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30.1.2013 Official
Journal
of
the
European
Union
L
30/1
II
(Non-legislative acts)
GUIDELINES
GUIDELINE OF THE EUROPEAN CENTRAL BANK
of 5 December 2012
on a Trans-European Automated Real-time Gross settlement Express Transfer system (TARGET2)
(recast)
(ECB/2012/27)
(2013/47/EU)
THE GOVERNING COUNCIL OF THE EUROPEAN CENTRAL BANK,
where the TARGET2 component systems are harmonised
to the greatest extent possible, with certain exceptions in
the event of national law constraints.
Having regard to the Treaty on the Functioning of the European
Union, and in particular the first and fourth indents of
Article 127(2) thereof,
(4) There
are
three
separate
levels
of
governance
for
TARGET2. Level 1 (Governing Council) has final
competence in relation to TARGET2 and safeguards its
Having regard to the Statute of the European System of Central
public function. Level 2 (Eurosystem central banks) has
Banks and of the European Central Bank, and in particular
subsidiary competence for TARGET2, while Level 3 (SSP-
Article 3.1 and Articles 17, 18 and 22 thereof,
providing NCBs) builds and operates the SSP for the
Eurosystem’s benefit.
Whereas:
(5)
Acting on the Eurosystem’s behalf, the European Central
Bank (ECB) enters into a Framework Agreement, as well
as a Confidentiality and Non-Disclosure Agreement, with
(1) Guideline
ECB/2007/2
of
26
April
2007
on
a
Trans-
European Automated Real-time Gross settlement
the network service provider designated by the
Express Transfer system (TARGET2)
(
Governing Council, which sets out the main elements

1 ) has been
amended on several occasions. Since further amendments
relating to network provision to the participants,
to this Guideline are now required to incorporate
including pricing.
material previously internal to the Eurosystem and to
add necessary definitions, as well as provisions with
regard to inapplicability of sanctions to non-Union
(6)
TARGET2 is essential for the performance of certain
banks, information sharing with regard to suspension
basic Eurosystem tasks, i.e. implementing the Union’s
or termination of access to monetary policy operations
monetary policy and promoting the smooth operation
and the consequences of such suspension or termination,
of payment systems,
it should be recast in the interests of clarity and trans
parency.
HAS ADOPTED THIS GUIDELINE:
(2) TARGET2
has
a
decentralised
structure
linking
together
national real-time gross settlement (RTGS) systems and
the ECB Payment Mechanism.
SECTION I
GENERAL PROVISIONS
(3) TARGET2
is
characterised
by
a
single
technical
platform
Article 1
called the Single Shared Platform (SSP). TARGET2 is
legally structured as a multiplicity of payment systems,
Subject matter and scope
1. TARGET2
provides
RTGS
for
payments
in
euro,
with
( 1 ) OJ L 237, 8.9.2007, p. 1.
settlement in central bank money. It is established and

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functions on the basis of the SSP through which all payment
(11) ‘Business Identifier Code (BIC)’ means a code as defined by
orders are submitted and processed and through which
ISO Standard No 9362;
payments are ultimately received in the same technical manner.
2. TARGET2
is
legally
structured
as
a
multiplicity
of
RTGS (12) ‘addressable BIC holder’ means an entity which:
systems.
(a) holds a BIC;
Article 2
Definitions
(b) is not recognised as an indirect participant;
For the purposes of this Guideline:
(1) ‘Single Shared Platform (SSP)’ means the single technical
(c) is a correspondent or customer of a direct participant
platform infrastructure provided by the SSP-providing
or a branch of a direct or indirect participant, and is
NCBs;
able to submit payment orders to and receive
payments from a TARGET2 component system via
the direct participant;
(2) ‘TARGET2 component system’ means any of the Euro
system CBs’ RTGS systems that form part of TARGET2;
(13) ‘indirect participant’ means a credit institution established
in the European Economic Area (EEA), which has entered
(3) ‘central bank (CB)’ means a Eurosystem CB and/or a
into an agreement with a direct participant to submit
connected NCB;
payment orders and receive payments via such direct
participant’s PM account, and which has been recognised
by a TARGET2 component system as an indirect
(4) ‘SSP-providing NCBs’ means the Deutsche Bundesbank, the
participant;
Banque de France and the Banca d’Italia in their capacity as
the CBs building and operating the SSP for the Euro
system’s benefit;
(14) ‘branch’ means a branch within the meaning of Article 4(3)
of Directive 2006/48/EC of the European Parliament and
(5) ‘network service provider’ means the provider of
of the Council of 14 June 2006 relating to the taking up
computerised network connections for the purpose of
and pursuit of the business of credit institutions ( 1 ), as
submitting payment messages in TARGET2;
implemented in national law;
(6) ‘participant’ or ‘direct participant’ means an entity that
(15) ‘business day’ means any day on which TARGET2 is open
holds at least one PM account with a Eurosystem CB;
for the settlement of payment orders, as set out in
Appendix V to Annex II;
(7) ‘Eurosystem CB’ means the ECB or a euro area NCB;
(16) ‘certification authorities’ means one or more NCBs
(8) ‘Payments Module (PM)’ means an SSP module in which
designated as such by the Governing Council to act on
payments of TARGET2 participants are settled on PM
behalf of the Eurosystem to issue, manage, revoke and
accounts;
renew electronic certificates;
(9) ‘PM account’ means an account held by a TARGET2
(17) ‘electronic certificates’ or ‘certificates’ means an electronic
participant in the PM with a Eurosystem CB which is
file, issued by the certification authorities, that binds a
necessary for such TARGET2 participant to:
public key with an identity and which is used for the
following: to verify that a public key belongs to an indi
vidual; to authenticate the holder; to check a signature
(a) submit payment orders or receive payments via
from this individual; or to encrypt a message addressed
TARGET2; and
to this individual. Certificates are held on a physical device
such as a smart card or USB stick, and references to
certificates include such physical devices. The certificates
(b) settle such payments with such Eurosystem CB;
are instrumental in the authentication process of the
participants accessing TARGET2 through the internet and
submitting payment messages or control messages;
(10) ‘euro area NCB’ means the national central bank (NCB) of
a Member State whose currency is the euro;
( 1 ) OJ L 177, 30.6.2006, p. 1.

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(18) ‘certificate holder’ means a named, individual person,
(29) ‘marginal lending facility’ means a Eurosystem standing
identified and designated by a TARGET2 participant as
facility which counterparties may use to receive
authorised to have internet-based access to the partici
overnight credit from an NCB at the pre-specified
pant’s TARGET2 account. Their application for certificates
marginal lending rate;
will have been verified by the participant’s home NCB and
transmitted to the certification authorities, which will in
turn have delivered certificates binding the public key with
(30) ‘settlement bank’ means a participant whose PM account
the credentials that identify the participant;
or sub-account is used to settle payment instructions
submitted by an ancillary system via the ASI;
(19) ‘connected NCB’ means an NCB, other than a euro area
NCB, which is connected to TARGET2 pursuant to a
(31) ‘ancillary system’ means a system managed by an entity
specific agreement;
established in the EEA that is subject to supervision and/or
oversight by a competent authority and complies with the
oversight requirements for the location of infrastructures
offering services in euro, as amended from time to time
(20) ‘AL group’ means a group composed of aggregated
and published on the ECB’s website ( 1 ), in which payments
liquidity (AL) group members that use the AL mode;
and/or financial instruments are exchanged and/or cleared
while the resulting monetary obligations are settled in
TARGET2 in accordance with this Guideline and a
bilateral arrangement between the ancillary system and
(21) ‘AL group member’ means a TARGET2 participant that
the relevant Eurosystem CB;
fulfils the criteria for using the AL mode and which has
entered into an AL agreement;
(32) ‘Ancillary System Interface (ASI)’ means the technical
device allowing an ancillary system to use a range of
(22) ‘AL agreement’ means the multilateral aggregated liquidity
special, predefined services for the submission and
agreement entered into by the AL group members and
settlement of ancillary system payment instructions; it
their respective AL NCBs, for the purposes of the AL
may also be used by a euro area NCB for the settlement
mode;
of cash operations resulting from cash deposits and with
drawals;
(23) ‘AL NCB’ means a euro area NCB that is party to an AL
agreement and acts as the counterparty for the AL group
(33) ‘payer’ means a TARGET2 participant whose PM account
members which participate in its TARGET2 component
will be debited as a result of a payment order being settled;
system;
(34) ‘payee’ means a TARGET2 participant whose PM account
will be credited as a result of a payment order being
(24) ‘AL mode’ means the aggregation of available liquidity on
settled;
PM accounts;
(35) ‘Harmonised Conditions’ means the conditions laid down
(25) ‘available liquidity’ means a credit balance on a TARGET2
in Annexes II and V;
participant’s PM account and, if applicable, any intraday
credit line granted by the relevant Eurosystem CB in
relation to such account;
(36) ‘core TARGET2 services’ means the processing of payment
orders in TARGET2 component systems, the settlement of
ancillary system-related transactions, and liquidity pooling
features;
(26) ‘intraday credit’ means credit extended for a period of less
than one business day;
( 1 ) The Eurosystem’s current policy for the location of infrastructure is
set out in the following statements, which are all available on the
ECB’s website at www.ecb.europa.eu: (a) the Policy statement on
euro payment and settlement systems located outside the euro
(27) ‘AL group manager’ means an AL group member
area of 3 November 1998; (b) The Eurosystem’s policy line with
appointed by the other AL group members to manage
regard to consolidation in central counterparty clearing of
available liquidity within the AL group during the
27 September 2001; (c) The Eurosystem policy principles on the
business day;
location and operation of infrastructures settling in euro-
denominated payment transactions of 19 July 2007; (d) The Euro
system policy principles on the location and operation of infra
structures settling euro-denominated payment transactions: specifi
cation of ‘legally and operationally located in the euro area’ of
(28) ‘marginal lending rate’ means the interest rate applicable to
20 November 2008; (e) The Eurosystem oversight policy
the marginal lending facility;
framework of July 2011.

