report parliamentary committee draft, 11 June 2026
On the proposal for a regulation of the European Parliament and of the Council on settlement finality and repealing Directive 98/26/EC and amending Directive 2002/47/EC on financial collateral arrangements
Document ECON-PR-789875 · (COM(2025)0941 – C100329/2025 – 2025/0381(COD))
Committee on Economic and Monetary Affairs · Rapporteur: Giovanni Crosetto
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Draft european parliament legislative resolution 183 paragraphs
(COM(2025)0941 – C100329/2025 – 2025/0381(COD))
(Ordinary legislative procedure: first reading)
The European Parliament,
–having regard to the Commission proposal to Parliament and the Council (COM(2025)0941),
–having regard to Article 294(2) and Article 114 of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C100329/2025),
–having regard to Article 294(3) of the Treaty on the Functioning of the European Union,
–having regard to the reasoned opinion submitted, within the framework of Protocol No 2 on the application of the principles of subsidiarity and proportionality, by the Czech Chamber of Deputies, asserting that the draft legislative act does not comply with the principle of subsidiarity,
–having regard to the opinion of the European Central Bank of 9 April 2026,
–having regard to the opinion of the European Economic and Social Committee of 18 March 2026,
–having regard to Rule 60 of its Rules of Procedure,
–having regard to the report of the Committee on Economic and Monetary Affairs (A100000/2026),
1.Adopts its position at first reading hereinafter set out;
Read the rest (171 paragraphs)
2.Calls on the Commission to refer the matter to Parliament again if it replaces, substantially amends or intends to substantially amend its proposal;
3.Instructs its President to forward its position to the Council, the Commission and the national parliaments.
Amendment 1
Proposal for a regulation
Article 2 – paragraph 1 – point 3 a (new)
| Text proposed by the Commission | Amendment |
|---|---|
| (3a) ‘final settlement’ means the completed discharge of the obligations of the parties to a transaction in an unconditional and irrevocable manner as determined by common rules and standardised procedures to which each designated system shall comply, as further specified under Article 21. |
Or. en
Amendment 2
Proposal for a regulation
Article 2 – paragraph 1 – point 5
| Text proposed by the Commission | Amendment |
|---|---|
| (5) ‘securities settlement system’ means a system whose activity consists of the settlement of transfer orders; | (5) ‘securities settlement system’ means a system whose activity consists of settlement as defined in Article 2(1), point (7), of Regulation (EU) No 909/2014 of the European Parliament and of the Council; |
Or. en
Amendment 3
Proposal for a regulation
Article 2 – paragraph 1 – point 15 – point a – point vii
| Text proposed by the Commission | Amendment |
|---|---|
| (vii) an entity other than the entities listed in points (i) to (vi); | (vii) an entity other than the entities listed in points (i) to (vi) that is allowed under the rules of that designated system ; |
Or. en
Amendment 4
Proposal for a regulation
Article 2 – paragraph 1 – point 15 – point b
| Text proposed by the Commission | Amendment |
|---|---|
| (b) for registered systems, any member allowed under the rules of that registered system; | (b) for registered systems, any entity allowed under the rules of that registered system; |
Or. en
Amendment 5
Proposal for a regulation
Article 2 – paragraph 1 – point 20 – point a
| Text proposed by the Commission | Amendment |
|---|---|
| (a) an instruction by a participant to place at the disposal of a recipient or member an amount of funds which results in the assumption or discharge of a payment obligation as laid down in the rules of the system; | (a) an instruction by a participant to place at the disposal of a recipient or member an amount of funds or an instruction which results in the assumption or discharge of a payment obligation as laid down in the rules of the system; |
Or. en
Amendment 6
Proposal for a regulation
Article 2 – paragraph 1 – point 22
| Text proposed by the Commission | Amendment |
|---|---|
| (22) book-entry’ means an electronic record, evidencing any credit or debit or other changes made to such electronic record, where the electronic record and any changes thereto may be undertaken by using distributed ledger technology; | (22) ‘book-entry’ means an electronic record, evidencing any credit or debit or other changes made to such electronic record, where the electronic record may be undertaken by using distributed ledger technology; |
Or. en
Amendment 7
Proposal for a regulation
Article 2 – paragraph 1 – point 27
| Text proposed by the Commission | Amendment |
|---|---|
