EU Intervenes to Avoid a No-Deal Brexit Disrupting Irish Share Trading
The European Union said on Friday if Britain leaves the bloc without a deal, Irish customers could still settle their stock and bond trades in London for the next two years to avoid market disruption.
The EU’s European Securities and Markets Authority (ESMA) said that in the event of a no-deal Brexit, Euroclear’s UK and Ireland central securities depository in London could still settle securities traded on the Dublin stock exchange.
It follows a similar decision taken by ESMA to allow the London Stock Exchange’s LCH unit to continue clearing trades for EU customers for a year under a no-deal Brexit.
Brussels-headquartered Euroclear is owned by banks and bourses, with the LSE acquiring a small stake recently.
ESMA also said it had authorised U.S. clearing and settlement house DTCC’s new Irish data repository with effect from Friday.
Repositories are used by banks and others to record their derivative, commodities, forex, stock and interest rate transactions.
DTCC has a repository in London but it risked being cut off from EU customers if Britain leaves the bloc this month with no transition deal.
“This registration is part of the DTCC Group strategy in response to a no-deal Brexit,” ESMA said in a statement.