Decision No 2018-03 of 16 April 2018 amending Decision No 2015-01 of 22 April 2015 on the implementation of the monetary policy and intraday credit of the Banque de France

Decision No 2018-03 of 16 April 2018 amending Decision No 2015-01 of 22 April 2015 on the implementation of the monetary policy and intraday credit of the Banque de France

THE GOVERNOR OF THE BANQUE DE FRANCE

Having regard to:

• the Treaty on the Functioning of the European Union, and in particular Article 127(1) and Article 127(2), first indent,
• the Statute of the European System of Central Banks and of the European Central Bank (ECB), and in particular Articles 3.1, first indent, 12.1, 14.3 and 18.2,
• ECB Guideline (EU) 2015/510 of 19 December 2014 on the implementation of the Eurosystem monetary policy framework (ECB/2014/60), as amended,
• ECB Guideline of 7 February 2018 amending Guideline (EU) 2015/510 on the implementation of the Eurosystem monetary policy framework (ECB/2018/3),
• the Monetary Agreement between the European Union and the Principality of Monaco of 26 December 2001, as amended on 29 November 2011,
• the Monetary and Financial Code, and in particular Article L. 142-8,
• the Governor of the Banque de France Decision No 2015-01 of 22 April 2015 on the implementation of the monetary policy and intraday credit of the Banque de France, as amended,

HEREBY DECIDES:

Article 1

The Governor of the Banque de France Decision No 2015-01 of 22 April 2015 on the implementation of the monetary policy and intraday credit of the Banque de France (hereinafter "the Decision") is amended as follows:

1. Article 2:
   a) Paragraph 8) is replaced by the following text:
   "8) 'tripartite agent', a CSD operating an eligible securities settlement system that has concluded a contract with a NCB whereby that CSD must provide certain collateral management services as an agent of that NCB;" b) Paragraph 17) is deleted; c) The following paragraph 24 bis) is inserted:
   "24 bis) 'eligible securities settlement system', a securities settlement system operated by a CSD that the Eurosystem has assessed as meeting the eligibility criteria set out in Annex VI bis for use in Eurosystem credit operations, and which is published on the list of eligible securities settlement systems of the Eurosystem available on the ECB website;" d) Paragraph 33) is replaced by the following text:
   "33) 'intraday credit', intraday credit as defined in Article 2(26) of ECB Guideline ECB/2012/27*

• Guideline of the European Central Bank of 5 December 2012 on the Trans-European Automated Real-time Gross settlement Express Transfer system (TARGET2) (ECB/2012/27) (OJ L 30, 30.1.2013, p. 1)."
  e) Paragraph 39 is replaced by the following text:
  "39) 'central securities depository' (CSD), a central securities depository as defined in Article 2(1)(1) of Regulation (EU) No 909/2014 of the European Parliament and of the Council*
• Regulation (EU) No 909/2014 of the European Parliament and of the Council of 23 July 2014 on improving securities settlement in the European Union and on central securities depositories and amending Directives 98/26/EC and 2014/65/EU and Regulation (EU) No 236/2012 (OJ L 257, 28.8.2014, p. 1)."
  f) The following paragraph 52 bis) is inserted:
  "52 bis) 'investment fund', a money market fund or a non-money market fund within the meaning of Annex A to Regulation (EU) No 549/2013;" g) The following paragraphs 56 bis), 56 ter) and 56 quater) are inserted:
  "56 bis) 'direct link', an agreement between two securities settlement systems operated by CSDs whereby a CSD becomes a direct participant in the securities settlement system operated by the other CSD by opening a securities account, in order to enable the transfer of securities by book entry;

'56 ter) 'eligible link', a direct or indirect link that the Eurosystem has assessed as meeting the eligibility criteria set out in Annex VI bis for use in Eurosystem credit operations, and which is published on the list of eligible links of the Eurosystem available on the ECB website. An indirect eligible link is composed of underlying eligible direct links;

'56 quater) 'indirect link', a link established between securities settlement systems operated by two different CSDs that carry out securities transactions or transfers of securities via a third securities settlement system acting as an intermediary or, in the case of securities settlement systems operated by CSDs participating in TARGET2-Securities, via several securities settlement systems acting as intermediaries;" h) Paragraph 83 is replaced by the following text:
"83) 'financial corporation', a financial corporation as defined in Annex A to Regulation (EU) No 549/2013 of the European Parliament and of the Council*