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(37) ‘Home Account’ means an account opened outside the PM
(44) ‘Information and Control Module (ICM)’ means the SSP
by a euro area NCB for an entity that is eligible to become
module that allows participants to obtain on-line
an indirect participant;
information and gives them the possibility to submit
liquidity transfer orders, manage liquidity and initiate
backup payment orders in contingency situations;
(38) ‘transition period’ means, in respect of each Eurosystem
CB, the period of four years starting from the moment
the Eurosystem CB migrates to the SSP, unless otherwise
(45) ‘TARGET2 coordinator’ means a person appointed by the
decided by the Governing Council with respect to specific
ECB to ensure the daily operational management of
features or services on a case-by-case basis;
TARGET2, to manage and coordinate activity in the
event of an abnormal situation occurring and to co
ordinate the dissemination of information to participants;
(39) ‘managing NCB’ means the AL NCB of the TARGET2
component system in which the AL group manager
participates;
(46) ‘TARGET2 settlement manager’ means a person appointed
by a Eurosystem CB to monitor the operation of its
TARGET2 component system;
(40) ‘enforcement event’ means, with regard to an AL group
member, any of the following:
(47) ‘TARGET2 crisis manager’ means a person appointed by a
Eurosystem CB to handle, on behalf of that Eurosystem
CB, failures of the SSP and/or abnormal external events;
(a) any event of default referred to in Article 34(1) of
Annex II;
(48) ‘technical malfunction of TARGET2’ means any difficulty,
defect or failure in the technical infrastructure and/or the
(b) any other event of default or event referred to in
computer systems of the SSP or the network connections
Article 34(2) of Annex II in relation to which the
relating to the SSP, or any other event that makes it
CB has decided, taking into account the seriousness
impossible to execute and complete the same-day
of the event of default or event, that a pledge should
processing of payments in the relevant TARGET2
be enforced in accordance with Article 25b of that
component system;
Annex, collateral should be enforced in accordance
with Article 25c of that Annex or a set-off of claims
should be triggered in accordance with Article 26 of
(49) ‘non-settled payment order’ means a payment order that is
that Annex;
not settled on the same business day as that on which it is
accepted;
(c) any decision to suspend or terminate access to
intraday credit;
(50) ‘cross-system settlement’ means the real-time settlement of
debit instructions under which payments are executed
from a settlement bank of one ancillary system using
settlement procedure 6 to a settlement bank of another
(41) ‘Participant Interface (PI)’ means the technical device
ancillary system using settlement procedure 6 as set out in
allowing direct participants to submit and settle payment
Annex IV;
orders via the services offered in the PM;
(51) ‘cash settlement’ means settlement of banknotes and coins.
(42) ‘Internet-based access’ means that the participant has opted
for a PM account that can only be accessed via the internet
and the participant submits payment messages or control
messages to TARGET2 by means of the internet;
Article 3
TARGET2 component systems
1. Each
Eurosystem
CB
shall
operate
its
own
TARGET2
(43) ‘insolvency proceedings’ means insolvency proceedings
component system.
within the meaning of Article 2(j) of Directive 98/26/EC
of the European Parliament and of the Council of 19 May
1998 on settlement finality in payment and securities
settlement systems ( 1 );
2. Each
TARGET2
component
system
shall
be
a
system
designated as such under the relevant national legislation imple
( 1 ) OJ L 166, 11.6.1998, p. 45.
menting Directive 98/26/EC.

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3. The
names
of
the
TARGET2
component
systems
shall Central Bank (hereinafter the ‘Statute of the ESCB’), the
only include ‘TARGET2’ and the name or abbreviation of the
management of TARGET2 shall be based on a three-level
relevant Eurosystem CB or of the Member State of such Euro
governance scheme. The tasks assigned to the Governing
system CB. The ECB’s TARGET2 component system shall be
Council (Level 1), the Eurosystem CBs (Level 2) and the SSP-
called TARGET2-ECB.
providing NCBs (Level 3) are laid down in Annex I.
Article 4
Connection of NCBs of Member States whose currency is
2. The
Governing
Council
shall
be
responsible
for
the
not the euro
direction, management and control of TARGET2. The tasks
assigned to Level 1 fall within the exclusive competence of
The NCBs of Member States whose currency is not the euro
the Governing Council. The ESCB’s Payment and Settlement
may only connect to TARGET2 if they conclude an agreement
Systems Committee (PSSC) shall assist the Governing Council
with the Eurosystem CBs. Such agreement shall specify that the
as an advisory body in all matters relating to TARGET2.
connected NCBs will comply with this Guideline, subject to any
mutually agreed appropriate specifications and modifications.
3. In
accordance
with
the
third
paragraph
of
Article
12.1
of
Article 5
the Statute of the ESCB, the Eurosystem CBs shall be
responsible for the tasks assigned to Level 2, within the
Intra-ESCB transactions
general framework defined by the Governing Council. In
Intra-European System of Central Banks (ESCB) transactions
addition to its advisory role, the PSSC shall conduct the
shall be processed through TARGET2, with the exception of
execution of the tasks assigned to Level 2. The connected
payments that the CBs bilaterally or multilaterally agree to
NCBs shall participate without voting rights on Level 2-related
process through correspondent accounts, where appropriate.
issues. Member States’ NCBs that are neither Eurosystem CBs
nor connected NCBs shall have observer status only at Level 2.
Article 6
Intra-Eurosystem settlement
4. The
Eurosystem
CBs
organise
themselves
through
the
1. Any
settlement
of
payments
between
participants
in conclusion of appropriate agreements. Within the context of
different TARGET2 component systems shall automatically
such agreements, decision-making shall be based on a simple
give rise to an intra-Eurosystem obligation of the Eurosystem
majority, and each Eurosystem CB shall have one vote.
CB of the payer towards the Eurosystem CB of the payee.
2. Any
intra-Eurosystem
obligation
arising
under
paragraph 5. In
accordance
with
the
third
paragraph
of
Article
12.1
of
1 shall automatically be aggregated and form part of a single
the Statute of the ESCB, the SSP-providing NCBs shall be
obligation in relation to each Eurosystem CB. Each time a
responsible for the tasks assigned to Level 3, within the
payment between participants in different TARGET2
general framework defined by the Governing Council.
component systems is settled, the single obligation of the
relevant Eurosystem CB shall be adjusted accordingly. At the
end of the business day each such single obligation shall be
subject to a multilateral netting procedure resulting in each
6.
The SSP-providing NCBs shall conclude an agreement with
euro area NCB’s obligation or claim towards the ECB, as set
the Eurosystem CBs governing the services to be provided by
out in an agreement between the Eurosystem CBs.
the former to the latter. Such agreement shall also include,
where appropriate, the connected NCBs.
3. Each
euro
area
NCB
shall
maintain
an
account
to
record
its obligation or claim towards the ECB, resulting from the
settlement of payments between TARGET2 component systems.
SECTION III
OPERATION OF TARGET2
4. The
ECB
shall
open
on
its
books
an
account
for
each
euro
Article 8
area NCB in order to mirror at the end of the day such euro
area NCB’s obligation or claim towards the ECB.
Harmonised Conditions for participation in TARGET2
1. Each
euro
area
NCB
shall
adopt
arrangements
imple
menting the Harmonised Conditions. These arrangements shall
SECTION II
exclusively govern the relationship between the relevant euro
GOVERNANCE
area NCB and its participants in respect of the processing of
payments in the PM. A PM account can be accessed using either
Article 7
internet-based access or via the network service provider. These
Governance levels
two methods of accessing a PM account shall be mutually
exclusive, although a participant may choose to have one or
1. Without
prejudice
to
Article
8
of
the
Statute
of
the more PM accounts, each of which will be accessible by either
European System of Central Banks and of the European
the internet or the network service provider.

