall be regularly assessed for compliance with the organisation’s established framework of policies (e.g. information security policy, cryptographic control policy).
Requirement 1.14: Virtualisation
Guest virtual machines shall comply with all the security controls that are set for physical hardware and systems (e.g. hardening, logging). Controls relating to hypervisors must include: hardening of the hypervisor and the hosting operating system, regular patching, strict separation of different environments (e.g. production and development). Centralised management, logging and monitoring as well as managing of access rights, in particular for high privileged accounts, shall be implemented based on a risk assessment. Guest virtual machines managed by the same hypervisor shall have a similar risk profile.
Requirement 1.15: Cloud computing
The usage of public and/or hybrid cloud solutions in the Payment Transaction Chain must be based on a formal risk assessment, taking into account the technical controls and the contractual clauses related to the cloud solution.
If hybrid cloud solutions are used, it is understood that the criticality level of the overall system is the highest one of the connected systems. All on-premises components of the hybrid solutions must be segregated from the other on-premises systems.
Business continuity management (applicable only to critical participants)
The following requirements (2.1 to 2.6) relate to business continuity management. Each TARGET2 participant classified by the Eurosystem as being critical for the smooth functioning of the TARGET2 system shall have a business continuity strategy in place comprising the following elements.
|
Requirement 2.1 |
: |
Business continuity plans shall be developed and procedures for maintaining them are in place. |
|
Requirement 2.2 |
: |
An alternate operational site shall be available. |
|
Requirement 2.3 |
: |
The risk profile of the alternate site shall be different from that of the primary site, in order to avoid that both sites are affected by the same event at the same time. For example, the alternate site shall be on a different power grid and central telecommunication circuit from those of the primary business location. |
|
Requirement 2.4 |
: |
In the event of a major operational disruption rendering the primary site inaccessible and/or critical staff unavailable, the critical participant shall be able to resume normal operations from the alternate site, where it shall be possible to properly close the business day and open the following business day(s). |
|
Requirement 2.5 |
: |
Procedures shall be in place to ensure that the processing of transactions is resumed from the alternate site within a reasonable timeframe after the initial disruption of service and commensurate to the criticality of the business that was disrupted. |
|
Requirement 2.6 |
: |
The ability to cope with operational disruptions shall be tested at least once a year and critical staff shall be aptly trained. The maximum period between tests shall not exceed one year. |
ANNEX IIA
HARMONISED CONDITIONS FOR THE OPENING AND OPERATION OF A T2S DEDICATED CASH ACCOUNT (T2S DCA) IN TARGET2
TITLE I
GENERAL PROVISIONS
Article 1
Definitions
For the purposes of these Harmonised Conditions (hereinafter the 'Conditions') the following definitions apply:
where the participant no longer meets the access criteria laid down in Article 5 or the requirements laid down in Article 6(1)(a)(i);
the opening of insolvency proceedings in relation to the participant;
the submission of an application relating to the proceedings referred to in point (b);
the issue by the participant of a written declaration of its inability to pay all or any part of its debts or to meet its obligations arising in relation to intraday credit;
the entry of the participant into a voluntary general agreement or arrangement with its creditors;
where the participant is, or is deemed by its CB to be, insolvent or unable to pay its debts;
where the participant's credit balance on its PM account, T2S DCA, or TIPS DCA or all or a substantial part of the participant's assets are subject to a freezing order, attachment, seizure or any other procedure that is intended to protect the public interest or the rights of the participant's creditors;
where participation of the participant in another TARGET2 component system and/or in an ancillary system has been suspended or terminated;
where any material representation or pre-contractual statement made by the participant or which is implied to have been made by the participant under the applicable law is incorrect or untrue;
the assignment of all or a substantial part of the participant's assets,
▼M8 —————
submit payment orders or receive payments via TARGET2; and
settle such payments with such Eurosystem CB,
authorised and supervised by a recognised competent authority, which has been designated as such under Directive 2014/65/EU; and
entitled to carry out the activities referred to under [insert national law provisions implementing items 2, 3, 6 and 7 of Section A of Annex I to Directive 2014/65/EU],
Article 2
Scope
The present Conditions govern the relationship between the relevant euro area NCB and its ►M6 T2S DCA holder ◄ as far the opening and the operation of the ►M6 T2S DCA ◄ is concerned.
Article 3
Appendices
The following Appendices form an integral part of these Conditions:
|
Appendix I |
: |
Parameters of the ►M6 T2S Dedicated Cash Accounts ◄ — Technical specifications; |
|
Appendix II |
: |
TARGET2 compensation scheme in relation to the opening and the operation of the ►M6 T2S DCA ◄ ; |
|
Appendix III |
: |
Terms of reference for capacity and country opinions; |
|
Appendix IV |
: |
Business continuity and contingency procedures; |
|
Appendix V |
: |
Operating schedule; |
|
Appendix VI |
: |
Fee schedule. |
Article 4
General description of TARGET2
The following transactions are processed in TARGET2-[insert CB/country reference]:
transactions directly resulting from or made in connection with Eurosystem monetary policy operations;
settlement of the euro leg of foreign exchange operations involving the Eurosystem;
settlement of euro transfers resulting from transactions in cross-border large-value netting systems;
settlement of euro transfers resulting from transactions in euro retail payment systems of systemic importance;
settlement of the cash leg of securities transactions;
T2S DCA to T2S DCA liquidity transfer orders, T2S DCA to PM liquidity transfer orders and PM to T2S DCA liquidity transfer orders;
instant payment orders;
positive recall answers;
TIPS DCA to PM liquidity transfer orders and PM to TIPS DCA liquidity transfer orders;
TIPS DCA to TIPS AS technical account liquidity transfer orders and TIPS AS technical account to TIPS DCA liquidity transfer orders; and
any other transactions in euro addressed to TARGET2 participants.
TITLE II
PARTICIPATION
Article 5
Access criteria
The following types of entities are eligible to become a ►M6 T2S DCA holder ◄ upon request in TARGET2-[insert CB/country reference]:
credit institutions established in the Union or the EEA, including when they act through a branch established in the Union or the EEA;
credit institutions established outside the EEA, provided that they act through a branch established in the Union or the EEA;
NCBs of Member States and the ECB;
provided that the entities referred to in points (a) and (b) are not subject to restrictive measures adopted by the Council of the European Union or Member States pursuant to Article 65(1)(b), Article 75 or Article 215 of the Treaty, the implementation of which, in the view of [CB/country reference] after informing the ECB, is incompatible with the smooth functioning of TARGET2.
The [insert name of the CB] may, at its discretion, also admit the following entities as ►M6 T2S DCA holders ◄ :
treasury departments of central or regional governments of Member States;
public sector bodies of Member States authorised to hold accounts for customers;
investment firms established in the Union or the EEA, including when they act through a branch established in the Union or the EEA; and
investment firms established outside the EEA, provided that they act through a branch established in the Union or the EEA.
entities managing ancillary systems and acting in that capacity; and
credit institutions or any of the entities of the types listed in points (a) to (d), in both cases where these are established in a country with which the Union has entered into a monetary agreement allowing access by any of such entities to payment systems in the Union subject to the conditions set out in the monetary agreement and provided that the relevant legal regime applying in the country is equivalent to the relevant Union legislation.
Article 6
Application procedure
In order for [insert name of CB] to open a ►M6 T2S DCA ◄ for an entity, such entity must comply with the access criteria of the provisions of [insert name of CB] implementing Article 5 and shall:
fulfil the following technical requirements:
install, manage, operate and monitor and ensure the security of the necessary IT infrastructure to provide a technical connection to the SSP and/or the T2S Platform and submit payment orders to it. In doing so, applicant participants may involve third parties, but retain sole liability. In particular, when connecting directly to the T2S Platform, applicant ►M6 T2S DCA holders ◄ shall enter into an agreement with a ►M8 NSP ◄ to obtain the necessary connection and admissions, in accordance with the technical specifications in Appendix I; and
have passed the certification testing and obtained the authorisation required by the [insert name of CB]; and
fulfil the following legal requirements:
provide a capacity opinion in the form specified in Appendix III, unless the information and representations to be provided in such capacity opinion have already been obtained by the [insert name of CB] in another context; and
for credit institutions or investment firms established outside the EEA, acting through a branch established in the Union or the EEA, provide a country opinion in the form specified in Appendix III, unless the information and representations to be provided in such country opinion have already been obtained by the [insert name of CB] in another context.
Entities wishing to open a ►M6 T2S DCA ◄ shall apply in writing to the [insert name of CB], as a minimum enclosing the following documents/information:
completed static data collection forms as provided by [insert name of CB],
the capacity opinion, if required by the [insert name of CB], and
the country opinion, if required by the [insert name of CB].
The [insert name of CB] shall reject the application to open a ►M6 T2S DCA ◄ if:
access criteria referred to in Article 5 are not met;
one or more of the participation criteria referred to in paragraph 1 are not met; and/or
in the [insert name of CB]'s assessment, opening a ►M6 T2S DCA ◄ would endanger the overall stability, soundness and safety of TARGET2-[insert CB/country reference] or of any other TARGET2 component system, or would jeopardise the [insert name of CB]'s performance of its tasks as described in [refer to relevant national law] and the Statute of the European System of Central Banks and of the European Central Bank, or poses risks on the grounds of prudence.
Article 7
T2S DCA holders
►M6 T2S DCA holders ◄ in TARGET2-[insert CB/country reference] shall comply with the requirements set out in Article 6. They shall have at least one ►M6 T2S DCA ◄ with the [insert name of CB].
Article 8
Links between securities accounts and ►M6 T2S DCAs ◄
TITLE III
OBLIGATIONS OF THE PARTIES
Article 9
Obligations of the [insert name of CB] and the ►M6 T2S DCA holders ◄
Article 10
Cooperation and information exchange
Article 11
Designation, suspension or termination of the Main PM account
TITLE IV
OPENING AND MANAGEMENT OF THE ►M6 T2S DCA ◄ AND PROCESSING OF OPERATIONS
Article 12
Opening and management of the ►M6 T2S DCA ◄
The [insert name of CB] shall open and operate at least one ►M6 T2S DCA ◄ for each ►M6 T2S DCA holder ◄ . A ►M6 T2S DCA ◄ shall be identified ►M6 by means of a unique account number of up to 34 characters ◄ which will be structured as follows.
|
|
Name |
Format |
Content |
|
Part A |
Account type |
1 char. exactly |
‘C’ for cash account |
|
Country code of the central bank |
2 char. exactly |
ISO country code 3166-1 |
|
|
Currency code |
3 char. exactly |
EUR |
|
|
Part B |
Account holder |
11 char. exactly |
BIC Code |
|
Part C |
Sub-classification of the account |
Up to 17 char. |
Free text (alphanumeric) to be provided by the ►M6 T2S DCA holder ◄ |
Article 13
Operations that may be carried out through the ►M6 T2S DCA ◄
Subject to the ►M6 T2S DCA holder ◄ designating the necessary securities account(s), the ►M6 T2S DCA holder ◄ may carry out the following operations through the ►M6 T2S DCA ◄ either on its own behalf or on behalf of its customers:
►M6 T2S DCA to PM liquidity transfer orders ◄ ;
►M6 T2S DCA to T2S DCA liquidity transfer orders ◄ ;
the settlement of cash instructions stemming from the T2S Platform; and
Article 14
Acceptance and rejection of payment orders
Payment orders submitted by ►M6 T2S DCA holders ◄ are deemed accepted by the [insert name of CB] if:
the payment message complies with the rules established by the ►M8 NSP ◄ ;
the payment message complies with the formatting rules and conditions of TARGET2-[insert CB/country reference] and passes the double-entry check described in Appendix I; and
in cases where a payer or a payee has been suspended, the suspended participant's CB's explicit consent has been obtained.
Article 15
Reservation and blocking of liquidity
Article 16
Moment of entry, moment of irrevocability
For the purposes of the first sentence of Article 3(1) and Article 5 of Directive 98/26/EC and [insert national law provision implementing these Articles of Directive 98/26/EC] and for all transactions settling on T2S DCAs, the following rules apply.
for all transactions settling on T2S DCAs and which are subject to matching of two separate transfer orders, such transfer orders are deemed entered into TARGET2-[Insert CB/country reference] at the moment at which they have been declared compliant with the technical rules of T2S by the T2S Platform and irrevocable at the moment the transaction has been given the status ‘matched’ on the T2S Platform; or
as an exception to point (a), for transactions involving one participating CSD having a separate matching component where transfer orders are sent directly to that participating CSD to be matched in its separate matching component, transfer orders are deemed entered into TARGET2-[Insert CB/country reference] at the moment at which they have been declared compliant with the technical rules of T2S by that participating CSD and irrevocable from the moment the transaction has been given the status ‘matched’ on the T2S Platform. A list of CSDs for which this point (b) applies is available on the website of the ECB.
▼M6 —————
TITLE V
SECURITY REQUIREMENTS, CONTINGENCY ISSUES AND USER INTERFACES
Article 17
Business continuity and contingency procedures
In the event of an abnormal external event or any other event which affects transactions on the ►M6 T2S DCAs ◄ , the business continuity and contingency procedures described in Appendix IV shall apply.
Article 18
Security requirements
Article 19
User interfaces
The ►M6 T2S DCA holder ◄ , or the Main PM account holder acting on its behalf, shall use either one or both of the following means to access that ►M6 T2S DCA ◄ :
direct connection to the T2S Platform in either U2A or A2A modes; or
the ►M6 ICM ◄ in combination with TARGET2 value-added services for T2S.
Further technical details relating to the ►M6 ICM ◄ are contained in [insert national provisions implementing Appendix I to Annex II to the Guideline].
TITLE VI
COMPENSATION, LIABILITY REGIME AND EVIDENCE
Article 20
Compensation scheme
In the event that funds remain overnight on a ►M6 T2S DCA ◄ due to a technical malfunction of either the SSP or the T2S Platform, the [insert name of CB] shall offer to compensate the participants concerned in accordance with the special procedure laid down in Appendix II.
Article 21
Liability regime
The [insert name of CB] shall not be liable:
to the extent that the loss is caused by the ►M6 T2S DCA holder ◄ ; or
if the loss arises out of external events beyond the [insert name of CB]'s reasonable control (force majeure).
Article 22
Evidence
TITLE VII
TERMINATION AND CLOSURE OF ►M6 T2S DCAS ◄
Article 23
Duration and ordinary termination of ►M6 T2S DCAs ◄
Article 24
Suspension and extraordinary termination of participation
A ►M6 T2S DCA holder's ◄ participation in TARGET2-[insert CB/country reference] shall be immediately terminated without prior notice or suspended if one of the following events of default occurs:
the opening of insolvency proceedings; and/or
the ►M6 T2S DCA holder ◄ no longer meets the access criteria laid down in Article 5.
For the purposes of this paragraph, the taking of crisis prevention measures or crisis management measures within the meaning of Directive 2014/59/EU against a T2S DCA holder shall not automatically qualify as the opening of insolvency proceedings.
The [insert name of CB] may terminate without prior notice or suspend the ►M6 T2S DCA holder's ◄ participation in TARGET2-[insert CB/country reference] if:
one or more events of default (other than those referred to in paragraph 1) occur;
the ►M6 T2S DCA holder ◄ is in material breach of these Conditions;
the ►M6 T2S DCA holder ◄ fails to carry out any material obligation to the [insert name of CB];
the ►M6 T2S DCA holder ◄ is excluded from, or otherwise ceases to be a member of, a T2S Closed Group of Users (CGU); and/or
any other event related to the ►M6 T2S DCA holder ◄ occurs which, in the [insert name of CB]'s assessment, would threaten the overall stability, soundness and safety of TARGET2-[insert CB/country reference] or of any other TARGET2 component system, or which would jeopardise the [insert name of CB]'s performance of its tasks as described in [refer to relevant national law] and the Statute of the European System of Central Banks and of the European Central Bank, or poses risks on the grounds of prudence.
In the event that the [insert name of CB] suspends or terminates a ►M6 T2S DCA holder's ◄ participation in TARGET2-[insert CB/country reference] under paragraph 1 or 2, the [insert name of CB] shall immediately inform, by means of an ICM broadcast message or a T2S broadcast message, that ►M6 T2S DCA holder ◄ , other CBs and ►M6 T2S DCA holders ◄ and PM account holders in all of the TARGET2 component systems of such suspension or termination. Such message shall be deemed to have been issued by the home CB of the ►M6 T2S DCA holder ◄ and PM account holder that receives the message. ◄
▼M4 —————
Once such an ICM broadcast message (in the case of PM account holders) or T2S broadcast message (in the case of ►M6 T2S DCA holders ◄ ) has been received by the participants, such participants shall be deemed informed of the termination/suspension of a ►M6 T2S DCA holder's ◄ participation in TARGET2-[insert CB/country reference] or another TARGET2 component system. The participants shall bear any losses arising from the submission of a payment order to participants whose participation has been suspended or terminated if such payment order was entered into TARGET2-[insert CB/country reference] after receipt of the ICM broadcast message or of the T2S broadcast message depending on which technical option provided for in Article 19 the ►M6 T2S DCA holder ◄ uses.
Article 25
Closure of ►M6 T2S DCAs ◄
TITLE VIII
FINAL PROVISIONS
Article 26
The [insert name of CB]'s rights of pledge and set-off
[Insert if applicable: The [insert name of CB] shall have a pledge over the ►M6 T2S DCA holder's ◄ existing and future credit balances on its ►M6 T2S DCAs ◄ , thereby collateralising any current and future claims arising out of the legal relationship between the parties.]
[Insert if applicable: A ►M6 T2S DCA holder's ◄ current and future claims towards the [insert name of the CB] arising from a credit balance on the ►M6 T2S DCA ◄ shall be transferred to the [insert name of the CB] as collateral, i.e. as a fiduciary transfer, for any current or future claim of the [insert name of the CB] towards the participant arising out of the [insert reference to the arrangement implementing these Conditions]. Such collateral shall be established by the mere fact that the funds have been credited to the ►M6 T2S DCA holder's ◄ ►M6 T2S DCA ◄ .]
On the occurrence of:
an event of default referred to in Article 24(1); or
any other event of default or event referred to in Article 24(2) that has led to the termination or suspension of the ►M6 T2S DCA holder's ◄ participation, notwithstanding the commencement of any insolvency proceedings in respect of a ►M6 T2S DCA holder ◄ and notwithstanding any assignment, judicial or other attachment or other disposition of or in respect of the ►M6 T2S DCA holder's ◄ rights;
all obligations of the ►M6 T2S DCA holder ◄ shall be automatically and immediately accelerated, without prior notice and without the need for any prior approval of any authority, so as to be immediately due. In addition, the mutual obligations of the ►M6 T2S DCA holder ◄ and the [insert name of CB] shall automatically be set off against each other, and the party owing the higher amount shall pay to the other the difference.
Article 27
Confidentiality
Article 28
Data protection, prevention of money laundering, administrative or restrictive measures and related issues
►M6 T2S DCA holders ◄ , when acting as the payment service provider of a payer or payee, shall comply with all requirements resulting from administrative or restrictive measures imposed pursuant to Articles 75 or 215 of the Treaty to which they are subject, including with respect to notification and/or the obtaining of consent from a competent authority in relation to the processing of transactions. In addition:
when the [insert name of CB] is the payment service provider of a ►M6 T2S DCA holder ◄ that is a payer:
the ►M6 T2S DCA holder ◄ shall make the required notification or obtain consent on behalf of the central bank that is primarily required to make notification or obtain consent, and shall provide the [insert name of CB] with evidence of having made a notification or having received consent;
the T2S DCA holder shall not enter any T2S DCA to PM liquidity transfer order or T2S DCA to T2S DCA liquidity transfer order, with the exception of such liquidity transfer orders between different accounts of the same T2S DCA holder, into TARGET2 until it has obtained confirmation from the [insert name of CB] that the required notification has been made or the consent has been obtained by or on behalf of the payment service provider of the payee;
when the [insert name of CB] is a payment service provider of a ►M6 T2S DCA holder ◄ that is a payee, the ►M6 T2S DCA holder ◄ shall make the required notification or obtain consent on behalf of the central bank that is primarily required to make notification or obtain consent, and shall provide the [insert name of CB] with evidence of having made a notification or having received consent.
For the purposes of this paragraph, the terms ‘payment service provider’, ‘payer’ and ‘payee’ shall have the meanings ascribed to them in the applicable administrative or restrictive measures.
Article 29
Notices
Article 30
Contractual relationship with an NSP
T2S DCA holders shall either:
have concluded a contract with an NSP within the framework of the concession contract with that NSP in order to establish a technical connection to TARGET2- [insert name of CB]; or
connect via another entity which has concluded a contract with an NSP within the framework of the concession contract with that NSP.
Article 31
Amendment procedure
The [insert name of CB] may at any time unilaterally amend these Conditions, including their Appendices. Amendments to these Conditions, including their Appendices, shall be announced by means of [insert relevant means of announcement]. Amendments shall be deemed to have been accepted unless the ►M6 T2S DCA holder ◄ expressly objects within 14 days of being informed of such amendments. In the event that a ►M6 T2S DCA holder ◄ objects to the amendment, the [insert name of CB] is entitled immediately to terminate and close that ►M6 T2S DCA holder's ◄ ►M6 T2S DCA ◄ in TARGET2-[insert CB/country reference].
Article 32
Third party rights
Article 33
Governing law, jurisdiction and place of performance
Article 34
Severability
If any provision in these Conditions is or becomes invalid, this shall not prejudice the applicability of all the other provisions of these Conditions.
Article 34a
Transitional provisions
Once the TARGET system is operational and TARGET2 has ceased operation, T2S DCA holders shall become T2S DCA holders in the TARGET system.
Article 34b
Deferred application of amendments introduced by paragraphs 1(c), 7 and 9 of Annex II to Guideline (EU) 2021/1759 (ECB/2021/30)
The necessary measures to be taken and applied from 13 June 2022 pursuant to Article 2(2) of Guideline (EU) 2021/1759 of the European Central Bank (ECB/2021/30) ( 31 ) shall be applied from 4 July 2022.
Article 35
Entry into force and binding nature
Appendix I
PARAMETERS OF THE T2S DEDICATED CASH ACCOUNTS – TECHNICAL SPECIFICATIONS
In addition to the Conditions, the following rules shall apply to the interaction with the T2S Platform:
1. Technical requirements for participation in TARGET2-[insert CB/country reference] regarding infrastructure, network and formats
(1) T2S uses the services of a ►M8 NSP ◄ for the exchange of messages. Each ►M6 T2S DCA holder ◄ using a direct connection shall have a connection to at least one ►M8 NSP ◄ secure IP network.
(2) Each ►M6 T2S DCA holder ◄ shall pass a series of tests to prove its technical and operational competence before it may participate in TARGET2-[insert CB/country reference].
(3) For the submission of liquidity transfer orders in the ►M6 T2S DCA ◄ the services of the ►M8 NSP ◄ shall be used. Liquidity transfer orders shall be directly addressed to the T2S DN and must contain the following information:
(4) For the exchange of information with the T2S Platform either A2A or U2A modes may be used. The security of the message exchange between ►M6 T2S DCA ◄ and the T2S Platform shall rely on the Public Key Infrastructure (PKI) service offered by a ►M8 NSP ◄ . Information on the PKI service is available in the documentation provided by such ►M8 NSP ◄ .
(5) ►M6 T2S DCA holders ◄ shall comply with the ISO20022 message structure and field specifications. All messages shall include a Business Application Header (BAH). Message structure, field specifications and BAHs are defined in the ISO documentation, under the restrictions set out for T2S, as described in Chapter 3.3.3 Cash Management (camt) of the T2S UDFS.
(6) Field contents shall be validated at the level of the T2S Platform in accordance with the T2S UDFS requirements.
