The ISSA recommendations 2000 are:

1. Securities systems have a primary responsibility to their users and other stakeholders. They must provide effective low-cost processing. Services should be priced equitably.

2. Securities systems must allow the option of network access on an interactive basis. They should cope with peak capacity without any services degradation, and have sufficient standby capabilities to recover operations in a reasonably short period within each processing day.

3. The industry worldwide must satisfy the need for efficient, fast settlement by full adherence to the International Securities Numbering process (ISO 6166) and uniform usage of ISO 15022 standards for all securities messages. The industry should seek to introduce a global client and counterpart identification methodology (BIC-ISO 9362) to further facilitate straightthrough processing. Applications and programmes should be structured in such a way as to facilitate open interaction between all parties.

4. Each market must have clear rules assuring investor protection by safeguarding participants from the financial risks of failed settlement and ensuring that listed companies are required to follow sound policies on corporate governance, transfer of economic benefits and shareholder rights.

5. The major risks in securities systems should be mitigated by five key measures, namely;

   • The implementation of real delivery versus payment

   • The adoption of a trade date plus one settlement cycle in a form that does not increase operational risk

   • The minimization of funding and liquidity constraints by enabling stock lending and borrowing, broad-based cross-collateralization, the use of repos and netting as appropriate

   • The enforcement of scripless settlement

   • The establishment of...