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2. The
ECB
shall
adopt
the
terms
and
conditions
of
(ii) operations relating to minimum reserve management
TARGET2-ECB by implementing Annex II except that
and standing facilities;
TARGET2-ECB shall only provide services to clearing and
settlement organisations, including entities established outside
the EEA, provided that they are subject to oversight by a
competent authority and their access to TARGET2-ECB has
(iii) cash transactions settled on Home Accounts.
been approved by the Governing Council.
2. For
ancillary
system-related
transactions
settled
on
Home
3. The
arrangements
adopted
by
the
Eurosystem
CBs
imple
Accounts during the transition period the following shall be
menting the Harmonised Conditions shall be made public.
charged: Fixed Fee I, Fixed Fee II and a transaction fee higher
than the ancillary system transaction fee specified in paragraph
18(1) of Annex IV. The Eurosystem CBs may apply other
pricing schemes for ancillary system-related transactions
4. The
Eurosystem
CBs
may
request
derogations
from
the settled on Home Accounts during the transition period,
Harmonised Conditions on the basis of national law constraints.
provided that the revenues are the same as or higher than
The Governing Council shall consider such requests on a case-
revenues that would be received if the Eurosystem CB were to
by-case basis and shall grant derogations where appropriate.
apply the scheme referred to in the first sentence of this para
graph.
5. Subject to the relevant monetary agreement, the ECB may
determine appropriate conditions for participation in TARGET2
Article 10
of entities referred to in Article 4(2)(e) of Annex II.
Liquidity pooling arrangements
1. The
AL
NCBs
shall
exchange
all
information
that
is
6. The
Eurosystem
CBs
shall
not
allow
any
entity
to
be
an necessary for the performance of their duties and obligations
indirect participant or to be registered as an addressable BIC
under an AL agreement. The AL NCBs shall immediately notify
holder in their TARGET2 component system if this entity acts
the managing NCB of any enforcement event of which they
via a direct participant that is an NCB of a Member State but is
become aware relating to the AL group or any AL group
neither a Eurosystem CB nor a connected NCB.
member, including the head office and branches thereof.
Article 9
2. When the managing NCB is notified that an enforcement
Pricing
event has occurred it shall, having regard to the AL agreement,
instruct the relevant AL NCBs regarding the enforcement action
1. The
Eurosystem
CBs
shall
ensure
that:
to be taken in relation to the AL group or the relevant AL
group member. The AL NCBs shall be responsible for
enforcing their rights under the AL agreement and the
(a) the fees for core TARGET2 services provided to their
arrangements implementing Annex II. The managing NCB
indirect participants and their addressable BIC holders that
shall be responsible for calculating and giving instructions in
are eligible to participate in TARGET2 as indirect
relation to the apportionment of claims.
participants are higher than the fees for direct participants
specified in paragraph 1(a) of Appendix VI to Annex II;
3. If,
on
the
occurrence
of
an
enforcement
event,
intraday
credit provided to any AL group member has not been fully
(b) the fees for payments between credit institutions established
reimbursed, an AL NCB shall, on receiving instructions from the
in the EEA settled on Home Accounts are higher than the
managing NCB, enforce the rights it may have in relation to its
fees for direct participants specified in paragraph 1(a) of
respective AL group members, including rights deriving from
Appendix VI to Annex II;
the relevant pledge, set-off, close-out netting or any other
relevant provision in the arrangements implementing Annex
II, in order to obtain full and timely discharge of the claims
that such AL NCB may have against its respective AL group
(c) payments in relation to open market operations settled on a
members under the AL agreement. Such claims shall be
Home Account shall be charged in accordance with
enforced before the enforcement of any other claims of the
Appendix VI to Annex II;
relevant AL NCB towards its respective AL group members.
(d) the pricing for all of the following operations and trans
4. Any
payments
received
in
discharge
of
a
claim
under
the
actions is outside the scope of the fee schedule laid down in
AL agreement following enforcement action shall be forwarded
Appendix VI to Annex II:
to the AL NCBs that have extended intraday credit to the
respective AL group members. Such payments shall be
allocated to the AL NCBs in proportion to the amount of
(i) liquidity transfers initiated from and processed within
intraday credit that is not reimbursed by the AL group
Home Accounts;
members to their respective AL NCBs.

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5. Any AL NCB that wishes to claim it has incurred loss that
— the operating schedule in Appendix V,
should be borne by all AL NCBs shall send a submission to the
managing NCB setting out the grounds for the claim. The
managing NCB shall forward such request to the relevant AL
— Article 11 (requirements for cooperation and information
NCBs and shall calculate the compensation due from each such
exchange), except paragraph 8,
AL NCB in equal shares.
Article 11
— Articles 27 and 28 (business continuity and contingency
procedures and security requirements),
Guarantee Fund Accounts and Remuneration
1. To the extent that a central counterparty (CCP) is required
by regulation, including on oversight grounds, to hold a
— Article 31 (liability regime),
Guarantee Fund Account, funds held on such an account of a
CCP shall be remunerated at the main refinancing operations
rate minus 15 basis points.
— Article 32 (evidence rules),
2. Funds
otherwise
credited
to
a
Guarantee
Fund
Account
of — Articles 33 and 34 (duration, termination and suspension of
a CCP shall be remunerated at the deposit rate.
participation), except Article 34(1)(b),
Article 12
— Article 35, where relevant (closure of PM accounts),
Intraday credit
1. The
euro
area
NCBs
may
grant
intraday
credit,
provided
that this is done in accordance with the arrangements imple
— Article 38 (confidentiality rules),
menting the rules on the provision of intraday credit laid down
in Annex III. No intraday-credit shall be granted to a participant
whose eligibility as a counterparty for Eurosystem monetary
— Article 39 (Union requirements for data protection,
policy operations has been suspended or terminated.
prevention of money laundering and related issues),
2. The
eligibility
criteria
for
intraday
credit
of
ECB
counter
— Article 40 (requirements for notices),
parties are defined in Decision ECB/2007/7 of 24 July 2007
concerning the terms and conditions of TARGET2-ECB ( 1 ).
Intraday credit granted by the ECB shall remain limited to the
— Article 41 (contractual relationship with the network service
day in question with no possibility of an extension to overnight
provider),
credit.
Article 13
— Article 44 (rules for governing law, jurisdiction and place of
performance).
Ancillary systems
1. The
Eurosystem
CBs
shall
provide
fund
transfer
services
in
central bank money to ancillary systems in the PM accessed
3. Bilateral
arrangements
with
ancillary
systems
that
use
the
through the network service provider or, during the transition
PI shall be in conformity with:
period and if applicable, on Home Accounts. Such services shall
be governed by bilateral arrangements between the Eurosystem
CBs and the respective ancillary systems.
(a) Annex II, with the exception of Title V and Appendices VI
and VII; and
2. Bilateral
arrangements
with
ancillary
systems
that
use
the
ASI shall be in conformity with Annex IV. In addition, the
(b) Article 18 of Annex IV.
Eurosystem CBs shall ensure that in such bilateral arrangements
the following provisions of Annex II apply mutatis mutandis:
4. By
derogation
from
paragraph
3,
bilateral
arrangements
— Article 8(1) (technical and legal requirements),
with ancillary systems that use the PI, but only settle
payments for the benefit of their customers, shall be in
conformity with:
— Article 8(2) to (5) (application procedure), except that
instead of being required to meet the access criteria in
Article 4 the ancillary system shall be required to meet
(a) Annex II, with the exception of Title V, Article 36 and
the access criteria in the definition of ‘ancillary system’ set
Appendices VI and VII; and
out in Article 1 of Annex II,
( 1 ) OJ L 237, 8.9.2007, p. 71.
(b) Article 18 of Annex IV.

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Article 14
(b) the information upon which the euro area NCB based its
decision, including any information or opinion obtained
Financing and cost methodology
from the relevant supervisory authority;
1. The Governing Council shall determine the rules
applicable to the financing of the SSP. Any surplus or deficit
resulting from the functioning of the SSP shall be distributed
(c) the measure taken and a proposed time-frame for its appli
among the euro area NCBs in accordance with the key for
cation.
subscription to the ECB’s capital, pursuant to Article 29 of
the Statute of the ESCB.
Each Eurosystem CB shall, if so requested by another Euro
system CB, exchange information in relation to such participant,
including information in relation to payments addressed to it.
2. The
Governing
Council
shall
determine
a
common
cost
methodology and pricing structure for core TARGET2 services.
3. A Eurosystem CB that has terminated or suspended the
participation of a participant in its TARGET2 component
Article 15
system in accordance with paragraph 1 shall assume liability
Security provisions
in relation to the other Eurosystem CBs if it either:
1. The
Governing
Council
shall
specify
the
security
policy
and security requirements and controls for the SSP and,
(a) subsequently authorises the settlement of payment orders
during the transition period, for the Home Account technical
addressed to participants whose participation it has
infrastructure. The Governing Council shall also specify the
suspended or terminated; or
principles applicable to the security of certificates used for
internet-based access.
(b) does not comply with the obligations in paragraphs 1
and 2.
2. The Eurosystem CBs shall comply with, and shall ensure
that the SSP complies with, the measures referred to in
4. The Eurosystem CBs’ obligations set out in paragraphs 1
paragraph 1.
to 3 shall also apply in the event of suspension or termination
of the use of the ASI by ancillary systems.
Article 16
Audit rules
Article 18
Audit assessments shall be performed in accordance with the
Procedures for the rejection on the grounds of prudence of
principles and arrangements set out in the Governing Council’s
an application for participation in TARGET2
ESCB Audit Policy.
Where, pursuant to Article 8(4)(c) of Annex II, a Eurosystem CB
rejects on the grounds of prudence an application to join
TARGET2, that Eurosystem CB shall promptly inform the
Article 17
ECB of such rejection.
Obligations in the event of suspension or termination
1. Eurosystem
CBs
shall
immediately
terminate
without
prior
Article 19
notice or suspend a participant’s participation in the relevant
Procedures for the suspension, limitation or termination
TARGET2 component system if:
on the grounds of prudence of participation in TARGET2
and access to intraday credit
(a) insolvency proceedings are opened in relation to a
1. Where
on
the
grounds
of
prudence,
a
euro
area
NCB
participant; or
suspends, limits or terminates a participant’s access to
intraday credit pursuant to paragraph 12(d) of Annex III or a
Eurosystem CB suspends or terminates a participant’s partici
(b) a participant no longer meets the access criteria for the
pation in TARGET2 pursuant to Article 34(2)(e) of Annex II,
participation in the relevant TARGET2 component system.
the decision shall, to the extent possible, take effect at the same
time in all TARGET2 component systems.
2. If a Eurosystem CB suspends or terminates a participant’s
2. The
euro
area
NCB
shall
provide
the
information
of
participation in TARGET2 in accordance with paragraph 1 or
Article 17(2) without delay to the relevant supervisory au
on the grounds of prudence in accordance with Article 19, it
thorities in the euro area NCB’s Member State, with the
shall immediately notify all other Eurosystem CBs thereof,
request that the supervisory authorities share information with
providing all of the following:
the supervisory authorities of other Member States in which the
participant has a subsidiary or branch. Taking into account the
decision pursuant to paragraph 1, other euro area NCBs shall
(a) the participant’s name, Monetary Financial Institution code
take appropriate action and provide information thereof to the
and BIC;
ECB without delay.