2. Message types
The following system message types are processed, subject to subscription:
|
Message Type |
Description |
|
(camt.003) |
GetAccount |
|
(camt.004) |
ReturnAccount |
|
(camt.005) |
GetTransaction |
|
(camt.006) |
ReturnTransaction |
|
(camt.009) |
GetLimit |
|
(camt.010) |
ReturnLimit |
|
(camt.011) |
ModifyLimit |
|
(camt.012) |
DeleteLimit |
|
(camt.018) |
GetBusinessDayInformation |
|
(camt.019) |
ReturnBusinessDayInformation |
|
(camt.024) |
ModifyStandingOrder |
|
(camt.025) |
Receipt |
|
(camt.050) |
LiquidityCreditTransfer |
|
(camt.051) |
LiquidityDebitTransfer |
|
(camt.052) |
BankToCustomerAccountReport |
|
(camt.053) |
BankToCustomerStatement |
|
(camt.054) |
BankToCustomerDebitCreditNotification |
|
(camt.064) |
LimitUtilisationJournalQuery |
|
(camt.065) |
LimitUtilisationJournalReport |
|
(camt.066) |
IntraBalanceMovementInstruction |
|
(camt.067) |
IntraBalanceMovementStatusAdvice |
|
(camt.068) |
IntraBalanceMovementConfirmation |
|
(camt.069) |
GetStandingOrder |
|
(camt.070) |
ReturnStandingOrder |
|
(camt.071) |
DeleteStandingOrder |
|
(camt.072) |
IntraBalanceMovementModificationRequest |
|
(camt.073) |
IntraBalanceMovementModificationRequestStatusAdvice |
|
(camt.074) |
IntraBalanceMovementCancellationRequest |
|
(camt.075) |
IntraBalanceMovementCancellationRequestStatusAdvice |
|
(camt.078) |
IntraBalanceMovementQuery |
|
(camt.079) |
IntraBalanceMovementQueryResponse |
|
(camt.080) |
IntraBalanceModificationQuery |
|
(camt.081) |
IntraBalanceModificationReport |
|
(camt.082) |
IntraBalanceCancellationQuery |
|
(camt.083) |
IntraBalanceCancellationReport |
|
(camt.084) |
IntraBalanceMovementPostingReport |
|
(camt.085) |
IntraBalanceMovementPendingReport |
3. Double-entry check
(1) All liquidity transfer orders shall pass a double-entry check, the aim of which is to reject liquidity transfer orders that have been submitted more than once.
(2) The following parameters shall be checked:
(3) If all the fields described in point (2) in a newly submitted liquidity transfer order are identical to those in a liquidity transfer order which has been accepted but not yet settled or a liquidity transfer order that has been settled within the past three business days, the newly submitted liquidity transfer order shall be rejected.
4. Error codes
If a liquidity transfer order is rejected on grounds of non-compliance with the fields in paragraph 3(2), the ►M6 T2S DCA holder ◄ shall receive a status advice message [camt.025], as described in Chapter 4.1 of the T2S UDFS.
5. Settlement triggers
(1) For immediate liquidity transfer orders, no specific XML tag is required;
(2) Predefined liquidity transfer orders and standing liquidity transfer orders may be triggered by a specific time or event on the day of settlement:
(3) The validity period for standing liquidity transfer orders shall be set by the following XML tags: ‘FromDate/VldtyPrd/FrDt/’ and ‘ToDate/VldtyPrd/ToDt/’.
6. Settlement of liquidity transfer orders
Liquidity transfer orders are not recycled, queued or offset.
The different statuses for liquidity transfer orders are described in Chapter 1.6.4 of the T2S UDFS.
7. Use of the U2A and A2A mode
(1) The U2A and A2A modes may be used for obtaining information and managing liquidity. The T2S network service providers' networks shall be the underlying technical communications networks for exchanging information and running control measures. The following modes shall be available for use by ►M6 T2S DCA holders ◄ :
Application-to-application mode (A2A)
In A2A, information and messages are transferred between the T2S Platform and the ►M6 T2S DCA holder's ◄ internal application. The ►M6 T2S DCA holder ◄ therefore has to ensure that an appropriate application is available for the exchange of XML messages (requests and responses).
User-to-application mode (U2A)
U2A permits direct communication between a T2S DCA holder and the T2S GUI. The information is displayed in a browser running on a PC system. For U2A access the IT infrastructure has to be able to support cookies. Further details are described in the T2S User Handbook.
(2) Static data shall be available to view in U2A mode. The screens shall be offered in English only.
(3) Information shall be provided in ‘pull’ mode, which means that each ►M6 T2S DCA holder ◄ has to ask to be provided with information.
(4) Access rights to the U2A and A2A mode shall be granted by using T2S GUI.
(5) The ‘Non-Repudiation of Origin’ (NRO) signature allows the recipient of a message to prove that such message has been issued and has not been altered.
(6) If a ►M6 T2S DCA holder ◄ has technical problems and is unable to submit any liquidity transfer order, it may contact its central bank which will on a best efforts basis act on behalf of the ►M6 T2S DCA holder ◄ .
8. Relevant documentation
Further details and examples explaining the above rules are contained in the T2S UDFS and the T2S User Handbook, as amended from time to time and published on the ECB's website in English.
Appendix II
TARGET2 COMPENSATION SCHEME IN RELATION TO THE OPENING AND THE OPERATION OF THE ►M6 T2S DCA ◄
1. General principles
If there is a technical malfunction of TARGET2, ►M6 T2S DCA holders ◄ may submit claims for compensation in accordance with the TARGET2 compensation scheme laid down in this Appendix.
Unless otherwise decided by the ECB's Governing Council, the TARGET2 compensation scheme shall not apply if the technical malfunction of TARGET2 arises out of external events beyond the reasonable control of the CBs concerned or as a result of acts or omissions by third parties.
Compensation under the TARGET2 compensation scheme shall be the only compensation procedure offered in the event of a technical malfunction of the TARGET2. ►M6 T2S DCA holders ◄ may, however, use other legal means to claim for losses. If a ►M6 T2S DCA holder ◄ accepts a compensation offer under the TARGET2 compensation scheme, this shall constitute the ►M6 T2S DCA holder's ◄ irrevocable agreement that it thereby waives all claims in relation to the payment orders concerning which it accepts compensation (including any claims for consequential loss) it may have against any CB, and that the receipt by it of the corresponding compensation payment constitutes full and final settlement of all such claims. The ►M6 T2S DCA holder ◄ shall indemnify the CBs concerned, up to a maximum of the amount received under the TARGET2 compensation scheme, in respect of any further claims which are raised by any other participant or any other third party in relation to the payment order or payment concerned.
The making of a compensation offer shall not constitute an admission of liability by the [insert name of CB] or any other CB in respect of a technical malfunction of the TARGET2.
2. Conditions for compensation offers
A payer may submit a claim for an administration fee and interest compensation if, due to a technical malfunction of TARGET2, a liquidity transfer order was not settled on the business day on which it was accepted.
A payee may submit a claim for an administration fee if, due to a technical malfunction of TARGET2, it did not receive a payment that it was expecting to receive on a particular business day. The payee may also submit a claim for interest compensation if one or more of the following conditions are met:
in the case of participants that have access to the marginal lending facility: due to a technical malfunction of TARGET2, a payee had recourse to the marginal lending facility; and/or
in the case of all participants: it was technically impossible to have recourse to the money market or such refinancing was impossible on other, objectively reasonable grounds.
3. Calculation of compensation
With respect to a compensation offer for a payer:
the administration fee shall be EUR 50 for the first non-settled payment order, EUR 25 for each of the next four such payment orders and EUR 12,50 for each further such payment order. The administration fee shall be calculated separately in relation to each payee;
interest compensation shall be determined by applying a reference rate to be fixed from day to day. This reference rate shall be the lower of the euro overnight index average (EONIA) rate and the marginal lending rate. The reference rate shall be applied to the amount of the payment order not settled as a result of the technical malfunction of TARGET2 for each day in the period from the date of the actual or, in relation to payment orders referred to in paragraph 2(b)(ii), intended submission of the payment order until the date on which the payment order was or could have been successfully settled. Any interest or charges resulting from the placing of any non-settled payment orders on deposit with the Eurosystem shall be deducted from, or charged to, the amount of any compensation, as the case may be; and
no interest compensation shall be payable if and in so far as funds resulting from non-settled payment orders were placed in the market or used to fulfil minimum reserve requirements.
With respect to a compensation offer for a payee:
the administration fee shall be EUR 50 for the first non-settled payment order, EUR 25 for each of the next four such payment orders and EUR 12,50 for each further such payment order. The administration fee shall be calculated separately in relation to each payer;
the method set out in point (a)(ii) for calculating interest compensation shall apply except that interest compensation shall be payable at a rate equal to the difference between the marginal lending rate and the reference rate, and shall be calculated on the amount of any recourse to the marginal lending facility occurring as a result of the technical malfunction of TARGET2.
4. Procedural rules
A claim for compensation shall be submitted on the claim form available on the website of the [insert name of CB] in English (see [insert reference to website of CB]). Payers shall submit a separate claim form in respect of each payee and payees shall submit a separate claim form in respect of each payer. Sufficient additional information and documents shall be provided to support the information indicated in the claim form. Only one claim may be submitted in relation to a specific payment or payment order.
Within four weeks of a technical malfunction of TARGET2, ►M6 T2S DCA holders ◄ shall submit their claim forms to the [insert name of CB]. Any additional information and evidence requested by the [insert name of CB] shall be supplied within two weeks of such request being made.
The [insert name of CB] shall review the claims and forward them to the ECB. Unless otherwise decided by the ECB's Governing Council and communicated to the ►M6 T2S DCA holders ◄ , all received claims shall be assessed no later than 14 weeks after the technical malfunction of TARGET2 occurs.
The [insert name of CB] shall communicate the result of the assessment referred to in point (c) to the relevant ►M6 T2S DCA holders ◄ . If the assessment entails a compensation offer, the ►M6 T2S DCA holders ◄ concerned shall, within four weeks of the communication of such offer, either accept or reject it, in respect of each payment or payment order comprised within each claim, by signing a standard letter of acceptance (in the form available on the website of the [insert name of CB] (see [insert reference to website of CB]). If such letter has not been received by the [insert name of CB] within four weeks, the ►M6 T2S DCA holders ◄ concerned shall be deemed to have rejected the compensation offer.
The [insert name of CB] shall make compensation payments on receipt of a ►M6 T2S DCA holder's ◄ letter of acceptance of compensation. No interest shall be payable on any compensation payment.
Appendix III
TERMS OF REFERENCE FOR CAPACITY AND COUNTRY OPINIONS
TERMS OF REFERENCE FOR CAPACITY OPINIONS FOR ►M6 T2S DCA HOLDERS ◄ IN TARGET2
[Insert name of CB]
[address]
Participation in the [name of the system]
[location]
[date]
Dear Sir or Madam,
We have been asked to provide this Opinion as [in-house or external] legal advisers to [specify name of ►M6 T2S DCA holder ◄ or branch of ►M6 T2S DCA holder ◄ ] in respect of issues arising under the laws of [jurisdiction in which the ►M6 T2S DCA holder ◄ is established; hereinafter the ‘jurisdiction’] in connection with the participation of [specify name of ►M6 T2S DCA holder ◄ ] (hereinafter the ‘ ►M6 T2S DCA holder ◄ ’) in the [name of the TARGET2 component system] (hereinafter the ‘System’).
This Opinion is confined to the laws of [jurisdiction] as they exist as on the date of this Opinion. We have made no investigation of the laws of any other jurisdiction as a basis for this Opinion, and do not express or imply any opinion in this regard. Each of the statements and opinions presented below applies with equal accuracy and validity under the laws of [jurisdiction], whether or not the ►M6 T2S DCA holder ◄ acts through its head office or one or more branches established inside or outside of [jurisdiction] in submitting liquidity transfer orders and receiving liquidity transfers.
I. DOCUMENTS EXAMINED
For the purposes of this Opinion, we have examined:
a certified copy of the [specify relevant constitutional documents] of the ►M6 T2S DCA holder ◄ such as is/are in effect on the date hereof;
[if applicable] an extract from the [specify relevant company register] and [if applicable] [register of credit institutions or analogous register];
[to the extent applicable] a copy of the ►M6 T2S DCA holder's ◄ licence or other proof of authorisation to provide banking, investment, funds transfer or other financial services in [jurisdiction];
[specify all powers of attorney and other documents constituting or evidencing the requisite power of the person or persons signing the relevant System Documents (as defined below) on behalf of the ►M6 T2S DCA holder ◄ ];
and all other documents relating to the ►M6 T2S DCA holder's ◄ constitution, powers, and authorisations necessary or appropriate for the provision of this Opinion (hereinafter the ' ►M6 T2S DCA holder's ◄ Documents').
For the purposes of this Opinion, we have also examined:
the [insert reference to the arrangements implementing the Harmonised Conditions for Opening and Operation of a Dedicated Cash Account in TARGET2] for the System dated [insert date] (hereinafter the ‘Rules’); and
[…].
The Rules and the […] shall be referred to hereinafter as the ‘System Documents’ (and collectively with the ►M6 T2S DCA holder's ◄ Documents as the ‘Documents’).
II. ASSUMPTIONS
For the purposes of this Opinion we have assumed in relation to the Documents that:
the System Documents with which we have been provided are originals or true copies;
the terms of the System Documents and the rights and obligations created by them are valid and legally binding under the laws of [insert reference to the Member State of the System] by which they are expressed to be governed, and the choice of the laws of [insert reference to the Member State of the System] to govern the System Documents is recognised by the laws of [insert reference to the Member State of the System];
the ►M6 T2S DCA holder's ◄ Documents are within the capacity and power of and have been validly authorised, adopted or executed and, where necessary, delivered by the relevant parties; and
the ►M6 T2S DCA holder's ◄ Documents are binding on the parties to which they are addressed, and there has been no breach of any of their terms.
III. OPINIONS REGARDING THE ►M6 T2S DCA HOLDER ◄
A. The ►M6 T2S DCA holder ◄ is a corporation duly established and registered or otherwise duly incorporated or organised under the laws of [jurisdiction].
B. The ►M6 T2S DCA holder ◄ has all the requisite corporate powers to execute and perform the rights and obligations under the System Documents to which it is party.
C. The adoption or execution and the performance by the ►M6 T2S DCA holder ◄ of the rights and obligations under the System Documents to which the ►M6 T2S DCA holder ◄ is party will not in any way breach any provision of the laws or regulations of [jurisdiction] applicable to the ►M6 T2S DCA holder ◄ or the ►M6 T2S DCA holder ◄ Documents.
D. No additional authorisations, approvals, consents, filings, registrations, notarisations or other certifications of or with any court or governmental, judicial or public authority that is competent in [jurisdiction] are required by the ►M6 T2S DCA holder ◄ in connection with the adoption, validity or enforceability of any of the System Documents or the execution or performance of the rights and obligations thereunder.
E. The ►M6 T2S DCA holder ◄ has taken all necessary corporate action and other steps necessary under the laws of [jurisdiction] to ensure that its obligations under the System Documents are legal, valid and binding.
This Opinion is stated as of its date and is addressed solely to [insert name of CB] and the [ ►M6 T2S DCA holder ◄ ]. No other persons may rely on this Opinion, and the contents of this Opinion may not be disclosed to persons other than its intended recipients and their legal counsel without our prior written consent, with the exception of the European Central Bank and the national central banks of the European System of Central Banks [and [the national central bank/relevant regulatory authorities] of [jurisdiction]].
Yours faithfully,
[signature]
TERMS OF REFERENCE FOR COUNTRY OPINIONS FOR NON-EEA ►M6 T2S DCA HOLDERS ◄ IN TARGET2
[Insert name of CB]
[address]
[name of the system]
[location],
[date]
Dear Sir or Madam,
We have been asked as [external] legal advisers to [specify name of ►M6 T2S DCA holder ◄ or branch of ►M6 T2S DCA holder ◄ ] (the ‘ ►M6 T2S DCA holder ◄ ’) in respect of issues arising under the laws of [jurisdiction in which the ►M6 T2S DCA holder ◄ is established; hereinafter the ‘jurisdiction’] to provide this Opinion under the laws of [jurisdiction] in connection with the participation of the ►M6 T2S DCA holder ◄ in a system which is a component of TARGET2 (hereinafter the ‘System’). References herein to the laws of [jurisdiction] include all applicable regulations of [jurisdiction]. We express an opinion herein under the law of [jurisdiction], with particular regard to the ►M6 T2S DCA holder ◄ established outside [insert reference to the Member State of the System] in relation to rights and obligations arising from participation in the System, as presented in the System Documents defined below.
This Opinion is confined to the laws of [jurisdiction] as they exist on the date of this Opinion. We have made no investigation of the laws of any other jurisdiction as a basis for this Opinion, and do not express or imply any opinion in this regard. We have assumed that there is nothing in the laws of another jurisdiction which affects this Opinion.
1. DOCUMENTS EXAMINED
For the purposes of this Opinion, we have examined the documents listed below and such other documents as we have deemed necessary or appropriate:
the [insert reference to the arrangements implementing the Harmonised Conditions for Opening and Operation of a Dedicated Cash Account in TARGET2] for the System dated [insert date] (hereinafter the ‘Rules’); and
any other document governing the System and/or the relationship between the ►M6 T2S DCA holder ◄ and other participants in the System, and between the participants in the System and the [insert name of CB].
The Rules and the [.] shall be referred to hereinafter as the ‘System Documents’.
2. ASSUMPTIONS
For the purposes of this Opinion we have assumed in relation to the System Documents that:
the System Documents are within the capacity and power of and have been validly authorised, adopted or executed and, where necessary, delivered by the relevant parties;
the terms of the System Documents and the rights and obligations created by them are valid and legally binding under the laws of [insert reference to the Member State of the System], by which they are expressed to be governed, and the choice of the laws of [insert reference to the Member State of the System] to govern the System Documents is recognised by the laws of [insert reference to the Member State of the System];
the documents submitted to us in copy or as specimens conform to the originals.
3. OPINION
Based on and subject to the foregoing, and subject in each case to the points set out below, we are of the opinion that:
3.1. Country-specific legal aspects [to the extent applicable]
The following characteristics of the legislation of [jurisdiction] are consistent with and in no way set aside the obligations of the ►M6 T2S DCA holder ◄ arising out of the System Documents: [list of country-specific legal aspects].
3.2. General insolvency and crisis management issues
Types of insolvency and crisis management proceedings
The only types of insolvency proceedings (including composition or rehabilitation) which, for the purpose of this Opinion, shall include all proceedings in respect of the T2S DCA holder’s assets or any branch it may have in [jurisdiction] to which the T2S DCA holder may become subject in [jurisdiction], are the following: [list proceedings in original language and English translation] (together collectively referred to as ‘Insolvency Proceedings’).
In addition to Insolvency Proceedings, the T2S DCA holder, any of its assets, or any branch it may have in [jurisdiction] may become subject in [jurisdiction] to [list any applicable moratorium, receivership, or any other proceedings as a result of which payment orders to and/or from the T2S DCA holder may be suspended, or limitations can be imposed in relation to such payment orders, or similar proceedings, including crisis prevention and crisis management measures equivalent to those defined in Directive 2014/59/EU, in original language and English translation] (hereinafter collectively referred to as ‘Proceedings’).
Insolvency treaties
[jurisdiction] or certain political subdivisions within [jurisdiction], as specified, is/are party to the following insolvency treaties: [specify, if applicable which have or may have an impact on this Opinion].
3.3. Enforceability of System Documents
Subject to the points set out below, all provisions of the System Documents will be binding and enforceable in accordance with their terms under the laws of [jurisdiction], in particular in the event of the opening of any Insolvency Proceedings or Proceedings with respect to the ►M6 T2S DCA holder ◄ .
In particular, we are of the opinion that:
3.3.a. Processing of liquidity transfer orders
The provisions on processing of liquidity transfer orders [list of sections] of the Rules are valid and enforceable. In particular, all liquidity transfer orders processed pursuant to such sections will be valid, binding and will be enforceable under the laws of [jurisdiction]. The provision of the Rules which specifies the precise point in time at which liquidity transfer orders become enforceable and irrevocable ([add section of the Rules]) is valid, binding and enforceable under the laws of [jurisdiction].
3.3.b. Authority of the [insert name of CB] to perform its functions
The opening of Insolvency Proceedings or Proceedings in respect of the ►M6 T2S DCA holder ◄ will not affect the authority and powers of the [insert name of CB] arising out of the System Documents. [Specify [to the extent applicable] that: the same opinion is also applicable in respect of any other entity which provides the ►M6 T2S DCA holders ◄ with services directly and necessarily required for participation in the System, e.g. network service provider].
3.3.c. Remedies in the event of default
[Where applicable to the ►M6 T2S DCA holder ◄ , the provisions contained in [list of sections] of the Rules regarding accelerated performance of claims which have not yet matured, the set-off of claims for using the deposits of the ►M6 T2S DCA holder ◄ , the enforcement of a pledge, suspension and termination of participation, claims for default interest, and termination of agreements and transactions ([insert other relevant clauses of the Rules or the System Documents]) are valid and enforceable under the laws of [jurisdiction].]
3.3.d. Suspension and termination
Where applicable to the ►M6 T2S DCA holder ◄ , the provisions contained in [list of sections] of the Rules (in respect of suspension and termination of the ►M6 T2S DCA holder's ◄ participation in the System on the opening of Insolvency Proceedings or Proceedings or other events of default, as defined in the System Documents, or if the ►M6 T2S DCA holder ◄ represents any kind of systemic risk or has serious operational problems) are valid and enforceable under the laws of [jurisdiction].
3.3.e. Assignment of rights and obligations
The rights and obligations of the ►M6 T2S DCA holder ◄ cannot be assigned, altered or otherwise transferred by the ►M6 T2S DCA holder ◄ to third parties without the prior written consent of the [insert name of CB].
3.3.f. Choice of governing law and jurisdiction
The provisions contained in [list of sections] of the Rules, and in particular in respect of the governing law, the resolution of a dispute, competent courts, and service of process are valid and enforceable under the laws of [jurisdiction].
3.4. Voidable preferences
We are of the opinion that no obligation arising out of the System Documents, the performance thereof, or compliance therewith prior to the opening of any Insolvency Proceedings or Proceedings in respect of the ►M6 T2S DCA holder ◄ may be set aside in any such proceedings as a preference, voidable transaction or otherwise under the laws of [jurisdiction].
In particular, and without limitation to the foregoing, we express this opinion in respect of any transfer orders submitted by any participant in the System. In particular, we are of the opinion that the provisions of [list of sections] of the Rules establishing the enforceability and irrevocability of transfer orders will be valid and enforceable and that a transfer order submitted by any participant and processed pursuant to [list of sections] of the Rules may not be set aside in any Insolvency Proceedings or Proceedings as a preference, voidable transaction or otherwise under the laws of [jurisdiction].
3.5. Attachment
If a creditor of the ►M6 T2S DCA holder ◄ seeks an attachment order (including any freezing order, order for seizure or any other public or private law procedure that is intended to protect the public interest or the rights of the ►M6 T2S DCA holder's ◄ creditors) — hereinafter referred to as an ‘Attachment’ — under the laws of [jurisdiction] from a court or governmental, judicial or public authority that is competent in [jurisdiction], we are of the opinion that [insert the analysis and discussion].
3.6. Collateral [if applicable]
3.6.a. Assignment of rights or deposit of assets for collateral purposes, pledge and/or repo
Assignments for collateral purposes will be valid and enforceable under the laws of [jurisdiction]. Specifically, the creation and enforcement of a pledge or repo under the [insert reference to the relevant arrangement with the CB] will be valid and enforceable under the laws of [jurisdiction].
3.6.b. Priority of assignees', pledgees' or repo purchasers' interest over that of other claimants
In the event of Insolvency Proceedings or Proceedings in respect of the ►M6 T2S DCA holder ◄ , the rights or assets assigned for collateral purposes, or pledged by the ►M6 T2S DCA holder ◄ in favour of the [insert reference to CB] or other participants in the System, will rank in priority of payment above the claims of all other creditors of the ►M6 T2S DCA holder ◄ and will not be subject to priority or preferential creditors.
3.6.c. Enforcing title to security
Even in the event of Insolvency Proceedings or Proceedings in respect of the ►M6 T2S DCA holder ◄ , other participants in the System and the [insert name of CB] as [assignees, pledgees or repo purchasers as applicable] will still be free to enforce and collect the ►M6 T2S DCA holder's ◄ rights or assets through the action of the [insert name of CB] pursuant to the Rules.
3.6.d. Form and registration requirements
There are no form requirements for the assignment for collateral purposes of, or the creation and enforcement of a pledge or repo over the ►M6 T2S DCA holder's ◄ rights or assets and it is not necessary for the [assignment for collateral purposes, pledge or repo, as applicable], or any particulars of such [assignment, pledge or repo, as applicable,] to be registered or filed with any court or governmental, judicial or public authority that is competent in [jurisdiction].
3.7. Branches [to the extent applicable]
3.7.a. Opinion applies to action through branches
Each of the statements and opinions presented above with regard to the ►M6 T2S DCA holder ◄ applies with equal accuracy and validity under the laws of [jurisdiction] in situations where the ►M6 T2S DCA holder ◄ acts through its one or more of its branches established outside [jurisdiction].
3.7.b. Conformity with law
Neither the execution and performance of the rights and obligations under the System Documents nor the submission, transmission or receipt of payment orders by a branch of the ►M6 T2S DCA holder ◄ will in any respect breach the laws of [jurisdiction].
