I propose to take Questions Nos. 100 and 101 together.
The decision to migrate the Central Securities Depository (CSD) used by Euronext Dublin (formerly the Irish Stock Exchange) was a market and industry decision made in 2018 which will result in the transfer of the settlement of trades in Irish equities and other exchange traded instruments from Euroclear UK and Ireland to Euroclear Bank Belgium.
The operation of the migrated CSD will be based upon the commercial agreement between Euroclear and Euronext. A key objective of the migration is to maintain the professional and modern management of Ireland’s stock exchange and capital market. In that regard it is the position of all stakeholders that the status quo remains in so far as possible and that Irish investors and traders can continue to operate as they have and without any additional and unnecessary friction.
The Government has put in place a number of legislative supports to assist the migration of the CSD in an orderly and timely manner.
Part 4 of the Withdrawal of the United Kingdom from the European Union (Consequential Provisions) Bill 2020 provides for miscellaneous amendments to the Companies Act 2014 to facilitate the operation of a substitute securities settlement system, compatible with the law of the European Union after the transition period. Specifically on timelines, section 1087G provides for a least a 72-hour period before a general meeting for a relevant issuer to permit investor’s voting instructions in a general meeting to be provided. This is compared to a 48-hour period for PLCs outside of the CSD system and is necessary operationally under the CSD’s intermediated system.
In addition to the provisions of Part 4 this Bill and the Finance Bill 2020, the Government also enacted the Migration of Participating Securities Act 2019 ensuring the orderly migration of all Irish securities to Euroclear Bank.
The combined effect of these legislative supports is to bring clarity to participants and to mitigate against any potential financial and disruption risks arising from the migration of the system.
The migration also allows for the operation of the CSD and all trades settled on it to continue to be covered under the EU regulatory framework in this area.
The wider responsibility for financial services lies with my colleague the Minister for Finance. I am committed to ensuring the Companies Act 2014 supports the proposed functioning of the securities markets and more broadly Irish business.