Article 12
Derogation from certain measures to prevent settlement fails
1.
Articles 8 and 10 shall not apply where the securities settlement system operated by a CSD meets the following conditions:
(a)
the value of settlement fails does not exceed EUR 2,5 billion per year;
(b)
the rate of settlement fails, based either on the number of settlement instructions or on the value of settlement instructions, is lower than 0,5 % per year.
The rate of settlement fails based on the number of settlement instructions shall be calculated by dividing the number of settlement fails by the number of settlement instructions entered into the securities settlement system during the relevant period.
The rate of settlement fails based on the value of settlement instructions shall be calculated by dividing the value in EUR of settlement fails by the value of settlement instructions entered into the securities settlement system during the relevant period.
2.
By 20 January of each year, CSDs shall assess whether the conditions referred to in paragraph 1 are met and shall notify the competent authority of the results of that assessment in accordance with Annex II.
Where the assessment confirms that at least one of the conditions referred to in paragraph 1 no longer applies, CSDs shall apply Article 8 and Article 10 within one year from the date of the notification referred to in the first subparagraph.