Asset servicing - France
For the specific services on the French market, please refer to the Market Profile – France.
Please refer to the relevant CBL, CBF OneClearstream, or LuxCSD Client Handbook for information about processing, reporting and connectivity for asset servicing.
This section covers the following business processes:
- Event announcement and entitlement forecast;
- Decision management;
- Payment management;
- Transaction management;
- Proxy voting services.
Event announcement and entitlement forecast
Event announcements for French issued securities are created based on the information received from the asset servicing provider for this market (BNP Paribas S.A., Paris).
Event announcements are generated with both the Clearstream corporate action reference and the Corporate Action Official Reference (COAF) as applied on the market.
Event announcement for predictable events
The events BPUT, EXWA and CONV are handled as non-predictable events in the French market. They are notified as soon as announced by the French Issuer CSD (Euroclear France).
Predictable events (INTR, REDM, PCAL, PRED and DRAW) are usually announced as from PD-45 calendar days.
Event announcement for unpredictable events
Clearstream informs clients on an “as and if received” basis of unscheduled securities events occurring on account holdings, such as rights offers, reinvestment options, exchange offers, purchase offers, mergers etc.
French DVOP event
Event notifications will include gross and net (of the applicable/default tax rate) reinvestment options.
Payment of proceeds
Proceeds are calculated based on the positions recorded at the close of business on the record date and paid to the client's account upon successful receipt and reconciliation of funds. Proceeds will be paid with the value with which they are received based on the final MT566 received from the asset servicing provider.
The payment is reported via IPAR.
French Foreign Tax Credit (FTC)
FTC adjustment is made when part of the dividend paid by the French distributing company has been paid out of profits received from its foreign subsidiary. The amount of FTC adjustment is announced on or after the dividend date and added to the net dividend (gross basis) to determine the nonresident price. CAEV and CORP ID remain the same as the main dividend event whenever the FTC is announced, be it before or after the main dividend PD. Clearstream applies a gross/net FTC calculation at client account level and includes this information in the event notifications.
For further information about event announcements and entitlement forecast processing and reporting, please refer to the relevant Client Handbook and to Market asset servicing – France.
Decision management
Instructions for predictable events
Clients may instruct Clearstream to carry out options foreseen in the terms and conditions of the underlying type of security. These options include, but are not limited to, put options, conversions, exercises of warrants, exchanges, detachment of warrants etc.
Instructions for unpredictable events
Clearstream collects and processes client instructions for voluntary events, such as subscription offer, choice dividend, reinvestment option, exchange offer, purchase offer, merger with instruction etc. The most common voluntary event on the French market is the choice dividend.
For further information about decision management processing and reporting, please refer to the relevant Client Handbook.
French Optional Dividend (DVOP)
For a given DVOP option, client instructions must include the applicable tax rate and the Beneficial Owner (BO) breakdown. An instruction for option SECU and a separate instruction for option CASH with the applicable tax rate are required.
Capital increases
If a capital increase is oversubscribed, the following procedures shall apply:
Classic subscription via rights
Clients elect to receive new shares based on the ratio of the subscription versus a subscription cash amount and the exercise of the corresponding number of rights. These subscriptions are fully served.Oversubscription
Oversubscription allows holders of rights that have participated in the classic subscription to request additional shares (versus the subscription amount) above and beyond their rights entitlement, but without the assurance that these additional shares will be made available.
Clearstream requires that, for each of their oversubscription instructions per final beneficiary, clients specify the number of rights exercised in the classic subscription.
Payment management
Payment of proceeds
Proceeds are calculated based on the positions recorded at the close of business on the record date and paid to the client's account upon successful receipt and reconciliation of funds. Proceeds will be paid with the value with which they are received based on the final MT566 received from the asset servicing provider. The payment is reported via IPAR.
For French taxable securities, Clearstream acts as local withholding tax agent. Clearstream collects and processes all information from clients necessary to apply the adequate taxation. Cash distributions are received gross from the agent and are made net of the client's applicable withholding tax rate.
Fonds Communs de Créance (FCC)
Interest and redemption on FCC are paid in one single payment.
French DVOP payment
The DVOP payment is received gross from the market and Clearstream is responsible for the tax calculation and payment breakdown at client account level based on received BO details.
French Foreign Tax Credit (FTC)
Clearstream being a withholding tax agent calculates the entitled net amount and generates the FTC payment to the underlying clients via T2S.
For further information on the payment management processing and reporting, please refer to the relevant Client Handbook.
Transaction management
Please refer to Transaction Management in T2S.
Market claims and reverse market claims
For the French market rules for market claims and reverse market claims, please refer to Transaction management rules – France.
Clearstream detects and process the market claims and reverse market claims on against payment and free of payment instructions of its clients as of status matched, as follows:
Market claims and reverse market claims on CBL client transactions
Internal | Bridge | Domestic | |
Detection | Yes | Yes | Yes |
Compensation | Yes | No | Yes |
Market claims and reverse market claims on CBF OneClearstream client transactions
Intra-CSDa (CBF-CBF, CBF-CBL) | Cross-CSD (CBF – LuxCSD) | Cross-CSD (CBF – T2S counterparty) | |
Detection | Yes | Yes | Yes |
Compensation | Yesb | Yesb | Yesc |
a. Including Eurex Clearing and LION related trades (subject to specific rules).
b. Market claims and reverse market claims in non-T2S eligible currencies and securities are processed on the corresponding CBF-i or CBL account of the CBF clients.
c. Excluding non-T2S eligible currencies and securities.