| (27) ‘collateral’ means all realisable assets, including, without limitation, those financial instruments and funds, including those issued or recorded using distributed ledger technology, including in tokenised form, and financial collateral referred to in Article 1(4), point (a), of Directive 2002/47/EC, provided under a pledge, a title transfer arrangement, a repurchase or similar agreement, or otherwise, for the purpose of securing rights and obligations potentially arising in connection with or related to a system, or provided to central banks of the Member States or to the European Central Bank; | (27) ‘collateral’ and ‘collateral security’ mean all realisable assets, including, without limitation, those financial instruments and funds, including those issued or recorded using distributed ledger technology, including in tokenised form, and financial collateral referred to in Article 1(4), point (a), of Directive 2002/47/EC, provided under a pledge, a title transfer arrangement, a repurchase or similar agreement, or otherwise, for the purpose of securing rights and obligations potentially arising in connection with or related to a system, or provided to central banks of the Member States or to the European Central Bank and including any default fund held by a CCP authorised under Article 14 of Regulation (EU) No 648/2012 in accordance with Article 42 of that Regulation and margins as referred to in Article 41 of that Regulation and any comparable default fund held by or margins provided to a third-country CCP; |
Or. en
Amendment 8
Proposal for a regulation
Article 2 – paragraph 2 – point b
| Text proposed by the Commission | Amendment |
|---|---|
| (b) the definition of participant laid down in paragraph 1, point (15), to add natural or legal persons, based on the experience of cases where such persons are allowed to participate in a DLT settlement system subject to Regulation (EU) 2022/858. | (b) the definition of participant laid down in paragraph 1, point (15), and the definition of indirect participant laid down in paragraph 1, point (17), to add natural or legal persons, based on the experience of cases where such persons are allowed to participate in a DLT settlement system subject to Regulation (EU) 2022/858. |
Or. en
Amendment 9
Proposal for a regulation
Article 5 – paragraph 1 – point j
| Text proposed by the Commission | Amendment |
|---|---|
| (j) the system operator is legally accountable, responsible and liable for the operation of the system, including for any links to other systems and the relationship to third parties and to the authorities; | (j) the common rules and standardised procedures of the system clearly identify what liability the system operator or, where more than one entity is the system operator, each such entity has under those rules and procedures to participants in relation to the operation of the system; |
Or. en
Amendment 10
Proposal for a regulation
Article 5 – paragraph 1 – point l
| Text proposed by the Commission | Amendment |
|---|---|
| (l) where the system operator consists of a network of nodes operating under a common governance and supervision framework, the common rules and standardised procedures of the system shall ensure that one undertaking is legally accountable, responsible and liable for the operation of the system; | (l) where more than one entity is the system operator, the application identifies which entity or entities are responsible for compliance with the duties under Article 8 and designates one such entity as the legal representative for receiving communications from the designating authority on behalf of all such entities in relation to the operation of the system; |
Or. en
Amendment 11
Proposal for a regulation
Article 5 – paragraph 1 – point m
| Text proposed by the Commission | Amendment |
|---|---|
| (m) where the system operator is a consortium of entities, all entities shall be jointly and severally accountable, responsible and liable for the operation of the system. | deleted |
Or. en
Amendment 12
Proposal for a regulation
Article 14 – paragraph 1 – point d
| Text proposed by the Commission | Amendment |
|---|---|
| (d) the system identifies clearly in its common rules and standardised procedures all of the following moments: | deleted |
| (i) the moment of entry of a transfer order into the system referred to in Article 18(1); | |
| (ii) the moment of irrevocability of a transfer order entered into the system referred to in Article 20(1); | |
| (iii) the moment of final settlement of a transfer order entered into a system referred to in Article 21(1). |
Or. en
Amendment 13
Proposal for a regulation
Article 16 – paragraph 1 – point b
| Text proposed by the Commission | Amendment |
|---|---|