3.7.c. Required authorisations
Neither the execution and performance of the rights and obligations under the System Documents nor the submission, transmission or receipt of payment orders by a branch of a ►M6 T2S DCA holder ◄ will require any additional authorisations, approvals, consents, filings, registrations, notarisations or other certifications of or with any court or governmental, judicial or public authority that is competent in [jurisdiction].
This Opinion is stated as of its date and is addressed solely to the [insert name of CB] and the [ ►M6 T2S DCA holder ◄ ]. No other persons may rely on this Opinion, and the contents of this Opinion may not be disclosed to persons other than its intended recipients and their legal counsel without our prior written consent, with the exception of the European Central Bank and the national central banks of the European System of Central Banks [and [the national central bank/relevant regulatory authorities] of [jurisdiction]].
Yours faithfully,
[signature]
Appendix IV
BUSINESS CONTINUITY AND CONTINGENCY PROCEDURES
1. General provisions
All references to specific times in this Appendix are to the local time at the seat of the ECB, i.e. Central European Time (CET ( 32 )).
2. Measures of business continuity
In the event that an abnormal external event occurs and/or there is a failure of the SSP, the T2S Platform or a network service provider which affects the normal operation of TARGET2, the [insert name of CB] shall be entitled to adopt business continuity measures.
The following main business continuity and contingency measures shall be available for the SSP:
relocating the operation of the SSP to an alternative site;
changing the SSP's operating hours; and
initiating contingency processing of very critical and critical payment orders, as defined in paragraph 6(c) and (d) of Appendix IV to Annex II.
The following main business continuity and contingency measures shall be available for the T2S Platform:
relocating the operation of the T2S Platform to an alternative site;
rescheduling events in the T2S Settlement day.
In relation to business continuity processing measures, the [insert name of CB] shall have full discretion regarding what measures are adopted.
3. Incident communication
Information about a failure of the TARGET2 and/or an abnormal external event shall be communicated to ►M6 T2S DCA holders ◄ through the domestic communication channels, the ICM, the T2S GUI and the T2S-information system as defined in the T2S UDFS. In particular, communications to ►M6 T2S DCA holders ◄ shall include the following information:
a description of the event;
the anticipated delay in processing (if known);
information on the measures already taken.
In addition, the [insert name of CB] may notify ►M6 T2S DCA holders ◄ of any other existing or anticipated event which has the potential to affect the normal operation of TARGET2.
4. Relocation of the operation of the SSP and/or T2S Platform to an alternative site
In the event that any of the events referred to in paragraph 2(a) occurs, the operation of the SSP and/or the T2S Platform may be relocated to an alternative site, either within the same region or in another region.
In the event that the operation of the T2S Platform is relocated to another region, the ►M6 T2S DCA holders ◄ shall (i) refrain from sending new instructions to the T2S Platform; and (ii) at the request of [insert name of CB] perform a reconciliation and resubmit any instructions identified as missing submitted within a maximum of five minutes prior to the time of failure or the occurrence of the abnormal external event and provide the [insert name of CB] with all relevant information in this respect.
5. Change of operating hours
The daytime processing of TARGET2 may be extended or the opening time of a new business day may be delayed. During any extended operating time of TARGET2, payment orders shall be processed in accordance with this Appendix.
TARGET2 daytime processing may be extended and the closing time thereby delayed, if a T2S Platform or SSP failure has occurred during the day but has been resolved before 18.00. Such a closing time delay shall in normal circumstances not exceed two hours and shall be announced as early as possible to ►M6 T2S DCA holders ◄ . Once such a delay is announced it may not be withdrawn.
6. Failures linked to ►M6 T2S DCA holders ◄
In the event that a ►M6 T2S DCA holder ◄ has a problem that prevents it from settling payment orders in TARGET2 [insert name of CB/country reference], it shall be its responsibility to resolve the problem.
In the event that a ►M6 T2S DCA holder ◄ unexpectedly submits an abnormally high number of messages, which threaten the stability of the T2S Platform, and does not, upon request of the [insert name of CB], refrain from such behaviour without delay, the [insert name of CB] may block from the T2S Platform all further messages submitted by such ►M6 T2S DCA holder ◄ .
7. Other provisions
In the event of a failure of the [insert name of CB], some or all of its technical functions in relation to TARGET2-[insert CB/country reference] may be performed by other Eurosystem CBs.
The [insert name of CB] may require that the ►M6 T2S DCA holders ◄ participate in regular or ad hoc testing of business continuity and contingency processing measures, training or any other preventative arrangements, as deemed necessary by the [insert name of CB]. Any costs incurred by the ►M6 T2S DCA holders ◄ as a result of such testing or other arrangements shall be borne solely by the ►M6 T2S DCA holders ◄ .
Appendix V
OPERATING SCHEDULE
1. TARGET2 is open on all days, except Saturdays, Sundays, New Year's Day, Good Friday and Easter Monday (according to the calendar applicable at the seat of the ECB), 1 May, 25 December and 26 December.
2. The reference time for the system is the local time at the seat of the ECB, i.e. CET ( 33 ).
3. The current business day is opened during the evening of the previous business day and operates according to the schedule set out in the T2S Scope Defining Set of Documents.
4. The T2S Platform is available for U2A and A2A mode during the whole settlement day, except during the technical maintenance period from 3.00 until 5.00. During the technical maintenance period messages sent using the A2A mode will be queued. It will not be possible to submit messages via the U2A mode.
5. The operating hours may be changed in the event that business continuity measures are adopted in accordance with paragraph 2 of Appendix IV.
6. An overview of the operating hours and significant business events during the day is shown in the following table:
|
SSP schedule |
T2S schedule (applicable to ►M6 T2S DCAs ◄ ) |
||
|
Time |
Description |
Time |
Description |
|
18.45-19.00 (1) |
Start-of-day processing (sending of GL files shortly after 18.45) |
18.45-20.00 |
Start of day: — Change of business date — Deadline for acceptance of CMS data feeds (19.00) — Preparation of the night time settlement |
|
19.00-19.30 (1) |
Night-time settlement: provision of liquidity from SF to HAM and PM; from HAM to PM and from PM to ►M6 T2S DCA ◄ . |
20.00-3.00 |
Night-time settlement: — First night-time settlement cycle — Last night-time settlement cycle (sequence X includes the partial settlement of unsettled payment instructions eligible for partial settlement and that have failed to settle due to a lack of securities; sequence Y includes the reimbursement of multiple liquidity providers at the end of cycle) |
|
19.30 (1)-22.00 |
Night-time settlement (NTS1): — Start-of-procedure message — Setting aside of liquidity on the basis of standing orders for the night-time processing (ancillary system settlement procedure 6 and T2S) |
|
|
|
22.00-1.00 |
Technical maintenance window (2) |
3.00-5.00 |
Technical maintenance window (3) |
|
►M6 1.00 – 7.00 ◄ |
Night-time processing (ancillary system settlement procedure 6 and T2S) |
5.00-18.00 |
Day trade/Real-time settlement (4): — Real-time settlement preparation (4) — Partial settlement windows at 14.00 and 15.45 (5) (for 15 minutes — 16.00: DvP cut-off — 16.30: Automatic auto-collateralisation reimbursement, followed by the optional cash sweep — 17.40: Cut-off for bilaterally agreed treasury management operations (BATM) and central bank operations (CBO) cut-off — 17.45: Inbound liquidity transfer cut-off — Automated cash sweep after 17.45 — 18.00: FOP cut-off |
|
6.45-7.00 |
Business window to prepare daylight operations |
|
|
|
7.00-18.00 |
Day trade phase: — 17.00: Cut-off for customer payments — 17.45: cut-off for liquidity transfers to ►M6 T2S DCAs ◄ — 18.00: Cut-off for interbank payments and incoming liquidity transfers from ►M6 T2S DCAs ◄ |
|
|
|
18.00-18.45 |
— 18.15 (1): Cut-off for the use of standing facilities — Data needed to update the accounting system is available for central banks, shortly after 18.30 — 18.40 (1): Cut-off for use of marginal lending (NCBs only) — End-of-day processing |
18.00-18.45 |
— End of T2S settlement processing — Recycling and purging — End-of-day reporting and statements |
Notes to table:
(1) Plus 15 minutes on the last day of the reserve maintenance period.
(2) Over a weekend or on a holiday, the technical window will last throughout the weekend or the holiday, i.e., from 22.00 on Friday until 1.00 on Monday or, in the case of a holiday, from 22.00 on the last business day until 1.00 on the next business day.
(3) Over a weekend or on a holiday, the technical window will last throughout the weekend or the holiday, i.e., from 3.00 on Saturday until 5.00 on Monday or, in the case of a holiday, from 3.00 on the holiday until 5.00 on the next business day.
(4) Real-time settlement preparation and real-time settlement may start before the maintenance window if the last night-time settlement cycle ends before 3.00.
(5) Each partial settlement window lasts for 15 minutes. The partial settlement applies to unsettled payment instructions eligible for partial settlement and that have failed to settle due to a lack of securities.
7. Up-to-date information on the operational status of the SSP and the T2S Platform shall be available on the TARGET2 Information System (T2IS) and the TARGET2-Securities Information System, respectively, on dedicated webpages on the ECB's website. The information on the operational status of the SSP and the T2S Platform on T2IS, TARGET2-Securities Information System and the ECB's website shall only be updated during normal business hours.
Appendix VI
FEE SCHEDULE
Fees for T2S services
The following fees for T2S services connected with ►M6 T2S DCAs ◄ shall be charged to the Main PM account holders:
|
Tariff items |
Price |
Explanation |
|
Settlement services |
||
|
T2S DCA to T2S DCA liquidity transfer orders |
14,1 euro cent |
per transfer |
|
Intra-balance movement (i.e. blocking, unblocking, reservation of liquidity etc.) |
9,4 euro cent |
per transaction |
|
Information services |
||
|
A2A reports |
0,4 euro cent |
Per business item in any A2A report generated |
|
A2A queries |
0,7 euro cent |
Per queried business item in any A2A query generated |
|
U2A queries |
10 euro cent |
Per executed search function |
|
U2A queries downloaded |
0,7 euro cent |
Per queried business item in any U2A query generated and downloaded |
|
Messages bundled into a file |
0,4 euro cent |
Per message in a file |
|
Transmissions |
1,2 euro cent |
Per transmission |
ANNEX IIB
HARMONISED CONDITIONS FOR THE OPENING AND OPERATION OF A TIPS DEDICATED CASH ACCOUNT (TIPS DCA) IN TARGET2
TITLE I
GENERAL PROVISIONS
Article 1
Definitions
For the purposes of these Harmonised Conditions (hereinafter the ‘Conditions’), the following definitions apply:
where the participant no longer meets the access criteria laid down in Article 5 or the requirements laid down in Article 6(1)(a)(i) or Article 6(1)(b)(iii);
the opening of insolvency proceedings in relation to the participant;
the submission of an application relating to the proceedings referred to in point (b);
the issue by the participant of a written declaration of its inability to pay all or any part of its debts or to meet its obligations arising in relation to intraday credit;
the entry of the participant into a voluntary general agreement or arrangement with its creditors;
where the participant is, or is deemed by its CB to be, insolvent or unable to pay its debts;
where the participant's credit balance on its TIPS DCA, PM account, or T2S DCA, or all or a substantial part of the participant's assets are subject to a freezing order, attachment, seizure or any other procedure that is intended to protect the public interest or the rights of the participant's creditors;
where participation of the participant in another TARGET2 component system and/or in an ancillary system has been suspended or terminated;
where any material representation or pre-contractual statement made by the participant or which is implied to have been made by the participant under the applicable law is incorrect or untrue;
the assignment of all or a substantial part of the participant's assets,
authorised and supervised by a recognised competent authority, which has been designated as such under Directive 2014/65/EU; and
entitled to carry out the activities referred to under [insert national law provisions implementing items 2, 3, 6 and 7 of Section A of Annex I to Directive 2014/65/EU],
▼M8 —————
Article 2
Scope
The present Conditions govern the relationship between the relevant euro area NCB and its TIPS DCA holder as far as the opening and the operation of the TIPS DCA is concerned.
Article 3
Appendices
Article 4
General description of TARGET2
The following transactions are processed in TARGET2-[insert CB/country reference]:
transactions directly resulting from or made in connection with Eurosystem monetary policy operations;
settlement of the euro leg of foreign exchange operations involving the Eurosystem;
settlement of euro transfers resulting from transactions in cross-border large-value netting systems;
settlement of euro transfers resulting from transactions in euro retail payment systems of systemic importance;
settlement of the cash leg of securities transactions;
T2S DCA to T2S DCA liquidity transfer orders, T2S DCA to PM liquidity transfer orders and PM to T2S DCA liquidity transfer orders;
instant payment orders;
positive recall answers;
TIPS DCA to PM liquidity transfer orders and PM to TIPS DCA liquidity transfer orders; and
TIPS DCA to TIPS AS technical account liquidity transfer orders and TIPS AS technical account to TIPS DCA liquidity transfer orders; and
any other transactions in euro addressed to TARGET2 participants.
TITLE II
PARTICIPATION
Article 5
Access criteria
The following types of entities are eligible to become a TIPS DCA holder in TARGET2-[insert CB/country reference]:
credit institutions established in the Union or the EEA, including when they act through a branch established in the Union or the EEA;
credit institutions established outside the EEA, provided that they act through a branch established in the Union or the EEA;
NCBs of Member States and the ECB;
provided that the entities referred to in points (a) and (b) are not subject to restrictive measures adopted by the Council of the European Union or Member States pursuant to Article 65(1)(b), Article 75 or Article 215 of the Treaty, the implementation of which, in the view of [CB/country reference] after informing the ECB, is incompatible with the smooth functioning of TARGET2.
The [insert name of the CB] may, at its discretion, also admit the following entities as TIPS DCA holders:
treasury departments of central or regional governments of Member States;
public sector bodies of Member States authorised to hold accounts for customers;
investment firms established in the Union or the EEA, including when they act through a branch established in the Union or the EEA; and
investment firms established outside the EEA, provided that they act through a branch established in the Union or the EEA;
entities managing ancillary systems and acting in that capacity; and
credit institutions or any of the entities of the types listed in points (a) to (d), in both cases where these are established in a country with which the Union has entered into a monetary agreement allowing access by any of such entities to payment systems in the Union subject to the conditions set out in the monetary agreement and provided that the relevant legal regime applying in the country is equivalent to the relevant Union legislation.
Article 6
Application procedure
In order for [insert name of CB] to open a TIPS DCA for an entity, such entity must comply with the access criteria of the provisions of [insert name of CB] implementing Article 5 and shall:
fulfil the following technical requirements:
install, manage, operate and monitor and ensure the security of the necessary IT infrastructure to connect to the TIPS Platform and submit payment orders to it. In doing so, applicant TIPS DCA holders may involve third parties, but retain sole liability. In particular, unless an instructing party is used, applicant TIPS DCA holders shall enter into an agreement with one or more NSPs to obtain the necessary connection and admissions, in accordance with the technical specifications in Appendix I; and
have passed the tests required by the [insert name of CB]; and
fulfil the following legal requirements:
provide a capacity opinion in the form specified in Appendix II, unless the information and representations to be provided in such capacity opinion have already been obtained by the [insert name of CB] in another context;
for credit institutions or investment firms established outside the EEA, acting through a branch established in the Union or the EEA, provide a country opinion in the form specified in Appendix II, unless the information and representations to be provided in such country opinion have already been obtained by the [insert name of CB] in another context; and
have adhered to the SCT Inst scheme by signing the SEPA Instant Credit Transfer Adherence Agreement.
Entities wishing to open a TIPS DCA shall apply in writing to the [insert name of CB], as a minimum enclosing the following documents/information:
completed static data collection forms as provided by [insert name of CB];
the capacity opinion, if required by the [insert name of CB];
the country opinion, if required by the [insert name of CB]; and
evidence of their adherence to the SCT Inst scheme.
The [insert name of CB] shall reject the application to open a TIPS DCA if:
access criteria referred to in Article 5 are not met;
one or more of the participation criteria referred to in paragraph 1 are not met; and/or
in the [insert name of CB]'s assessment, opening a TIPS DCA would endanger the overall stability, soundness and safety of TARGET2-[insert CB/country reference] or of any other TARGET2 component system, or would jeopardise the [insert name of CB]'s performance of its tasks as described in [refer to relevant national law] and the Statute of the European System of Central Banks and of the European Central Bank, or poses risks on the grounds of prudence.
Article 7
TIPS DCA holders
In order to send messages to the TIPS Platform, TIPS DCA holders may access the TIPS Platform:
directly, and/or
using one or more instructing parties.
For both of these methods of access, the TIPS DCA holder shall use one or more TIPS DNs.
In order to receive messages from the TIPS Platform, TIPS DCA holders shall access the TIPS Platform:
directly; or
using one instructing party.
For both of these methods of access, the TIPS DCA holder shall use one TIPS DN to receive instant payment orders.
Article 8
Reachable parties
Article 9
Contractual relationship with an NSP
Participants shall either:
conclude a contract with an NSP within the framework of the concession contract with that NSP in order to establish a technical connection to TARGET2-[insert CB/country reference]; or
connect via another entity which has concluded a contract with an NSP within the framework of the concession contract with that NSP.
▼M8 —————
Article 11
TIPS directory
It shall be updated daily.
Article 11a
MPL repository
TITLE III
OBLIGATIONS OF THE PARTIES
Article 12
Obligations of the [insert name of CB] and the TIPS DCA holders
▼M8 —————
Article 13
Designation, suspension or termination of a Linked PM account
Article 14
Cooperation and information exchange
TITLE IV
MANAGEMENT OF TIPS DCAs AND PROCESSING OF PAYMENT ORDERS
Article 15
Opening and management of TIPS DCAs
The [insert name of CB] shall open and operate at least one TIPS DCA for each TIPS DCA holder. A TIPS DCA shall be identified by means of a unique account number of up to 34 characters which will be structured as follows.
|
|
Name |
Format |
Content |
|
Part A |
Account type |
1 char. exactly |
‘I’ for instant payment account |
|
Country code of the central bank |
2 char. exactly |
ISO country code 3166-1 |
|
|
Currency code |
3 char. exactly |
EUR |
|
|
Part B |
Account holder |
11 char. exactly |
BIC |
|
Part C |
Sub-classification of the account |
Up to 17 char. |
Free text (alphanumeric) to be provided by the TIPS DCA holder |
TIPS DCAs shall either be remunerated at zero per cent or at the deposit facility rate, whichever is lower, unless they are used to hold any of the following:
minimum reserves;
excess reserves;
government deposits as defined in Article 2, point (5) of Guideline (EU) 2019/671 (ECB/2019/7).
In the case of minimum reserves, the calculation and payment of remuneration of holdings shall be governed by Council Regulation (EC) No 2531/98 ( 37 ) and Regulation (EU) 2021/378 of the European Central Bank (ECB/2021/1) ( 38 ).
In the case of excess reserves, the calculation and payment of remuneration of holdings shall be governed by Decision (EU) 2019/1743 (ECB/2019/31) ( 39 ).
In the case of government deposits, the remuneration of holdings shall be governed by the provisions relating to those government deposits as set out in Article 4 of Guideline (EU) 2019/671 (ECB/2019/7) ( 40 ).
Article 16
Types of payment orders in TIPS DCA
The following are classified as payment orders for the purposes of the TIPS service:
instant payment orders;
positive recall answers;
TIPS DCA to PM liquidity transfer orders;
TIPS DCA to TIPS AS technical account liquidity transfer orders; and
TIPS AS technical account to TIPS DCA liquidity transfer orders.
Article 17
Acceptance and rejection of payment orders
Payment orders within the meaning of Article 16 and submitted by TIPS DCA holders are deemed accepted by the [insert name of CB] if:
the payment message has been delivered to the TIPS Platform by the respective ►M8 NSP ◄ ; and
the payment message complies with the formatting rules and conditions of TARGET2-[insert CB/country reference] and passes the double-entry check described in Appendix I.
Article 18
Processing of payment orders on TIPS DCAs
After an instant payment order has been accepted as set out in Article 17, the TARGET2-[insert CB/country reference] shall check if sufficient funds are available on the payer's TIPS DCA.
If sufficient funds are not available, the instant payment order shall be rejected;
If sufficient funds are available, the corresponding amount shall be reserved while awaiting the payee's response. In the event of acceptance by the payee, the instant payment order shall be settled and the reservation shall be simultaneously lifted. In the event of rejection by the payee or the absence of a timely response, within the meaning of the SCT Inst scheme, the instant payment order shall be cancelled and the reservation shall be simultaneously lifted.
Article 19
Recall request
Article 20
Moment of entry, moment of irrevocability
For the purposes of the first sentence of Article 3(1) and Article 5 of Directive 98/26/EC and [insert national law provisions implementing these Articles of Directive 98/26/EC]:
instant payment orders are deemed entered into TARGET2-[insert CB/country reference] and irrevocable at the moment that the relevant funds on the TIPS DCA of the TIPS DCA holder are reserved;
TIPS DCA to PM liquidity transfer orders, positive recall answers and TIPS DCA to TIPS AS technical account liquidity transfer orders are deemed entered into TARGET2-[insert CB/country reference] and irrevocable at the moment that the relevant TIPS DCA is debited. TIPS AS technical account to TIPS DCA liquidity transfer orders are deemed entered into TARGET2-[insert CB/country reference] and irrevocable at the moment that the relevant TIPS AS technical account is debited.
TITLE V
SECURITY REQUIREMENTS, BUSINESS CONTINUITY AND USER INTERFACE
Article 21
Security requirements and business continuity
Article 22
User interfaces
The TIPS DCA holder, or the Linked PM account holder acting on its behalf, shall use either one or both of the following means to access that TIPS DCA:
a direct connection to the TIPS Platform in either U2A or A2A modes; or
the ICM liquidity management features for the TIPS service.
A direct connection to the TIPS Platform allows TIPS DCA holders:
to access information relating to their accounts and to manage CMBs;
to initiate TIPS DCA to PM liquidity transfer orders; and
to manage certain static data.
The ICM liquidity management features for the TIPS service allows the holder of the Linked PM account:
to access information relating to the balance of the TIPS DCAs;
to manage liquidity and to initiate liquidity transfer orders to and from the TIPS DCAs.
Further technical details relating to the user interfaces are contained in Appendix I.
As regards the ICM, further technical details are contained in [insert national provisions implementing Appendix I to Annex II to the Guideline].
TITLE VI
LIABILITY REGIME AND EVIDENCE
Article 23
Liability regime
The [insert name of CB] shall not be liable:
to the extent that the loss is caused by the TIPS DCA holder; or
if the loss arises out of external events beyond the [insert name of CB]'s reasonable control (force majeure).
Article 24
Evidence
TITLE VII
TERMINATION AND CLOSURE OF TIPS DCAs
Article 25
Duration and ordinary termination of TIPS DCAs
Article 26
Suspension and extraordinary termination of participation
A TIPS DCA holder's participation in TARGET2-[insert CB/country reference] shall be immediately terminated without prior notice or suspended if one of the following events of default occurs:
the opening of insolvency proceedings; and/or
the TIPS DCA holder no longer meets the access criteria laid down in Article 5.
For the purposes of this paragraph, the taking of crisis prevention measures or crisis management measures within the meaning of Directive 2014/59/EU against a TIPS DCA holder shall not automatically qualify as the opening of insolvency proceedings.
The [insert name of CB] may terminate without prior notice or suspend the TIPS DCA holder's participation in TARGET2-[insert CB/country reference] if:
one or more events of default (other than those referred to in paragraph 1) occur;
the TIPS DCA holder is in material breach of these Conditions;
the TIPS DCA holder fails to carry out any material obligation to the [insert name of CB];
the TIPS DCA holder no longer has a valid agreement with a ►M8 NSP ◄ to obtain the necessary connection to the TIPS Platform;
any other TIPS DCA holder-related event occurs which, in the [insert name of CB]'s assessment, would threaten the overall stability, soundness and safety of TARGET2-[insert CB/country reference] or of any other TARGET2 component system, or which would jeopardise the [insert name of CB]'s performance of its tasks as described in [refer to relevant national law] and the Statute of the European System of Central Banks and of the European Central Bank, or poses risks on the grounds of prudence.
Linked PM account holders shall have the responsibility to inform their Linked TIPS DCA holders of the suspension or termination of any TIPS DCA holder’s participation in TARGET2-[insert CB/country reference].
In the event that the suspension or termination of a TIPS DCA holder’s participation in TARGET2-[insert CB/country reference] occurs during the technical maintenance window, the ICM broadcast message shall be sent after the start of daytime processing on the next TARGET2 business day.
