Software & Information Industry Association ● Financial Information Services Division

Present

Michael Atkin (SIIA/FISD)
John Bottega (Merrill Lynch)
Armin Bories (Clearstream Banking/DESSUG)
Edward Casey (Royal Bank of Canada/ISITC)
David Ewings (Gartmore)
Anthony Kirby (Deutsche Borse)
Steve Kelly (Goldman Sachs
Bernd Matschke (Commerzbank/DESSUG)
Richard Robinson (Deutsche Bank)
Iman Szeto (Northern Trust)
John White (State Street Global Advisors)

Clarification of Requirements for Instrument Identification

The core of the discussion focused on clarification of the criteria for unique instrument identification (UII) and the differences between “place of listing,” and “place of trade.  This issue continues to create some confusion among marketplace participants and is the key to understanding the full dimensions of UII.

The core point is that “place of listing” is an aspect of the security and associated with the legal and regulatory process undertaken to list a security.  “Place of trade” is an aspect of trading conditions and relates to issues of liquidity associated with (some) pricing decisions and intra-day arbitrage opportunities.

The REDAC paper (authored by Richard Robinson) makes this clarification with a fair degree of precision.  The distinctions between place of listing and place of trade were well vetted and accepted by participants on the conference call.

Update to REDAC/RDUG UII Paper

Participants strongly recommended that we incorporate some of the clarifications from the REDAC paper into the core UII document – including the creation of a formal glossary of the terms used in describing the criteria of unique instrument identification as well as the addition of more examples.  REDAC agreed to help manage the process for updating the UII document.

Implications of UII/Best Practices Document

Once the distinctions between issuer, issue, place of listing and place of trade are understood -- the core question relates to how these distinctions will affect systems, processes and applications (including investment decisions, portfolio valuation and rebalancing, risk management, trading, mid office processing, back office and settlement processing, F/X, corporate action processing, accounting and regulatory reporting).

Understanding how OPOL will be used as well as the systems implications (cost) are absolutely essential.  Edward Casey (representing ISITC) agreed to coordinate this discussion with the objective of producing a market best practices document for industry-wide consideration. 

REDAC and RDUG members as well as the Securities Markets Practice Group will be fully involved the development of the best practices document.  The inquiry process is scheduled to begin in early January 2004.