| (b) the third-country system operator or the system it operates, as applicable, no longer complies with the conditions set out in Article 14; | (b) the third-country system operator or the system it operates, as applicable, no longer complies with the conditions set out in Article 14 and the system operator has not taken the remedial actions requested by the designating authority within a set timeframe; |
Or. en
Amendment 14
Proposal for a regulation
Article 19 – paragraph 2 a (new)
| Text proposed by the Commission | Amendment |
|---|---|
| 2a. Following the opening of insolvency proceedings against a participant or system operator of an interoperable system, the relevant settlement agent may use, in the name and on behalf of the insolvent entity, for the purposes of fulfilling its obligations related to participation in the system or an interoperable system that arose before the opening of insolvency proceedings: | |
| a) funds and financial instruments available on the insolvent entity's settlement account; | |
| b) credit lines opened in favour of the insolvent entity against an existing guarantee and intended to satisfy that entity's obligations to the system. |
Or. en
Amendment 15
Proposal for a regulation
Article 20 – paragraph 1 a (new)
| Text proposed by the Commission | Amendment |
|---|---|
| 1a. ESMA and EBA shall by [OP insert date = 12 months after the date of entry into force of this Regulation] develop draft regulatory technical standards to specify how a designated system shall determine the moment at which, in its system, a participant or a third party cannot revoke a transfer order for the purposes of paragraph 1. | |
| The Commission shall be empowered to adopt delegated acts to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010. |
Or. en
Amendment 16
Proposal for a regulation
Article 20 – paragraph 2
| Text proposed by the Commission | Amendment |
|---|---|
| 2. In the case of interoperable systems, each system shall determine in its own common rules and standardised procedures the moment of irrevocability, while ensuring, to the extent possible, that the common rules and standardised procedures of all interoperable systems concerned are coordinated. Unless expressly provided for by the common rules and standardised procedures of all the systems that are party to an interoperability arrangement, one system's rules on the moment of irrevocability shall not be affected by any rules of the other systems with which it is interoperable. | 2. In the case of interoperable systems, each system shall determine the moment of irrevocability on the basis of standardised definitions and procedures across the Union according to the regulatory technical standards referred to in paragraph 1a, ensuring that the common rules and standardised procedures of all interoperable systems concerned are coordinated. |
Or. en
Amendment 17
Proposal for a regulation
Article 21 – paragraph 1 a (new)
| Text proposed by the Commission | Amendment |
|---|---|
| 1a. By [OP insert date = 12 months after the date of entry into force of this Regulation] ESMA and EBA shall develop draft regulatory technical standards on the common rules and standardised procedures for determining the moment of final settlement for the purposes of paragraph 1. | |
| The Commission shall be empowered to adopt delegated acts to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010. |
Or. en
Amendment 18
Proposal for a regulation
Article 21 – paragraph 2
| Text proposed by the Commission | Amendment |
|---|---|
| 2. In the case of interoperable systems, each system shall determine in its own common rules and standardised procedures the moment of final settlement. Each system operator shall ensure, to the extent possible, that the rules of all interoperable systems concerned are coordinated. Unless expressly provided for by the common rules and standardised procedures of all the systems that are party to an interoperability arrangement, one system's common rules and standardised procedures on the moment of final settlement shall not be affected by any common rules or standardised procedures of the other systems with which it is interoperable. | 2. In the case of interoperable systems, each system shall determine in its own common rules and standardised procedures established in accordance with the regulatory technical standards referred to in paragraph 1a the moment of final settlement. Each system operator shall ensure that the rules of all interoperable systems concerned are coordinated. |
Or. en
Amendment 19
Proposal for a regulation
Article 21 – paragraph 3 – subparagraph 1 – point c
| Text proposed by the Commission | Amendment |
|---|---|
| (c) the moment, referred to in Article 20(1), in which a transfer order that entered into the designated system cannot be revoked; | deleted |
Or. en
Amendment 20
Proposal for a regulation
Article 21 – paragraph 3 – subparagraph 1 – point e
| Text proposed by the Commission | Amendment |
|---|---|
| (e) the moment of final settlement referred to in paragraph 1; | deleted |