If a TIPS DCA holder is suspended from TARGET2-[insert CB/country reference] on grounds other than those specified in paragraph (1)(a), the suspended TIPS DCA holder's CB shall either:
reject all of its incoming payment orders;
reject all of its outgoing payment orders; or
reject both its incoming and outgoing payment orders.
Article 27
Closure of TIPS DCAs
On termination of participation, pursuant to either Article 25 or 26, the [insert name of CB] shall close the TIPS DCAs of the TIPS DCA holders concerned, after having:
settled any instant payment order accepted by the payee for which funds have already been reserved; and
made use of its rights of pledge and set-off under Article 28.
TITLE VIII
FINAL PROVISIONS
Article 28
The [insert name of CB]'s rights of pledge and set-off
On the occurrence of:
an event of default, referred to in Article 26(1); or
any other event of default or event referred to in Article 26(2) that has led to the termination or suspension of the TIPS DCA holder's participation, notwithstanding the commencement of any insolvency proceedings in respect of a TIPS DCA holder and notwithstanding any assignment, judicial or other attachment or other disposition of or in respect of the TIPS DCA holder's rights;
all obligations of the TIPS DCA holder shall be automatically and immediately accelerated, without prior notice and without the need for any prior approval of any authority, so as to be immediately due. In addition, the mutual obligations of the TIPS DCA holder and the [insert name of CB] shall automatically be set off against each other, and the party owing the higher amount shall pay to the other the difference.
Article 29
Confidentiality
By derogation from paragraph 1, the TIPS DCA holder agrees that the [insert name of CB] may disclose payment, technical or organisational information regarding the TIPS DCA holder, other TIPS DCAs held by TIPS DCA holders from the same group or the TIPS DCA holder's customers obtained in the course of the operation of TARGET2-[insert CB/country reference] to:
other CBs or third parties that are involved in the operation of TARGET2-[insert CB/country reference], to the extent that this is necessary for the efficient functioning of TARGET2 or the monitoring of the TIPS DCA holder's or its group's exposure;
other CBs in order to carry out the analysis necessary for market operations, monetary policy functions, financial stability or financial integration; or
supervisory, resolution and oversight authorities of Member States and the Union, including CBs, to the extent that this is necessary for the performance of their public tasks, and provided in all such cases that the disclosure is not in conflict with the applicable law.
The [insert name of CB] shall not be liable for the financial and commercial consequences of such disclosure.
Article 30
Data protection, prevention of money laundering, administrative or restrictive measures and related issues
TIPS DCA holders, when acting as the payment service provider of a payer or payee, shall comply with all requirements resulting from administrative or restrictive measures imposed pursuant to Articles 75 or 215 of the Treaty to which they are subject, including with respect to notification and/or the obtaining of consent from a competent authority in relation to the processing of transactions. In addition:
when the [insert name of CB] is the payment service provider of a TIPS DCA holder that is a payer:
the TIPS DCA holder shall make the required notification or obtain consent on behalf of the central bank that is primarily required to make notification or obtain consent, and shall provide the [insert name of CB] with evidence of having made a notification or having received consent;
the TIPS DCA holder shall not enter any payment order into TARGET2 with the exception of payment orders concerning the transfer of liquidity between different accounts of the same TIPS DCA holder, until it has obtained confirmation from the [insert name of CB] that the required notification has been made or the consent has been obtained by or on behalf of the payment service provider of the payee;
when the [insert name of CB] is a payment service provider of a TIPS DCA holder that is a payee, the TIPS DCA holder shall make the required notification or obtain consent on behalf of the central bank that is primarily required to make notification or obtain consent, and shall provide the [insert name of CB] with evidence of having made a notification or having received consent.
For the purposes of this paragraph, the terms ‘payment service provider’, ‘payer’ and ‘payee’ shall have the meanings ascribed to them in the applicable administrative or restrictive measures.
Article 31
Notices
Article 32
Amendment procedure
The [insert name of CB] may at any time unilaterally amend these Conditions, including the Appendices. Amendments to these Conditions, including the Appendices, shall be announced by means of [insert relevant means of announcement]. Amendments shall be deemed to have been accepted unless the TIPS DCA holder expressly objects within 14 days of being informed of such amendments. In the event that a TIPS DCA holder objects to the amendment, the [insert name of CB] is entitled immediately to terminate and close that TIPS DCA holder's TIPS DCA in TARGET2- [insert CB/country reference].
Article 33
Third party rights
Article 34
Governing law, jurisdiction and place of performance
Article 35
Severability
If any provision in these Conditions is or becomes invalid, this shall not prejudice the applicability of all the other provisions of these Conditions.
Article 35a
Transitional provision
Once the TARGET system is operational and the TARGET2 has ceased operation, TIPS DCA holders shall become TIPS DCA holders in the TARGET system.
Article 36
Entry into force and binding nature
Appendix I
PARAMETERS OF THE TIPS DCAs — TECHNICAL SPECIFICATIONS
In addition to the Conditions, the following rules shall apply to the interaction with the TIPS Platform:
1. Technical requirements for participation in TARGET2-[insert CB/country reference] regarding infrastructure, network and formats
A TIPS DCA holder shall use the services of at least one ►M8 NSP ◄ for the exchange of messages.
A TIPS DCA holder shall specify a TIPS DN to receive messages relevant for the TIPS DCA holder, such as in relation to reports, and floor/ceiling notifications. This may be different from the TIPS DN used for the exchange of instant payments orders.
Each TIPS DCA holder shall pass a series of tests to prove its technical and operational competence before it may participate in TARGET2-[insert CB/country reference].
For the submission of TIPS DCA to PM liquidity transfer orders the services of a ►M8 NSP ◄ or the ICM shall be used. Liquidity transfer orders shall include, inter alia, the unique account number of up to 34 characters of the sending TIPS DCA holder and the BIC of the receiving PM account.
For the exchange of information with the TIPS Platform either A2A or U2A modes may be used. The security of the message exchange between the TIPS DCA and the TIPS Platform shall rely on the Public Key Infrastructure (PKI) service offered by the ►M8 NSP ◄ used. Information on the PKI service is available in the documentation provided by such ►M8 NSP ◄ .
For the exchange of information with the Common Reference Data Management component U2A mode shall be used. The Common Reference Data Management component allows users to configure, create and maintain reference data needed in TIPS service.
TIPS DCA holders shall comply with the ISO20022 message structure and field specifications. Message structure and field specifications are described in Chapter 3.3.2 of the TIPS UDFS.
Field contents shall be validated at the level of the TIPS Platform in accordance with the TIPS UDFS requirements.
2. Message types
The following system message types are processed, subject to subscription:
|
Message Type |
Message Name |
|
Pacs.002 |
FIToFIPayment Status Report |
|
Pacs.004 |
PaymentReturn |
|
Pacs.008 |
FIToFICustomerCreditTransfer |
|
Pacs.028 |
FIToFIPaymentStatusRequest |
|
camt.003 |
GetAccount |
|
camt.004 |
ReturnAccount |
|
camt.005 |
GetTransaction |
|
camt.006 |
ReturnTransaction |
|
camt.011 |
ModifyLimit |
|
camt.019 |
ReturnBusinessDayInformation |
|
camt.025 |
Receipt |
|
camt.029 |
ResolutionOfInvestigation |
|
camt.050 |
LiquidityCreditTransfer |
|
camt.052 |
BankToCustomerAccountReport |
|
camt.053 |
BankToCustomerStatement |
|
camt.054 |
BankToCustomerDebitCreditNotification |
|
camt.056 |
FIToFIPaymentCancellationRequest |
|
acmt.010 |
AccountRequestAcknowledgement |
|
acmt.011 |
AccountRequestRejection |
|
acmt.015 |
AccountExcludedMandateMaintenanceRequest |
|
reda.016 |
PartyStatusAdviceV01 |
|
reda.022 |
PartyModificationRequestV01 |
3. Double-entry check
All payment orders shall pass a double-entry check, the aim of which is to reject payment orders that have been submitted more than once.
4. Error codes
If an instant payment order or a positive recall answer is rejected for any reason, the TIPS DCA holder shall receive a payment status report [pacs.002], as described in Chapter 4.2 of the TIPS UDFS. If a liquidity transfer order is rejected for any reason, the TIPS DCA holder shall receive a rejection [camt.025], as described in Chapter 1.6 of the TIPS UDFS.
5. Settlement of liquidity transfer orders
Liquidity transfer orders are not recycled, queued or offset. The different statuses for liquidity transfer orders are described in Chapter 1.4.2 of the TIPS UDFS.
6. Use of the U2A and A2A mode
The U2A and A2A modes may be used for obtaining information and managing liquidity. The ►M8 NSP ◄ networks shall be the underlying technical communications networks for exchanging information and running control measures. The following modes shall be available for use by TIPS DCA holders:
Application-to-application mode (A2A)
In A2A, information and messages are transferred between the TIPS Platform and the TIPS DCA holder's internal application. The TIPS DCA holder therefore has to ensure that an appropriate application is available for the exchange of XML messages (requests and responses).
User-to-application mode (U2A)
U2A permits direct communication between a TIPS DCA holder and the TIPS GUI. The information is displayed in a browser running on a PC system. For U2A access the IT infrastructure has to be able to support cookies. Further details are described in the TIPS User Handbook.
The ‘Non-Repudiation of Origin’ (NRO) signature allows the recipient of a message to prove that such message has been issued and has not been altered.
If a TIPS DCA holder has technical problems and is unable to submit a TIPS DCA to PM liquidity transfer order, it may contact its central bank which will on a best efforts basis act on behalf of the TIPS DCA holder.
7. Relevant documentation
Further details and examples explaining the above rules are contained in the User Handbooks and UDFS as relevant for TIPS, as amended from time to time and published on the ECB's website in English.
Appendix II
TERMS OF REFERENCE FOR CAPACITY AND COUNTRY OPINIONS
TERMS OF REFERENCE FOR CAPACITY OPINIONS FOR TIPS DCA HOLDERS IN TARGET2
[Insert name of CB]
[address]
Participation in the [name of the system]
[location]
[date]
Dear Sir or Madam,
We have been asked to provide this Opinion as [in-house or external] legal advisers to [specify name of TIPS DCA holder or branch of TIPS DCA holder] in respect of issues arising under the laws of [jurisdiction in which the TIPS DCA holder is established; hereinafter the ‘jurisdiction’] in connection with the participation of [specify name of TIPS DCA holder] (hereinafter the ‘TIPS DCA holder’) in the [name of the TARGET2 component system] (hereinafter the ‘System’).
This Opinion is confined to the laws of [jurisdiction] as they exist as on the date of this Opinion. We have made no investigation of the laws of any other jurisdiction as a basis for this Opinion, and do not express or imply any opinion in this regard. Each of the statements and opinions presented below applies with equal accuracy and validity under the laws of [jurisdiction], whether or not the TIPS DCA holder acts through its head office or one or more branches established inside or outside of [jurisdiction] in submitting liquidity transfer orders and receiving liquidity transfers.
I. Documents examined
For the purposes of this Opinion, we have examined:
a certified copy of the [specify relevant constitutional documents] of the TIPS DCA holder such as is/are in effect on the date hereof;
[if applicable] an extract from the [specify relevant company register] and [if applicable] [register of credit institutions or analogous register];
[to the extent applicable] a copy of the TIPS DCA holder's licence or other proof of authorisation to provide banking, investment, funds transfer or other financial services in [jurisdiction];
[if applicable] a copy of a resolution adopted by the board of directors or the relevant governing body of the TIPS DCA holder on [insert date], [insert year], evidencing the TIPS DCA holder's agreement to adhere to the System Documents, as defined below; and
[specify all powers of attorney and other documents constituting or evidencing the requisite power of the person or persons signing the relevant System Documents (as defined below) on behalf of the TIPS DCA holder];
and all other documents relating to the TIPS DCA holder's constitution, powers, and authorisations necessary or appropriate for the provision of this Opinion (hereinafter the ‘TIPS DCA holder's Documents’).
For the purposes of this Opinion, we have also examined:
the [insert reference to the arrangements implementing the Harmonised Conditions for Opening and Operation of a TIPS Dedicated Cash Account in TARGET2] for the System dated [insert date] (hereinafter the ‘Rules’); and
[…].
The Rules and the […] shall be referred to hereinafter as the ‘System Documents’ (and collectively with the TIPS DCA holder's Documents as the ‘Documents’).
II. Assumptions
For the purposes of this Opinion we have assumed in relation to the Documents that:
the System Documents with which we have been provided are originals or true copies;
the terms of the System Documents and the rights and obligations created by them are valid and legally binding under the laws of [insert reference to the Member State of the System] by which they are expressed to be governed, and the choice of the laws of [insert reference to the Member State of the System] to govern the System Documents is recognised by the laws of [insert reference to the Member State of the System];
the TIPS DCA holder's Documents are within the capacity and power of and have been validly authorised, adopted or executed and, where necessary, delivered by the relevant parties; and
the TIPS DCA holder's Documents are binding on the parties to which they are addressed, and there has been no breach of any of their terms.
III. Opinions regarding the tips DCA holder
The TIPS DCA holder is a corporation duly established and registered or otherwise duly incorporated or organised under the laws of [jurisdiction].
The TIPS DCA holder has all the requisite corporate powers to execute and perform the rights and obligations under the System Documents to which it is party.
The adoption or execution and the performance by the TIPS DCA holder of the rights and obligations under the System Documents to which the TIPS DCA holder is party will not in any way breach any provision of the laws or regulations of [jurisdiction] applicable to the TIPS DCA holder or the TIPS DCA holder Documents.
No additional authorisations, approvals, consents, filings, registrations, notarisations or other certifications of or with any court or governmental, judicial or public authority that is competent in [jurisdiction] are required by the TIPS DCA holder in connection with the adoption, validity or enforceability of any of the System Documents or the execution or performance of the rights and obligations thereunder.
The TIPS DCA holder has taken all necessary corporate action and other steps necessary under the laws of [jurisdiction] to ensure that its obligations under the System Documents are legal, valid and binding.
This Opinion is stated as of its date and is addressed solely to [insert name of CB] and the [TIPS DCA holder]. No other persons may rely on this Opinion, and the contents of this Opinion may not be disclosed to persons other than its intended recipients and their legal counsel without our prior written consent, with the exception of the European Central Bank and the national central banks of the European System of Central Banks [and [the national central bank/relevant regulatory authorities] of [jurisdiction]].
Yours faithfully,
[signature]
TERMS OF REFERENCE FOR COUNTRY OPINIONS FOR NON-EEA TIPS DCA HOLDERS IN TARGET2
[Insert name of CB]
[address]
[name of the system]
[location],
[date]
Dear Sir or Madam,
We have been asked as [external] legal advisers to [specify name of TIPS DCA holder or branch of TIPS DCA holder] (the ‘TIPS DCA holder’) in respect of issues arising under the laws of [jurisdiction in which the TIPS DCA holder is established; hereinafter the ‘jurisdiction’] to provide this Opinion under the laws of [jurisdiction] in connection with the participation of the TIPS DCA holder in a system which is a component of TARGET2 (hereinafter the ‘System’). References herein to the laws of [jurisdiction] include all applicable regulations of [jurisdiction]. We express an opinion herein under the law of [jurisdiction], with particular regard to the TIPS DCA holder established outside [insert reference to the Member State of the System] in relation to rights and obligations arising from participation in the System, as presented in the System Documents defined below.
This Opinion is confined to the laws of [jurisdiction] as they exist on the date of this Opinion. We have made no investigation of the laws of any other jurisdiction as a basis for this Opinion, and do not express or imply any opinion in this regard. We have assumed that there is nothing in the laws of another jurisdiction which affects this Opinion.
1. Documents examined
For the purposes of this Opinion, we have examined the documents listed below and such other documents as we have deemed necessary or appropriate:
the [insert reference to the arrangements implementing the Harmonised Conditions for Opening and Operation of a TIPS Dedicated Cash Account in TARGET2] for the System dated [insert date] (hereinafter the ‘Rules’); and
any other document governing the System and/or the relationship between the TIPS DCA holder and other participants in the System, and between the participants in the System and the [insert name of CB].
The Rules and the [.] shall be referred to hereinafter as the ‘System Documents’.
2. Assumptions
For the purposes of this Opinion we have assumed in relation to the System Documents that:
the System Documents are within the capacity and power of and have been validly authorised, adopted or executed and, where necessary, delivered by the relevant parties;
the terms of the System Documents and the rights and obligations created by them are valid and legally binding under the laws of [insert reference to the Member State of the System], by which they are expressed to be governed, and the choice of the laws of [insert reference to the Member State of the System] to govern the System Documents is recognised by the laws of [insert reference to the Member State of the System];
the documents submitted to us in copy or as specimens conform to the originals.
3. Opinion
Based on and subject to the foregoing, and subject in each case to the points set out below, we are of the opinion that:
3.1. Country-specific legal aspects [to the extent applicable]
The following characteristics of the legislation of [jurisdiction] are consistent with and in no way set aside the obligations of the TIPS DCA holder arising out of the System Documents: [list of country-specific legal aspects].
3.2. General insolvency and crisis management issues
Types of insolvency and crisis management proceedings
The only types of insolvency proceedings (including composition or rehabilitation) which, for the purpose of this Opinion, shall include all proceedings in respect of the TIPS DCA holder’s assets or any branch it may have in [jurisdiction] to which the TIPS DCA holder may become subject in [jurisdiction], are the following: [list proceedings in original language and English translation] (together collectively referred to as ‘Insolvency Proceedings’).
In addition to Insolvency Proceedings, the TIPS DCA holder, any of its assets, or any branch it may have in [jurisdiction] may become subject in [jurisdiction] to [list any applicable moratorium, receivership, or any other proceedings as a result of which payment orders to and/or from the TIPS DCA holder may be suspended, or limitations can be imposed in relation to such payment orders, or similar proceedings, including crisis prevention and crisis management measures equivalent to those defined in Directive 2014/59/EU, in original language and English translation] (hereinafter collectively referred to as ‘Proceedings’).
Insolvency treaties
[jurisdiction] or certain political subdivisions within [jurisdiction], as specified, is/are party to the following insolvency treaties: [specify, if applicable which have or may have an impact on this Opinion].
3.3. Enforceability of System Documents
Subject to the points set out below, all provisions of the System Documents will be binding and enforceable in accordance with their terms under the laws of [jurisdiction], in particular in the event of the opening of any Insolvency Proceedings or Proceedings with respect to the TIPS DCA holder.
In particular, we are of the opinion that:
3.3.a. Processing of payment orders
The provisions on processing of payment orders [list of sections] of the Rules are valid and enforceable. In particular, all payment orders processed pursuant to such sections will be valid, binding and will be enforceable under the laws of [jurisdiction]. The provision of the Rules which specifies the precise point in time at which payment orders become enforceable and irrevocable ([add section of the Rules]) is valid, binding and enforceable under the laws of [jurisdiction].
3.3.b. Authority of the [insert name of CB] to perform its functions
The opening of Insolvency Proceedings or Proceedings in respect of the TIPS DCA holder will not affect the authority and powers of the [insert name of CB] arising out of the System Documents. [Specify [to the extent applicable] that: the same opinion is also applicable in respect of any other entity which provides the TIPS DCA holders with services directly and necessarily required for participation in the System, e.g. ►M8 NSP ◄ ].
3.3.c. Remedies in the event of default
[Where applicable to the TIPS DCA holder, the provisions contained in [list of sections] of the Rules regarding accelerated performance of claims which have not yet matured, the set-off of claims for using the deposits of the TIPS DCA holder, the enforcement of a pledge, suspension and termination of participation, claims for default interest, and termination of agreements and transactions ([insert other relevant clauses of the Rules or the System Documents]) are valid and enforceable under the laws of [jurisdiction].]
3.3.d. Suspension and termination
Where applicable to the TIPS DCA holder, the provisions contained in [list of sections] of the Rules (in respect of suspension and termination of the TIPS DCA holder's participation in the System on the opening of Insolvency Proceedings or Proceedings or other events of default, as defined in the System Documents, or if the TIPS DCA holder represents any kind of systemic risk or has serious operational problems) are valid and enforceable under the laws of [jurisdiction].
3.3.e. Assignment of rights and obligations
The rights and obligations of the TIPS DCA holder cannot be assigned, altered or otherwise transferred by the TIPS DCA holder to third parties without the prior written consent of the [insert name of CB].
3.3.f. Choice of governing law and jurisdiction
The provisions contained in [list of sections] of the Rules, and in particular in respect of the governing law, the resolution of a dispute, competent courts, and service of process are valid and enforceable under the laws of [jurisdiction].
3.4. Voidable preferences
We are of the opinion that no obligation arising out of the System Documents, the performance thereof, or compliance therewith prior to the opening of any Insolvency Proceedings or Proceedings in respect of the TIPS DCA holder may be set aside in any such proceedings as a preference, voidable transaction or otherwise under the laws of [jurisdiction].
In particular, and without limitation to the foregoing, we express this opinion in respect of any transfer orders submitted by any participant in the System. In particular, we are of the opinion that the provisions of [list of sections] of the Rules establishing the enforceability and irrevocability of transfer orders will be valid and enforceable and that a transfer order submitted by any participant and processed pursuant to [list of sections] of the Rules may not be set aside in any Insolvency Proceedings or Proceedings as a preference, voidable transaction or otherwise under the laws of [jurisdiction].
3.5. Attachment
If a creditor of the TIPS DCA holder seeks an attachment order (including any freezing order, order for seizure or any other public or private law procedure that is intended to protect the public interest or the rights of the TIPS DCA holder's creditors) — hereinafter referred to as an ‘Attachment’ — under the laws of [jurisdiction] from a court or governmental, judicial or public authority that is competent in [jurisdiction], we are of the opinion that [insert the analysis and discussion].
3.6. Collateral [if applicable]
3.6.a. Assignment of rights or deposit of assets for collateral purposes, pledge and/or repo
Assignments for collateral purposes will be valid and enforceable under the laws of [jurisdiction]. Specifically, the creation and enforcement of a pledge or repo under the [insert reference to the relevant arrangement with the CB] will be valid and enforceable under the laws of [jurisdiction].
3.6.b. Priority of assignees', pledgees' or repo purchasers' interest over that of other claimants
In the event of Insolvency Proceedings or Proceedings in respect of the TIPS DCA holder, the rights or assets assigned for collateral purposes, or pledged by the TIPS DCA holder in favour of the [insert reference to CB] or other participants in the System, will rank in priority of payment above the claims of all other creditors of the TIPS DCA holder and will not be subject to priority or preferential creditors.
3.6.c. Enforcing title to security
Even in the event of Insolvency Proceedings or Proceedings in respect of the TIPS DCA holder, other participants in the System and the [insert name of CB] as [assignees, pledgees or repo purchasers as applicable] will still be free to enforce and collect the TIPS DCA holder's rights or assets through the action of the [insert name of CB] pursuant to the Rules.
3.6.d. Form and registration requirements
There are no form requirements for the assignment for collateral purposes of, or the creation and enforcement of a pledge or repo over the TIPS DCA holder's rights or assets and it is not necessary for the [assignment for collateral purposes, pledge or repo, as applicable], or any particulars of such [assignment, pledge or repo, as applicable,] to be registered or filed with any court or governmental, judicial or public authority that is competent in [jurisdiction].
3.7. Branches [to the extent applicable]
3.7.a. Opinion applies to action through branches
Each of the statements and opinions presented above with regard to the TIPS DCA holder applies with equal accuracy and validity under the laws of [jurisdiction] in situations where the TIPS DCA holder acts through its one or more of its branches established outside [jurisdiction].
3.7.b. Conformity with law
Neither the execution and performance of the rights and obligations under the System Documents nor the submission, transmission or receipt of payment orders by a branch of the TIPS DCA holder will in any respect breach the laws of [jurisdiction].
3.7.c. Required authorisations
Neither the execution and performance of the rights and obligations under the System Documents nor the submission, transmission or receipt of payment orders by a branch of a TIPS DCA holder will require any additional authorisations, approvals, consents, filings, registrations, notarisations or other certifications of or with any court or governmental, judicial or public authority that is competent in [jurisdiction].
This Opinion is stated as of its date and is addressed solely to the [insert name of CB] and the [TIPS DCA holder]. No other persons may rely on this Opinion, and the contents of this Opinion may not be disclosed to persons other than its intended recipients and their legal counsel without our prior written consent, with the exception of the European Central Bank and the national central banks of the European System of Central Banks [and [the national central bank/relevant regulatory authorities] of [jurisdiction]].
