CCMA reaffirms Canadian marketās commitment to SECās T+1 implementation date
17 February 2023 Canada
Image: Feng Yu
The Canadian Capital Markets Association (CCMA) has restated that Canada will reduce its standard securities clearing and settlement cycle to T+1 on the same date as the US.
The reaffirmation comes after the U.S. Ķų±¬³Ō¹Ļ and Exchange Commission (SEC) confirmed 28 May 2024 as the US marketās "compliance date" for moving to a shorter standard securities settlement cycle.
āThere has been an inadvertent misunderstanding in the US that has led to US statements implying a different T+1 implementation date in Canada,ā says Barb Amsden, lead, communications and education at the CCMA.
She adds: āCanada's position, since 2021, has been that Canada will reduce the Canadian standard securities clearing and settlement cycles to T+1 on the same date as the USā.
However, the SECās recently confirmed implementation date (28 May), which is a long weekend commemorating the US Memorial Day, is only a two-day weekend in Canada.
Commenting on this, Amsden says: āThe CCMA, and other Canadian industry organisations, overwhelmingly recommended an implementation date of Labour Day 2024 (2 September) ā a common US and Canada long weekend.ā
Despite this, the CCMA has said it will ācontinue to work with Canadian and American market participants to replicate past successful settlement-cycle reductions.ā
The revised settlement compression time of T+1 for the US market was officially proposed by the SEC in February 2022. It ensures securities trades are cleared and settled within one working day. The move will come seven years after T+2 first became the market standard in 2017.
The reaffirmation comes after the U.S. Ķų±¬³Ō¹Ļ and Exchange Commission (SEC) confirmed 28 May 2024 as the US marketās "compliance date" for moving to a shorter standard securities settlement cycle.
āThere has been an inadvertent misunderstanding in the US that has led to US statements implying a different T+1 implementation date in Canada,ā says Barb Amsden, lead, communications and education at the CCMA.
She adds: āCanada's position, since 2021, has been that Canada will reduce the Canadian standard securities clearing and settlement cycles to T+1 on the same date as the USā.
However, the SECās recently confirmed implementation date (28 May), which is a long weekend commemorating the US Memorial Day, is only a two-day weekend in Canada.
Commenting on this, Amsden says: āThe CCMA, and other Canadian industry organisations, overwhelmingly recommended an implementation date of Labour Day 2024 (2 September) ā a common US and Canada long weekend.ā
Despite this, the CCMA has said it will ācontinue to work with Canadian and American market participants to replicate past successful settlement-cycle reductions.ā
The revised settlement compression time of T+1 for the US market was officially proposed by the SEC in February 2022. It ensures securities trades are cleared and settled within one working day. The move will come seven years after T+2 first became the market standard in 2017.
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