Or. en
Amendment 21
Proposal for a regulation
Article 21 – paragraph 4 – subparagraph 1 – point c
| Text proposed by the Commission | Amendment |
|---|---|
| (c) the moment, referred to in Article 20(1), in which a transfer order that entered into the designated system cannot be revoked; | deleted |
Or. en
Amendment 22
Proposal for a regulation
Article 21 – paragraph 4 – subparagraph 1 – point e
| Text proposed by the Commission | Amendment |
|---|---|
| (e) the moment of final settlement referred to in paragraph 1; | deleted |
Or. en
Amendment 23
Proposal for a regulation
Article 22 – paragraph 2 – subparagraph 1 a (new)
| Text proposed by the Commission | Amendment |
|---|---|
| Where the participant subject to the decision is a participant in a designated system, the competent authority referred to in the first subparagraph shall immediately notify the designating authority, if different. The designating authority shall immediately notify the system operator of the designated system. |
Or. en
Amendment 24
Proposal for a regulation
Article 22 – paragraph 2 – subparagraph 1 b (new)
| Text proposed by the Commission | Amendment |
|---|---|
| Where the participant subject to the decision is a participant in a registered system and is established in a Member State in which that system is registered, the competent authority referred to in the first subparagraph shall immediately notify the registering authority, if different. The registering authority in that Member State shall immediately notify the system operator of the registered system. |
Or. en
Amendment 25
Proposal for a regulation
Article 25 – paragraph 1 – subparagraph 2
| Text proposed by the Commission | Amendment |
|---|---|
| Such collateral security may be realised for the satisfaction of those rights. | Such collateral security may be realised for the satisfaction of those rights, including through the retention of the collateral security and the exercise of the right of sale or other enforcement measures in accordance with the applicable law. |
Or. en
Amendment 26
Proposal for a regulation
Article 25 – paragraph 2 – subparagraph 2
| Text proposed by the Commission | Amendment |
|---|---|
| For the purposes of the first subparagraph, the location of a register, account or centralised deposit held at a legal entity shall be the Member State where that entity has its registered office. | For the purposes of the first subparagraph, the location of a register, account or centralised deposit held at a branch or office in a Member State of a legal entity shall be the Member State where that branch or office is located. |
Or. en
Amendment 27
Proposal for a regulation
Article 25 – paragraph 3
| Text proposed by the Commission | Amendment |
|---|---|
| 3. Where it is not possible to determine the location of a register, account or centralised deposit system in accordance with paragraph 2, the determination of the rights of participants, system operators, a central bank of a Member State or the European Central Bank, and the rights of any nominee, agent or third party acting on their behalf, with respect to the financial instruments provided as collateral security, shall be governed by the law governing the system or the interoperability arrangement referred to in paragraph 1. | 3. Where it is not possible to determine the location of a register, account or centralised deposit system in accordance with paragraph 2, the determination of the rights of participants, system operators, a central bank of a Member State or the European Central Bank, and the rights of any nominee, agent or third party acting on their behalf, with respect to the financial instruments provided as collateral security, shall be governed by the law governing the system or the interoperability arrangement referred to in paragraph 1 or the law governing the arrangement under which the collateral is provided to the central bank or the European Central Bank, as applicable. |
Or. en
Amendment 28
Proposal for a regulation
Article 28 – paragraph 1
| Text proposed by the Commission | Amendment |
|---|---|
| 1. By way of derogation from Article 3, a system designated under Directive 98/26/EC prior to [OP insert date = entry into force of this Regulation] shall continue to be designated for the purposes of this Regulation until it is re-designated under that Article or until [OP insert date= 5 years after the entry into force of this Regulation], whichever is earlier. In the meantime, the Member State law on the designation of a system shall continue to apply. | 1. By way of derogation from Article 3, a system designated under Directive 98/26/EC prior to [date of entry into force of this Regulation] shall be considered as designated for the purposes of this Regulation: |