• Regulation (EU) No 549/2013 of the European Parliament and of the Council of 21 May 2013 on the European System of National and Regional Accounts in the European Union (ESA 2010) (OJ L 174, 26.6.2013, p. 1)."
  i) Paragraph 90) is replaced by the following text:
  "90) 'securities settlement system', a securities settlement system as defined in Article 2(1)(10) of Regulation No 909/2014, enabling the transfer of securities, free of payment or against payment (delivery versus payment system);"

2. Article 4, Table 1 is replaced by the following table:
   "Table 1
   Overview of the characteristics of Eurosystem monetary policy operations

Categories of monetary policy operations | Types of instruments | Maturity | Frequency | Procedure | Liquidity injection | Liquidity withdrawal --- | --- | --- | --- | --- | --- | --- Open market operations | Main refinancing operations | Repurchase transactions | — One week | Weekly | Normal tender procedures | Yes | No

Longer-term refinancing operations	Repurchase transactions	— Three months(*)	Monthly(*)	Normal tender procedures	Yes	No
Fine-tuning operations	Repurchase transactions	Repurchase transactions	Non-standardised	Non-standardised	Tender procedures	Bilateral procedures()	Yes	Yes
Foreign exchange swaps	Foreign exchange swaps	—					Withdrawal of liquidity in white
Structural operations	Repurchase transactions	Repurchase transactions	Non-standardised	Non-standardised	Normal tender procedures(*)	—
Issuance of ECB debt certificates	Less than 12 months				Issuance of debt certificates of the ECB
Firm purchases	Firm sales	—		Bilateral procedures	Tender procedures()
Permanent facilities	Marginal lending facility	Repurchase transactions	—	24 hours	Access at counterparties' discretion
Deposit facility	— Deposits	24 hours	Access at counterparties' discretion

() In accordance with Article 7(2)(b) and (c), Article 7(3) and Article 7(4).
() In accordance with Article 8(2)(c), Article 10(4)(c), Article 11(5)(c) and Article 12(6)(c).
() In accordance with Article 9(2)(c), Article 10(4)(c) and Article 13(5)(d).
() In accordance with Article 9(2)(c) and Article 14(3)(c)."

3. Article 6, paragraph 2, point (f) is replaced by the following text:
   "(f) are subject to the eligibility criteria defined in Part Three, which must be met by all counterparties submitting bids for these operations;"

4. Article 7, paragraph 2, point (f) is replaced by the following text:
   "(f) are subject to the eligibility criteria defined in Part Three, which must be met by all counterparties submitting bids for these operations;"

5. Article 8, paragraph 2 is replaced by the following text:
   "2. From the perspective of their operational characteristics, fine-tuning operations:
   (a) may be carried out as liquidity injection or withdrawal operations; (b) have a frequency and maturity that are usually not standardised; (c) are normally carried out by rapid tender procedures, unless the Eurosystem decides to carry out the particular fine-tuning operation by other means (normal tender procedure or bilateral procedure) due to particular monetary policy aspects or to react to market conditions; (d) are executed in a decentralised manner by the NCBs, without prejudice to Article 45(3); (e) are subject to the eligibility criteria for counterparties set out in Part Three, depending on:
   (i) the particular type of instrument used to carry out the fine-tuning operations; and (ii) the procedure applicable to that particular type of instrument; (f) when carried out by means of repurchase transactions, they are based on eligible assets used as collateral."

6. Article 9, paragraph 2, point (e) is replaced by the following text:
   "(e) are subject to the eligibility criteria for counterparties set out in Part Three, depending on: (i) the particular type of instrument used to carry out the structural operations; and (ii) the procedure applicable to that particular type of instrument;"

7. Article 10, paragraph 4 is replaced by the following text:
   "4. From the perspective of their operational characteristics, repurchase transactions for monetary policy purposes:
   (a) may be carried out as liquidity injection or withdrawal operations; (b) have a frequency and maturity that depend on the category of open market operations for which they are used; (c) those falling under open market operations are executed by means of normal tender procedures, except fine-tuning operations, which are executed by means of tender procedures or bilateral procedures; (d) those falling under the marginal lending facility are executed as described in Article 18; (e) are executed in a decentralised manner by the NCBs, without prejudice to Article 45(3)."

8. Article 11, paragraph 6 is replaced by the following text:
   "6. Counterparties participating in foreign exchange swaps for monetary policy purposes are subject to the eligibility criteria set out in Part Three, according to the procedure applicable to the operation concerned."

