The Government is pressing ahead with plans to set up an Irish system to settle shares and other securities traded on the Irish Stock Exchange, as the UK presses ahead with plans to exit the European Union.
For the past 20 years, the settlement of trades has been carried out by a UK-based Central Securities Depository (CSD) called Crest, which is operated by Euroclear UK & Ireland in London, making Ireland the only member of the EU that doesn't have such a system.
Minister for Finance Paschal Donohoe said on Thursday that the establishment of an Irish CSD "would best ensure the smooth continuation of settlement services", as Euroclear UK & Ireland would lose the right to passport services into the Republic under a so-called hard Brexit.
The Minister said he encourages applications to the Central Bank to establish a CSD in Ireland.
“An Irish-based CSD that can meet the requirements of Irish market participants will provide increased choice and an opportunity to all Irish market participants currently serviced by CSDs outside Ireland to relocate that business to an Irish domiciled entity.”
Euroclear
Euroclear UK & Ireland’s owner, Brussels-based Euroclear, said in a statement that it is “well advanced” with its planning and is considering setting up a new CSD in Ireland.
"We have been engaging in close, regular and constructive dialogue with the Irish market and Irish authorities, including the Central Bank and the Department of Finance on this issue," Euroclear said.
The Irish Times reported in April that the State may have to set up its own CSD system to deal with the fall-out from Brexit.
The current system, Crest, also assists companies in the payment of dividends and Revenue in collecting stamp duty, currently charged at a rate of 1 per cent on Irish share trading.
