The settlement period for securities, such as shares and bonds, will be reduced to T+1 instead of T+2. The Commission intends to reflect the amendment to the settlement period for securities by amending Regulation (EU) No 909/2014.

Certain securities financing transactions will be exempt from the T+1 settlement cycle requirement, but only if structured as single transactions composed of two linked operations.

The Commission states that a move to T+1 will:

• Enhance the efficiency of settlements and also develop the resilience of capital markets within the EU
• Assist to prevent market fragmentation and also reduce costs which are associated with discrepancies between EU and global financial markets, therefore supporting the global competitiveness and reduce unnecessary costs

• Transitioning to the T+1 would require legal amendments to ensure legal certainty and foster improvements in post-trading processes
• Technology upgrades to modernise settlement systems
• Market standardisation to align workflows across participants

To oversee the transition and address complexity with the implementation of the changes, a governance structure has been established. The governance structure is comprised by:

• T+1 Coordination Committee
• Industry structure comprising the T+1 Industry Committee (the Industry Committee) and several dedicated specialised workstreams which are guided by the Industry Committee

The rules will take effect on 11 October 2027 pending formal adoption. Upon approval, all relevant stakeholders will have until 2027 to refine processes and thoroughly test systems to ensure a smooth transition to T+1.

The European Council’s press release of 18 June 2025 can be found here.

The Commission’s proposal of 12 February 2025 can be found here.