The “Settlement Finality in Payment Systems and Securities Settlement Systems (Amendment) Law of 2011” and the “Financial Collateral Arrangements (Amendment) Law of 2011”.
The aim of this legislative package is to further promote transparency and legal certainty of transactions relating to securities, by harmonising Cyprus legislation with EU “Directive 2009/44/EC of the European Parliament and of the Council amending Directive 98/26/EC on settlement finality in payment and securities settlement systems and Directive 2002/47/EC on financial collateral arrangements as regards linked systems and credit claims”.
More specifically, The “Settlement Finality in Payment Systems and Securities Settlement Systems (Amendment) Law of 2011”, ensuring compliance with article 1 of the said EU Directive, amends the basic law [Law 8(I)/2003 as amended by Law 118(I)/2006] with regard to the following:
(a) The definition and the legal protection of interoperable systems, due to the impeding strengthening of their interoperability;
(b) The legal protection of night-time settlements, by clarifying that the term “business day” covers both day and night-time settlements and shall encompass all events happening during the business cycle of a system.
Furthermore, the “Financial Collateral Arrangements (Amendment) Law of 2011” harmonises the basic law [Law 43(I)/2004] with article 2 of the mentioned EU Directive, by extending the scope of the basic law, so as to cover “credit claims”, meaning pecuniary claims arising out of an agreement whereby a credit institution grants credit in the form of a loan.