| (a) until the system is re-designated under that Article or until [5 years after the entry into force of this Regulation], whichever is earlier, or | |
| (b) if the system operator applies for designation of that system under Article 3 before [5 years after the entry into force of this Regulation] and the application is still pending on that date, until the system is re-designated under that Article, a decision has been made rejecting the application or the application is withdrawn. |
Or. en
Amendment 29
Proposal for a regulation
Article 28 – paragraph 2
| Text proposed by the Commission | Amendment |
|---|---|
| 2. By way of derogation from Article 12, a third-country system to which a Member State has extended the protections granted under Directive 98/26/EC prior to [OP insert date = entry into force of this Regulation] shall be considered as registered in that Member State for the purposes of this Regulation until it is registered in accordance with that Article in that same Member State or until [OP insert date = 5 years after the date of entry into force of this Regulation], whichever is earlier. | 2. By way of derogation from Article 12, a third-country system to which a Member State has extended one or more of the protections granted under Directive 98/26/EC or has applied similar protections prior to [entry into force of this Regulation] shall be considered as registered in that Member State for the purposes of this Regulation: |
| (a) until the system is registered in accordance with that Article in that same Member State or until [5 years after the entry into force of this Regulation], whichever is earlier, or | |
| (b) if the system operator applies for registration of the system under Article 12 in that same Member State before [5 years after the entry into force of this Regulation] and the application is still pending on that date, until the system is registered in accordance with that Article in that Member State, a decision has been made rejecting the application or the application has been withdrawn. |
Or. en
Amendment 30
Proposal for a regulation
Article 28 – paragraph 2 a (new)
| Text proposed by the Commission | Amendment |
|---|---|
| 2a. Where the system operator of a system designated under Directive 98/26/EC prior to [date of entry into force of this Regulation] applies for re-designation of the system under Article 3, the designating authority shall ensure that the process is as streamlined as possible and that any information relating to the system or system operator already held by the designating authority is taken into account. |
Or. en
Amendment 31
Proposal for a regulation
Article 28 – paragraph 2 b (new)
| Text proposed by the Commission | Amendment |
|---|---|
| 2b. Where the system operator of a third-country system to which a Member State has extended one or more of the protections granted under Directive 98/26/EC (or applied similar protections) prior to [entry into force of this Regulation] applies for registration of the system in accordance with Article 12 in that Member State, the registering authority in that Member State shall ensure that the process is as streamlined as possible and that any information relating to the system or system operator already held by the registering authority is taken into account. |
Or. en
Amendment 32
Proposal for a regulation
Article 31 – paragraph 1 – point 2 a (new)
Directive 2002/47/EC
Article 9 – paragraph 1 – subparagraph 1 a (new)
| Text proposed by the Commission | Amendment |
|---|---|
| (2a) in Article 9(1), the following subparagraph is added: | |
| ‘For the purpose of the first subparagraph, the location of an account held at a branch or office of a legal entity shall be the country where that branch or office is located’. |
Or. en
Amendment 33
Proposal for a regulation
Article 31 – paragraph 1 – point 2 b (new)
Directive 2002/47/EC
Article 9 – paragraph 2 a (new)
| Text proposed by the Commission | Amendment |
|---|---|
| (2b) in Article 9, the following paragraph is added: | |
| ‘2a. Where it is not possible to determine the location of an account for the purposes of paragraph 1, the matters specified in paragraph 2 arising in relation to book entry securities collateral shall be governed by the law governing the financial collateral arrangement’. |
Or. en
Explanatory statement 23 paragraphs
The Rapporteur welcomes the Commission’s proposal to replace Directive 98/26/EC with a directly applicable Regulation on settlement finality, as part of the Market Integration and Supervision Package (MISP).
The Rapporteur considers that the replacement of the existing Directive by a directly applicable Regulation represents a major opportunity to establish a more coherent and harmonised framework for settlement finality across the Union. Greater harmonisation should reduce legal fragmentation, improve legal certainty and support the further integration of European financial markets.