Yours faithfully,
[signature]
Appendix III
OPERATING SCHEDULE
1. The TIPS Platform is operated and available in U2A and A2A mode 24 hours a day, every day of the year.
2. After the completion of the last algorithms in TARGET2, a message is sent to the TIPS platform after which the change of business day is initiated. After the start of the new business day the TIPS Platform sends a record to the SSP of the balances on the TIPS DCAs as they stood at the time of the change of business day.
3. The SSP is operated on all days, except Saturdays, Sundays, New Year's Day, Good Friday and Easter Monday (according to the calendar applicable at the seat of the ECB), 1 May, 25 December and 26 December.
4. The reference time for the system is the local time at the seat of the ECB, i.e. CET ( 41 ).
5. The operating hours may be changed in the event that business continuity measures are adopted.
6. An overview of the operating hours and significant business events during the day is shown in the following table. Settlement of instant payment orders continues without interruption 24/7/365. Liquidity transfers are possible at all times except those indicated in the table:
|
SSP schedule |
TIPS schedule (applicable to TIPS DCAs) |
||
|
Time |
Description |
Time |
Description |
|
6.45-7.00 |
Business window to prepare daytime operations (1) |
|
|
|
7.00-18.00 |
Daytime processing |
|
|
|
17.00 |
Cut-off time for customer payments |
|
|
|
18.00 |
Cut-off time for interbank payments Cut-off time for liquidity transfers (2) |
18.00 |
Cut-off time for liquidity transfers (2) |
|
Shortly after 18.00 |
Completion of last algorithms |
|
|
|
Upon completion of last algorithms |
Send message to TIPS to inform that change of business day can be performed |
Upon receipt of message from SSP |
— Change of business day in TIPS — Snapshot of balances on TIPS DCAs and generation of End-of-day files (General Ledger) |
|
18.00-18.45 (3) |
End-of-day processing |
|
|
|
18.15 (3) |
General cut-off time for the use of standing facilities |
|
|
|
(Shortly after) 18.30 (4) |
Data for the update of accounting systems are available to CBs |
|
|
|
18.45-19.30 (4) |
Start-of-day processing (new business day) |
|
|
|
Provision of liquidity on the PM account |
|
|
|
|
19.30 (3) |
‘Start-of-procedure’ message and settlement of the standing orders to transfer liquidity from the PM accounts to the subaccounts/technical account (ancillary system-related settlement) & Start of liquidity transfers between TARGET2 and TIPS |
19.30 |
Start of liquidity transfers between TARGET2 and TIPS |
|
19.30 (4)-22.00 |
Execution of additional liquidity transfers via the ICM for settlement procedure 6 real-time; execution of additional liquidity transfers via the ICM before the ancillary system sends the ‘start of cycle’ messages for settlement procedure 6 interfaced; settlement period of night-time ancillary system operations (only for ancillary system settlement procedure 6 real-time and settlement procedure 6 interfaced) |
|
|
|
22.00-1.00 |
Technical maintenance window (5) |
22.00 – 1.00 |
Liquidity transfers not possible as the SSP is closed |
|
1.00-7.00 |
Settlement procedure of night-time ancillary system operations (only for ancillary system settlement procedure 6 real-time and settlement procedure 6 interfaced) Liquidity transfers between TARGET2 and TIPS |
|
|
|
(1)
‘Daytime operations’ means daytime processing and end-of-day processing.
(2)
Liquidity transfers entered into the system before the cut-off time will be processed.
(3)
Ends 15 minutes later on the last day of the Eurosystem reserve maintenance period.
(4)
Starts 15 minutes later on the last day of the Eurosystem reserve maintenance period.
(5)
Over a weekend or on a holiday, the technical maintenance window will last throughout the weekend or the holiday, i.e., from 22.00 on Friday until 1.00 on Monday or, in the case of a holiday, from 22.00 on the last business day until 1.00 on the next business day. |
|||
7. Up-to-date information on the operational status of the SSP and the TIPS Platform shall be available on the TARGET2 Information System (T2IS) and on the TIPS Information System on dedicated webpages on the ECB's website. The information on the operational status of the SSP and the TIPS Platform on T2IS and the ECB's website shall only be updated during normal business hours.
Appendix IV
FEE SCHEDULE
Fees for the TIPS service
1. The following fees for the TIPS service connected with TIPS DCAs shall be charged to the Linked PM account holders:
|
Tariff items |
Price |
Explanation |
|
Settlement services |
||
|
Instant payment order |
0,20 euro cent |
To be charged also for unsettled transactions |
|
Recall request |
0,00 |
|
|
Negative recall answer |
0,00 |
|
|
Positive recall answer |
0,20 euro cent |
To be charged to the holder of the Linked PM account associated with the TIPS DCA to be credited (also for unsettled transactions) |
▼M8 —————
3. PM to TIPS DCA liquidity transfer orders sent from a participant's PM account and TIPS DCA to PM liquidity transfer orders received on a participant's PM account shall be charged to the Linked PM account holder in accordance with Appendix VI to Annex II.
▼M8 —————
ANNEX III
PROVISION OF INTRADAY CREDIT
Definitions
For the purposes of this Annex:
‘credit institution’ means either: (a) a credit institution within the meaning of point (1) of Article 4(1) of Regulation (EU) No 575/2013 [and, if relevant, insert national law provisions implementing Article 2(5) of Directive 2013/36/EU] that is subject to supervision by a competent authority; or (b) another credit institution within the meaning of Article 123(2) of the Treaty that is subject to scrutiny of a standard comparable to supervision by a competent authority;
◄‘marginal lending facility’ means a Eurosystem standing facility which counterparties may use to receive overnight credit from an NCB at the pre-specified marginal lending rate;
‘marginal lending rate’ means the interest rate applicable to the marginal lending facility;
‘branch’ means a branch within the meaning of point (17) of Article 4(1) of Regulation (EU) No 575/2013;
◄‘public sector body’ means an entity within the ‘public sector’, the latter term as defined in Article 3 of Council Regulation (EC) No 3603/93 of 13 December 1993 specifying definitions for the application of the prohibitions referred to in Articles 104 and 104b (1) of the Treaty ( 42 );
‘investment firm’ means an investment firm within the meaning of [insert national law provisions implementing Article 4(1)(1) of Directive 2014/65/EU], excluding the institutions specified in [insert national law provisions implementing Article 2(1) of Directive 2014/65/EU], provided that the investment firm in question is: (a) authorised and supervised by a recognised competent authority, which has been designated as such under Directive 2014/65/EU; and (b) entitled to carry out the activities referred to under [insert national law provisions implementing items 2, 3, 6 and 7 of Section A of Annex I to Directive 2014/65/EU];
‘close links’ means close links within the meaning of Article 138 of Guideline (EU) 2015/510 (ECB/2014/60);
‘insolvency proceedings’ means insolvency proceedings within the meaning of Article 2(j) of Directive 98/26/EC;
‘event of default’ means any impending or existing event, the occurrence of which may threaten the performance by an entity of its obligations under the national arrangements implementing this Guideline or any other rules (including those specified by the Governing Council with respect to Eurosystem monetary policy operations) applying to the relationship between that entity and any of the Eurosystem CBs, including:
where the entity no longer meets the access criteria and/or technical requirements laid down in Annex II and, if applicable, Annex V, or Annex IIa or Annex IIb or where its eligibility as a counterparty for Eurosystem monetary policy operations has been suspended or terminated;
the opening of insolvency proceedings in relation to the entity;
the submission of an application relating to the proceedings referred to in point (b);
the issue by the entity of a written declaration of its inability to pay all or any part of its debts or to meet its obligations arising in relation to intraday credit;
the entry of the entity into a voluntary general agreement or an arrangement with its creditors;
where the entity is, or is deemed by the relevant euro area NCB to be, insolvent or unable to pay its debts;
where the entity's credit balance on ►M6 its PM account, its T2S DCA or its TIPS DCA ◄ or all or a substantial part of the entity's assets are subject to a freezing order, attachment, seizure or any other procedure that is intended to protect the public interest or the rights of the entity's creditors;
where participation of the entity in another TARGET2 component system and/or in an ancillary system has been suspended or terminated;
where any material representation or pre-contractual statement made by the entity or which is implied to have been made by the entity under the applicable law is incorrect or untrue; or
the assignment of all or a substantial part of the entity's assets;
‘T2S Dedicated Cash Account (T2S DCA)’ means an account held by a T2S DCA holder, opened in TARGET2, and used for cash payments in relation to securities settlement in T2S;
‘TIPS Dedicated Cash Account (TIPS DCA)’ means an account held by a TIPS DCA holder, opened in TARGET2, and used for the provision of instant payment services to its customers.
Eligible entities
1. ►M6 Each euro area NCB shall provide intraday credit to credit institutions established in the Union or the EEA that are eligible counterparties for Eurosystem monetary policy operations, have access to the marginal lending facility and have an account with the relevant euro area NCB, including when those credit institutions act through a branch established in the Union or the EEA and including branches established in the Union or the EEA of credit institutions that are established outside the EEA, provided that such branches are established in the same country as the relevant euro area NCB. ◄ No intraday credit may be provided to entities that are subject to restrictive measures adopted by the Council of the European Union or Member States pursuant to Article 65(1)(b), Article 75 or Article 215 of the Treaty, the implementation of which, in the view of [CB/country reference] after informing the ECB, is incompatible with the smooth functioning of TARGET2.
2. Intraday credit may also be granted to the following entities:
deleted;
credit institutions established in the Union or the EEA that are not eligible counterparties for Eurosystem monetary policy operations and/or do not have access to the marginal lending facility, including when they act through a branch established in the Union or the EEA and including branches established in the Union or the EEA of credit institutions that are established outside the EEA;
treasury departments of central or regional governments of Member States and public sector bodies of Member States authorised to hold accounts for customers;
investment firms established in ►M6 the Union or the EEA ◄ provided that they have concluded an arrangement with a Eurosystem monetary policy counterparty to ensure that any residual debit position at the end of the relevant day is covered; and
entities other than those falling within point (b) that manage ancillary systems and act in that capacity, provided that the arrangements for granting intraday credit to such entities have been submitted to the Governing Council in advance and have been approved by the Governing Council,
provided that in the cases specified in points (b) to (e) the entity receiving intraday credit is established in the same jurisdiction as the NCB providing the intraday credit.
All overnight credit granted to eligible central counterparties shall be subject to the terms of this Annex (including the provisions in relation to eligible collateral).
The sanctions provided for in paragraphs 10 and 11 shall apply when eligible central counterparties fail to reimburse the overnight credit extended to them by their NCB.
3. For the entities mentioned in paragraph 2(b) to (e), and in accordance with Article 19 of Guideline (EU) 2015/510 (ECB/2014/60), intraday credit shall be limited to the day in question and no extension to overnight credit shall be possible.
By way of derogation, the Governing Council may decide, by means of a reasoned prior decision, to provide access to the marginal lending facility to certain eligible central counterparties (CCPs), within the scope of Article 139(2)(c) of the Treaty in conjunction with Articles 18 and 42 of the Statute of the ESCB and Article 1(1) of Guideline (EU) 2015/510 (ECB/2014/60). Such eligible CCPs are those that, at all relevant times:
are eligible entities for the purposes of paragraph 2(e), provided also that those eligible entities are authorised as CCPs in accordance with the applicable Union or national legislation;
are established in the euro area;
are subject to supervision and/or oversight by competent authorities;
comply with the oversight requirements for the location of infrastructures offering services in euro, as amended from time to time and published on the ECB's website ( 43 );
have accounts in the Payments Module (PM) of TARGET2;
have access to intraday credit.
Eligible collateral
4. Intraday credit shall be based on eligible collateral and granted by means of collateralised intraday overdrafts and/or intraday repurchase transactions in compliance with the additional minimum common features (including the events of default therein listed, as well as their respective consequences) that the Governing Council specifies with respect to Eurosystem monetary policy operations. Eligible collateral shall consist of the same assets as eligible for use in Eurosystem monetary policy operations, and shall be subject to the same valuation and risk control rules as those laid down in Part Four of Guideline (EU) 2015/510 (ECB/2014/60).
Intraday credit shall only be granted once the eligible assets provided as collateral have been finally transferred or pledged. For this purpose, counterparties shall pre-deposit or shall pledge the eligible assets with the relevant NCB or shall settle the eligible assets with the relevant NCB on a delivery-versus-payment basis.
5. Debt instruments issued or guaranteed by the entity, or by any other third party with which the entity has close links, may only be accepted as eligible collateral in the situations laid down in Part Four of Guideline (EU) 2015/510 (ECB/2014/60).
5a. Use of ineligible collateral may result in the application of sanctions in accordance with Part Five of Guideline (EU) 2015/510 (ECB/2014/60).
6. The Governing Council may, upon a proposal by the relevant euro area NCB, exempt the treasury departments referred to in paragraph 2(c) from the requirement to provide adequate collateral before obtaining intraday credit.
Credit extension procedure
7. Access to intraday credit may only be granted on business days.
8. Intraday credit shall be provided free of interest.
9. The failure by an entity referred to in paragraph 1 to reimburse the intraday credit at the end of the day shall automatically be considered as a request by such entity for recourse to the marginal lending facility. If an entity referred to in paragraph 1 holds a TIPS DCA, any end-of-day balance on its TIPS DCA recorded in accordance with Appendix III of Annex IIb to this Guideline shall be taken into account for the purpose of calculating the amount of the entity's recourse to the automatic marginal lending facility. This shall not, however, trigger any equivalent release of assets pre-deposited as collateral for the underlying outstanding intraday credit.
10. The failure by an entity referred to in paragraph 2(b), (d) or (e) to reimburse the intraday credit at the end of the day for whatever reason shall render that entity liable to the following penalties:
if the entity in question has a debit balance on its account at the end of the day for the first time within any 12-month period, then this entity shall incur penalty interest calculated at a rate of five percentage points above the marginal lending rate on the amount of such debit balance;
if the entity in question has a debit balance on its account at the end of the day for at least the second time within the same 12-month period, then the penalty interest mentioned in subparagraph (a) shall be increased by 2,5 percentage points for each time additional to the first that a debit position has occurred within this 12-month period.
11. The Governing Council may decide to waive or reduce the penalties imposed pursuant to paragraph 10, if the end-of-day debit balance of the entity in question is attributable to force majeure and/or technical malfunction of TARGET2, the latter phrase as defined in Annex II.
Suspension, limitation or termination of intraday credit
12.
euro area NCBs shall suspend or terminate access to intraday credit if one of the following events of default occurs:
the account of the entity with the euro area NCB is suspended or closed;
the entity concerned ceases to meet any of the requirements laid down in this Annex for the provision of intraday credit;
a decision is made by a competent judicial or other authority to implement in relation to the entity a procedure for the winding-up of the entity or the appointment of a liquidator or analogous officer over the entity or any other analogous procedure;
the entity becomes subject to the freezing of funds and/or other measures imposed by the Union restricting the entity’s ability to use its funds;
the entity’s eligibility as a counterparty for Eurosystem monetary policy operations has been suspended or terminated.
euro area NCBs may suspend or terminate access to intraday credit if an NCB suspends or terminates the participant’s participation in TARGET2 pursuant to Article 34(2)(b) to (e) of Annex II, or one or more events of default (other than those referred to in Article 34(2)(a)) occur.
If the Eurosystem decides to suspend, limit or exclude counterparties' access to monetary policy instruments on the grounds of prudence or otherwise in accordance with Article 158 of Guideline (EU) 2015/510 (ECB/2014/60), euro area NCBs shall implement that decision in respect of access to intraday credit pursuant to provisions in the contractual or regulatory arrangements applied by the respective NCBs.
euro area NCBs may decide to suspend, limit or terminate a participant’s access to intraday credit if the participant is deemed to pose risks on the grounds of prudence. In such cases, the euro area NCB shall immediately notify the ECB and other euro area NCBs and connected NCBs thereof in writing. Where appropriate, the Governing Council shall decide upon uniform implementation of the measures taken in all TARGET2 component systems.
13. Where a euro area NCB decides to suspend, limit or terminate a Eurosystem monetary policy counterparty’s access to intraday credit in accordance with paragraph 12(d) above, such decision shall not take effect until the ECB has approved it.
14. By derogation from paragraph 13, in urgent circumstances a euro area NCB may suspend a Eurosystem monetary policy counterparty’s access to intraday credit with immediate effect. In such cases the euro area NCB concerned shall immediately notify the ECB thereof in writing. The ECB shall have the power to reverse the euro area NCB’s action. However, if the ECB does not send the euro area NCB notice of such reversal within 10 business days of the ECB’s receipt of notification, the ECB shall be deemed to have approved the euro area NCB’s action.
ANNEX IIIA
CONDITIONS FOR AUTO-COLLATERALISATION OPERATIONS
Definitions
For the purposes of this Annex:
‘auto-collateralisation’ means intraday credit granted by the euro area NCB in central bank money triggered when a ►M6 T2S DCA holder ◄ has insufficient funds to settle securities transactions, whereby such intraday credit is collateralised either with the securities being purchased (collateral on flow), or with securities already held by the ►M6 T2S DCA holder ◄ (collateral on stock). An auto collateralisation transaction consists of two distinct transactions, one for the granting of auto-collateralisation and one for its reimbursement. It may also include a third transaction for any eventual relocation of collateral. For the purposes of Article 16 of Annex IIa, all three transactions are deemed to have been entered into the system and deemed to be irrevocable at the same time as the transaction for the granting of the auto-collateralisation;
‘available liquidity’ means the credit balance on the ►M6 T2S DCA ◄ decreased by the amount of any processed reservations of liquidity or blocking of funds;
‘T2S Dedicated Cash Account (T2S DCA)’ means an account held by a T2S DCA holder, opened in TARGET2, and used for cash payments in relation to securities settlement in T2S;
‘credit institution’ means either: (a) a credit institution within the meaning of point (1) of Article 4(1) of Regulation (EU) No 575/2013 [and, if relevant, insert national law provisions implementing Article 2(5) of Directive 2013/36/EU] that is subject to supervision by a competent authority; or (b) another credit institution within the meaning of Article 123(2) of the Treaty that is subject to scrutiny of a standard comparable to supervision by a competent authority;
‘branch’ means a branch within the meaning of point (17) of Article 4(1) of Regulation (EU) No 575/2013;
‘close links’ means close links within the meaning of Article 138 of Guideline (EU) 2015/510 (ECB/2014/60).
‘insolvency proceedings’ means insolvency proceedings within the meaning of Article 2(j) of Directive 98/26/EC;
‘event of default’ means any impending or existing event, the occurrence of which may threaten the performance by an entity of its obligations under the [insert reference to the arrangements implementing the ►M6 Harmonised Conditions for the Opening and Operation of a T2S Dedicated Cash Account in TARGET2 ◄ and the provisions of this Annex IIIa] or any other rules (including those specified by the Governing Council with respect to Eurosystem monetary policy operations) applying to the relationship between that entity and any of the Eurosystem CBs, including:
where the entity no longer meets the access criteria and/or technical requirements laid down in [insert reference to the arrangements implementing the Harmonised Conditions for the Opening and Operation of a PM account in TARGET2 and, if applicable, Annex V, or the Harmonised Conditions for the Opening and Operation of a T2S Dedicated Cash Account in TARGET2 or the Harmonised Conditions for the Opening and Operation of a TIPS Dedicated Cash Account in TARGET2] or where its eligibility as a counterparty for Eurosystem monetary policy operations has been suspended or terminated;
the opening of insolvency proceedings in relation to the entity;
the submission of an application relating to the proceedings referred to in point (b);
the issue by the entity of a written declaration of its inability to pay all or any part of its debts or to meet its obligations arising in relation to intraday credit;
the entry of the entity into a voluntary general agreement or an arrangement with its creditors;
where the entity is, or is deemed by the [insert name of CB] to be, insolvent or unable to pay its debts;
where the entity's credit balance on its PM account, T2S DCA, or TIPS DCA or all or a substantial part of the entity's assets are subject to a freezing order, attachment, seizure or any other procedure that is intended to protect the public interest or the rights of the entity's creditors;
where participation of the entity in another TARGET2 component system and/or in an ancillary system has been suspended or terminated;
where any material representation or pre-contractual statement made by the entity or which is implied to have been made by the entity under the applicable law is incorrect or untrue; or
the assignment of all or a substantial part of the entity's assets;
‘TIPS Dedicated Cash Account (TIPS DCA)’ means an account held by a TIPS DCA holder, opened in TARGET2, and used for the provision of instant payment services to its customers.
Eligible entities
1. Notwithstanding paragraph 13, [insert name of CB] shall, from ►M4 18 September ◄ 2017 and further to a request, offer auto-collateralisation facilities to the entities to which it provides intraday credit in accordance with Annex III, on condition that such entities have both a ►M6 T2S DCA ◄ and a PM account with [insert name of CB] and are not subject to restrictive measures adopted by the Council of the European Union or Member States pursuant to Article 65(1)(b), Article 75 or Article 215 of the Treaty, [the implementation of which, in the view of [CB/country reference] after informing the ECB, is incompatible with the smooth functioning of TARGET2].
2. Auto-collateralisation shall be limited to intraday only. No extension to overnight credit shall be possible.
Eligible collateral
3. Auto-collateralisation shall be based on eligible collateral. Eligible collateral shall consist of the same assets as eligible for use in Eurosystem monetary policy operations, and shall be subject to the same valuation and risk control rules as those laid down in Part Four of Guideline (EU) 2015/510 (ECB/2014/60).
Furthermore, eligible collateral for auto-collateralisation:
may be limited by euro area NCBs by means of an ex ante exclusion of potential close-link collateral;
shall, in the case of cross-border use, be mobilised through a link assessed as eligible for use in Eurosystem credit operations by the Governing Council of the ECB and published on the website of the ECB ( 44 );
is subject to certain discretionary choices for the exclusion of eligible collateral as granted to the euro area NCBs by decisions of the Governing Council of the ECB;
4. Debt instruments issued or guaranteed by the entity, or by any other third party with which the entity has close links, may only be accepted as eligible collateral in the situations laid down in Part Four of Guideline (EU) 2015/510 (ECB/2014/60).
4a. Use of ineligible collateral may result in the application of sanctions in accordance with Part Five of Guideline (EU) 2015/510 (ECB/2014/60).
Credit provision and recovery procedure
5. Auto-collateralisation may only be provided on business days.
6. Credit obtained by means of auto-collateralisation shall be provided free of interest.
7. Fees shall be charged for the provision of auto-collateralisation in line with the fee schedule attached as Appendix VI to Annex IIa.
8. Auto-collateralisation may be reimbursed at any time during the day by the ►M6 T2S DCA holder ◄ by following the procedure described in the T2S UDFS.
9. Auto-collateralisation shall be reimbursed at the latest at the time defined in [insert reference to the arrangements implementing Appendix V to the ►M6 Harmonised Conditions for the Opening and Operation of a T2S Dedicated Cash Account in TARGET2 ◄ ], and in accordance with the following process:
the [insert name of CB] acting via the T2S Platform releases the reimbursement instruction which is settled subject to cash being available to reimburse outstanding auto-collateralisation;
if, after performing step (a), the balance on the ►M6 T2S DCA ◄ is not sufficient to reimburse outstanding auto-collateralisation, the [insert name of CB] acting via the T2S Platform checks other ►M6 T2S DCAs ◄ opened in its books for the same ►M6 T2S DCA holder ◄ and transfers cash from any or all of these to the ►M6 T2S DCA ◄ where reimbursement instructions are pending;
if, after performing steps (a) and (b), the balance on a ►M6 T2S DCA ◄ is not sufficient to reimburse outstanding auto-collateralisation, the ►M6 T2S DCA holder ◄ shall be deemed to have instructed the [insert name of CB] to transfer the collateral which was used to obtain the outstanding auto-collateralisation to the collateral account of [insert name of CB]. Thereafter, the [insert name of CB] shall provide the liquidity to reimburse the outstanding auto-collateralisation and shall without undue delay debit the relevant PM account of the ►M6 T2S DCA holder ◄ .
The [insert name of CB] shall apply a penalty fee of EUR 1 000 for each business day where one or more recourses to collateral relocation under point (c) occur. The penalty fee shall be debited from the relevant PM account of the ►M6 T2S DCA holder ◄ referred to in point (c).
Suspension, limitation or termination of auto-collateralisation facilities
10.
[insert name of CB] shall suspend or terminate access to auto-collateralisation facilities if one of the following events of default occurs:
the T2S DCA, TIPS DCA or PM account of the entity with the [insert name of CB] is suspended or closed;
the entity concerned ceases to meet any of the requirements laid down in [insert reference to provisions implementing these Conditions for auto-collateralisation operations];
a decision is made by a competent judicial or other authority to implement in relation to the entity a procedure for the winding-up of the entity or the appointment of a liquidator or analogous officer over the entity or any other analogous procedure;
the entity becomes subject to the freezing of funds and/or other measures imposed by the Union restricting the entity's ability to use its funds;
the entity's eligibility as a counterparty for Eurosystem monetary policy operations has been suspended or terminated.