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Union
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3. The
ECB’s
Executive
Board
may
propose
to
the
Governing 4. A
failure
affecting
an
ancillary
system
shall
be
reported
by
Council to take any decisions in order to ensure uniform imple
the Eurosystem CBs to the TARGET2 coordinator for
mentation of the measures taken pursuant to paragraphs 1
information purposes. The TARGET2 coordinator shall initiate
and 2.
a teleconference of the TARGET2 settlement managers in the
event that there is an unavoidable systemic impact, in particular
when this is of a cross-border nature.
4. The
euro
area
NCBs
of
the
Member
States
in
which
the
decision is to be implemented shall inform the participant about
the decision, and shall take all necessary implementation
5. In
exceptional
circumstances,
the
SSP’s
closure
may
be
measures.
delayed if there is a failure affecting an ancillary system. A
request to delay the SSP’s closure shall be communicated by
the Eurosystem CBs to the TARGET2 crisis managers.
Article 20
Procedures for cooperation by Eurosystem CBs in
connection with administrative or restrictive measures
Article 22
In connection with the implementation of Article 39(3) of
Treatment of claims under the TARGET2 compensation
Annex II:
scheme
1. Unless
otherwise
decided
by
the
Governing
Council,
the
compensation procedure set out in Appendix II to Annex II
(a) any Eurosystem CB shall promptly share with all potentially
shall be managed in accordance with this Article.
affected CBs all information that it receives in connection
with a proposed credit transfer order;
2. The CB of the participant submitting the claim for
compensation shall assess the compensation claim on a
(b) any Eurosystem CB that receives from a participant evidence
preliminary basis and communicate with the participant in
of notification having been made to, or consent having been
relation to that assessment. Where necessary for the assessment
received from, any competent authority shall promptly
of claims, such CB shall be assisted by other CBs concerned.
transmit such evidence to any other CB acting as the
The relevant CB shall inform the ECB and all other CBs
payment service provider of the payer or payee as appro
concerned as soon as it becomes aware of pending claims.
priate;
3. Within
nine
weeks
following
a
technical
malfunction
of
(c) the Eurosystem CB acting as payment service provider of
TARGET2, the CB of the participant submitting the claim shall:
the payer shall then promptly inform the payer that it can
enter a credit transfer order into TARGET2.
(a) prepare a preliminary assessment report containing the CB’s
assessment of the claims received; and
Article 21
Business continuity
1. If
the
events
referred
to
in
Article
27
of
Annex
II
affect (b) submit the preliminary assessment report to the ECB and all
the operation of the SSP modules other than the PM and the
other CBs concerned.
ICM, the Eurosystem CB concerned shall monitor and manage
such events in order to prevent any spillover to the smooth
functioning of the SSP.
4. Within
five
weeks
following
receipt
of
the
preliminary
assessment report, the Governing Council shall carry out the
final assessment of all claims received, and shall decide on the
2. If an event affecting the normal operation of the PM
compensation offers to be made to the participants concerned.
and/or the ICM occurs, the Eurosystem CB concerned shall
Within five business days following the completion of the final
immediately notify the TARGET2 coordinator, who together
assessment, the ECB shall communicate the outcome of the final
with the settlement manager of the Eurosystem CB concerned
assessment to the CBs concerned. Those CBs shall without delay
shall decide on the further steps to be taken. The TARGET2
inform their participants of the outcome of the final assessment
settlement managers shall agree on the information that should
and, where applicable, details of the compensation offer,
be communicated to TARGET2 participants.
together with the form constituting the letter of acceptance.
3. The
Eurosystem
CBs
shall
report
the
participant’s
failure
to 5. Within
two
weeks
following
expiry
of
the
period
referred
the TARGET2 coordinator if such failure might affect the
to in the last sentence of Article 4(d) of Appendix II to Annex
settlement in ancillary systems or create systemic risk. The
II, the CB shall inform the ECB and all other CBs concerned
SSP’s closure shall normally not be delayed due to a partici
about which compensation offers have been accepted and
pant’s failure.
which compensation offers have been rejected.

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L 30/10
EN
Official Journal of the European Union
30.1.2013
6. The
CBs
shall
inform
the
ECB
of
any
claim
submitted
by incurred by the CBs in compensating their participants shall be
their participants to those CBs outside the scope of the
shared among the Eurosystem CBs in accordance with the key
TARGET2 compensation scheme, but relating to a technical
for subscription to the ECB’s capital.
malfunction of TARGET2.
Article 24
Article 23
Security rights in relation to funds on sub-accounts and
intra-Eurosystem guarantee
Treatment of losses caused by a technical malfunction of
TARGET2
1. For the purpose of the settlement of ancillary system-
related payment instructions, any Eurosystem CB that has
1. In
the
event
of
a
technical
malfunction
of
TARGET2:
opened sub-accounts for its participants shall ensure that the
balances on such sub-accounts (including increases or
reductions of the frozen balance resulting from crediting or
debiting cross system settlement payments to or from the
(a) On the payer’s side, any CB with which a payer has placed a
sub-account or from crediting liquidity transfers to the sub-
deposit benefits from certain financial gains which amount
account) that are frozen during the ancillary system processing
to the difference between the Eurosystem’s main refinancing
cycle can be used for the settlement of ancillary system related
operations rate and the deposit rate applied to the marginal
payment instructions. This is notwithstanding any insolvency
increase in the use of the Eurosystem’s deposit facility for
proceedings with respect to the relevant participant and
the period of the technical malfunction of TARGET2 and up
notwithstanding any individual enforcement measure relating
to the amount of the non-settled payment orders. Where
to such participant’s sub-account.
the payer is left with non-remunerated surplus funds, the
financial gains amount to the Eurosystem’s main refinancing
operations rate, applied to the amount of the non-interest-
bearing surplus funds for the period of the technical
2. Each
time
liquidity
is
transferred
to
a
participant’s
sub-
malfunction of TARGET2 and up to the amount of the
account and where the Eurosystem CB is not the ancillary
non-settled payment orders.
system’s CB, such Eurosystem CB shall, upon communication
by the ancillary system (via a ‘start-of-cycle’ message), confirm
the freezing of the balances on the sub-account to the relevant
ancillary system and, in doing so, guarantee to the ancillary
system’s CB payment up to the amount of this particular
(b) On the payee’s side, the CB from whom the payee has
balance. The confirmation of the freezing to the ancillary
borrowed by using the marginal lending facility benefits
system shall also entail a legally binding declaration of will by
from certain financial gains which amount to the difference
the ancillary system’s CB that the latter guarantees to the
between the marginal lending rate and the Eurosystem’s
ancillary system payment up to the amount of the frozen
main refinancing operations rate, applied to the marginal
balance. By confirming the increase or reduction of the frozen
increase in the use of the marginal lending facility for the
balance upon crediting or debiting cross-system settlement
period of the technical malfunction of TARGET2 and up to
payments to or from the sub-account or crediting liquidity
the amount of the non-settled payment orders.
transfers to the sub-account, both the Eurosystem CB that is
not the ancillary system’s CB and the ancillary system’s CB
declare an increase or a reduction of the guarantee in the
amount of the payment. Both guarantees shall be irrevocable,
2. The
ECB’s
financial
gains
amount
to:
unconditional and payable on first demand. Both guarantees
and the freezing of the balances shall expire upon communi
cation by the ancillary system that the settlement has been
completed (via an ‘end-of-cycle’ message).
(a) the earnings in relation to the connected NCBs arising from
the different remuneration of end-of-day balances of those
connected NCBs in relation to the ECB; and
SECTION IV
TRANSITIONAL AND FINAL PROVISIONS
(b) the amount of penalty interest the ECB receives from
Article 25
connected NCBs whenever one of those connected NCBs
Dispute resolution and applicable law
imposes a penalty on a participant for a failure to
reimburse intraday credit on time, as provided for in the
1. In
the
event
of
a
dispute
between
Eurosystem
CBs
in
agreement between the Eurosystem CBs and the connected
relation to this Guideline, the affected parties shall seek to
NCBs.
settle the dispute in accordance with the Memorandum of
Understanding on an Intra-ESCB Dispute Settlement Procedure.
3. The financial gains referred to in paragraphs 1 and 2 shall
2. By
derogation
from
paragraph
1,
if
a
dispute
relating
to
be pooled by the CBs and the resulting pooled amount shall be
the division of the tasks between Level 2 and Level 3 cannot be
used to reimburse those CBs that incur the costs of compen
settled by agreement between the affected parties, the Governing
sating their participants. Any remaining financial gains or costs
Council shall resolve the dispute.

