IRAN: CSDI Adopts T+2 Settlement

Tuesday February 27 2018

On 6^th February 2018, the standard settlement cycle for brokerage transactions including stocksat Central Securities Depository of Iran (CSDI) was reduced from trade date plus 3 business days (“T+3”) to trade date plus 2 business days (“T+2”).

The CSDI President meanwhile acknowledged that Central Securities Depository of Iran (CSDI) now plans to design and fully implement Delivery-versus-Payment system (DvP) standard settlement services as well as a Central Counter-Party (CCP) in a very near future.

CSDI is currently operating under a settlement policy which is very similar to DvP2. However Iran’s Depository seeks to optimize the existing settlement to access standard DVP instructions for all its settlements standards and procedures.

The core focus at CSDI is to provide protection to both sides of a trade so that each party makes sure the trade will settle at the agreed price even in the event one party defaults on its obligations through Investor Protection Funds, credit limits and custodians. The CCP, too, will strengthen this aspect as it interposes itself as counterparty to both parties involved in a trade.

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