Corporate Actions Harmonisation: KADI DE funds and remaining DE ISINs migration to OneCAS
Clearstream Banking AG1 informs clients that, as part of its Corporate Actions Harmonisation (CAH) Project Phase 2, effective
1 July 2024
asset servicing for CBF-issued securities being investment funds, individual certificates, non-DE taxable country, non-T2S eligible will be upgraded to OneClearstream Asset Servicing (OneCAS) level (CAH Project KADI DE funds migration Phase 2 to OneCAS) and will become mandatory.
Background
CBF has established the CAH project focusing on the following aspects:
- Continuous effort to ensure compliance with the Securities Market Practice Group (SMPG) standards and anticipate future changes, such as Single Collateral Management Rulebook for Europe (SCoRE) Standards and the launch of the Eurosystem Collateral Management System (ECMS);
- Modernisation of the technical infrastructure;
- Functional simplification and harmonisation achieved through the consolidation of the processing environments;
- Reduction of the complexity of operating dual asset servicing processing on different technical platforms (KADI versus custody); and
- Promotion of straight-through-processing (STP).
Within the framework of this initiative, corporate actions and income processing for CBF-issued securities, which are currently performed on KADI, will be gradually migrated into the existing OneCAS performed on the Clearstream Banking S.A. (CBL) custody platform. The processing for CBF-issued securities will generally be aligned with current OneCAS processing. Exceptions resulting from regulatory requirements or deviating market standards for CBF-issued securities may apply.
During the first migration phase in July 2023, the harmonisation took place for all CBF-issued securities (Lagerland 099, as per Wertpapier-Mitteilungen (WM)), such as equities, bonds, warrants and certificates with the exception of investment funds and non-German-taxable DE-ISINs (for example, U.S. taxable DE-ISIN). All corporate action events are affected with the exception of meeting events, TEFRA D, class actions and non German-taxable corporate actions events.
In Phase 2, the remaining DE market, that is, CBF-issued investment funds, individual certificates, non-DE taxable country, non-T2S eligible will be migrated. Further markets that are currently processed by KADI, such as Switzerland and the U.S.A. are not in scope of this migration and are planned for a later date.
Impact on clients
OneCAS will become mandatory2 for all migrated CBF-issued securities. This enhancement will benefit CBF clients using the current CBF legacy KADI DE processing and aims to harmonise and improve asset servicing processes across Clearstream Banking entities.
OneCAS processing for OneClearstream eligible securities (Investor-CSD link) will also be enhanced for certain events resulting in harmonisation across the markets.
Detailed information on upcoming changes will be available in the Detailed Functional Specifications.
In addition, the Detailed Functional Specifications also provide the reporting changes for clients acting as lead managers and main paying agents.
Client simulation
CBF is planning to offer a guided client simulation and test cases related to the enhancements of the CAH project (KADI DE Funds Migration Phase 2 to OneCAS).
Participation in the guided client simulation is optional but highly recommended. Clients wishing to participate in the simulation will be asked to register. Further details regarding client simulation will be provided in due course.
Cut-over
After the migration, CBF will generally process corporate action events in OneCAS. However, all ongoing corporate action event at the time of implementation will continue to be processed in KADI.
Detailed information will be provided in a migration guide in due course.
Further information
For further information, clients may contact OneClearstream@clearstream.com, Clearstream Banking Client Services or their Relationship Officer.
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1. This Announcement is published by Clearstream Banking AG (CBF), registered office at Mergenthalerallee 61, 65760 Eschborn, Germany, registered with the Commercial Register of the District Court in Frankfurt am Main, Germany, under number HRB 7500.
2. The current optional OneClearstream Asset Servicing for CBF-issued securities will be replaced by OneClearstream mandatory service.