[insert name of CB] may terminate access to auto-collateralisation facilities if another NCB suspends or terminates the ►M6 T2S DCA holder's ◄ participation in TARGET2 pursuant to Article 24(2)(b) to (d) of Annex IIa, or if one or more events of default (other than those referred to in Article 24(2)(a) of Annex IIa) occur.
►M4 The Eurosystem may decide to suspend, limit or exclude counterparties' access to monetary policy instruments on the grounds of prudence or otherwise in accordance with Article 158 of Guideline (EU) 2015/510 (ECB/2014/60). ◄ In such cases, [insert name of CB] shall implement that decision in respect of access to auto-collateralisation facilities pursuant to provisions in the contractual or regulatory arrangements applied by the [insert name of CB].
[insert name of CB] may decide to suspend, limit or terminate a ►M6 T2S DCA holder's ◄ access to auto-collateralisation facilities if the ►M6 T2S DCA holder ◄ is deemed to pose risks on the grounds of prudence. In such cases, the [insert name of CB] shall immediately notify the ECB and other euro area NCBs and connected NCBs thereof in writing. Where appropriate, the Governing Council shall decide upon uniform implementation of the measures taken in all TARGET2 component systems.
11. Where [insert name of CB] decides to suspend, limit or terminate a ►M6 T2S DCA holder's ◄ access to auto-collateralisation facilities in accordance with paragraph 10(d), such decision shall not take effect until the ECB has approved it.
12. By derogation from paragraph 11, in urgent circumstances [insert name of CB] may suspend a ►M6 T2S DCA holder's ◄ access to auto-collateralisation facilities with immediate effect. In such cases the [insert name of CB] shall immediately notify the ECB thereof in writing. The ECB shall have the power to reverse the [insert name of CB] action. However, if the ECB does not send the [insert name of CB] notice of such reversal within ten business days of the ECB's receipt of notification, the ECB shall be deemed to have approved the [insert name of CB] action.
Transitional provision
13. By derogation from paragraph 1, in the period from 22 June 2015 to ►M4 18 September ◄ 2017 [insert name of CB] may, further to a request, offer auto-collateralisation facilities to the entities to which it provides intraday credit in accordance with Annex III, on condition that such entities have both a ►M6 T2S DCA ◄ and a PM account with [insert name of CB] and are not subject to restrictive measures adopted by the Council of the European Union or Member States pursuant to Article 65(1)(b), Article 75 or Article 215 of the Treaty, [the implementation of which, in the view of [CB/country reference] after informing the ECB, is incompatible with the smooth functioning of TARGET2].
ANNEX IV
SETTLEMENT PROCEDURES FOR ANCILLARY SYSTEMS
1. Definitions
For the purposes of this Annex and further to the definitions in Article 2:
‘credit instruction’ means a payment instruction submitted by an ancillary system and addressed to the ASCB to debit one of the accounts kept and/or managed by the ancillary system in the PM, and to credit a settlement bank's PM account or subaccount by the amount specified therein,
‘debit instruction’ means a payment instruction addressed to the SCB and submitted by an ancillary system to debit a settlement bank's PM account or subaccount by the amount specified therein, on the basis of a debit mandate, and to credit either one of the ancillary system's accounts in the PM or another settlement bank's PM account or subaccount,
‘payment instruction’ or ‘ancillary system payment instruction’ means a credit instruction or a debit instruction,
‘ancillary system central bank (ASCB)’ means the Eurosystem CB with which the relevant ancillary system has a bilateral arrangement for the settlement of ancillary system payment instructions in the PM,
‘settlement central bank (SCB)’ means a Eurosystem CB holding a settlement bank's PM account,
‘settlement bank’ means a participant whose PM account or subaccount is used to settle ancillary system payment instructions,
‘Information and Control Module (ICM)’ means the SSP module that allows PM account holders to obtain online information and gives them the possibility to submit liquidity transfer orders, manage liquidity and, if applicable, initiate backup payment orders or payment orders to the Contingency Solution in a contingency,
‘ICM broadcast message’ means information made simultaneously available to all or a selected group of PM account holders via the ICM,
‘debit mandate’ means an authorisation by a settlement bank in the form provided by the Eurosystem CBs in the static data forms addressed to both its ancillary system and its SCB, entitling the ancillary system to submit debit instructions, and instructing the SCB to debit the settlement bank's PM account or subaccount as a result of debit instructions,
‘short’ means owing money during the settlement of ancillary system payment instructions,
‘long’ means being owed money during the settlement of ancillary system payment instructions,
‘cross-system settlement’ means the real-time settlement of debit instructions under which payments are executed from a settlement bank of one ancillary system using settlement procedure 6 to a settlement bank of another ancillary system using settlement procedure 6,
‘Static Data (Management) Module’ means the SSP module in which static data are collected and recorded,
‘technical account’ means a specific account held in the PM by an ancillary system or held by the ASCB on an ancillary system's behalf in its TARGET2 component system for use by the ancillary system,
‘Contingency Solution’ means the SSP functionality that processes very critical and critical payments in contingency.
2. Role of SCBs
Each Eurosystem CB shall act as the SCB in relation to any settlement bank for which it holds a PM account.
3. Management of relationship between CBs, ancillary systems and settlement banks
(1) The ASCBs shall ensure that the ancillary systems with which they have bilateral arrangements provide a list of settlement banks containing the settlement banks' PM account details, which the ASCB shall store in the Static Data (Management) Module of the SSP. Any ancillary system may access the list of its respective settlement banks via the ICM.
(2) The ASCBs shall ensure that the ancillary systems with which they have bilateral arrangements inform them without delay of any changes with regard to the list of settlement banks. The ASCBs shall inform the relevant SCB regarding any such changes via an ICM broadcast message.
(3) The ASCBs shall ensure that the ancillary systems with which they have bilateral arrangements collect the debit mandates and other relevant documents from their settlement banks and submit them to the ASCB. Such documents shall be provided in English and/or the ASCB's relevant national language(s). If the ASCB's national language(s) is/are not identical to the SCB's national language(s), the necessary documents shall be provided in English only or both in English and in the ASCB's relevant national language(s). In the case of ancillary systems that settle via TARGET2-ECB, the documents shall be provided in English.
(4) If a settlement bank is a participant in the relevant ASCB's TARGET2 component system, the ASCB shall verify the validity of the debit mandate given by the settlement bank and make any necessary entries in the Static Data (Management) Module. If a settlement bank is not a participant in the relevant ASCB's TARGET2 component system, the ASCB shall forward the debit mandate (or an electronic copy thereof, if so agreed between the ASCB and SCB) to the relevant SCBs for verification of its validity. The SCBs shall perform such verification and shall inform the relevant ASCB of the outcome of verification within five business days after receipt of such request. After verification, the ASCB shall update the list of settlement banks in the ICM.
(5) The verification undertaken by the ASCB shall be without prejudice to the ancillary system's responsibility to restrict payment instructions to the list of settlement banks referred to in subparagraph 1.
(6) Unless they are one and the same, the ASCBs and SCBs shall exchange information regarding any significant event during the settlement process.
(7) The ASCBs shall ensure that the ancillary systems with which they have bilateral arrangements provide the name and the BIC of the ancillary system with which they intend to execute cross-system settlement and the date from which cross-system settlement with a particular ancillary system should begin or stop. This information shall be recorded in the Static Data (Management) Module.
4. Initiation of payment instructions via the ASI
(1) All payment instructions submitted by an ancillary system via the ASI shall be in the form of XML messages.
(2) All payment instructions submitted by an ancillary system via the ASI shall be considered as ‘highly urgent’ and shall be settled in accordance with Annex II.
(3) A payment instruction shall be deemed accepted if:
the payment instruction complies with the rules established by the TARGET2 network service provider;
the payment instruction complies with the formatting rules and conditions of the ASCB's TARGET2 component system;
the settlement bank is on the list of settlement banks referred to in paragraph 3(1);
in the case of a cross-system settlement, the relevant ancillary system is on the list of ancillary systems with which cross-system settlement may be executed;
in the event that a settlement bank's participation in TARGET2 has been suspended, the explicit consent of the SCB of the suspended settlement bank has been obtained.
5. Entry of payment instructions into the system and their irrevocability
(1) Credit instructions shall be deemed to be entered in the relevant TARGET2 component system at the moment that they are accepted by the ASCB and shall be irrevocable from that moment. Debit instructions shall be deemed to be entered in the relevant TARGET2 component system at the moment that they are accepted by the SCB and shall be irrevocable from that moment.
(2) The application of subparagraph 1 shall not have any effect on any rules of ancillary systems which stipulate a moment of entry into the ancillary system and/or irrevocability of transfer orders submitted to such ancillary system at a point in time earlier than the moment of entry of the respective payment instruction in the relevant TARGET2 component system.
6. Settlement procedures
(1) If an ancillary system requests the use of a settlement procedure, the ASCB concerned shall offer one or more of the settlement procedures specified below.
|
(a) |
settlement procedure 2 |
(real-time settlement), |
|
(b) |
settlement procedure 3 |
(bilateral settlement), |
|
(c) |
settlement procedure 4 |
(standard multilateral settlement), |
|
(d) |
settlement procedure 5 |
(simultaneous multilateral settlement), |
|
(e) |
settlement procedure 6 |
(dedicated liquidity, real-time and cross-system settlement). |
(2) Settlement procedure 1 (liquidity transfer) is no longer offered.
(3) The SCBs shall support the settlement of ancillary system payment instructions in accordance with the choice of settlement procedures referred to in subparagraph 1 by, inter alia, settling payment instructions on the settlement banks' PM accounts or subaccounts.
(4) Further details relating to the settlement procedures referred to in subparagraph 1 are contained in paragraphs 10 to 14.
7. No obligation to open PM account
Ancillary systems shall not be obliged to become direct participants in a TARGET2 component system or to maintain a PM account while using the ASI.
8. Accounts to support settlement procedures
(1) In addition to PM accounts, the following types of accounts may be opened in the PM and used by ASCBs, ancillary systems and settlement banks for the settlement procedures referred to in paragraph 6(1):
technical accounts;
guarantee fund accounts;
subaccounts.
(2) When an ASCB offers settlement procedure 4, 5 or 6 for interfaced models, it shall open a technical account in its TARGET2 component system for the ancillary systems concerned. Such accounts may be offered by the ASCB as an option for settlement procedures 2 and 3. Separate technical accounts shall be opened in respect of settlement procedures 4 and 5. For settlement procedure 3, 4, 5 or 6 for interfaced models, the balance on technical accounts shall be zero or positive at the end of the relevant ancillary system's settlement process and the end-of-day balance shall be zero. Technical accounts are identified by either the BIC of the ancillary system or the relevant ASCB's BIC.
(3) When offering settlement procedure 6 real-time an ASCB shall open technical accounts in its TARGET2 component system. Technical accounts for settlement procedure 6 real-time may only have a zero or positive balance during the day and may maintain a positive balance overnight. Any overnight balance on the account shall be subject to the same remuneration rules that apply to Guarantee Funds under Article 11 of this Guideline.
(4) When offering settlement procedure 4 or 5, an ASCB may open a guarantee fund account in its TARGET2 component system for ancillary systems. The balances of these accounts shall be used to settle the ancillary system's payment instructions in the event that there is no available liquidity on the settlement bank's PM account. Guarantee fund account holders may be ASCBs, ancillary systems or guarantors. Guarantee fund accounts are identified by the relevant account holder's BIC.
(5) When settlement procedure 6 is offered by an ASCB for interfaced models, SCBs shall open one or more subaccounts in their TARGET2 component systems for settlement banks, to be used for dedicating liquidity and, if relevant, cross-system settlement. Subaccounts shall be identified by the BIC of the PM account to which they relate, in combination with an account number that is specific to the relevant subaccount. The account number is composed of the country code plus up to 32 characters (depending on the relevant national bank account structure).
(6) The accounts referred to in subparagraph 1(a) to (c) shall not be published in the TARGET2 directory. If so requested by the PM account holder, the relevant statements of accounts (MT 940 and MT 950) for all such accounts may be provided to the account holder at the end of every business day.
(7) The detailed rules on the opening of the account types mentioned in this paragraph and on their application while supporting the settlement procedures may be further specified in bilateral arrangements between the ancillary systems and ASCBs.
9. Settlement procedure 1 — Liquidity transfer
This procedure is no longer offered.
10. Settlement procedure 2 — Real-time settlement
(1) When offering settlement procedure 2, the ASCBs and SCBs shall support the settlement of the cash leg of ancillary system transactions by settling payment instructions submitted by the ancillary system on an individualised basis, rather than in batches. If a payment instruction to debit a short settlement bank's PM account is queued in line with Annex II, the SCB concerned shall inform the settlement bank via an ICM broadcast message.
(2) Settlement procedure 2 may also be offered to the ancillary system for the settlement of multilateral balances and in such cases the ASCB shall open a technical account for such ancillary system. Furthermore, the ASCB shall not offer the ancillary system the service of properly managing the sequence of incoming and outgoing payments as may be required for such multilateral settlement. The ancillary system itself shall assume responsibility for the necessary sequencing.
(3) The ASCB may offer the settlement of payment instructions within certain time limits to be defined by the ancillary system, as referred to in paragraph 15(2) and (3).
(4) The settlement banks and ancillary systems shall have access to information via the ICM. The ancillary systems shall be notified on completion or failure of the settlement by a message on the ICM. If they so request, settlement banks accessing TARGET2 via the TARGET2 network service provider shall be notified of successful settlement via a SWIFT MT 900 or MT 910 message. PM account holders using internet-based access shall be informed by a message on the ICM.
11. Settlement procedure 3 — Bilateral settlement
(1) When offering settlement procedure 3, the ASCBs and SCBs shall support settlement of the cash leg of ancillary system transactions by settling payment instructions which the ancillary system submits in batch mode. If a payment instruction to debit a short settlement bank's PM account is queued in line with Annex II, the SCB concerned shall inform the settlement bank via an ICM broadcast message.
(2) Settlement procedure 3 may also be offered to the ancillary system for the settlement of multilateral balances. Paragraph 10(2) shall apply mutatis mutandis, subject to the modifications that:
payment instructions: (i) to debit the short settlement banks' PM accounts and credit the ancillary system's technical account; and (ii) to debit the ancillary system's technical account and credit the long settlement banks' PM accounts are submitted in separate files; and
the long settlement banks' PM accounts shall be credited only after all short settlement banks' PM accounts are debited.
(3) If multilateral settlement fails (for example, because not all collections from short settlement banks' accounts are successful), the ancillary system shall submit payment instructions in order to reverse already settled debit transactions.
(4) The ASCBs may offer:
the settlement of payment instructions within certain time limits defined by the ancillary system, as referred to in paragraph 15(3); and/or
the ‘information period’ functionality, as referred to in paragraph 15(1).
(5) The settlement banks and ancillary systems shall have access to information via the ICM. The ancillary systems shall be notified on completion or failure of the settlement based on the selected option — single or global notification. If they so request, settlement banks shall be notified of successful settlement via a SWIFT MT 900 or MT 910 message. PM account holders using internet-based access shall be informed by a message on the ICM.
12. Settlement procedure 4 — Standard multilateral settlement
(1) When offering settlement procedure 4, the ASCBs and SCBs shall support the settlement of multilateral cash balances of ancillary system transactions by settling payment instructions submitted by the ancillary system in batch mode. The ASCBs shall open a specific technical account for such an ancillary system.
(2) The ASCBs and SCBs shall ensure the required sequencing of payment instructions. They shall only book credits if all debits have been collected successfully. Payment instructions: (a) to debit short settlement banks' accounts and credit the ancillary system's technical account; and (b) to credit long settlement banks' accounts and debit the ancillary system's technical account are submitted in a single file.
(3) Payment instructions to debit the short settlement banks' PM account and to credit the ancillary system's technical account will be settled first; only upon settlement of all such payment instructions (including possible funding of the technical account by a guarantee fund mechanism) will the PM accounts of the long settlement banks be credited.
(4) If a payment instruction to debit a short settlement bank's PM account is queued in line with Annex II, the SCBs shall inform such settlement bank via an ICM broadcast message.
(5) If a short settlement bank has insufficient funds on its PM account, a guarantee fund mechanism shall be activated by the ASCB if that is provided for in the bilateral arrangement between the ASCB and the ancillary system.
(6) If no guarantee fund mechanism is provided for and the entire settlement fails, then the ASCBs and SCBs shall be deemed to have been instructed to return all payment instructions in the file and shall reverse payment instructions which have already been settled.
(7) The ASCBs shall inform settlement banks of a settlement failure via an ICM broadcast message.
(8) The ASCBs may offer:
the settlement of payment instructions within certain time limits defined by the ancillary system, as referred to in paragraph 15(3);
the ‘information period’ functionality, as referred to in paragraph 15(1);
a guarantee fund mechanism, as referred to in paragraph 15(4).
(9) The settlement banks and ancillary systems shall have access to information via the ICM. Ancillary systems shall be notified on completion or failure of the settlement. If they so request, settlement banks shall be notified of successful settlement via a SWIFT MT 900 or MT 910 message. PM account holders using internet-based access shall be informed by a message on the ICM.
13. Settlement procedure 5 — Simultaneous multilateral settlement
(1) When offering settlement procedure 5, the ASCBs and SCBs shall support the settlement of multilateral cash balances of ancillary system transactions by settling payment instructions submitted by the ancillary system. In order to settle relevant payment instructions Algorithm 4 shall be used (see Appendix I to Annex II). Unlike settlement procedure 4, settlement procedure 5 operates on an ‘all-or-nothing’ basis. In this procedure the debiting of short settlement banks' PM accounts and the crediting of long settlement banks' PM accounts shall be done simultaneously (rather than sequentially, as in settlement procedure 4). Paragraph 12 shall apply mutatis mutandis subject to the following modification. If one or more of the payment instructions cannot be settled, all payment instructions shall be queued, and Algorithm 4, as described in paragraph 16(1), shall be repeated in order to settle the ancillary system's payment instructions in the queue.
(2) The ASCBs may offer:
the settlement of payment instructions within certain time limits defined by the ancillary system, as referred to in paragraph 15(3);
the ‘information period’ functionality, as referred to in paragraph 15(1);
a guarantee fund mechanism, as referred to in paragraph 15(4).
(3) The settlement banks and ancillary systems shall have access to information via the ICM. The ancillary systems shall be notified on completion or failure of the settlement. If they so request, settlement banks shall be notified of successful settlement via a SWIFT MT 900 or MT 910 message. PM account holders using internet-based access shall be informed by a message on the ICM.
(4) If a payment instruction to debit a short settlement bank's PM account is queued in line with Annex II, the SCB concerned shall inform the settlement banks via an ICM broadcast message.
14. Settlement procedure 6 — dedicated liquidity, real-time and cross-system settlement
(1) Settlement procedure 6 can be used for both the interfaced and the real-time model, as described in subparagraphs 4 to 12 and 13 to 16 below respectively. In the case of the real-time model, the relevant ancillary system has to use a technical account to collect the necessary liquidity set aside by its settlement banks for funding their positions. In the case of the interfaced model, the settlement bank has to open at least one subaccount relating to a specific ancillary system.
(2) If they so request, the settlement banks shall be notified via a SWIFT MT 900 or MT 910 message and PM account holders using internet-based access shall be informed by a message on the ICM of the crediting and debiting of their PM accounts and, if applicable, of their subaccounts.
(3) When offering cross-system settlement under settlement procedure 6, the ASCBs and SCBs shall support cross-system settlement payments, if they are initiated by the relevant ancillary systems. For settlement procedure 6 interfaced, an ancillary system can only initiate cross-system settlement during its processing cycle, and settlement procedure 6 has to be running in the ancillary system receiving the payment instruction. For settlement procedure 6 real-time, an ancillary system can initiate cross-system settlement at any time during the TARGET2 daytime processing and settlement of night-time ancillary system operations. The possibility to execute cross-system settlement between two individual ancillary systems shall be recorded in the Static Data (Management) Module.
(A) Interfaced model
(4) When offering settlement procedure 6 interfaced, the ASCBs and SCBs shall support the settlement of bilateral and/or multilateral cash balances of ancillary system transactions by:
enabling a settlement bank to pre-fund its prospective settlement obligation through liquidity transfers from its PM account into its subaccount (‘dedicated liquidity’) prior to the ancillary system processing; and
settling the ancillary system's payment instructions subsequent to the completion of the ancillary system processing: in relation to short settlement banks by debiting their subaccounts (within the limits of the funds provided on such accounts) and crediting the ancillary system's technical account and in relation to long settlement banks by crediting their subaccounts and debiting the ancillary system's technical account.
(5) When offering settlement procedure 6 interfaced:
the SCBs shall open at least one subaccount in relation to a single ancillary system for each settlement bank; and
the ASCB shall open a technical account for the ancillary system for: (i) crediting funds collected from the subaccounts of the short settlement banks; and (ii) debiting funds when making credits to the dedicated subaccounts of the long settlement banks.
(6) Settlement procedure 6 interfaced shall be offered at any time during the TARGET2 daytime processing and settlement of night-time ancillary system operations. The new business day shall start immediately on fulfilment of the minimum reserve requirements; any debit or credit made on the relevant accounts thereafter shall be for value of the new business day.
(7) Under settlement procedure 6 interfaced, the ASCBs and SCBs shall offer the following types of liquidity transfer service into and from the subaccount:
standing orders which settlement banks may submit or modify at any time during a business day via the ICM (when it is available). Standing orders submitted after the sending of the ‘start-of-procedure’ message on a given business day shall be valid only for the next business day. If there are several standing orders to credit different subaccounts and/or the technical account of the ancillary system, they shall be settled in the order of their amount, starting with the highest. During night-time ancillary system operations, if there are standing orders for which there are insufficient funds on the PM account, such orders shall be settled following a pro rata reduction of all orders;
current orders, which may only be submitted either by a settlement bank (via the ICM) or the relevant ancillary system via an XML message during the running of settlement procedure 6 interfaced (identified by the time span from the ‘start-of-procedure’ to the ‘end-of-procedure’ message) and which shall be settled only as long as the ancillary system processing cycle has not yet started. If there is a current order submitted by the ancillary system for which there are insufficient funds on the PM account, such order shall be partially settled;
SWIFT orders that go via an MT 202 message or by automatic mapping to an MT202 from the screens for PM account holders using internet-based access, which may only be submitted during the running of settlement procedure 6 interfaced and only during daytime processing. Such orders shall be settled immediately.
(8) Settlement procedure 6 interfaced shall start by means of a ‘start-of-procedure’ message and finish by means of an ‘end-of-procedure’ message, which shall be sent by the ancillary system (or ASCB on its behalf). ‘Start-of-procedure’ messages shall trigger the settlement of standing orders for the transfer of liquidity into the subaccounts. The ‘end-of-procedure’ message leads to an automatic retransfer of liquidity from the subaccount to the PM account.
(9) Under settlement procedure 6 interfaced, dedicated liquidity on the subaccounts shall be frozen as long as the ancillary system processing cycle is running (starting with a ‘start-of-cycle’ message and ending with an ‘end-of-cycle’ message, both to be sent by the ancillary system) and released thereafter. The frozen balance can be changed during the processing cycle as a result of cross-system settlement payments or if a settlement bank transfers liquidity from its PM account. The ASCB shall notify the ancillary system of the reduction or increase of liquidity on the subaccount as a result of cross-system settlement payments. If the ancillary system so requests, the ASCB shall also notify it of the increased liquidity on the subaccount as a result of liquidity transfer by the settlement bank.
(10) Within each ancillary system processing cycle under settlement procedure 6 interfaced, payment instructions shall be settled out of dedicated liquidity whereby Algorithm 5 (as referred to in Appendix I to Annex II) shall be used as a rule.
(11) Within each ancillary system processing cycle under settlement procedure 6 interfaced, a settlement bank's dedicated liquidity can be increased by crediting certain incoming payments directly to its subaccounts, i.e. coupons and redemption payments. In such cases, the liquidity first has to be credited on the technical account, then debited from such account before crediting the liquidity on the subaccount (or on the PM account).
(12) Cross-system settlement between two interfaced ancillary systems can only be initiated by an ancillary system (or its ASCB on its behalf) whose participant's subaccount is debited. The payment instruction is settled by debiting the amount indicated in the payment instruction from the subaccount of a participant of the ancillary system initiating the payment instruction and crediting the subaccount of a participant of another ancillary system.
