Adoption of the SWIFT ISO 20022 standard for Corporate Actions

There is increasing desire to adopt the ISO 20022 message format in the field of Corporate Actions (CA). The Central Depositories that are members of the European Central Securities Depository Association (ECSDA) have indicated that they no longer wish to maintain the 15022 format for their participants beyond 2030. However, there is no visibility on the end of the use of the 15022 format by non-T2S players, given that the SWIFT Community as a whole has confirmed that it does not wish to set a deadline for discontinuing this format.

What is the ISO 20022 format?

The ISO 20022 message format makes it possible to benefit from the advantages of visual modelling language UML (Unified Modelling Language), of which XML (eXtensible Markup Language) is a part. XML makes it possible to define data in a structured way, facilitating the management and exchange of information on the Internet. The ISO 20022 format has been adopted for a number of years in various areas such as settlement and delivery and cash settlement in Europe.

In 2022, SWIFT decided that new messages will only be created in ISO 20022 format under the MX name.

Target2 Securities uses the ISO 20022 standard for its messages

For its part, the European Central Bank (ECB) has already imposed the XML format as the sole communication methodology (settlement, delivery and reporting) within the framework of T2S (Target2 Securities). In reality, the T2S format is currently a smaller version of ISO 20022, as not all possibilities in terms of data are available.

At the same time, in the area of payments, messages have switched to XML format as part of the T2-T2S merger project (March 2023). This format will be rolled out to more than 80 currencies by 2025.

ECB SCoRE rules recommend the use of the ISO 20022 format

In its desire to harmonise collateral management practices across Europe, the ECB has drawn up common standards for Europe (SCoRE Single Collateral management Rulebook for Europe), which recommend the adoption of standards for triparty collateral management, the processing of corporate actions and associated invoicing processes. SCoRE requires the use of the ISO 20022 format.

Exchanges with the new ECMS platform will use the ISO 20022 standard

In reality, SCoRE is setting the stage for the launch of the ECMS platform  (a priori in November 2024). The SCoRE standards have an impact both on participants in the ECB’s central collateral mobilisation platform and on all European collateral and securities players. The pace of adoption will therefore be set in Europe by the SCoRE rules imposed by the ECB and collateral players.

In Europe, corporate action messages are set to switch to the ISO 20022 standard.

As part of the ECMS project, the ECB issued a set of recommendations applicable to the CA processing process. One of these recommendations is the use of SWIFT ISO 20022 formats and the standardisation of the process applicable to different countries. This format will be adopted as soon as the ECMS is launched for all players communicating with this platform. Wider adoption is expected between November 2025, when custodians like SGSS are supposed to be able to offer this new format to any client requesting it, and November 2030, when European CSDs plan to stop maintaining the 15022 format in operation.  It should be noted that currently very few clients of custodians are requesting this new format.

How does SGSS support you?

SGSS has taken steps to move to this format, as it is aware that the impact on its clients will be significant. SGSS’s strategy is to offer its clients a parallel run period, to enable them to gradually migrate until messages in ISO 15022 format are discontinued. In addition to the significant operational technology aspect, supporting clients is a key aspect for SGSS.

Also discover our ISO 20022 focus sheet
Your usual relationship managers are available to assist you in this matter.

Pierre Colladon,
Senior Advisor Public Affairs and Regulation, Societe Generale Securities Services