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European
Union L
30/11
3. In the event of a dispute of the type referred to in
(b) payments between credit institutions and ancillary systems;
paragraph 1, the parties’ respective rights and obligations shall
and
primarily be determined by the rules and procedures laid down
in this Guideline. In disputes concerning payments between
TARGET2 component systems, the law of the Member State
(c) payments in relation to Eurosystem open market operations.
where the seat of the Eurosystem CB of the payee is located
shall apply in a supplementary manner, provided that it does
not conflict with this Guideline.
3. On expiry of the transition period, the following shall
cease:
Article 26
(a) registration as an addressable BIC holder by a Eurosystem
Entry into force and application
CB, in the case of entities referred to in Article 4(1)(a) and
(b) of Annex II;
1. This
Guideline
shall
enter
into
force
on
7
December
2012. It shall apply from 1 January 2013, subject to the tran
sitional provisions laid down in Article 27.
(b) indirect participation with a Eurosystem CB; and
2. Guideline
ECB/2007/2
is
repealed
with
effect
from
(c) settlement on Home Accounts of all payments mentioned
1 January 2013.
in paragraph 2(a) to (c).
3. References
to
the
repealed
Guideline
shall
be
construed
as
Article 28
references to this Guideline and shall be read in accordance with
the correlation table set out in Annex VII.
Addressees, implementing measures and annual reports
1. This
Guideline
applies
to
all
Eurosystem
CBs.
Article 27
2. The
euro
area
NCBs
shall
by
20
December
2012
send
to
Miscellaneous and transitional provisions
the ECB the measures by which they intend to comply with
1. Accounts
opened
outside
the
PM
by
a
euro
area
NCB
for Article 39 of Annex II, Appendix VI to Annex II, paragraph
credit institutions and ancillary systems shall be governed by the
9(a), paragraph 12(a)(v) and paragraph 13 of Annex III,
rules of such euro area NCB, subject to the provisions of this
paragraph 18(1)(c)(ii) of Annex IV, and Appendix IIA to
Guideline which relate to Home Accounts and other decisions
Annex V of this Guideline.
of the Governing Council. Accounts opened outside the PM by
a euro area NCB for entities other than credit institutions and
ancillary systems shall be governed by the rules of such euro
3. The
ECB
shall
prepare
annual
reports
for
review
by
the
area NCB.
Governing Council on the overall functioning of TARGET2.
2. During
its
transition
period,
each
Eurosystem
CB
may Done at Frankfurt am Main, 5 December 2012.
continue to settle payments and other transactions on its
Home Accounts, including the following:
For the Governing Council of the ECB
The President of the ECB
(a) payments between credit institutions;
Mario DRAGHI

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L 30/12
EN
Official Journal of the European Union
30.1.2013
ANNEX I
TARGET2 GOVERNANCE ARRANGEMENTS
Level 1 — Governing Council Level
2
—
Eurosystem
CBs Level
3
—
SSP-providing
NCBs
0. General provisions
Level 1 has final competence in
Level 2 has subsidiary competence in Level 3 takes decisions on the daily
relation to domestic and cross-border relation to issues left to its discretion running of the Single Shared Platform
TARGET2 issues and is responsible for by Level 1
(SSP) on the basis of the service levels
safeguarding the public function of
defined in the agreement referred to in
TARGET2
Article 7(6) of this Guideline
1. Cost and pricing policy
— Deciding on common cost
— Deciding on pricing of additional (Not applicable)
methodology
services and/or modules
— Deciding on single price structure
2. Service level
— Deciding on core services —
Deciding
on
additional
services
— Delivering input according to Level
and/or modules
1/Level 2 needs
3. Risk management
— Deciding on the general framework — Conducting the actual risk
— Providing the necessary
for risk management and
management
information for risk analysis
acceptance of remaining risks
according to Level 1/Level 2
— Conducting risk analysis and
requests
follow-up
4. Governance and financing
— Defining rules for ownership,
— Drawing up the rules on
— Providing cost figures to Level 2
decision-making and financing of
governance and financing decided
for the service provision
the SSP
at Level 1
— Establishing and ensuring adequate — Drawing up the budget, its
implementation of the European
approval and implementation
System of Central Bank’s legal
framework for TARGET2
— Having ownership and/or control
of the application
— Collecting funds and remun
eration of services
5. Development
— Being consulted by Level 2 on the — Deciding on the initial design and — Proposing the initial design of the
location of the SSP
development of the SSP
SSP
— Approving the overall project plan — Deciding on establishing from
— Proposing whether to establish
scratch against establishing on the
from scratch or establish on the
basis of an existing platform
basis of an existing platform
— Deciding on the choice of the SSP — Proposing the location of the SSP
operator
— Drafting the general and the
— Establishing, in agreement with
detailed functional specifications
Level 3, the service levels of the
(internal detailed functional spe
SSP
cifications and user detailed func
tional specifications)
— Deciding on the location of the
SSP after consultation of Level 1

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Level 1 — Governing Council Level
2
—
Eurosystem
CBs Level
3
—
SSP-providing
NCBs
— Approving the specification
— Drafting the detailed technical
process methodology and the
specifications
‘deliverables’ of Level 3 deemed
appropriate in order to specify
— Providing initial and ongoing input
and, later on, test and accept the
for milestone project planning and
product (in particular general and
control
detailed user specifications)
— Technical and operational support
— Establishing a milestone project
for tests (performing tests on the
plan
SSP, input on SSP-related test
scenarios, supporting Eurosystem
— Evaluating and accepting the
CBs in their SSP test activities)
deliverables
— Establishing test scenarios
— Central banks’ and users’ test
coordination, in close cooperation
with Level 3
6. Implementation and migration
— Deciding on the migration strategy — Preparing
and
coordinating
— Providing input on migration
migration to the SSP, in close
issues in accordance with Level 2
cooperation with Level 3
requests
— Performing SSP-related migration
work; additional support for
joining NCBs
7. Operation
— Managing severe crisis situations
— Management with regard to
— Managing the system on the basis
system-owner responsibilities
of the agreement referred to in
— Authorising establishment and
Article 7(6) of this Guideline
operation of TARGET2 Simulator
— Maintaining contacts with users at
European level (subject to the sole
— Appointing certification authorities
responsibility of Eurosystem CBs
for internet-based access
for the business relationship with
— Specifying security policies,
their customers) and monitoring
requirements and controls for the
daily user activity from a business
SSP
perspective (Eurosystem CB task)
— Specifying principles applicable to — Monitoring business devel
security of certificates used for
opments
internet-based access
— Budgeting, financing, invoicing
(Eurosystem CB task) and other
administrative tasks

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L 30/14
EN
Official Journal of the European Union
30.1.2013
ANNEX II
HARMONISED CONDITIONS FOR PARTICIPATION IN TARGET2
TITLE I
GENERAL PROVISIONS
Article 1
Definitions
For the purposes of these Harmonised Conditions (hereinafter the ‘Conditions’), the following definitions apply:
— ‘addressable BIC holder’ means an entity which: (a) holds a Business Identifier Code (BIC); (b) is not recognised as an
indirect participant; and (c) is a correspondent or customer of a direct participant or a branch of a direct or indirect
participant, and is able to submit payment orders to and receive payments from a TARGET2 component system via
the direct participant,
— ‘AL agreement’ means the multilateral aggregated liquidity agreement entered into by the AL group members and their
respective AL NCBs, for the purposes of the AL mode,
— ‘AL group’ means a group composed of AL group members that use the AL mode,
— ‘AL group manager’ means an AL group member appointed by the other AL group members to manage available
liquidity within the AL group during the business day,
— ‘AL group member’ means a TARGET2 participant which has entered into an AL agreement,
— ‘AL mode’ means the aggregation of available liquidity on PM accounts,
— ‘AL NCB’ means a euro area NCB that is party to an AL agreement and acts as the counterparty for the AL group
members which participate in its TARGET2 component system,
— ‘ancillary system’ means a system managed by an entity established in the European Economic Area (EEA) that is
subject to supervision and/or oversight by a competent authority and complies with the oversight requirements for
the location of infrastructures offering services in euro, as amended from time to time and published on the ECB’s
website ( 1 ), in which payments and/or financial instruments are exchanged and/or cleared while the resulting monetary
obligations are settled in TARGET2 in accordance with Guideline ECB/2012/27 on a Trans-European Automated Real-
time Gross settlement Express Transfer system (TARGET2) ( 2 ) and a bilateral arrangement between the ancillary
system and the relevant CB,
— ‘available liquidity’ (or ‘liquidity’) means a credit balance on a TARGET2 participant’s PM account and, if applicable,
any intraday credit line granted by the relevant CB in relation to such account,
— ‘Business Identifier Code (BIC)’ means a code as defined by ISO Standard No 9362,
— ‘branch’ means a branch within the meaning of [insert national law provisions implementing Article 4(3) of Directive
2006/48/EC of the European Parliament and of the Council of 14 June 2006 relating to the taking up and pursuit of
the business of credit institutions ( 3 )],
( 1 ) The Eurosystem’s current policy for the location of infrastructure is set out in the following statements, which are all available on the
ECB’s website at www.ecb.europa.eu: (a) the Policy statement on euro payment and settlement systems located outside the euro area of
3 November 1998; (b) The Eurosystem’s policy line with regard to consolidation in central counterparty clearing of 27 September
2001; (c) The Eurosystem policy principles on the location and operation of infrastructures settling in euro-denominated payment
transaction of 19 July 2007; and (d) The Eurosystem policy principles on the location and operation of infrastructures settling euro-
denominated payment transactions: specification of legally and operationally located in the euro area of 20 November 2008; (e) The
Eurosystem oversight policy framework of July 2011.
( 2 ) OJ L 30, 30.1.2013, p. 1.
( 3 ) OJ L 177, 30.6.2006, p. 1.