The ancillary system initiating the payment instruction and the other ancillary system shall be notified on completion of the settlement. If they so request, settlement banks shall be notified of successful settlement via a SWIFT MT 900 or MT 910 message. PM account holders using internet-based access shall be informed by a message on the ICM.
(B) Real-time model
(13) When offering settlement procedure 6 real-time, the ASCBs and SCBs shall support such settlement.
(14) Under settlement procedure 6 real-time, the ASCBs and SCBs shall offer the following types of liquidity transfer service into and from a technical account:
standing orders (for night-time ancillary system operations), which settlement banks may submit or modify at any time during a business day via the ICM (when it is available). Standing orders submitted after start-of-day processing shall be valid only for the next business day. If there are several standing orders, they shall be settled in the order of their amount, starting with the highest. During night-time ancillary system operations, if there are standing orders for which there are insufficient funds on the PM account, such orders shall be settled following a pro rata reduction of all orders;
current orders to credit the technical account, which may only be submitted either by a settlement bank (via the ICM) or by the relevant ancillary system on its behalf (via an XML message). If there is a current order submitted by the relevant ancillary system on behalf of the settlement bank for which there are insufficient funds on the PM account, such order shall be partially settled;
current orders to debit the technical account, which may only be submitted by the relevant ancillary system (via an XML message);
SWIFT orders using MT 103 messages may not be submitted.
(15) The ‘start-of-procedure’ and ‘end-of-procedure’ will take place automatically upon completion of the ‘Start-of-day processing’ and start of ‘End-of-day processing’ respectively.
(16) Cross-system settlement between two ancillary systems using the real-time model will take place without intervention by the ancillary system whose technical account will be credited. The payment instruction is settled by debiting the amount indicated in the payment instruction from the technical account used by the ancillary system initiating the payment instruction and crediting the technical account used by another ancillary system. The payment instruction cannot be initiated by the ancillary system whose technical account will be credited.
The ancillary system initiating the payment instruction and the other ancillary system shall be notified on completion of the settlement. If they so request, settlement banks shall be notified of successful settlement via a SWIFT MT 900 or MT 910 message. PM account holders using internet-based access shall be informed by a message on the ICM.
15. Optional connected mechanisms
(1) The optional connected mechanism ‘information period’ may be offered by the ASCBs for settlement procedures 3, 4 and 5. If the ancillary system (or its ASCB on its behalf) has specified an optional ‘information period’ time, the settlement bank shall receive an ICM broadcast message indicating the time until which the settlement bank may request a reversal of the relevant payment instruction. Such request shall be taken into account by the SCB only if it is communicated via and approved by the ancillary system. The settlement shall start if the SCB does not receive such request until the ‘information period’ time has elapsed. Upon receipt by the SCB of such request within the ‘information period’:
when settlement procedure 3 is used for bilateral settlement, the relevant payment instruction shall be reversed; and
when settlement procedure 3 is used for the settlement of multilateral balances, or if in settlement procedure 4 the entire settlement fails, all payment instructions in the file shall be reversed and all settlement banks and the ancillary system shall be informed via an ICM broadcast message.
(2) If an ancillary system sends the settlement instructions before the scheduled settlement time (‘from’), the instructions are stored until the scheduled time is reached. In this case, the payment instructions are only submitted to the entry disposition when the ‘from’ time is reached. This optional mechanism can be used in settlement procedure 2.
(3) The settlement period (‘till’) makes it possible to allocate a limited period of time for ancillary system settlement in order not to prevent or delay the settlement of other ancillary system-related or TARGET2 transactions. If any payment instruction is not settled until the ‘till’ time is reached or within the defined settlement period, these payment instructions are either returned or, in the case of settlement procedures 4 and 5, the guarantee fund mechanism may be activated. The settlement period (‘till’) can be specified for settlement procedures 2 to 5.
(4) The guarantee fund mechanism may be used if a settlement bank's liquidity is insufficient to cover its obligations stemming from ancillary system settlement. In order to allow the settlement of all payment instructions involved in an ancillary system settlement, this mechanism is used to provide the complementary liquidity needed. This mechanism may be used for settlement procedures 4 and 5. If the guarantee fund mechanism is to be used, it is necessary to maintain a special guarantee fund account where ‘emergency liquidity’ is available or made available on demand.
16. Algorithms used
(1) Algorithm 4 supports settlement procedure 5. To facilitate settlement and to reduce the liquidity needed, all ancillary system payment instructions are included (regardless of their priority). Ancillary system payment instructions to be settled following settlement procedure 5 bypass the entry disposition and are kept in the PM separately until the end of the current optimisation process. Several ancillary systems using settlement procedure 5 will be included in the same run of Algorithm 4 if they intend to settle at the same time.
(2) In settlement procedure 6 interfaced, the settlement bank can dedicate a liquidity amount to settle balances coming from a specific ancillary system. Dedication is brought about by setting aside the necessary liquidity on a specific subaccount (interfaced model). Algorithm 5 is used both for night-time ancillary system operations and daytime processing. The settlement process takes place by means of debiting the short settlement banks' subaccounts in favour of the ancillary system technical account and then debiting the ancillary system technical account in favour of the long settlement banks' subaccounts. In the case of credit balances the booking can take place directly — if indicated by the ancillary system within the relevant transaction — on the settlement bank's PM account. If the settlement of one or more debit instructions is unsuccessful, i.e. as the result of an ancillary system's error, the payment concerned is queued on the subaccount. Settlement procedure 6 interfaced can make use of Algorithm 5 running on subaccounts. Furthermore, Algorithm 5 does not have to take account of any limits or reservations. For every settlement bank the total position is calculated and, if all total positions are covered, all transactions will be settled. Transactions which are not covered are put back into the queue.
17. Effect of suspension or termination
If suspension or termination of the use of the ASI by an ancillary system takes effect during the settlement cycle of ancillary system payment instructions, the ASCB shall be deemed to be authorised to complete the settlement cycle on behalf of the ancillary system.
18. Fee schedule and invoicing
(1) An ancillary system using the ASI or the Participant Interface, irrespective of the number of any accounts it may hold with the ASCB and/or the SCB, shall be subject to a fee schedule consisting of the following elements.
A fixed monthly fee of EUR 1 000 to be charged to each ancillary system (‘Fixed Fee I’).
A second monthly fixed fee of between EUR 417 and EUR 8 334 , in proportion to the underlying gross value of the ancillary system's euro cash settlement transactions (‘Fixed Fee II’):
|
Band |
From (EUR million/business day) |
To (EUR million/business day) |
Annual fee (EUR) |
Monthly fee (EUR) |
|
1 |
0 |
below 1 000 |
5 000 |
417 |
|
2 |
1 000 |
below 2 500 |
10 000 |
833 |
|
3 |
2 500 |
below 5 000 |
20 000 |
1 667 |
|
4 |
5 000 |
below 10 000 |
30 000 |
2 500 |
|
5 |
10 000 |
below 50 000 |
40 000 |
3 333 |
|
6 |
50 000 |
below 500 000 |
50 000 |
4 167 |
|
7 |
500 000 and above |
— |
100 000 |
8 334 |
The gross value of the ancillary system's euro cash settlement transactions shall be calculated by the ASCB once a year on the basis of such gross value during the previous year and the calculated gross value shall be applied for calculating the fee from 1 January of each calendar year. The gross value shall exclude transactions settled on ►M6 T2S DCAs and TIPS DCAs ◄ .
A transaction fee calculated on the same basis as the schedule established for PM account holders in Appendix VI to Annex II. The ancillary system may choose one of the two options: either to pay a flat EUR 0,80 fee per payment instruction (Option A) or to pay a fee calculated on a degressive basis (Option B), subject to the following modifications:
for Option B, the limits of the bands relating to volume of payment instructions are divided by two; and
a monthly fixed fee of EUR 150 (under Option A) or EUR 1 875 (under Option B) shall be charged in addition to Fixed Fee I and Fixed Fee II.
In addition to the fees set out in (a) to (c), an ancillary system using the ASI or the Participant Interface shall also be subject to the following fees:
if the ancillary system makes use of the TARGET2 value-added services for T2S, the monthly fee for the use of the value added services shall be EUR 50 for those systems that have chosen option A and EUR 625 for those systems that have chosen option B. This fee shall be charged for each account held by the ancillary system that uses the services;
the ancillary system as Main PM account holder shall be charged the following fees for T2S services connected with the linked ►M6 T2S DCA(s) ◄ . These items shall be billed separately:
|
Tariff items |
Price (eurocent) |
Explanation |
|
Settlement services |
||
|
T2S DCA to T2S DCA liquidity transfer orders |
14,1 euro cent |
per transfer |
|
Intra-balance movement (i.e. blocking, unblocking, reservation of liquidity etc.) |
9,4 euro cent |
per transaction |
|
Information services |
||
|
A2A reports |
0,4 |
Per business item in any A2A report generated |
|
A2A queries |
0,7 |
Per queried business item in any A2A query generated |
|
U2A queries |
10 |
Per executed search function |
|
U2A queries downloaded |
0,7 |
Per queried business item in any U2A query generated and downloaded |
|
Messages bundled into a file |
0,4 |
Per message in a file |
|
Transmissions |
1,2 |
Per transmission |
the ancillary system as Linked PM account holder shall be charged the following fees for TIPS service connected with the linked TIPS DCA(s):
|
Tariff items |
Price |
Explanation |
|
Settlement services |
||
|
Instant payment order |
0,20 euro cent |
To be charged also for unsettled transactions |
|
Recall request |
0,00 |
|
|
Negative recall answer |
0,00 |
|
|
Positive recall answer |
0,20 euro cent |
To be charged to holder of the Linked PM account associated with the TIPS DCA to be credited (also for unsettled transactions) |
▼M8 —————
(2) Any fee payable in relation to a payment instruction submitted or payment received by an ancillary system, via either the Participant Interface or the ASI, shall be exclusively charged to this ancillary system. The Governing Council may establish more detailed rules for the determination of billable transactions settled via the ASI.
(3) Each ancillary system shall receive an invoice from its ASCB for the previous month based on the fees referred to in subparagraph 1, no later than the ninth business day of the following month. Payments shall be made no later than the 14th business day of this month to the account specified by the ASCB or shall be debited from an account specified by the ancillary system.
(4) For the purposes of this paragraph, each ancillary system that has been designated under Directive 98/26/EC shall be treated separately, even if two or more of them are operated by the same legal entity. The same rule shall apply to the ancillary systems that have not been designated under Directive 98/26/EC, in which case the ancillary systems shall be identified by reference to the following criteria: (a) a formal arrangement, based on a contractual or legislative instrument, e.g. an agreement among the participants and the system operator; (b) with multiple membership; (c) with common rules and standardised arrangements; and (d) for the clearing, netting and/or settlement of payments and/or securities between the participants.
ANNEX IVa
TIPS SERVICE FOR ANCILLARY SYSTEMS SETTLING INSTANT PAYMENTS
1. Definitions
For the purposes of this Annex and further to the definitions in Article 1 of Annex IIb:
‘ancillary system central bank (ASCB)’ means the Eurosystem CB with which the relevant ancillary system settling instant payments in its own books has a bilateral arrangement for the settlement of ancillary system instant payments;
‘underlying gross volume’ means the number of instant payments settled on the ancillary system’s own books and enabled by funds held on the TIPS AS technical account. It does not include instant payments to or from TIPS DCAs or other TIPS AS technical accounts;
‘instructing party’ means an entity which has been designated as such by an ancillary system and which is allowed to send payment orders to the TIPS Platform and/or receive payment orders from the TIPS Platform on behalf of that ancillary system or a reachable party of that ancillary system.
2. Entry of payment orders into the system and their irrevocability
The application of Article 20 of Annex IIb, regarding the moment of entry of instant payment orders, positive recall answers and TIPS DCA to TIPS AS technical account liquidity transfer orders and TIPS AS technical account to TIPS DCA liquidity transfer orders in the relevant TARGET2 component system shall not have any effect on any rules of ancillary systems which stipulate a moment of entry into the ancillary system and/or irrevocability of transfer orders submitted to such ancillary system at a point in time earlier than the moment of entry of the respective payment order in the relevant TARGET2 component system.
3. Accounts to support settlement of instant payments in ancillary systems own books
To support the settlement of instant payments related to ancillary systems in TIPS, one TIPS AS technical account shall be opened.
A TIPS AS technical account shall be identified by means of a unique account number of up to 34 characters and shall be structured as set out in the table:
|
|
Name |
Format |
Content |
|
Part A |
Account type |
1 char. exactly |
‘A’ for AS technical account |
|
Country code of the central bank |
2 char. exactly |
ISO country code 3166-1 |
|
|
Currency code |
3 char. exactly |
EUR |
|
|
Part B |
Account holder |
11 char. exactly |
BIC |
|
Part C |
Sub-classification of the account |
Up to 17 char. |
Free text (alphanumeric) to be provided by the account holder. |
TIPS AS technical accounts may only have a zero or positive balance during the day and may maintain a positive balance overnight. Overnight balance on the account shall be subject to the same remuneration rules that apply to Guarantee Funds pursuant to Article 11 of this Guideline.
4. Settlement procedure
The ancillary system shall use a TIPS AS technical account to collect the necessary liquidity set aside by their clearing members to fund their positions.
Upon request, the ancillary system shall be notified of the crediting and debiting of their TIPS AS technical account.
An ancillary system may send instant payment orders, and positive recall answers to any TIPS DCA holder or TIPS ancillary system. An ancillary system shall receive and process instant payment orders, recall requests and positive recall answers from any TIPS DCA holder or TIPS ancillary system.
5. User interface
The TIPS AS technical account holder shall access the TIPS Platform in A2A mode and may also connect in U2A mode either directly or via one or more instructing parties.
Access to the TIPS Platform allows TIPS AS technical account holders to:
access information relating to their accounts and to manage CMBs;
initiate TIPS AS technical account to TIPS DCA liquidity transfer orders; and
manage certain static data.
6. Fee schedule and invoicing
An ancillary system in TIPS, shall be subject to both of the following:
a transaction fee calculated on the same basis as the schedule established for TIPS DCA holders in Appendix IV to Annex IIb;
a fee based on the underlying gross volume of instant payments settled in the ancillary system’s own platform and enabled by the pre-funded positions on the TIPS AS technical account. The fee shall be EUR 0.0005 per instant payment.
The underlying gross volume of the ancillary system's instant payments shall be calculated by the ASCB each month on the basis of the underlying gross volume during the previous month rounded down to the nearest ten thousand and reported by the ancillary system at the latest by the third business day of the following month. The calculated gross volume shall be applied for calculating the fee during the following month.
Each ancillary system shall receive an invoice from its ASCB for the previous month based on the fees referred to in point (1) of this paragraph, no later than the ninth business day of the following month. Payments shall be made no later than the 14th business day of the month in which the invoice is issued to the account specified by the ASCB or shall be debited from an account specified by the ancillary system.
For the purposes of fee schedules and invoicing pursuant to this Annex:
an ancillary system that has been designated as a system under Directive 98/26/EC shall be treated as a separate ancillary system, notwithstanding that it is operated by a legal entity that operates another ancillary system;
an ancillary system that has not been designated as a system under Directive 98/26/EC shall be treated as a separate ancillary system where it fulfils the following criteria:
it is a formal arrangement, in the form of a contract or a legislative instrument;
it has more than one [member] [participant] [excluding the system operator of that system];
it is established for the purposes of clearing, netting and/or settlement of payments and/or securities between the participants; and
it applies common rules and standardised arrangements to the clearing, netting and settlement of payments and securities between the participants.
The fees, for the purposes of invoicing pursuant to this Article for the period from 1 December 2021 to 28 February 2022, shall amount to the average of the total fees invoiced for the months of September, October and November 2021.
ANNEX V
SUPPLEMENTAL AND MODIFIED HARMONISED CONDITIONS FOR THE OPENING AND OPERATION OF A PM ACCOUNT IN TARGET2 USING INTERNET-BASED ACCESS
Article 1
Scope
The Conditions set out in Annex II apply to participants using internet-based access to access one or more PM accounts subject to the provisions of this Annex.
Article 2
Definitions
For the purposes of this Annex, the following definitions apply:
For the purposes of this Annex the definition of ‘payment order’ is amended as follows:
Article 3
Inapplicable provisions
The following provisions of Annex II shall not apply with regard to internet-based access:
Article 4(1)(c) and (2)(d); Article 5(2), (3) and (4); Articles 6 and 7; Article 11(8); Article 14(1)(a); Article 17(2); Articles 23 to 26; Article 41; and Appendices I, VI and VII.
Article 4
Supplemental and modified provisions
The following provisions of Annex II shall apply with regard to internet-based access as modified below:
Article 2(1) is replaced by the following:
The following Appendices form an integral part of these Conditions and apply to participants accessing a PM account using internet-based access:
Article 3 is modified as follows:
paragraph 1 is replaced by the following:
paragraph 2 is replaced by the following:
The following payment orders are processed in TARGET2-[insert CB/country reference]:
►M6 transactions directly resulting from or made in connection with Eurosystem monetary policy operations ◄ ;
settlement of the euro leg of foreign exchange operations involving the Eurosystem;
settlement of euro transfers resulting from transactions in cross-border large-value netting systems;
settlement of euro transfers resulting from transactions in euro retail payment systems of systemic importance; and
►M6 any other transactions in euro addressed to TARGET2 participants ◄ .’
the following paragraph 2a is inserted:
paragraph 4 is replaced by the following:
paragraph 6 is replaced by the following:
Article 4(2)(e) is replaced by the following:
credit institutions or any of the entities of the types listed under subparagraphs (a) to (c), in both cases where these are established in a country with which the Union has entered into a monetary agreement allowing access by any of such entities to payment systems in the Union, subject to the conditions set out in the monetary agreement and provided that the relevant legal regime applying in the country is equivalent to the relevant Union legislation.’.
Article 8 is modified as follows:
paragraph 1(a)(i) is replaced by the following:
To open an internet-accessible PM account in TARGET2-[insert CB/country reference], applicant participants shall:
fulfil the following technical requirements:
install, manage, operate and monitor and ensure the security of the necessary IT infrastructure to connect to TARGET2-[insert CB/country reference] and submit payment orders to it, in accordance with the technical specifications in Appendix IA to Annex V. In doing so, applicant participants may involve third parties, but retain sole liability; and’; and
the following paragraph 1(c) is added:
specify that they wish to access their PM account by means of the internet, and apply for a separate PM account in TARGET2 if they wish in addition to be able to access TARGET2 via the ►M3 TARGET2 network service provider ◄ . Applicants shall submit a duly completed application form for the issuance of the electronic certificates needed to access TARGET2 through internet-based access.’.
Article 9 is modified as follows:
paragraph 3 is replaced by the following:
paragraph 5 is replaced by the following:
Article 10 is modified as follows:
paragraphs 1 and 2 are replaced by the following:
the following paragraph 5 is added:
Participants shall do both of the following:
actively check, at regular intervals throughout each business day, all information made available to them on the ICM, in particular for information relating to important system events (such as messages regarding the settlement of ancillary systems) and events of exclusion or suspension of a participant. The [insert name of CB] shall not be held responsible for any losses, direct or indirect, arising from a participant’s failure to make these checks; and
at all times both ensure compliance with the security requirements specified in Appendix IA to Annex V, in particular with respect to the safekeeping of certificates, and maintain rules and procedures to ensure that certificate holders are aware of their responsibilities with respect to the safeguarding of certificates.’.
Article 11 is modified as follows:
the following paragraph 5a is added:
paragraph 6 is replaced by the following:
Article 12(7) is replaced by the following:
Article 13 is replaced by the following:
‘The following are classified as payment orders for the purposes of TARGET2:
credit transfer orders;
direct debit instructions received under a direct debit authorisation. Participants using internet-based access shall not be able to send direct debit instructions from their PM account;
liquidity transfer orders.’
Article 14(1)(b) is replaced by the following:
the payment message complies with the formatting rules and conditions of TARGET2-[insert CB/country reference] and passes the double-entry check described in Appendix IA to Annex V’.
Article 16(2) is replaced by the following:
Article 18(3) is replaced by the following:
Article 21(4) is replaced by the following:
Article 28 is modified as follows:
paragraph 1 is replaced by the following:
Participants using internet-based access shall implement adequate security controls, in particular those specified in Appendix IA to Annex V, to protect their systems from unauthorised access and use. Participants shall be exclusively responsible for the adequate protection of the confidentiality, integrity and availability of their systems.’;
paragraph 4 is replaced by the following:
Participants using internet-based access shall provide the [insert name of CB] with their TARGET2 self-certification.’; and
the following paragraph 6 is added:
Participants using internet-based access shall inform [insert name of CB] immediately of any event that may affect the validity of the certificates, in particular those events specified in Appendix IA to Annex V, including, without limitation, any loss or improper use.’.
Article 29 is replaced by the following:
‘Article 29
Use of the ICM
The ICM:
allows participants to input payments;
allows participants to access information relating to their accounts and to manage liquidity;
may be used to initiate liquidity transfer orders; and
allows participants to access system messages.
Article 32 is modified as follows:
paragraph 1 is replaced with the following:
paragraph 3 is replaced by the following:
Article 34(4)(c) is replaced by the following:
Once such an ICM broadcast message has been made available to participants using internet-based access, those participants shall be deemed informed of the termination/- suspension of a participant’s participation in TARGET2-[insert CB/country reference] or another TARGET2 component system. The participants shall bear any losses arising from the submission of a payment order to participants whose participation has been suspended or terminated if such payment order was entered into TARGET2-[insert CB/country reference] after the ICM broadcast message was made available.’.
Article 39(1) is replaced by the following:
Article 40(1) is replaced by the following:
Article 45 is replaced by the following:
‘Article 45
Severability
If any provision in these Conditions or Annex V is or becomes invalid, this shall not prejudice the applicability of all the other provisions of these Conditions or Annex V.’.
Appendix IA
TECHNICAL SPECIFICATIONS FOR THE PROCESSING OF PAYMENT ORDERS FOR INTERNET-BASED ACCESS
In addition to the Conditions, the following rules shall apply to the processing of payment orders using internet-based access:
1. Technical requirements for participation in TARGET2-[insert CB/country reference] regarding infrastructure, network and formats
(1) Each participant using internet-based access must connect to the ICM of TARGET2 using a local client, operating system and internet browser as specified in the Annex ‘Internet-based participation — System requirements for internet access’ to the User Detailed Functional Specifications (UDFS), with settings defined. Each participant’s PM account shall be identified by an eight- or 11-digit BIC. Furthermore, each participant shall pass a series of tests to prove its technical and operational competence before it may participate in TARGET2-[insert CB/country reference].
(2) For the submission of payment orders and the exchange of payment messages in the PM the TARGET2 platform BIC, TRGTXEPMLVP, will be used as the message sender/receiver. Payment orders sent to a participant using internet-based access should identify that receiving participant in the beneficiary institution field. Payment orders made by a participant using internet-based access will identify that participant as the ordering institution.
(3) Participants using internet-based access shall use public key infrastructure services as specified in the ‘User Manual: internet Access for the public-key certification service’.
2. Payment message types
(1) Internet-based participants can make the following types of payments:
customer payments, i.e. credit transfers for which the ordering and/or beneficiary customer are not financial institutions;
customer payments STP, i.e. credit transfers for which the ordering and/or beneficiary customer are not financial institutions, executed in straight through processing mode;
bank-to-bank transfers to request the movement of funds between financial institutions;
cover payments to request the movement of funds between financial institutions related to an underlying customer credit transfer.
In addition, participants using internet-based access to a PM account can receive direct debit orders.
(2) Participants shall comply with the field specifications, as defined in Chapter 9.1.2.2 of the UDFS, Book 1.
(3) Field contents shall be validated at the level of TARGET2-[insert country/CB reference] in accordance with the UDFS requirements. Participants may agree among each other on specific rules regarding the field contents. However, in TARGET2-[insert country/CB reference] there shall be no specific checks as to whether participants comply with any such rules.
(4) Participants using internet-based access may make cover payments via TARGET2, i.e. payments made by correspondent banks to settle (cover) credit transfer messages which are submitted to a customer’s bank by other, more direct means. Customer details contained in these cover payments shall not be displayed in the ICM.
3. Double-entry check
(1) All payment orders shall pass a double-entry check, the aim of which is to reject payment orders that have been submitted more than once by mistake.