9. Article 12, paragraph 7 is replaced by the following text:
   "7. Counterparties participating in liquidity absorption operations are subject to the eligibility criteria set out in Part Three, according to the procedure applicable to the operation concerned."

10. Article 13, paragraph 6 is replaced by the following text:
    "6. Counterparties participating in the normal tender procedure for the issuance of ECB debt certificates must meet the eligibility criteria set out in Part Three."

11. Article 14, paragraph 4 is replaced by the following text:
    "4. Counterparties participating in firm operations must meet the eligibility criteria set out in Part Three."

12. Article 25, Tables 5 and 6 are replaced by the following tables:
    "Table 5
    Indicative timeline of operational steps for normal tender procedures (hours indicated in Central European Time)

Table 6
Indicative timeline of operational steps for rapid tender procedures (hours indicated in Central European Time)

9 Central European Time takes into account the switch to Central European Summer Time."

13. Article 55 is replaced by the following text:
    "Article 55
    Eligibility criteria for participation in Eurosystem monetary policy operations

With regard to Eurosystem monetary policy operations, subject to Article 57, the Banque de France authorises only the participation of credit institutions within the meaning of the Monetary and Financial Code, as well as the Caisse des dépôts et consignations, provided that they are established in metropolitan France, the overseas departments and regions, Saint-Martin and Saint-Barthélemy and Saint-Pierre-and-Miquelon (hereinafter 'France'), or in the territory of the Principality of Monaco and provided that they meet the following criteria:
(a) they are subject to the Eurosystem mandatory reserve regime under Article 19.1 of the Statute of the ESCB and are not exempted from their obligations under the mandatory reserve regime under Regulation (EC) No 2531/98 and Regulation (EC) No 1745/2003 (ECB/2003/9); (b) they may be institutions that are:
(i) either subject, by the competent authorities, to at least one form of harmonised prudential supervision at Union or EEA level, in accordance with Directive 2013/36/EU and Regulation (EU) No 575/2013; (ii) or public credit institutions, as defined in Article 123(2) of the Treaty, subject to prudential supervision of a level comparable to the prudential supervision exercised by competent authorities under Directive 2013/36/EU and Regulation (EU) No 575/2013; (iii) or institutions subject to non-harmonised prudential supervision, exercised by competent authorities, of a level comparable to the harmonised prudential supervision at Union or EEA level exercised by competent authorities under Directive 2013/36/EU and Regulation (EU) No 575/2013, for example branches, established in Member States whose currency is the euro, of institutions registered outside the EEA. Generally, in order to assess whether an institution may be admitted to participate in Eurosystem monetary policy operations, non-harmonised prudential supervision is considered to be of a level comparable to the harmonised prudential supervision at Union or EEA level exercised by competent authorities under Directive 2013/36/EU and Regulation (EU) No 575/2013, if it is considered that the Basel III standards, adopted by the Basel Committee on Banking Supervision, have been implemented in the prudential supervision regime of the country concerned; (c) they must be financially sound within the meaning of Article 55 bis; (d) they meet any operational criteria specified in the contractual or regulatory provisions applied by the NCB of the home country or the ECB concerning the specific instrument or operation."

14. Article 61, paragraph 1 is replaced by the following text:
"1. The ECB publishes an up-to-date list of eligible marketable assets on its website, in accordance with the methods specified thereon, and updates it every day on which TARGET2 is operational. Marketable assets appearing on the list of eligible marketable assets become eligible for use in the context of Eurosystem credit operations upon their publication on the list. By way of exception to this rule, in the specific case of debt securities with same-day settlement, the Eurosystem may grant eligibility as of the date of issuance. Assets assessed in accordance with Article 87(3) are not published on this list of eligible marketable assets."

15. Article 66:
a) Paragraph 1 is replaced by the following text:
"1. Subject to paragraph 2, in order to be eligible, debt securities are issued in the EEA with a central bank or an eligible securities settlement system." b) Paragraph 3 is replaced by the following text:
"3. International debt securities issued through ICSDs meet the criteria below, where applicable.
(a) International debt securities represented by a bearer global certificate are issued in the form of new global notes (NGN) and deposited with a common safekeeper, which is an ICSD or a CSD operating an eligible securities settlement system. This condition does not apply to international debt securities represented by a bearer global certificate issued in the form of classical global notes before 1 January 2007, nor to continuous fungible issuances of these certificates with the same ISIN number, regardless of the date of the continuous issuance. (b) International debt securities issued in the form of registered global certificates are issued within the new structure for the holding of international debt securities. By way of derogation, this provision does not apply to international debt securities issued in the form of registered global certificates before 1 October 2010. (c) International debt securities issued in the form of individual certificates are not eligible, unless they were issued in that form before 1 October 2010."

