Global Securities Markets: Navigating the World's Exchanges and OTC Markets

EUROCLEAR

Euroclear is a securities settlement system. Like DTCC, it is also a limited purpose bank. Unlike DTCC, it does not operate a CCP like NSCC. Formed in 1968, Euroclear enables its members (through their own accounts in Euroclear) to settle securities transactions by moving securities free of payment or against cash (delivery versus payment or DVP). Euroclear is an international settlement system in that it does not support a particular domestic securities market but supports the settlement of the securities issued in a variety of jurisdictions and under a variety of laws.

Its members are banks, financial institutions or securities houses. They must meet certain criteria for admission to the Euroclear system. These include (a) financial resources, (b) operational capability, and (c) projected settlement volumes.

Euroclear members instruct the settlement of transactions and make inquiries of Euroclear as to their holdings by means of Euroclear's proprietary interface (Euclid) or by using the Society for World Interbank Financial Telecommunication (SWIFT) network. Euclid is available only to Euroclear members. Only Euroclear members can access Euroclear using SWIFT.

Euroclear Bank does not currently disclose the admission criteria for securities, but these are likely to require that (a) a security is freely transferable, (b) interests in it are capable of electronic settlement, and (c) each unit in a security (as denoted by the ISIN—see below) is fungible with every other ...