(2) The following fields of the message types shall be checked:
|
Details |
Part of the message |
Field |
|
Sender |
Basic Header |
BIC Address |
|
Message Type |
Application Header |
Message Type |
|
Receiver |
Application Header |
Destination Address |
|
Transaction Reference Number (TRN) |
Text Block |
:20 |
|
Related Reference |
Text Block |
:21 |
|
Value Date |
Text Block |
:32 |
|
Amount |
Text Block |
:32 |
(3) If all the fields described in subparagraph 2 in relation to a newly submitted payment order are identical to those in relation to a payment order that has already been accepted, the newly submitted payment order shall be returned.
4. Error codes
If a payment order is rejected, an abort notification shall be provided via the ICM indicating the reason for the rejection by using error codes. The error codes are defined in Chapter 9.4.2 of the UDFS.
5. Predetermined settlement times
(1) For payment orders using the Earliest Debit Time Indicator, the codeword ‘/FROTIME/’ shall be used.
(2) For payment orders using the Latest Debit Time Indicator, two options shall be available.
Codeword ‘/REJTIME/’: if the payment order cannot be settled by the indicated debit time, the payment order shall be returned.
Codeword ‘/TILTIME/’: if the payment order cannot be settled by the indicated debit time, the payment order shall not be returned but shall be kept in the relevant queue.
Under both options, if a payment order with a Latest Debit Time Indicator is not settled 15 minutes prior to the time indicated therein, a notification shall automatically be provided via the ICM.
(3) If the codeword ‘/CLSTIME/’ is used, the payment shall be treated in the same way as a payment order referred to in subparagraph 2(b).
6. Settlement of payment orders in the entry disposition
(1) Offsetting checks and, if appropriate, extended offsetting checks (both terms as defined in paragraphs 2 and 3) shall be carried out on payment orders entered into the entry disposition to provide quick, liquidity-saving gross settlement of payment orders.
(2) An offsetting check shall determine whether the payee’s payment orders that are at the front of the highly urgent or, if inapplicable, the urgent queue are available to be offset against the payer’s payment order (hereinafter ‘offsetting payment orders’). If an offsetting payment order does not provide sufficient funds for the respective payer’s payment order in the entry disposition, it shall be determined whether there is sufficient available liquidity on the payer’s PM account.
(3) If the offsetting check fails, the [insert name of CB] may apply an extended offsetting check. An extended offsetting check determines whether offsetting payment orders are available in any of the payee’s queues regardless of when they joined the queue. However, if in the queue of the payee there are higher priority payment orders addressed to other TARGET2 participants, the FIFO principle may only be breached if settling such an offsetting payment order would result in a liquidity increase for the payee.
7. Settlement of payment orders in the queue
(1) The treatment of payment orders placed in queues depends on the priority class to which it was designated by the instructing participant.
(2) Payment orders in the highly urgent and urgent queues shall be settled by using the offsetting checks described in paragraph 6, starting with the payment order at the front of the queue in cases where there is an increase in liquidity or there is an intervention at queue level (change of queue position, settlement time or priority, or revocation of the payment order).
(3) Payments orders in the normal queue shall be settled on a continuous basis including all highly urgent and urgent payment orders that have not yet been settled. Different optimisation mechanisms (algorithms) are used. If an algorithm is successful, the included payment orders will be settled; if an algorithm fails, the included payment orders will remain in the queue. Three algorithms (1 to 3) shall be applied to offset payment flows. By means of Algorithm 4, settlement procedure 5 (as defined in Chapter 2.8.1 of the UDFS) shall be available for the settlement of payment instructions of ancillary systems. To optimise the settlement of highly urgent ancillary system transactions on participants’ sub-accounts, a special algorithm (Algorithm 5) shall be used.
Under Algorithm 1 (‘all-or-nothing’) the [insert name of CB] shall, both for each relationship in respect of which a bilateral limit has been set and also for the total sum of relationships for which a multilateral limit has been set:
calculate the overall liquidity position of each TARGET2 participants’ PM account by establishing whether the aggregate of all outgoing and incoming payment orders pending in the queue is negative or positive and, if it is negative, check whether it exceeds that participant’s available liquidity (the overall liquidity position shall constitute the ‘total liquidity position’); and
check whether limits and reservations set by each TARGET2 participant in relation to each relevant PM account are respected.
If the outcome of these calculations and checks is positive for each relevant PM account, the [insert name of CB] and other CBs involved shall settle all payments simultaneously on the PM accounts of the TARGET2 participants concerned.
Under Algorithm 2 (‘partial’) the [insert name of CB] shall:
calculate and check the liquidity positions, limits and reservations of each relevant PM account as under Algorithm 1; and
if the total liquidity position of one or more relevant PM accounts is negative, extract single payment orders until the total liquidity position of each relevant PM account is positive.
Thereafter, the [insert name of CB] and the other CBs involved shall, provided there are sufficient funds, settle all remaining payments (except the extracted payment orders) simultaneously on the PM accounts of the TARGET2 participants concerned.
When extracting payment orders, the [insert name of CB] shall start from the TARGET2 participants’ PM account with the highest negative total liquidity position and from the payment order at the end of the queue with the lowest priority. The selection process shall only run for a short time, to be determined by the [insert name of CB] at its discretion.
Under Algorithm 3 (‘multiple’) the [insert name of CB] shall:
compare pairs of TARGET2 participants’ PM accounts to determine whether queued payment orders can be settled within the available liquidity of the two TARGET2 participants’ PM accounts concerned and within the limits set by them (by starting from the pair of PM accounts with the smallest difference between the payment orders addressed to each other), and the CBs involved shall book those payments simultaneously on the two TARGET2 participants’ PM accounts; and
if, in relation to a pair of PM accounts as described under point (i), liquidity is insufficient to fund the bilateral position, extract single payment orders until there is sufficient liquidity. In this case the CBs involved shall settle the remaining payments, except the extracted ones, simultaneously on the two TARGET2 participants’ PM accounts.
After performing the checks specified under subparagraphs (i) to (ii), the [insert name of CB] shall check the multilateral settlement positions (between a participant’s PM account and other TARGET2 participants’ PM accounts in relation to which a multi-lateral limit has been set). For this purpose, the procedure described under subparagraphs (i) to (ii) shall apply mutatis mutandis.
Under Algorithm 4 (‘partial plus ancillary system settlement’) the [insert name of CB] shall follow the same procedure as for Algorithm 2, but without extracting payment orders in relation to the settlement of an ancillary system (which settles on a simultaneous multilateral basis).
Under Algorithm 5 (‘ancillary system settlement via sub-accounts’) the [insert name of CB] shall follow the same procedure as for Algorithm 1, subject to the modification that the [insert name of CB] shall start Algorithm 5 via the Ancillary System Interface and shall only check whether sufficient funds are available on participants’ sub-accounts. Moreover, no limits and reservations shall be taken into account. Algorithm 5 shall also run during night-time settlement.
(4) Payment orders entered into the entry disposition after the start of any of Algorithms 1 to 4 may nevertheless be settled immediately in the entry disposition if the positions and limits of the TARGET2 participants’ PM accounts concerned are compatible with both the settlement of these payment orders and the settlement of payment orders in the current optimisation procedure. However, two algorithms shall not run simultaneously.
(5) During daytime processing the algorithms shall run sequentially. As long as there is no pending simultaneous multilateral settlement of an ancillary system, the sequence shall be as follows:
Algorithm 1;
if Algorithm 1 fails, then Algorithm 2;
if Algorithm 2 fails, then Algorithm 3, or if Algorithm 2 succeeds, repeat Algorithm 1.
When simultaneous multilateral settlement (‘procedure 5’) in relation to an ancillary system is pending, Algorithm 4 shall run.
(6) The algorithms shall run flexibly by setting a pre-defined time lag between the application of different algorithms to ensure a minimum interval between the running of two algorithms. The time sequence shall be automatically controlled. Manual intervention shall be possible.
(7) While included in a running algorithm, a payment order shall not be reordered (change of the position in a queue) or revoked. Requests for reordering or revocation of a payment order shall be queued until the algorithm is complete. If the payment order concerned is settled while the algorithm is running, any request to reorder or revoke shall be rejected. If the payment order is not settled, the participant’s requests shall be taken into account immediately.
8. Use of the ICM
(1) The ICM may be used for inputting payment orders.
(2) The ICM may be used for obtaining information and managing liquidity.
(3) With the exception of warehoused payment orders and static data information, only data in relation to the current business day shall be available via the ICM. The screens shall be offered in English only.
(4) Information shall be provided in ‘pull’ mode, which means that each participant has to ask to be provided with information. Participants shall check the ICM regularly throughout the business day for important messages.
(5) Only user-to-application mode (U2A) shall be available for participants using internet-based access. U2A permits direct communication between a participant and the ICM. The information is displayed in a browser running on a PC. Further details are described in the ICM User Handbook.
(6) Each participant shall have at least one workstation with internet access to access the ICM via U2A.
(7) Access rights to the ICM shall be granted by using certificates, the use of which is described more fully in paragraphs 10 to 13.
(8) Participants may also use the ICM to transfer liquidity:
[insert if applicable] from their PM account to their account outside the PM;
between the PM account and the participant’s sub-accounts; and
from the PM account to the technical account managed by an ancillary system using settlement procedure 6 real-time.
9. The UDFS, the ICM User Handbook and the ‘User Manual: internet Access for the Public Key Certification Service’
Further details and examples explaining the above rules are contained in the UDFS and the ICM User Handbook, as amended from time to time and published on the [insert name of CB]’s website and the TARGET2 website in English, and in the ‘User Manual: internet Access for the Public Key Certification Service’.
10. Issuance, suspension, reactivation, revocation and renewal of certificates
(1) The participant shall request from [insert name of CB] the issuance of certificates to allow them to access TARGET2 [insert CB/country reference] using internet-based access.
(2) The participant shall request from [insert name of CB] the suspension and reactivation of certificates, as well as the revocation and renewal of certificates, when a certificate holder no longer wishes to have access to TARGET2 or if the participant ceases its activities in TARGET2-[insert CB/country reference], e.g. as the result of a merger or acquisition.
(3) The participant shall adopt every precaution and organisational measure to ensure that certificates are used only in conformity with the Harmonised Conditions.
(4) The participant shall promptly notify [insert name of CB] of any material change to any of the information contained in the forms submitted to [insert name of CB] in connection with the issuance of certificates.
11. Handling of certificates by the participant
(1) The participant shall ensure the safekeeping of all certificates and adopt robust organisational and technical measures to avoid injury to third parties and to ensure that each certificate is only used by the specific certificate holder to which it was issued.
(2) The participant shall promptly provide all information requested by [insert name of CB] and guarantee the reliability of that information. Participants shall at all times remain fully responsible for the continued accuracy of all information provided to [insert name of CB] in connection with the issuance of certificates.
(3) The participant shall assume full responsibility for ensuring that all of its certificate holders keep their assigned certificates separate from the secret PIN and PUK codes.
(4) The participant shall assume full responsibility for ensuring that none of its certificate holders use the certificates for functions or purposes other than those for which the certificates were issued.
(5) The participant shall immediately inform [insert name of CB] of any request and rationale for suspension, reactivation, revocation or renewal of certificates.
(6) The participant shall immediately request [insert name of CB] to suspend any certificates, or the keys contained therein, that are defective or that are no longer in the possession of its certificate holders.
(7) The participant shall immediately notify the [insert name of CB] of any loss or theft of certificates.
12. Security requirements
(1) The computer system that a participant uses to access TARGET2 using internet-based access shall be located in premises owned or leased by the participant. Access to TARGET2-[insert CB/country reference] shall only be allowed from such premises, and, for the avoidance of doubt, no remote access shall be allowed.
(2) The participant shall run all software on computer systems that are installed and customised in accordance with current international IT security standards, which as a minimum shall include the requirements detailed in paragraph 12(3) and paragraph 13(4). The participant shall establish appropriate measures, including in particular anti-virus and malware protection, anti-phishing measures, hardening, and patch management procedures. All such measures and procedures shall be regularly updated by the participant.
(3) The participant shall establish an encrypted communication link with TARGET2-[insert CB/country reference] for internet access.
(4) User computer accounts in the participant’s workstations shall not have administrative privileges. Privileges shall be assigned in accordance with the ‘least privilege’ principle.
(5) The participant shall at all times protect the computer systems used for TARGET2-[insert CB/country reference] internet access as follows:
They shall protect the computer systems and workstations from unauthorised physical and network access, at all times using a firewall to shield the computer systems and workstations from incoming internet traffic, and the workstations from unauthorised access over the internal network. They shall use a firewall that protects against incoming traffic, as well as a firewall on work-stations that ensures that only authorised programs communicate with the outside.
Participants shall only be permitted to install on workstations the software that is necessary to access TARGET2 and that is authorised under the participant’s internal security policy.
Participants shall at all times ensure that all software applications that run on the workstations are regularly updated and patched with the latest version. This applies in particular in respect of the operating system, the internet browser and plug-ins.
Participants shall at all times restrict outgoing traffic from the workstations to business-critical sites, as well as to sites required for legitimate and reasonable software updates.
Participants shall ensure that all critical internal flows to or from the workstations are protected against disclosure and malicious changes, especially if files are transferred through a network.
(6) The participant shall ensure that its certificate holders at all times follow secure browsing practices, including:
reserving certain workstations to access sites of the same criticality level and only accessing those sites from those workstations;
always restarting the browser session before and after accessing TARGET2-[insert CB/country reference] internet access;
verifying any server’s SSL certificate authenticity at each logon to TARGET2-[insert CB/country reference] internet access;
being suspicious of e-mails that appear to come from TARGET2-[insert CB/country reference], and never providing the certificate’s password if asked for that password, as TARGET2-[insert CB/country reference] will never ask for a certificate’s password in an e-mail or otherwise.
(7) The participant shall at all times implement the following management principles to alleviate risks to its system:
establishing user management practices which ensure that only authorised users are created and remain on the system and maintaining an accurate and up-to-date list of authorised users;
reconciling daily payment traffic to detect mismatches between authorised and actual daily payment traffic, both sent and received;
ensuring that a certificate holder does not simultaneously browse any other internet site at the same time as it accesses TARGET2-[insert CB/country reference].
13. Additional security requirements
(1) The participant shall at all times ensure by means of appropriate organisational and/or technical measures that user IDs disclosed for the purpose of controlling access rights (Access Right Review) are not abused, and, in particular, that no unauthorised persons gain knowledge of them.
(2) The participant shall have in place a user administration process to ensure the immediate and permanent deletion of the related user ID in the event that an employee or other user of a system on the premises of a participant leaves the participant’s organisation.
(3) The participant shall have in place a user administration process and shall immediately and permanently block user IDs that are in any way compromised, including in cases where certificates are lost or stolen, or where a password has been phished.
(4) If a participant is unable to eliminate security-related faults or configuration errors, e.g. resulting from malware infected systems, after three occurrences, the SSP-providing NCBs may permanently block all the participant’s user IDs.
Appendix IIA
FEE SCHEDULE AND INVOICING FOR INTERNET-BASED ACCESS
Fees for direct participants
1. The monthly fee for the processing of payment orders in TARGET2-[insert CB/country reference] for direct participants shall be EUR 70 per PM account internet access fee plus EUR 150 per PM account plus a flat fee per transaction (debit entry) of EUR 0,80;
2. There shall be an additional monthly fee for direct participants who do not wish the BIC of their account to be published in the TARGET2 directory of EUR 30 per account.
3. The [insert name of CB] shall issue and maintain up to five active certificates per participant for each PM account free of charge. The [insert name of CB] shall charge a fee of EUR 120 for the issuance of a sixth and for each subsequent active certificate. The [insert name of CB] shall charge an annual maintenance fee of EUR 30 for the sixth and for each subsequent active certificate. Active certificates shall be valid for five years.
Invoicing
4. In the case of direct participants, the following invoicing rules apply. The direct participant shall receive the invoice for the previous month specifying the fees to be paid, no later than on the ninth business day of the following month. Payments shall be made no later than the 14th business day of that month to the account specified by [insert name of CB] or shall be debited from an account specified by the participant.
ANNEX VI
REPEALED GUIDELINE WITH ITS SUCCESSIVE AMENDMENTS
ANNEX VII
CORRELATION TABLE
|
Guideline ECB/2007/2 |
This Guideline |
|
Articles 1-4 |
Articles 1-4 |
|
— |
Articles 5-6 |
|
Article 5 |
Article 7 |
|
Article 6 |
Article 8 |
|
— |
Articles 9-11 |
|
Article 7 |
Article 12 |
|
Article 8 |
Article 13 |
|
Article 9 |
Article 14 |
|
Article 10 |
Article 15 |
|
Article 11 |
Article 16 |
|
— |
Articles 17-24 |
|
Article 12 |
Article 25 |
|
Article 14 |
Article 26 |
|
Article 15 |
Article 27 |
|
Article 16 |
Article 28 |
|
Annexes I-V |
Annexes I-V |
( 1 ) Guideline (EU) 2015/510 of the European Central Bank of 19 December 2014 on the implementation of the Eurosystem monetary policy framework (ECB/2014/60) (OJ L 91, 2.4.2015, p. 3) (General Documentation Guideline).
( 2 ) The Eurosystem's current policy for the location of infrastructure is set out in the following statements, which are available on the ECB's website at www.ecb.europa.eu: (a) the policy statement on euro payment and settlement systems located outside the euro area of 3 November 1998; (b) the Eurosystem's policy line with regard to consolidation in central counterparty clearing of 27 September 2001; (c) the Eurosystem policy principles on the location and operation of infrastructures settling euro-denominated payment transactions of 19 July 2007; (d) the Eurosystem policy principles on the location and operation of infrastructures settling euro-denominated payment transactions: specification of ‘legally and operationally located in the euro area’ of 20 November 2008; (e) the Eurosystem oversight policy framework, revised version of July 2016.
( 3 ) OJ L 166, 11.6.1998, p. 45.
( 4 ) Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1).
( 5 ) Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC (OJ L 176, 27.6.2013, p. 338).
( 6 ) OJ L 237, 8.9.2007, p. 71.
( 7 ) Guideline ECB/2012/13 of 18 July 2012 on TARGET2-Securities (OJ L 215, 11.8.2012, p. 19).
( 8 ) The Eurosystem's current policy for the location of infrastructure is set out in the following statements, which are available on the ECB's website at www.ecb.europa.eu: (a) the policy statement on euro payment and settlement systems located outside the euro area of 3 November 1998; (b) the Eurosystem's policy line with regard to consolidation in central counterparty clearing of 27 September 2001; (c) the Eurosystem policy principles on the location and operation of infrastructures settling euro-denominated payment transactions of 19 July 2007; (d) the Eurosystem policy principles on the location and operation of infrastructures settling euro-denominated payment transactions: specification of ‘legally and operationally located in the euro area’ of 20 November 2008; (e) the Eurosystem oversight policy framework, revised version of July 2016.
( 9 ) Guideline ECB/2012/27 of 5 December 2012 on a Trans-European Automated Real-time Gross settlement Express Transfer system (TARGET2) (OJ L 30, 30.1.2013, p. 1).
( 10 ) Commission Regulation (EC) No 1126/2008 of 3 November 2008 adopting certain international accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council (OJ L 320, 29.11.2008, p. 1).
( 11 ) OJ L 166, 11.6.1998, p. 45.
( 12 ) Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (OJ L 173, 12.6.2014, p. 349).
( 13 ) OJ L 332, 31.12.1993, p. 1.
( 14 ) OJ L 267, 10.10.2009, p. 7.
( 15 ) Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the Council (OJ L 173, 12.6.2014, p. 190).
( 16 ) Council Regulation (EC) No 2531/98 of 23 November 1998 concerning the application of minimum reserves by the European Central Bank (OJ L 318, 27.11.1998, p. 1).
( 17 ) Regulation (EU) 2021/378 of the European Central Bank of 22 January 2021 on the application of minimum reserve requirements (ECB/2021/1) (OJ L 73, 3.3.2021, p. 1).
( 18 ) Decision (EU) 2019/1743 of the European Central Bank of 15 October 2019 on the remuneration of holdings of excess reserves and of certain deposits (ECB/2019/31) (OJ L 267, 21.10.2019, p. 12).
( 19 ) Guideline (EU) 2019/671 of the European Central Bank of 9 April 2019 on domestic asset and liability management operations by the national central banks (ECB/2019/7) (OJ L 113, 29.4.2019, p. 11).
( 20 ) Directive (EU) 2015/2366 of the European Parliament and of the Council of 25 November 2015 on payment services in the internal market, amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No 1093/2010, and repealing Directive 2007/64/EC (OJ L 337, 23.12.2015, p. 35).
( 21 ) Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the Council (OJ L 173, 12.6.2014, p. 190).
( 22 ) CET takes into account the change to Central European Summer Time.
( 23 ) Starts 15 minutes later on the last day of the Eurosystem reserve maintenance period.
( 24 ) OJ L 166, 11.6.1998, p. 45.
( 25 ) OJ L 166, 11.6.1998, p. 45.
( 26 ) The need-to-know principle refers to the identification of the set of information that an individual needs access to in order to carry out her/his duties.
( 27 ) The principle of least privilege refers to tailoring a subject’s access profile to an IT system in order to match the corresponding business role.
( 28 ) A supplier in the context of this exercise should be understood as any third party (and its personnel) which is under contract (agreement), with the institution, to provide a service and under the service agreement the third party (and its personnel) is granted access, either remotely or on site, to information and/or information systems and/or information processing facilities of the institution in scope or associated to the scope covered under the exercise of the TARGET2 self-certification.
( 29 ) Directive 98/26/EC of the European Parliament and of the Council of 19 May 1998 on settlement finality in payment and securities settlement systems (OJ L 166, 11.6.1998, p. 45).
( 30 ) Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC (OJ L 267, 10.10.2009, p. 7).
( 31 ) Guideline (EU) 2021/1759 of the European Central Bank of 20 July 2021 amending Guideline ECB/2012/27 on a Trans-European Automated Real-time Gross settlement Express Transfer system (TARGET2) (ECB/2021/30) (OJ L 354, 6.10.2021, p. 45).
( 32 ) CET takes into account the change to Central European Summer Time
( 33 ) CET takes into account the change to Central European Summer Time
( 34 ) The Eurosystem's current policy for the location of infrastructure is set out in the following statements, which are available on the ECB's website at www.ecb.europa.eu: (a) the policy statement on euro payment and settlement systems located outside the euro area of 3 November 1998; (b) the Eurosystem's policy line with regard to consolidation in central counterparty clearing of 27 September 2001; (c) the Eurosystem policy principles on the location and operation of infrastructures settling euro-denominated payment transactions of 19 July 2007; (d) the Eurosystem policy principles on the location and operation of infrastructures settling euro-denominated payment transactions: specification of ‘legally and operationally located in the euro area’ of 20 November 2008; (e) the Eurosystem oversight policy framework, revised version of July 2016.
( 35 ) Directive 98/26/EC of the European Parliament and of the Council of 19 May 1998 on settlement finality in payment and securities settlement systems (OJ L 166, 11.6.1998, p. 45).
( 36 ) Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC (OJ L 267, 10.10.2009, p. 7).
( 37 ) Council Regulation (EC) No 2531/98 of 23 November 1998 concerning the application of minimum reserves by the European Central Bank (OJ L 318, 27.11.1998, p. 1).
( 38 ) Regulation (EU) 2021/378 of the European Central Bank of 22 January 2021 on the application of minimum reserve requirements (ECB/2021/1) (OJ L 73, 3.3.2021, p. 1).
( 39 ) Decision (EU) 2019/1743 of the European Central Bank of 15 October 2019 on the remuneration of holdings of excess reserves and of certain deposits (ECB/2019/31) (OJ L 267, 21.10.2019, p. 12).
( 40 ) Guideline (EU) 2019/671 of the European Central Bank of 9 April 2019 on domestic asset and liability management operations by the national central banks (ECB/2019/7) (OJ L 113, 29.4.2019, p. 11).
( 41 ) CET takes into account the change to Central European Summer Time.
( 42 ) OJ L 332, 31.12.1993, p. 1.
( 43 ) The Eurosystem's current policy for the location of infrastructure is set out in the following statements, which are available on the ECB's website at www.ecb.europa.eu: (a) the policy statement on euro payment and settlement systems located outside the euro area of 3 November 1998; (b) the Eurosystem's policy line with regard to consolidation in central counterparty clearing of 27 September 2001; (c) the Eurosystem policy principles on the location and operation of infrastructures settling euro-denominated payment transactions of 19 July 2007; (d) the Eurosystem policy principles on the location and operation of infrastructures settling euro-denominated payment transactions: specification of ‘legally and operationally located in the euro area’ of 20 November 2008; (e) the Eurosystem oversight policy framework, revised version of July 2016.
( 44 ) http://www.ecb.int/paym/coll/coll/ssslinks/html/index.en.html