BREAKING: EU Council & Parliament Seal Deal on T+1 Settlement – Traders, Brace for Impact

Europe's financial infrastructure just got a turbocharge—whether it's ready or not.

The T+1 Countdown Begins

No more leisurely two-day settlement windows. The EU's power players just greenlit T+1, forcing the bloc's creaky legacy systems to keep pace with crypto's 24/7 tempo. Front offices are celebrating; back offices are sweating bullets.

Why This Hurts So Good

Faster settlements mean less counterparty risk and freed-up capital. Also means your "pending" trades will expose operational flaws faster than a Bitcoin flash crash. Bonus: watch traditional finance firms spend millions to achieve what blockchain does by design.

The Cynic's Corner

Banks will now charge "liquidity facilitation fees" for the privilege of settling trades in merely 24 hours—innovative rent-seeking at its finest.

The Council and the European Parliament reached a provisional agreement on new rules to make transactions in transferable securities more efficient.

The goal is to , such as transactions in shares or bonds, executed on EU trading venues, from no later than two business days (the so-called ‘T+2’) .

“A win for the Polish Presidency — we led the push to shorten the settlement cycle from T+2 to T+1, meaning trades in shares or bonds will now be settled in one day instead of two. Faster settlements mean stronger markets and a more competitive EU.”

Andrzej Domanski, Polish minister for finance

The new measure takes the FORM of , which entered into force ten years ago. The regulation harmonised the securities settlement cycle in the EU at a maximum of two business days after the trade date. Since then, many markets outside the EU have shortened their settlement cycle or are in the process of doing so.

The agreement to change the settlement cycle in the CSDR will therefore and . Indeed, both the Draghi and Letta reports highlight the current post-trading landscape, including settlement of trades, as a significant barrier to EU capital markets.

The co-legislators agreed however to  from the settlement cycle requirement. SFTs are financial transactions that allow investors and firms to use assets, such as the shares or bonds they own, to secure funding for their activities.

In order to avoid any risks of circumvention of the T+1 settlement cycle requirement, the exemption should only apply if SFTs are documented as single transactions composed of two linked operations.

The two institutions will have to formally adopt the new rules. They will then apply from 11 October 2027.

The Commission proposed the initiative to shorten the settlement cycle on 12 February 2025.

Source: European Council