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The Prague Securities Centre (SCP - Středisko cenných papírů) has been developing systematically its foreign contacts on a long-term basis and in 1998 became one of the founding members of the Association of Central and Eastern Europe Central Securities Depositories (CEECSDA). This association set out as its main goals to provide the overall survey of the preceding and current activities and to coordinate new services and processes of the individual member institutions on their national capital markets in preparation for the convergence of these markets in Pan European measure. When, in January 2006, the CEECSDA entered - by mutual consent - into a merger with its older sister association called ECSDA (European Central Securities Depositories Association), the SCP, together with other 17 members of the former CEECSDA, acceded to a new-formed ECSDA (the SCP itself in a position of the member-observer). The main reason for the decision of such type of membership was the position of the SCP on the Czech capital market after the newly adopted legislation in our country - Capital Market Undertakings Act in 2004 – specifying the role of the SCP as a temporary one operating only until a newly established institution of the Central Securities Depository of the Czech Republic is established. ECSDA (European Central Securities Depository Association) associates currently 41 member institutions as a key special interest forum of the national central securities depositories and central counterparties (institutions providing securities pre-settlement and settlement services). The Association also serves as a very important mediator for the national institutions to the European Union bodies – European Commission, European Central Bank, ECOFIN Council etc. The association summons the member institutions to the participation on the Association Board of Directors, the Annual General Meeting and the Members Conferences2-3 times a year. The SCP is regularly taking part on these venues, evaluating the results of the Association work in preceding period and set the tasks and missions for the future actions. Its specialized and expert activities are structured into six working groups WG 1 – WG 6:
The SCP is not engaged regularly as an active participant in any of these working groups, above all due to its position of the member-observer and also in consideration of the character of its operation, something different from the settlement processes of other central depositories, nevertheless it participates in various exploratory initiatives, prepared by these working groups in different areas - e.g. the comparative survey and the report on issuers services in 2007-8 (Report on Issuers Services January 2008), or the research of the situation in removal of the communication barriers (so-called Giovannini Barrier No. 1), having been in progress within the cooperation of the ECSDA, its member institutions and the SWIFT Research Team in 2007-8 and not completed yet (SCP participated in preparation of the Draft Giovannini Barrier 1 Compliance Report). However, the main activities of the ECSDA and its members in 2006 – 2009 period focused on getting through into the practice the principles of the commonly accepted document of the European associations EACH, ECSDA a FESE, known as the Code of Conduct. This Code specifies as its major goal to achieve greater efficiency especially in cross-border securities operations and related further integration of European national capital markets. The Code stipulated the enforcing of its principles in following sequence of phases:
In accordance with the commitment to make public documents, relevant for the above-mentioned phases, on the ECSDA members’ websites – the separate directory called Code of Conduct was established within the SCP webpage www.scp.cz in September 2007, presenting relevant documents concerning the Code. In September 2008, the SCP completed and sent to the ECSDA (on the requirement of the Code of Conduct Monitoring Group – MOG) Self Assessment Report Price Transparency 2007; Self Assessment Report - Access & Interoperability for CSDs 2007 and also the General Implementation Report 2007. The SCP presented in these documents, that notwithstanding the fact it participates in the processes under the status of the member-observer and considering the character of its services (not including the financial settlement leg of securities operations) as well as its current role and position on the Czech capital market, the confidence that all the main principles included in the Code have been always respected in its work and all the initiatives aiming to improve functionality of the capital market and enhance the level of services provided to our clients have been backed.
In April 2009, the SCP completed and committed to the ECSDA the required Self Assessment Report – Services Unbundling and Accounting Separation – in which has been presented the opinion that the main objectives of unbundling of services and accounting separation initiative, i.e. removal of bundled services and guaranteeing of accounting separately for each single (unbundled) service are among the core principles of the SCP operation during all its work history. The portfolio of the SCP services offered has neither contained any bundled services nor used consolidated services accounting methods at all. In June 2009, the General Implementation Report 2008 was committed to the ECSDA, providing an overall summary of the involvement of the SCP during the implementation phases of the Code of Conduct until the date. Code of ConductOn 7 November 2006 securities infrastructures in Europe — stock exchanges, central counterparty clearing houses and central securities depositories — agreed on the Code of Conduct for Clearing and Settlement with the aim to achieve greater efficiency and further integration of European capital markets. The ultimate aim is to offer market participants the freedom to choose their preferred provider of services separately at each layer of the transaction chain and to make the concept of “cross-border” redundant for transactions between EU Member States. The Code of Conduct will have an impact in the area of price transparency, conditions of access and interoperability between infrastructures and service unbundling and accounting separation. Following documents relate to the implementation process of Code of Conduct from the point of view of the SCP and its intended engagement in the process: Service Unbundling & Accounting Separation (10.61 kB)
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