Euroclear UK & Ireland today provided another update in relation to its ability to continue to offer Euro settlement on and from March 29, 2021, when the existing arrangements with the ECB allowing Euroclear UK & Ireland access to TARGET2 are scheduled to expire.

Euroclear UK & Ireland was seeking permission from the ECB to retain access to TARGET2 following the expiry of the existing arrangements.

Today, however, Euroclear UK & Ireland said that it will not be able to continue to settle in Euros under the current arrangements from 29 March 2021. This means that, unless alternative arrangements can be secured beforehand, the final date for Euro settlement in the CREST system will be Friday, 26 March 2021.

The company says it is investigating alternative arrangements with the aim that Euros can continue as a settlement currency in the CREST system However, at this stage, this cannot be guaranteed.

As FX News Group has reported, Euroclear UK & Ireland will formally apply to ESMA seeking recognition as a third country CSD under Article 25 of CSDR in respect of Irish Securities Settlement and Relevant DI Settlement. As Euroclear has previously communicated, from the expiry of the transition period, scheduled to be 31 December 2020, EUI needs third country CSD recognition pursuant to the CSD Regulation (CSDR) in order to continue to provide Irish Securities Settlement and Relevant DI Settlement.