The Rapporteur recalls that the Settlement Finality Directive has successfully safeguarded payment and securities settlement systems against systemic disruptions for more than twenty-five years. The core principles underpinning that framework — enforceability of transfer orders, protection of settlement finality and mitigation of contagion risks arising from insolvency proceedings — remain essential to financial stability and should continue to form the cornerstone of the future Regulation.
The Rapporteur welcomes the Commission’s efforts to modernise the legal framework in light of technological developments, including distributed ledger technology (DLT), tokenisation and emerging forms of market infrastructure. The future Regulation should embrace innovation while preserving legal certainty, operational resilience and technological neutrality. New technologies should be accommodated without imposing unnecessary legal or operational constraints that could hinder innovation or market development.
The Rapporteur considers that legal certainty should remain the primary objective of the future framework. In particular, the rules governing transfer orders, settlement finality, collateral security and insolvency-related protections should remain clear, predictable and capable of operating effectively across different technological and organisational models.
The Rapporteur underlines the importance of ensuring that the Regulation remains proportionate and operationally workable for market participants and financial market infrastructures. Regulatory requirements should strengthen resilience and legal certainty without creating unnecessary duplication, excessive compliance burdens or barriers to market participation.
The Rapporteur further considers that the Regulation should facilitate the continued integration of European financial markets with global financial infrastructures. In this regard, the framework applicable to third-country systems should preserve a high level of protection while avoiding unnecessary obstacles to cross-border participation, interoperability and market access, provided that appropriate safeguards are maintained.
The Rapporteur welcomes the inclusion of provisions aimed at ensuring that settlement finality protections remain effective in modern market environments, including those involving DLT-based infrastructures. The legal framework should ensure that equivalent activities receive equivalent protections irrespective of the underlying technology used.
The Rapporteur underlines the important role performed by settlement agents within the post-trade ecosystem. The future Regulation should provide adequate legal certainty regarding their ability to complete settlement processes in situations involving insolvency proceedings affecting participants or operators of interoperable systems. Appropriate safeguards can contribute to preserving orderly settlement and reducing systemic risk.
The Rapporteur also considers that greater legal clarity should be provided regarding collateral security arrangements. The protection and enforceability of collateral have historically constituted one of the essential pillars of the Union settlement finality framework and should continue to benefit from robust and predictable legal protection, including in cross-border and insolvency-related situations.
The Rapporteur notes that the implementation of the new framework may require substantial operational adjustments by financial institutions, market infrastructures and other market participants. The transition towards the new regime should therefore be carefully managed, ensuring continuity of protection for existing systems and avoiding unintended cliff-edge effects during the transition period.
Particular attention should be paid to the interaction between the future Settlement Finality Regulation and other major market initiatives, including the transition towards a T+1 settlement cycle in the Union and future developments. Regulatory implementation should support market preparedness and operational certainty while avoiding unnecessary disruption.
The Rapporteur considers that transitional arrangements should ensure that systems already benefiting from settlement finality protections continue to enjoy those protections while applications for designation or registration are being assessed. Existing systems should not face a loss of legal protection solely as a result of administrative delays or the timing of regulatory implementation.
The Rapporteur underlines that further work during the legislative process should focus in particular on:
preserving legal certainty and the effectiveness of settlement finality protections.
ensuring technological neutrality and accommodating innovative market infrastructures.
strengthening the protection of settlement agents in insolvency situations.
enhancing legal clarity regarding collateral security and conflict-of-law rules.
maintaining proportionate and operationally workable requirements for financial market infrastructures.
ensuring continuity of protection through appropriate transitional arrangements.
supporting market integration and efficient cross-border participation, including in relation to third-country systems.
The Rapporteur believes that a modernised and harmonised settlement finality framework can make an important contribution to the integration, efficiency and competitiveness of European financial markets while preserving the high level of legal certainty and systemic risk mitigation that has characterised the Union framework for more than two decades.
In this spirit, the Rapporteur stands ready to work constructively with other Members and groups and then later with the Council and the Commission to deliver a Settlement Finality Regulation that strengthens legal certainty, supports innovation, facilitates market integration and enhances the resilience and competitiveness of European financial markets.