Changes to the handling of the corporate actions requiring payment of exercise price


LuxCSD1 informs customers of the changes to the handling of corporate actions requiring payment of exercise price that become effective on  

18 May 2020

The change will be implemented in order for LuxCSD to comply with requirements of the Commission Delegated Regulation (EU) 2017/390 of 11 November 2016 supplementing Regulation (EU) No 909/2014 of the European Parliament and of the Council with regard to regulatory technical standards on certain prudential requirements for central securities depositories and designated credit institutions offering banking-type ancillary services.

For corporate actions events requiring payment of exercise price and in line with Article 18 of LuxCSD General Terms and Conditions, customers who have given their instruction to exercise should ensure their account is sufficiently provisioned on the payment date to settle the Payment Free of Delivery (PFOD) generated on their account by LuxCSD.

Impacted corporate action events include, but are not limited to, priority issue, warrant exercise and exercise of rights.

The unsuccessful cash provisioning of the account on the payment date will lead to:

  • daily penalties fee for a late cash provisioning;
  • a delay in securities distribution and other actions as per Article 32 of LuxCSD General Terms and Conditions.

Customers are, and remain, liable for such payment or payment default in these circumstances. Further details about the penalty fees will be published at a later stage.

To facilitate proper handling of the impacted corporate action events by customers, the following enhancements will be implemented to the current reporting: 

  • The MT564 Corporate Action Notification will include a narrative reminding customers of a timely cash provisioning of the account on the payment date;
  • In the case of insufficient cash provisioning of the account on payment date, customers will receive an MT567 Corporate Action Instruction Status Advice with a status IPRC//PEND and a new reason code PEND//MONY, as well as standard settlement reporting;
  • Immediate action is required to fund the account. The credit of securities proceeds will be dependent on the settlement of the PFOD instruction.

Failed PFOD instructions will be recycled until the account is successfully provisioned as per Article 18 of LuxCSD General Terms and Conditions or until the instruction is cancelled by LuxCSD in accordance with LuxCSD Customer Handbook.

There will be no other changes to the processing and reporting of these corporate action events and instructions.  

Further information

For further information, customers may contact Client Services or their Relationship Officer.


1. LuxCSD refers to LuxCSD, société anonyme registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, Luxembourg, registered with the Trade and Company Register of Luxembourg, under number B. 154 449.