The UK Accelerated Settlement Taskforce Technical Group (AST) published its final report and set of recommendations for transitioning to T+1 in the UK on 6 February 2025.
The report includes a UK T+1 Code of Conduct (UK-TCC) that contains the scope of instruments that will be subject to T+1 settlement, a timetable of recommended actions starting from June 2025, and a series of expected behaviours by market participants.
The final report follows an earlier interim report and initial set of recommendations as set out in the Geffen Report.
Timing and scope
The recommended date for adopting T+1 in the UK is 11 October 2027, to achieve alignment with EU and Swiss markets. Legislative change will be achieved via a statutory instrument amending the UK Central Securities Depositories Regulation (CSDR).
Instruments currently in scope of UK CSDR (transferable securities that are both traded on a UK trading venue and settled at a UK CSD) will be in scope for T+1 settlement. The existing exemptions from UK CSDR will therefore remain in place. The AST recommends that activity not captured by UK CSDR also adapts to T+1 settlement at the same time (e.g. transactions conducted over-the-counter or via Systematic Internalisers). Securities financing transactions are recommended to be explicitly exempted from scope. The AST notes there is a question mark over the treatment of cash-settled derivatives, and has committed to working with the derivatives industry to consider the application of T+1 to exchange-traded and OTC traded derivatives.
Recommended actions
The UK-TCC sets out 12 critical actions that must be implemented by all market participants, as well as 26 highly recommended actions.
The critical actions are:
HMT amendment of UK CSDR, by October 2027.
Trading venues to amend their rulebooks, by October 2027.
Market participants to comply with T+1 with respect to in-scope instruments and transactions, by October 2027.
Allocation and confirmation processes to be completed by end of T0 at the latest, via automated processes, whether on an electronic trade matching platform or otherwise, by end 2026. The AST also notes that market participants should consider moving processes to real-time, optimising the timeliness of data exchanges between parties and increasing the frequency or elimination of batch processing.
Settlement instructions to be sent to CSDs by 6am on T+1, by October 2027.
Market participants to put in place policies and procedures to ensure compliance with T+1, by end 2026.
Financial market infrastructures (FMIs) to review existing procedures and operating systems to remove any potential barriers to T+1, by end 2025.
FMIs to communicate any proposed updates to members, by end 2026.
Euroclear International to publish its CREST modernisation programme schedule, avoiding any major platform changes immediately before or after the T+1 transition date, by June 2025. CREST opening hours will be extended to 9pm allowing for instructions to be submitted on T0 up until that time.
Market participants to implement the Core Principles and templates contained in the Financial Markets Standard Board’s (FMSB) Standard for Sharing of Standard Settlement Instructions (SSIs), by end 2026.
Market participants to automate lending recall processes, according to industry best practice, by end 2026.
Market participants adhere to industry best practices regarding recall cut off times and return deadlines, by October 2027.
The UK-TCC also establishes five expected behaviours needed to achieve a smooth and efficient transition to T+1. These are commitments to compliance, automation, ‘action this day’, settlement discipline, and readiness for testing. The AST notes that responsibility for implementing these behaviours lies with senior management, who should set the correct ‘tone from the top’.
The AST also identifies a number of longer-term market practice changes that would support the smooth and efficient transition to T+1, but that are out of scope of the specific recommendations. These include establishment of an equities consolidated tape, greater adoption of after hours trading and digital identities, and changes to UK domiciled mutual funds’ settlement cycles.
Begin preparing for T+1 early to realise its full benefits.
Review current processes and operating systems against the UK-TCC to identify any barriers to implementation.
Develop processes to embed the expected behaviours and market practices within ‘business as usual’.
The benefits of T+1 settlement are expected to include reduced collateral requirements, improved reaction times to market events, and reduced frictions and potential barriers to the growth and competitiveness of UK markets. T+1 in the UK will also ensure harmonisation with other global markets, and alignment between the settlement cycles for securities with UK gilts.
The AST identifies actions market participants, including FMIs, should take in 2025, 2026 and 2027.
Specifically, the AST encourages market participants to begin preparing for T+1 as soon as possible, and to adopt the processes, systems and controls needed to settle on a T+1 basis earlier than the transition date where possible. The AST also recommends that market participants should establish project management arrangements and secure funding in 2025 for the system enhancements that will be needed for T+1.
As a starting point, all market participants involved in the trading, clearing and settling of in-scope instruments should review their current processes and operating systems against the UK-TCC to identify gaps and any potential barriers to implementation.
This includes reviewing all bilateral agreements with counterparties and relevant third-parties/vendors, for activities supporting in-scope transactions for T+1 (in particular service level agreement timings and deadlines).
Market participants will also need to enhance their control frameworks to take account of the individual nature of each transaction to determine whether it is in scope of T+1 or not.
Firms should consider the processes they will need to fully embed the expected behaviours, procedures and market practices, including through staff training and education and compliance and/or internal audit reviews. Firms are encouraged to implement automated solutions wherever possible, and ensure they have adequate resources to ensure transactions can be settled in a timely manner.
Firms should also be prepared to discuss their preparedness and alignment with the UK-TCC with their supervisory teams (e.g. from the FCA, Bank of England and PRA).
The UK AST will continue to monitor and oversee market developments and preparations for T+1, amending the UK-TCC if needed, and consider testing approaches and arrangements. It will develop and publish a Playbook by the end of June 2026 for market participants to use as they prepare for T+1.
The AST will also work with industry bodies to develop market practices in support of T+1, covering issues such as functionality, custodianship and debt issuance.
The Accelerated Settlement Taskforce Technical Group’s draft recommendations underline the collective effort needed for the UK to achieve a successful transition to T+1 settlement. Read PwC’s summary of the groups’ recommended measures market participants and regulators will need to implement.
PwC’s analysis of the impact of shorter settlement cycles on market participants, and summary of UK and EU T+1 publications.