16. Article 67:
a) Paragraph 1 is replaced by the following text:
"1. In order to be eligible, debt securities are transferable by book entry and are held and settled in Member States whose currency is the euro by means of an account opened with an NCB or an eligible securities settlement system, so that registration formalities and the realisation of collateral are subject to the legislation of a Member State whose currency is the euro." b) Paragraph 1 bis is replaced by the following text:
"1 bis. Furthermore, when the use of this type of debt security entails triparty collateral management services, at national or cross-border level, these are provided by a triparty agent that has been assessed positively under the 'Eurosystem standards for the use of triparty agents (TPAs) in Eurosystem credit operations', published on the ECB website." c) Paragraph 2 is replaced by the following text:
"2. If the CSD in which the asset is issued and the CSD in which the asset is held are not identical, the securities settlement systems operated by these two CSDs must be linked by an eligible link in accordance with Article 150."

17. Article 69:
a) Paragraph 1 is replaced by the following text:
"1. In order to be eligible, debt securities are issued or guaranteed by the central banks of Member States, public sector entities, agencies, credit institutions, financial corporations other than credit institutions, non-financial corporations, multilateral development banks or international organisations. For marketable assets originating from more than one issuer, this requirement applies to each issuer." b) Paragraph 3 is replaced by the following text:
"3. Debt securities issued or guaranteed by investment funds are not eligible."

18. Article 70, paragraph 1 is replaced by the following text:
"1. In order to be eligible, debt securities are issued by an issuer established in the EEA or in a G10 country not belonging to the EEA, subject to the exceptions set out in this Article, paragraphs 3 to 6, and in Article 81 bis, paragraph 4. For marketable assets originating from more than one issuer, this requirement applies to each issuer."

19. Article 73, paragraph 1, point (b) is deleted;

20. Article 73, paragraph 6 is deleted;

21. Article 81 bis is replaced by the following text:
"Article 81 bis
Eligibility criteria for certain unsecured debt securities issued by credit institutions or investment firms, or by entities closely linked to them

1. By way of derogation from Article 64 and subject to meeting all other eligibility criteria, the following subordinated unsecured debt securities issued by credit institutions or investment firms, or by entities closely linked to them as referred to in Article 141(3), are eligible until their maturity, provided that they were issued before 31 December 2018 and that their subordination does not result from contractual subordination as defined in paragraph 2, nor from structural subordination as defined in paragraph 3:

• debt securities issued by recognised agencies as defined in Article 2 of ECB Decision (EU) No 2015/774 (ECB/2015/10)*,
• debt securities guaranteed by a Union public sector entity authorised to raise taxes by means of a guarantee meeting the characteristics set out in Article 114, paragraphs 1 to 4, and Article 115.

2. For the purposes of paragraph 1, contractual subordination means subordination arising from the contractual terms of an unsecured debt security, whether or not recognised by law.

3. Unsecured debt securities issued by holding companies, including intermediate holding companies, subject to national legislation transposing Directive 2014/59/EU or to similar resolution and recovery schemes, are not eligible.

4. The issuer is established in the Union for unsecured debt securities issued by credit institutions or investment firms, or by entities closely linked to them as referred to in Article 141(3), other than unsecured debt securities issued by multilateral development banks or international organisations referred to in Article 70(4).

5. Unsecured debt securities that were eligible before 16 April 2018 but do not meet the eligibility conditions set out in this Article remain eligible until 31 December 2018, provided that they meet all other eligibility criteria for marketable assets.

• Decision (EU) 2015/774 of the European Central Bank of 4 March 2015 on a secondary markets public sector asset purchase programme (ECB/2015/10) (OJ L 121, 14.5.2015, p. 20)."

22. Article 84, point (a), point (iii) is replaced by the following text:
    "(iii) In the absence of an ECAI rating for the issuance, or, in the case of covered bonds, in the absence of an issuance rating meeting the requirements of Annex IX ter, the Eurosystem may take"