CDAD Prepares an Updated Draft of its Rules and Regulations

The Bulgarian Central Depository AD has prepared an updated draft of its rules and regulations. The new draft was sent last week to the Association of Banks in Bulgaria for review by the Association’s member banks. The most important amendments compared to the previous draft version announced in November 2012 are:

• The procedure for amendments of CDAD rules and regulations and supporting operating rules: amendments in operating rules and amendments in rules and regulations including the Fee Schedule affecting CDAD members shall only be made after preliminary review by CDAD members.
• Amended criteria for membership:
  • Clearing members shall be members of the System for Clearing and Settlement (SCS); such members shall be entitled to operate on behalf of and for the account of non-clearing members.
  • Direct members shall be members of the SCS: such as banks, investment intermediaries, management companies, other depositories, clearing institutions and regulated markets.
  • Non-clearing members are non-direct members of SCS: such as banks and investment intermediaries providing services through an agreement with a clearing member.
• Introduction of buyer protection and market claims regulation.
• Establishment of a settlement guarantee fund that will be utilised in case there is a four day delay in settlement of on-exchange deals with financial instruments.

Impact on investors: CDAD has announced further draft amendments to its rules and regulations, which are expected to introduce significant changes to the market infrastructure.

Related Newsflash: Newsflash BULGARIA – Central Depository AD Plans to Amend Its Rules and Regulations