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— ‘business day’ means any day on which TARGET2 is open for the settlement of payment orders, as set out in
Appendix V,
— ‘CAI group’ means a group composed of TARGET2 participants that use the CAI mode,
— ‘CAI group manager’ means a CAI group member appointed by the other members of the CAI group to monitor and
distribute the available liquidity within the CAI group during the business day,
— ‘CAI mode’ means the provision of consolidated account information in relation to PM accounts via the ICM,
— ‘capacity opinion’ means a participant-specific opinion that contains an assessment of a participant’s legal capacity to
enter into and carry out its obligations under these Conditions,
— ‘central banks (CBs)’ means the Eurosystem CBs and the connected NCBs,
— ‘connected NCB’ means a national central bank (NCB), other than a Eurosystem CB, which is connected to TARGET2
pursuant to a specific agreement,
— ‘Contingency Module’ means the SSP module enabling the processing of critical and very critical payments in
contingency situations,
— ‘credit institution’ means either: (a) a credit institution within the meaning of [insert national law provisions imple
menting Article 4(1)(a) and, if relevant, Article 2 of Directive 2006/48/EC] that is subject to supervision by a
competent authority; or (b) another credit institution within the meaning of Article 123(2) of the Treaty on the
Functioning of the European Union that is subject to scrutiny of a standard comparable to supervision by a
competent authority,
— ‘credit transfer order’ means an instruction by a payer to make funds available to a payee by means of a book entry
on a PM account,
— ‘direct debit authorisation’ means a general instruction by a payer to its CB entitling and obliging that CB to debit the
payer’s account upon a direct debit instruction from a payee,
— ‘direct debit instruction’ means an instruction from a payee submitted to its CB pursuant to which the CB of the payer
debits the payer’s account by the amount specified in the instruction, on the basis of a direct debit authorisation,
— ‘enforcement event’ means, with regard to an AL group member: (a) any event of default referred to in Article 34(1);
(b) any other event of default or event referred to in Article 34(2) in relation to which the [insert name of CB] has
decided, taking into account the seriousness of the event of default or event, [Insert if applicable: [a pledge should be
enforced in accordance with Article 25b] [collateral should be enforced in accordance with Article 25c] and] a set-off
of claims should be triggered in accordance with Article 26; or (c) any decision to suspend or terminate access to
intraday credit,
— ‘entry disposition’ means a payment processing phase during which TARGET2-[insert CB/country reference] attempts
to settle a payment order which has been accepted pursuant to Article 14, by means of specific procedures, as
described in Article 20,
— ‘euro area NCB’ means the national central bank (NCB) of a Member State whose currency is the euro,
— ‘Eurosystem CB’ means the ECB or a euro area NCB,
— ‘event of default’ means any impending or existing event, the occurrence of which may threaten the performance by a
participant of its obligations under these Conditions or any other rules applying to the relationship between that
participant and the [insert name of CB] or any other CB, including:

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Official Journal of the European Union
30.1.2013
(a) where the participant no longer meets the access criteria laid down in Article 4 or the requirements laid down in
Article 8(1)(a)(i);
(b) the opening of insolvency proceedings in relation to the participant;
(c) the submission of an application relating to the proceedings referred to in subparagraph (b);
(d) the issue by the participant of a written declaration of its inability to pay all or any part of its debts or to meet its
obligations arising in relation to intraday credit;
(e) the entry of the participant into a voluntary general agreement or arrangement with its creditors;
(f) where the participant is, or is deemed by its CB to be, insolvent or unable to pay its debts;
(g) where the participant’s credit balance on its PM account or all or a substantial part of the participant’s assets are
subject to a freezing order, attachment, seizure or any other procedure that is intended to protect the public
interest or the rights of the participant’s creditors;
(h) where participation of the participant in another TARGET2 component system and/or in an ancillary system has
been suspended or terminated;
(i) where any material representation or pre-contractual statement made by the participant or which is implied to
have been made by the participant under the applicable law is incorrect or untrue;
(j) the assignment of all or a substantial part of the participant’s assets,
— ‘group’ means:
(a) a composition of credit institutions included in the consolidated financial statements of a parent company where
the parent company is obliged to present consolidated financial statements under International Accounting
Standard 27 (IAS 27), adopted pursuant to Commission Regulation (EC) No 2238/2004 ( 1 ) and consisting of
either: (i) a parent company and one or more subsidiaries; or (ii) two or more subsidiaries of a parent company; or
(b) a composition of credit institutions as referred to in subparagraph (a)(i) or (ii), where a parent company does not
present consolidated financial statements in accordance with IAS 27, but may be able to satisfy the criteria defined
in IAS 27 for inclusion in consolidated financial statements, subject to the verification of the CB of the direct
participant or, in the case of an AL group, the managing NCB;
(c) a bilateral or multilateral network of credit institutions that is: (i) organised through a statutory framework
determining the affiliation of credit institutions to such a network; or (ii) characterised by self-organised mech
anisms of cooperation (promoting, supporting and representing the business interests of its members) and/or
economic solidarity going beyond the ordinary cooperation usual between credit institutions whereby such
cooperation and solidarity are permitted by credit institutions’ by-laws or articles of incorporation or established
by virtue of separate agreements;
and in each case referred to in (c) the ECB’s Governing Council has approved an application to be considered as
constituting a group,
— ‘Home Account’ means an account opened outside the PM by a CB for an entity that is eligible to become an indirect
participant,
( 1 ) Commission Regulation (EC) No 2238/2004 of 29 December 2004 amending Regulation (EC) No 1725/2003 adopting certain inter
national accounting standards in accordance with Regulation (EC) No 1606/2002 of the European Parliament and of the Council, as
regards IASs IFRS 1, IASs Nos 1 to 10, 12 to 17, 19 to 24, 27 to 38, 40 and 41 and SIC Nos 1 to 7, 11 to 14, 18 to 27 and 30 to
33 (OJ L 394, 31.12.2004, p. 1).

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— ‘Information and Control Module (ICM)’ means the SSP module that allows participants to obtain on-line information
and gives them the possibility to submit liquidity transfer orders, manage liquidity and initiate backup payment orders
in contingency situations,
— ‘ICM broadcast message’ means information made simultaneously available to all or a selected group of TARGET2
participants via the ICM,
— ‘indirect participant’ means a credit institution established in the EEA, which has entered into an agreement with a
direct participant to submit payment orders and receive payments via such direct participant’s PM account, and which
has been recognised by a TARGET2 component system as an indirect participant,
— ‘insolvency proceedings’ means insolvency proceedings within the meaning of Article 2(j) of Directive 98/26/EC of the
European Parliament and of the Council of 19 May 1998 on settlement finality in payment and securities settlement
systems ( 1 ),
— ‘instructing participant’ means a TARGET2 participant that has initiated a payment order,
— ‘intraday credit’ means credit extended for a period of less than one business day,
— ‘investment firm’ means an investment firm within the meaning of [insert national law provisions implementing
Article 4(1)(1) of Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets
in financial instruments amending Council Directives 85/611/EEC and 93/6/EEC and Directive 2000/12/EC of the
European Parliament and of the Council and repealing Council Directive 93/22/EEC ( 2 )], excluding the institutions
specified in [insert national law provisions implementing Article 2(1) of Directive 2004/39/EC], provided that the
investment firm in question is:
(a) authorised and supervised by a recognised competent authority, which has been designated as such under
Directive 2004/39/EC; and
(b) entitled to carry out the activities referred to under [insert national law provisions implementing items 2, 3, 6 and
7 of Section A of Annex I to Directive 2004/39/EC],
— ‘liquidity transfer order’ means a payment order, the main purpose of which is to transfer liquidity between different
accounts of the same participant or within a CAI or AL group,
— ‘managing NCB’ means the AL NCB of the TARGET2 component system in which the AL group manager participates,
— ‘marginal lending facility’ means a Eurosystem standing facility which counterparties may use to receive overnight
credit from a Eurosystem CB at the pre-specified marginal lending rate,
— ‘marginal lending rate’ means the interest rate applicable to the marginal lending facility,
— ‘multi-addressee access’ means the facility by which branches or credit institutions established in the EEA can access
the relevant TARGET2 component system by submitting payment orders and/or receiving payments directly to and
from the TARGET2 component system; this facility authorises these entities to submit their payment orders through
the direct participant’s PM account without that participant’s involvement,
— ‘network service provider’ means the undertaking appointed by the ECB’s Governing Council to provide computerised
network connections for the purpose of submitting payment messages in TARGET2,
— ‘non-settled payment order’ means a payment order that is not settled on the same business day as that on which it is
accepted,
— ‘participant’ (or ‘direct participant’) means an entity that holds at least one PM account with the [insert name of CB],
( 1 ) OJ L 166, 11.6.1998, p. 45.
( 2 ) OJ L 145, 30.4.2004, p. 1.

