The Governing Council of the European Central Bank (ECB) has set the delivery-versus-payment price for TARGET2-Securities (T2S) at 15 cents per instruction.
This price will be fixed from September 2014, when T2S will go live, to December 2018. After 2018, the Governing Council says it will not increase T2S fees by more than 10% per year between 2019 and the end of September 2022.
This pricing policy is subject to a number of conditions:
– In addition to the euro settlement volume, non-euro currencies add at least 20% to the total volume- The securities settlement volume in the EU is no more than 10% lower than the volumes projected by the T2S Programme Office, which are based on information provided by market participants- The tax authorities confirm that the Eurosystem will not be charged VAT for the T2S services it provides.
According to the Governing Council, since the project is organized on a non-profit basis, the fees aim at full cost recovery, which should be achieved over an amortization period of 7 years of full operation (after 1 year of migration).
This pricing policy has been developed following thorough and intensive discussion with all T2S stakeholders and will significantly cut the cost of the cross-border settlement of securities transactions in Europe, the Governing Council claims.