Thailand: Bond Investor Registration (BIR) Scheme - New mandatory details required for settlement instructions for Thai debt securities - Update
Note: This announcement, originally published on 7 February 2022, has been updated to explain the counterparty LEI further. Changes have been highlighted.
Further to our initial announcement A21137 regarding the Bank of Thailand’s Bond Investor Registration (BIR) Scheme, Clearstream Banking1 advises customers of new settlement instruction requirements, effective
28 February 2022
Background
The Bank of Thailand (BOT) implemented the BIR scheme on 4 January 2022 in order to reinforce the transparency over all Thai debt security activities. Clearstream Banking was granted a special approval (No. ThorPorTor.ForKorNgor(31) 621 /2564) by the BOT to maintain its existing omnibus account in the market, upon condition that all underlying Ultimate Beneficial Owners (UBOs) holding Thai debt securities within Clearstream Banking carry out a one-time registration and secondly, that Clearstream Banking complies with an enhanced daily disclosure reporting of UBO holdings and settlement transaction data.
Impact on customers
All Thai debt security settlement instructions require the new mandatory details , in order to facilitate Clearstream Banking’s automated daily disclosure reporting to the Bank of Thailand.
Please note that the current monthly disclosure process for Thai debt securities will be continued in parallel with Clearstream Banking’s automated disclosure reporting process, until the Bank of Thailand allows Clearstream Banking to decommission it.
Customers are requested to take note of the new requirements for internal and domestic settlement instructions for Thai debt securities and amend their instruction formats accordingly.
From 28 February 2022, the following details will become mandatory in customer’s settlement instructions for Thai debt securities. Settlement instruction requirements for other Thai securities remain unchanged.
- The Legal Entity Identifier (LEI) of the counterparty
- The Deal Price for against payment transactions only
Clearstream Banking customer domestic (external) settlement instructions
Counterparty LEI
When settling outside of Clearstream Banking in the domestic market, the counterparty (in this case, counterparty is either the Ordering Party or Beneficiary) LEI must always be mentioned in the narrative of against payment and free of payment settlement instructions as follows:
:70E::DECL// of the DEAG/REAG in sub-sequence E1 in Xact via SWIFT and Xact File Transfer; Declaration Details in Xact Web Portal, as per the below format:
“NNNNNNNNNNNNNNNNNNNN” (the 20-character, alpha-numeric code representing a LEI)
Example:
:70E::DECL//549300OL514RA0SXJJ44
Deal Price
The deal price must always be mentioned in the customer domestic against payment settlement instructions and to be expressed as a yield (YIEL), percentage (PRCT) of par or an actual amount (ACTU) per unit.
Deal price is not required for free of payment instructions.
Note: It is still a mandatory requirement to include the Ordering Party’s or Beneficiary’s segregated depository account number at TSD in all domestic (external) settlement instructions in field :97A::SAFE// of the SELL/BUYR in sub-sequence E1 in Xact via SWIFT and Xact File Transfer; Account in CreationOnline; Party Safekeeping account in Xact Web Portal.
Clearstream Banking customer internal settlement instructions
When settling inside of Clearstream Banking (internal settlement), the counterparty LEI and segregated depository account number at TSD are not mandatory.
The deal price must always be mentioned in the customer internal against payment settlement instructions and to be expressed as a yield (YIEL), percentage (PRCT) of par or an actual amount (ACTU) per unit.
The deal price is not required for free of payment instructions.
Settlement instruction requirements
Please refer to the below summary of domestic (external) settlement instruction requirements for Thai debt securities in Xact via SWIFT. The new requirements are highlighted for easy reference:
Thai debt securities
In the following tables, M=Mandatory; O=Optional; C=Conditional; CM=CBL Mandatory; Seq=SWIFT Message (sub)sequence.