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— ‘payee’, except where used in Article 39 of this Annex, means a TARGET2 participant whose PM account will be
credited as a result of a payment order being settled,
— ‘payer’, except where used in Article 39 of this Annex, means a TARGET2 participant whose PM account will be
debited as a result of a payment order being settled,
— ‘payment order’ means a credit transfer order, a liquidity transfer order or a direct debit instruction,
— ‘Payments Module (PM)’ means an SSP module in which payments of TARGET2 participants are settled on PM
accounts,
— ‘PM account’ means an account held by a TARGET2 participant in the PM with a CB which is necessary for such
TARGET2 participant to:
(a) submit payment orders or receive payments via TARGET2; and
(b) settle such payments with such CB,
— ‘public sector body’ means an entity within the ‘public sector’, the latter term as defined in Article 3 of Council
Regulation (EC) No 3603/93 of 13 December 1993 specifying definitions for the application of the prohibitions
referred to in Articles 104 and 104b (1) of the Treaty ( 1 ),
— ‘Single Shared Platform (SSP)’ means the single technical platform infrastructure provided by the SSP-providing NCBs,
— ‘SSP-providing NCBs’ means the Deutsche Bundesbank, the Banque de France and the Banca d’Italia in their capacity as
the CBs building and operating the SSP for the Eurosystem’s benefit,
— ‘static data collection form’ means a form developed by [insert name of CB] for the purpose of registering applicants
for TARGET2-[insert CB/country reference] services and registering any changes in relation to the provision of such
services,
— ‘suspension’ means the temporary freezing of the rights and obligations of a participant for a period of time to be
determined by the [insert name of CB],
— ‘TARGET2-[insert CB/country reference]’ means the TARGET2 component system of [insert CB name],
— ‘TARGET2’ means the entirety resulting from all TARGET2 component systems of the CBs,
— ‘TARGET2 component system’ means any of the CBs’ real-time gross settlement (RTGS) systems that form part of
TARGET2,
— ‘TARGET2 CUG’ means a subset of the network service provider’s customers grouped for the purpose of their use of
the relevant services and products of the network service provider when accessing the PM,
— ‘TARGET2 participant’ means any participant in any TARGET2 component system,
— ‘technical malfunction of TARGET2’ means any difficulty, defect or failure in the technical infrastructure and/or the
computer systems used by TARGET2-[insert CB/country reference], or any other event that makes it impossible to
execute and complete the same-day processing of payments in TARGET2-[insert CB/country reference],
— ‘User Detailed Functional Specifications (UDFS)’ means the most up-to-date version of the UDFS, which is the
technical documentation that details how a participant interacts with TARGET2.
( 1 ) OJ L 332, 31.12.1993, p. 1.

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Union L
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Article 2
Appendices
1. The
following
Appendices
form
an
integral
part
of
these
Conditions:
Appendix I: Technical specifications for the processing of payment orders
Appendix II: TARGET2 compensation scheme
Appendix III: Terms of reference for capacity and country opinions
Appendix IV: Business continuity and contingency procedures
Appendix V: Operating schedule
Appendix VI: Fee schedule and invoicing
Appendix VII: Aggregated liquidity agreement
2. In the event of any conflict or inconsistency between the content of any appendix and the content of any other
provision in these Conditions, the latter shall prevail.
Article 3
General description of TARGET2-[insert CB/country reference] and TARGET2
1. TARGET2 provides real-time gross settlement for payments in euro, with settlement in central bank money.
2. The
following
payment
orders
are
processed
in
TARGET2-[insert
CB/country
reference]:
(a) payment orders directly resulting from or made in connection with Eurosystem monetary policy operations;
(b) settlement of the euro leg of foreign exchange operations involving the Eurosystem;
(c) settlement of euro transfers resulting from transactions in cross-border large-value netting systems;
(d) settlement of euro transfers resulting from transactions in euro retail payment systems of systemic importance; and
(e) any other payment orders in euro addressed to TARGET2 participants.
3. TARGET2 is established and functions on the basis of the SSP. The Eurosystem specifies the SSP’s technical
configuration and features. The SSP services are provided by the SSP-providing NCBs for the benefit of the Eurosystem
CBs, pursuant to separate agreements.
4. The [insert name of CB] is the provider of services under these Conditions. Acts and omissions of the SSP-providing
NCBs shall be considered acts and omissions of [insert name of CB], for which it shall assume liability in accordance with
Article 31 below. Participation pursuant to these Conditions shall not create a contractual relationship between
participants and the SSP-providing NCBs when the latter act in that capacity. Instructions, messages or information
which a participant receives from, or sends to, the SSP in relation to the services provided under these Conditions are
deemed to be received from, or sent to, [insert name of CB].
5. TARGET2 is legally structured as a multiplicity of payment systems composed of all the TARGET2 component
systems, which are designated as ‘systems’ under the national laws implementing Directive 98/26/EC. TARGET2-[insert
CB/country reference] is designated as a ‘system’ under [insert the relevant legal provision implementing Directive
98/26/EC].

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6. Participation in TARGET2 takes effect via participation in a TARGET2 component system. These Conditions
describe the mutual rights and obligations of participants in TARGET2-[insert CB/country reference] and the [insert
name of CB]. The rules on the processing of payment orders (Title IV) refer to all payment orders submitted or payments
received by any TARGET2 participant.
TITLE II
PARTICIPATION
Article 4
Access criteria
1. The
following
types
of
entities
are
eligible
for
direct
participation
in
TARGET2-[insert
CB/country
reference]:
(a) credit institutions established in the EEA, including when they act through a branch established in the EEA;
(b) credit institutions established outside the EEA, provided that they act through a branch established in the EEA;
(c) NCBs of Member States and the ECB;
provided that the entities referred to in subparagraphs (a) and (b) are not subject to restrictive measures adopted by the
Council of the European Union or Member States pursuant to Article 65(1)(b), Article 75 or Article 215 of the Treaty,
the implementation of which, in the view of [CB/country reference] after informing the ECB, is incompatible with the
smooth functioning of TARGET2.
2. The
[insert
name
of
the
CB]
may,
at
its
discretion,
also
admit
the
following
entities
as
direct
participants:
(a) treasury departments of central or regional governments of Member States active in the money markets;
(b) public sector bodies of Member States authorised to hold accounts for customers;
(c) investment firms established in the EEA;
(d) entities managing ancillary systems and acting in that capacity;
(e) credit institutions or any of the entities of the types listed under subparagraphs (a) to (d), in both cases where these
are established in a country with which the Union has entered into a monetary agreement allowing access by any of
such entities to payment systems in the Union subject to the conditions set out in the monetary agreement and
provided that the relevant legal regime applying in the country is equivalent to the relevant Union legislation.
3. Electronic money institutions, within the meaning of [insert national law provisions implementing Article 2(1) of
Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit
and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and
2006/48/EC and repealing Directive 2000/46/EC ( 1 )], are not entitled to participate in TARGET2-[insert CB/country
reference].
Article 5
Direct participants
1. Direct
participants
in
TARGET2-[insert
CB/country
reference]
shall
comply
with
the
requirements
set
out
in
Article 8(1) and (2). They shall have at least one PM account with the [insert name of CB].
2. Direct participants may designate addressable BIC holders, regardless of their place of establishment.
3. Direct
participants
may
designate
entities
as
indirect
participants,
provided
that
the
conditions
laid
down
in
Article 6 are met.
( 1 ) OJ L 267, 10.10.2009, p. 7.

