The Settlement Infrastructure of Ukrainian Stock Market: State and Directions for Reform
Abstract
The research defines the concepts of clearing and clearing activity. It explores the models of the clearing institutions’ organizational structure in EU countries. It also outlines the directions for the settlement and clearing infrastructure reform based on the diversification of the settlement and clearing functions. It should ensure the integrity of the stock market, the reduction of risks, the creation of an efficient and transparent system for the execution of transactions with securities; reduction of expenses of market participants; acceleration of payment terms for operations with securities and process of registration of property rights; differentiation of responsibility at different stages of performance of transactions. The author has defined the legal status of the Financial Settlements Center as a banking institution with a special legal personality of the conducting monetary settlements under transactions concerning securities and other financial instruments, made on the stock exchange and outside the stock exchange, if payments are made according to the principle of ‘supply against payment’. The study shows the need for the universal model of settlements to serve all the exchange markets. We offer to demonopolize the market of clearing services and to provide access for international clearing institutions. We also suggest transferring the settlement function to the Central Depositary and the clearing function – to clearing institutions.
References
[2] Development of Ukrainian Capital Markets Infrastructure. 2016. https://bank.gov.ua/control/en/publish/article?art_id=36150556.
[3] Directions for designation of the universal model for depository, clearing and settlement systems in Ukraine. 2011. https://bitly.su/oKCU.
[4] Domanski, D., Gambacorta, L., and Picillo, C. 2015. Central clearing: trends and current issues. https://www.bis.org/publ/qtrpdf/r_qt1512g.pdf.
[5] Global Clearing and Settlement: A Plan of Action. 2003. G30 Working Group, 143 р. https://www.hcch.net/en/publications-and-studies/details4/?pid=3435&dtid=28.
[6] Glushkova, S., Lomakina, O., and Sakulyeva, T. 2019. The economy of developing countries in the context of globalization: Global supply chain management. International Journal of Supply Chain Management 8(1): 876-884.
[7] Lukashov, A.V. 2006. Settlement and clearing system and global stock architecture. Corporate Finance Management 6(18): 352 – 372. https://www.nbp.pl/en/system_platniczy/ securities_settlement_systems_rus.pdf.
[8] Melnik, V. 2017. Application of international standards for the regulation of depository and clearing activities in Ukraine. Jurnalul juridic national: teoriei practic 4(26): 104 – 108. www.jurnaluljuridic.in.ua/archive/2017/4/24.pdf.
[9] Molodkin, A.Yu. 2009. Formation of the securities market infrastructure. The author's dissertation abstract of the candidate of economic sciences. All-Russian State Tax Academy of the Ministry of Finance of the Russian Federation.
[10] Panova, L.V. 2013. The emergence and functioning of the settlement and clearing systems and clearing organizations. Scientific Bulletin of the Uzhgorod National University, 21: 239 – 242. https://dspace.uzhnu.edu.ua/jspui/handle/lib/902.
[11] Pirrong, C. 2011. The Economics of Central Clearing: Theory and Practice. Discussion Papers Series 1, 43. https://www.isda.org/a/yiEDE/isdadiscussion-ccp-pirrong.pdf.
[12] Ruffini, I. 2015. Central clearing: Risks and customer protections. 90 – 100. https://ideas.repec.org/a/fip/fedhep/00016.html.
[13] Settlement and clearing systems for securities in Poland and the European Union. 2009. http://www.nbp.pl/en/system_platniczy/securities_settlement_systems_rus.pdf.
[14] Sukharev, A.Ya. 2007. The Big legal dictionary. INFRA-M.
[15] The regulators discussed ways of the capital market infrastructure transformation with its participants. 2016. Press release. https://bank.gov.ua/control/uk/publish/printable_article;jsessionid=3E077329D6B34A055617F7D8B73CDE15?art_id=36017425&showTitle=true:2010-06-08-09-41-01&Itemid=100066.
The Copyright Transfer Form to ASERS Publishing (The Publisher)
This form refers to the manuscript, which an author(s) was accepted for publication and was signed by all the authors.
The undersigned Author(s) of the above-mentioned Paper here transfer any and all copyright-rights in and to The Paper to The Publisher. The Author(s) warrants that The Paper is based on their original work and that the undersigned has the power and authority to make and execute this assignment. It is the author's responsibility to obtain written permission to quote material that has been previously published in any form. The Publisher recognizes the retained rights noted below and grants to the above authors and employers for whom the work performed royalty-free permission to reuse their materials below. Authors may reuse all or portions of the above Paper in other works, excepting the publication of the paper in the same form. Authors may reproduce or authorize others to reproduce the above Paper for the Author's personal use or for internal company use, provided that the source and The Publisher copyright notice are mentioned, that the copies are not used in any way that implies The Publisher endorsement of a product or service of an employer, and that the copies are not offered for sale as such. Authors are permitted to grant third party requests for reprinting, republishing or other types of reuse. The Authors may make limited distribution of all or portions of the above Paper prior to publication if they inform The Publisher of the nature and extent of such limited distribution prior there to. Authors retain all proprietary rights in any process, procedure, or article of manufacture described in The Paper. This agreement becomes null and void if and only if the above paper is not accepted and published by The Publisher, or is with drawn by the author(s) before acceptance by the Publisher.