ECB Governing Council decides on TARGET2-Securities pricing policy

On 18 November 2010 the Governing Council of the European Central Bank (ECB) decided to set the delivery-versus-payment price for TARGET2-Securities (T2S) at 15 cent per instruction. This price will be fixed for the period from September 2014, when T2S will go live, to December 2018. In order to provide assurance to market participants about T2S prices after 2018, the Governing Council has made a commitment not to increase T2S fees by more than 10% per year between 2019 and the end of the cost recovery period, i.e. September 2022.

This pricing policy is subject to the following conditions: (i) in addition to the euro settlement volume, non-euro currencies add at least 20% to the total volume; (ii) 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; and (iii) the tax authorities confirm that the Eurosystem will not be charged VAT for the T2S services it provides.

As the project is organised on a non-profit basis, the fees aim at full cost recovery, which should be achieved over an amortisation period of seven years of full operation (after one year of migration).

This pricing policy has been developed following thorough and intensive discussion with all T2S stakeholders. It will significantly cut the cost of the cross-border settlement of securities transactions in Europe.

Further information about the T2S project in general and the pricing structure in particular is available on the ECB’s website.