MT540 | Receive Free | Seq | ||
M | :98A: | :TRAD | //Trade date/time | B |
O | :90A: | :DEAL | //Deal price | |
M | :95P: | :PSET | //TSDCTHBK[XXX] | E1 |
M | :95P: | :DEAG | //Counterparty's BIC a | |
CM | :70E: | :DECL | //Ordering party’s LEI b | |
M | :95P: | :SELL | //Ordering party's BIC, if different from DEAG a | |
M | :97A: | :SAFE | //Ordering party’s segregated depository account number at TSD c | |
|
|
| ||
M | :98A: | :TRAD | //Trade date/time | B |
CM | :90A: e OR | :DEAL | //Deal price | |
CM | :90B: f | :DEAL | //Deal price | |
C | :22F: | :RTGS | // d | E |
M | :95P: | :PSET | //TSDCTHBK[XXX] | E1 |
M | :95P: | :DEAG | //Counterparty's BIC a | |
CM | :70E: | :DECL | //Ordering party’s LEI b | |
M | :95P: | :SELL | //Ordering party's BIC, if different from DEAG a | |
M | :97A: | :SAFE | //Ordering party’s segregated depository account number at TSD c | |
|
|
| ||
M | :98A: | :TRAD | //Trade date/time | B |
O | :90A: | :DEAL | //Deal price | |
M | :95P: | :PSET | //TSDCTHBK[XXX] | E1 |
M | :95P: | :REAG | //Counterparty's BIC a | |
CM | :70E: | :DECL | //Beneficiary's LEI b | |
M | :95P: | :BUYR | //Beneficiary's BIC, if different from REAG a | |
M | :97A: | :SAFE | //Beneficiary's segregated depository account number at TSD c | |
|
|
| ||
M | :98A: | :TRAD | //Trade date/time | B |
CM | :90A: e OR | :DEAL | //Deal price | |
CM | :90B: f | :DEAL | //Deal price | |
C | :22F: | :RTGS | // d | E |
M | :95P: | :PSET | //TSDCTHBK[XXX] | E1 |
M | :95P: | :REAG | //Counterparty's BIC a | |
CM | :70E: | :DECL | //Beneficiary's LEI b | |
M | :95P: | :BUYR | //Beneficiary's BIC, if different from REAG a | |
M | :97A: | :SAFE | //Beneficiary's segregated depository account number at TSD c |
|
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a. If the appropriate BIC does exist but is not provided, STP cannot be guaranteed and there is a risk of incurring eventual charges.
b. The Ordering Party's or Beneficiary's LEI must be in the format NNNNNNNNNNNNNNNNNNN (20-character, alpha-numeric code representing the LEI).
c. For all transactions in debt securities, the Ordering Party’s or Beneficiary’s segregated depository account number at TSD is mandatory. There will be no validation in Clearstream on this field, only on the local market. Therefore, if it is incorrectly or incompletely populated, it may cause settlement delays.
d. When RTGS-DVP is required, this field must contain the code word YRTG.
e. When entering the deal price using :90A::DEAL// then the deal price should either be expressed as a yield (YIEL) or percentage (PRCT) of par.
f. When entering the deal price using :90B::DEAL// then the deal price should be expressed as an actual amount (ACTU) per unit.
Note: Failure to adhere with the above requirements will lead to a customer’s settlement instruction being rejected and a potential delay in settlement.
Important reminder to register UBOs
Customers who currently hold or who intend to hold Thai debt securities via Clearstream Banking are reminded to ensure that they complete the one-time registration process with the BOT as well as ensure that their accounts are correctly set up per UBO in Clearstream Banking (refer to A21137 for full details). Customers who continue to send settlement instructions to Clearstream Banking accounts that are not correctly registered as being set up to hold and settle Thai debt securities from 28 February 2022 onwards will receive the following rejection message: “Account not eligible for Thai debt securities”.
Further information
The Market Link Guide - Thailand will be updated to reflect the above-mentioned changes.
For further information, customers may contact Clearstream Banking Client Services or their Relationship Officer.
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1. Clearstream Banking refers collectively to Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248, and Clearstream Banking AG (for Clearstream Banking AG customers using Creation Accounts), registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500.