Market claims and reverse market claims on LuxCSD client transactions
Intra-CSD (LuxCSD - LuxCSD, LuxCSD - CBL) | Cross-CSD (LuxCSD – CBF) | Cross-CSD (LuxCSD – T2S counterparty) | |
Detection | Yes | Yes | Yes |
Compensation | Yesa | Yesa | Yesb |
a. Market claims and reverse market claims in non-T2S eligible currency/securities are processed on the corresponding CBL accounts of the LuxCSD clients.
b. Excluding non-T2S eligible currencies and securities.
Both market claims instructions, in cash and in securities, are processed via matching settlement instructions generated on behalf of client accounts, flagged as follows:
ICP clients MT54x | DCP clients sese.023/sese.025 | |
Market claim and reverse market claim instruction | :22F::SETR//CLAI | Transaction code: CLAI |
Detected market claims are reported to clients in the Custody Market Claims report and via Claim and Reversal Advice.
Debits/credits resulting from market claims and reverse market claims compensations are reported in the Custody Market Claims report and via Claim and Reversal Advice.
The market claims and reverse market claims are visible in Xact Web Portal.
For further information on the processing and reporting, please refer to the relevant Client Handbook.
Transformations
For the French market rules for transformations, please refer to Transaction management rules – France.
Clearstream detects and process the transformations on pending matched against payment and free of payment instructions of its clients, as follows:
Transformations on CBL client transactions
Internal | Bridge | Domestic | |
Detection | Yes | Yes | Yes |
Cancellation | Yes | Yes | Yes |
Re-instruction | Yes | No | Yes |
Transformations on CBF OneClearstream client transactions
Intra-CSDa (CBF-CBF, CBF-CBL) | Cross-CSD (CBF – LuxCSD) | Cross-CSD (CBF – T2S counterparty) | |
Detection | Yes | Yes | Yes |
Cancellation | Yes | Yes | Yes |
Re-instruction | Yesb | Yesb | Yesc |
a. Including LION related trades (subject to specific rules).
b. Re-instructions in non-T2S eligible currency/securities are processed on the corresponding CBF-i/CBL accounts of the CBF clients.
c. Re-instructions in non-T2S eligible currency/securities.
Transformations on LuxCSD client transactions
Intra-CSD (LuxCSD - LuxCSD, LuxCSD - CBL) | Cross-CSD (LuxCSD – CBF) | Cross-CSD (LuxCSD – T2S counterparty) | |
Detection | Yes | Yes | Yes |
Cancellation | Yes | Yes | Yes |
Re-instruction | Yesa | Yesa | Yesb |
a. Re-instructions in non-T2S eligible currency/securities are processed on the corresponding CBL accounts of the LuxCSD clients.
b. Re-instructions in non-T2S eligible currency/securities.
Both re-instructions, in cash and in securities, are processed via matching settlement instructions generated on behalf of client accounts, flagged as follows.
ICP clients MT54x | DCP clients sese.023/sese.025 | |
Re-instructions in securities | :22F::SETR//as in the underlying instruction :22F:STCO//TRAN | Transaction code: as in the underlying instruction Transaction condition: TRAN |
Re-instructions in cash | :22F::SETR//CORP :22F::STCO//TRAN | Transaction code: CORP Transaction condition: TRAN |
Transformations are subject to settlement reporting.
For further information on the processing and reporting, please refer to the relevant Client Handbook.
Buyer protection
For the French market rules for buyer protection, please refer to Transaction management rules – France.
Clearstream does not introduce an automated buyer protection infrastructure. Instead buyer protection will be handled bilaterally between the counterparties, that is, outside the CSD environment.
In order to comply with the Corporate Actions standards on manual buyer protection, clients must use the Corporate Actions Joint Working Group (CAJWG) Buyer protection invocation template for corporate actions if the requested option is not the default option, referencing the corporate action, the chosen option(s), the quantity of securities and the underlying transaction in the template. The template must be sent electronically (via fax or email) to the seller.
When provided on the market, the below key buyer protection dates will be included in Clearstream MT564 Corporate Action Notifications:
- Election to counterparty deadline;
- Guaranteed participation date.
For further information on the processing and reporting, please refer to the relevant Client Handbook.
Proxy Voting procedures
Proxy voting services are available in Clearstream for this market.
All proxy voting instructions must include the beneficial owner details.
If the beneficial owner is a legal person, the following information must be provided:
- Name
- Country of incorporation
- Legal Entity Identifier (LEI)
If the beneficial owner is a natural person, the following information must be provided:
- First name
- Last Name
- Country of residence
- Identification Type
- Identification number
Note: Type of national identification is dependent on the country of residence of the beneficial owner. The list of acceptable national identification types can be found here.
For details on the proxy voting services offered by Clearstream, please refer to the relevant Client Handbook.