CCMA reaffirms Canadian market’s commitment to T+1 implementation date
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CCMA reaffirms Canadian market’s commitment to T+1 implementation date 17 February 2023Canada Reporter: Jenna Lomax
Image: Feng Yu
The Canadian Capital Markets Association (CCMA) has restated that Canada will reduce its standard securities clearing and settlement cycle to T+1 on the same date as the US.
The reaffirmation comes after the U.S. Securities and Exchange Commission (SEC) confirmed 28 May 2024 as the US market’s "compliance date" for moving to a shorter standard securities settlement cycle.
“There has been an inadvertent misunderstanding in the US that has led to US statements implying a different T+1 implementation date in Canada,” says Barb Amsden, lead, communications and education at the CCMA.
She adds: “Canada's position, since 2021, has been that Canada will reduce the Canadian standard securities clearing and settlement cycles to T+1 on the same date as the US”.
However, the SEC’s recently confirmed implementation date (28 May), which is a long weekend commemorating the US Memorial Day, is only a two-day weekend in Canada.
Commenting on this, Amsden says: “The CCMA, and other Canadian industry organisations, overwhelmingly recommended an implementation date of Labour Day 2024 (2 September) — a common US and Canada long weekend.”
Despite this, the CCMA has said it will “continue to work with Canadian and American market participants to replicate past successful settlement-cycle reductions.”
The revised settlement compression time of T+1 for the US market was officially proposed by the SEC in February 2022. It ensures securities trades are cleared and settled within one working day. The move will come seven years after T+2 first became the market standard in 2017.
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Image: Feng Yu 