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4. Multi-addressee
access
through
branches
may
be
provided
as
follows:
(a) A credit institution within the meaning of Article 4(1)(a) or (b), which has been admitted as a direct participant, may
grant access to its PM account to one or more of its branches established in the EEA in order to submit payment
orders and/or receive payments directly, provided that [insert name of the CB] has been informed accordingly.
(b) Where a branch of a credit institution has been admitted as a direct participant, the other branches of the same legal
entity and/or its head office, in both cases provided that they are established in the EEA, may access the branch’s PM
account, provided that it has informed the [insert name of CB].
Article 6
Indirect participants
1. Credit institutions established in the EEA may each enter into a contract with one direct participant that is either a
credit institution within the meaning of Article 4(1)(a) or (b), or a CB, in order to submit payment orders and/or receive
payments, and to settle them via the PM account of that direct participant. TARGET2-[insert CB/country reference] shall
recognise indirect participants by registering such indirect participation in the TARGET2 directory, the latter as described
in Article 9.
2. Where a direct participant, which is a credit institution within the meaning of Article 4(1)(a) or (b), and an indirect
participant belong to the same group, the direct participant may expressly authorise the indirect participant to use the
direct participant’s PM account directly to submit payment orders and/or receive payments by way of group-related multi-
addressee access.
Article 7
Direct participant’s responsibility
1. For the avoidance of doubt, payment orders submitted or payments received by indirect participants pursuant to
Article 6, and by branches under Article 5(4), shall be deemed to have been submitted or received by the direct
participant itself.
2. The
direct
participant
shall
be
bound
by
such
payment
orders,
regardless
of
the
content
of,
or
any
non-compliance
with, the contractual or other arrangements between that participant and any of the entities referred to in paragraph 1.
Article 8
Application procedure
1. To
join
TARGET2-[insert
CB/country
reference],
applicant
participants
shall:
(a) fulfil the following technical requirements:
(i) install, manage, operate and monitor and ensure the security of the necessary IT infrastructure to connect to
TARGET2-[insert CB/country reference] and submit payment orders to it. In doing so, applicant participants may
involve third parties, but retain sole liability. In particular, applicant participants shall enter into an agreement
with the network service provider to obtain the necessary connection and admissions, in accordance with the
technical specifications in Appendix I; and
(ii) have passed the tests required by the [insert name of CB]; and
(b) fulfil the following legal requirements:
(i) provide a capacity opinion in the form specified in Appendix III, unless the information and representations to be
provided in such capacity opinion have already been obtained by the [insert name of CB] in another context; and
(ii) for the entities referred to in Article 4(1)(b), provide a country opinion in the form specified in Appendix III,
unless the information and representations to be provided in such country opinion have already been obtained by
the [insert name of CB] in another context.

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2. Applicants shall apply in writing to the [insert name of CB], as a minimum enclosing the following documents/
information:
(a) completed static data collection forms as provided by [insert name of CB];
(b) the capacity opinion, if required by the [insert name of CB]; and
(c) the country opinion, if required by the [insert name of CB].
3. The [insert name of CB] may also request any additional information it deems necessary to decide on the
application to participate.
4. The
[insert
name
of
CB]
shall
reject
the
application
to
participate
if:
(a) access criteria referred to in Article 4 are not met;
(b) one or more of the participation criteria referred to in paragraph 1 are not met; and/or
(c) in the [insert name of CB]’s assessment, such participation would endanger the overall stability, soundness and safety
of TARGET2-[insert CB/country reference] or of any other TARGET2 component system, or would jeopardise the
[insert name of CB]’s performance of its tasks as described in [refer to relevant national law] and the Statute of the
European System of Central Banks and of the European Central Bank, or poses risks on the grounds of prudence.
5. The [insert name of CB] shall communicate its decision on the application to participate to the applicant within one
month of the [insert name of CB]’s receipt of the application to participate. Where the [insert name of CB] requests
additional information pursuant to paragraph 3, the decision shall be communicated within one month of the [insert
name of CB]’s receipt of this information from the applicant. Any rejection decision shall contain reasons for the
rejection.
Article 9
TARGET2 directory
1. The TARGET2 directory is the database of BICs used for the routing of payment orders addressed to:
(a) TARGET2 participants and their branches with multi-addressee access;
(b) indirect participants of TARGET2, including those with multi-addressee access; and
(c) addressable BIC holders of TARGET2.
It shall be updated weekly.
2. Unless otherwise requested by the participant, its BICs shall be published in the TARGET2 directory.
3. Participants
may
only
distribute
the
TARGET2
directory
to
their
branches
and
entities
with
multi-addressee
access.
4. Entities specified in paragraph 1(b) and (c) shall only use their BIC in relation to one direct participant.
5. Participants acknowledge that the [insert name of CB] and other CBs may publish participants’ names and BICs. In
addition, names and BICs of indirect participants registered by participants may be published and participants shall ensure
that indirect participants have agreed to such publication.

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Union L
30/23
TITLE III
OBLIGATIONS OF THE PARTIES
Article 10
Obligations of the [insert name of CB] and the participants
1. The [insert name of CB] shall offer the services described in Title IV. Save where otherwise provided in these
Conditions or required by law, the [insert name of CB] shall use all reasonable means within its power to perform its
obligations under these Conditions, without guaranteeing a result.
2. Participants shall pay to the [insert name of CB] the fees laid down in Appendix VI.
3. Participants shall ensure that they are connected to TARGET2-[insert CB/country reference] on business days, in
accordance with the operating schedule in Appendix V.
4. The participant represents and warrants to the [insert name of CB] that the performance of its obligations under
these Conditions does not breach any law, regulation or by-law applicable to it or any agreement by which it is bound.
Article 11
Cooperation and information exchange
1. In performing their obligations and exercising their rights under these Conditions, the [insert name of CB] and
participants shall cooperate closely to ensure the stability, soundness and safety of TARGET2-[insert CB/country refer
ence]. They shall provide each other with any information or documents relevant for the performance of their respective
obligations and the exercise of their respective rights under these Conditions, without prejudice to any banking secrecy
obligations.
2. The [insert name of CB] shall establish and maintain a system support desk to assist participants in relation to
difficulties arising in connection with system operations.
3. Up-to-date information on the SSP’s operational status shall be available on the TARGET2 Information System
(T2IS). The T2IS may be used to obtain information on any event affecting the normal operation of TARGET2.
4. The [insert name of CB] may either communicate messages to participants by means of an ICM broadcast or by any
other means of communication.
5. Participants are responsible for the timely update of existing static data collection forms and the submission of new
static data collection forms to the [insert name of CB]. Participants are responsible for verifying the accuracy of
information relating to them that is entered into TARGET2-[insert CB/country reference] by the [insert name of CB].
6. The [insert name of CB] shall be deemed to be authorised to communicate to the SSP-providing NCBs any
information relating to participants which the SSP-providing NCBs may need in their role as service administrators, in
accordance with the contract entered into with the network service provider.
7. Participants
shall
inform
the
[insert
name
of
CB]
about
any
change
in
their
legal
capacity
and
relevant
legislative
changes affecting issues covered by the country opinion relating to them.
8. Participants
shall
inform
the
[insert
name
of
CB]
of:
(a) any new indirect participant, addressable BIC holder or entity with multi-addressee access which they register; and
(b) any changes to the entities listed in paragraph (a).
9. Participants shall immediately inform the [insert name of CB] if an event of default occurs in relation to them.

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TITLE IV
MANAGEMENT OF PM ACCOUNTS AND PROCESSING OF PAYMENT ORDERS
Article 12
Opening and management of PM accounts
1. The
[insert
name
of
CB]
shall
open
and
operate
at
least
one
PM
account
for
each
participant.
Upon
request
by
a
participant acting as a settlement bank, the [insert name of CB] shall open one or more sub-accounts in TARGET2-[insert
CB/country reference] to be used for dedicating liquidity.
2. [Insert
if
applicable:
No
debit
balance
shall
be
allowed
on
PM
accounts].
3. [Insert if applicable: At the beginning and end of a business day, there shall be a zero balance on the PM accounts.
Participants shall be deemed to have instructed the [insert name of CB] to transfer any balance at the end of a business
day to the account designated by the participant].
4.
[Insert if applicable: At the beginning of the next business day such balance shall be retransferred to the participant’s
PM account].
5. PM
accounts
and
their
sub-accounts
shall
be
interest
free,
unless
they
are
used
to
hold
minimum
reserves.
In
such
a
case, the calculation and payment of the remuneration of holdings of minimum reserves shall be governed by Council
Regulation (EC) No 2531/98 of 23 November 1998 concerning the application of minimum reserves by the European
Central Bank ( 1 ) and Regulation (EC) No 1745/2003 of the European Central Bank of 12 September 2003 on the
application of minimum reserves (ECB/2003/9) ( 2 ).
6. In addition to the settlement of payment orders in the Payments Module, a PM account may be used to settle
payment orders to and from Home Accounts, according to the rules laid down by the [insert name of CB].
7. Participants
shall
use
the
ICM
to
obtain
information
on
their
liquidity
position.
The
[insert
name
of
CB]
shall
provide a daily statement of accounts to any participant that has opted for such service.
Article 13
Types of payment orders
The following are classified as payment orders for the purposes of TARGET2:
(a) credit transfer orders;
(b) direct debit instructions carried out under a direct debit authorisation; and
(c) liquidity transfer orders.
Article 14
Acceptance and rejection of payment orders
1. Payment orders submitted by participants are deemed accepted by the [insert name of CB] if:
(a) the payment message complies with the rules established by the network service provider;
(b) the payment message complies with the formatting rules and conditions of TARGET2-[insert CB/country reference]
and passes the double-entry check described in Appendix I; and
(c) in cases where a payer or a payee has been suspended, the suspended participant’s CB’s explicit consent has been
obtained.
( 1 ) OJ L 318, 27.11.1998, p. 1.
( 2 ) OJ L 250, 2.10.2003, p. 10.

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2. The
[insert
name
of
CB]
shall
immediately
reject
any
payment
order
that
does
not
fulfil
the
conditions
laid
down
in
paragraph 1. The [insert name of CB] shall inform the participant of any rejection of a payment order, as specified in
Appendix I.
3. The SSP determines the timestamp for the processing of payment orders on the basis of the time when it receives
and accepts the payment order.
Article 15
Priority rules
1. Instructing participants shall designate every payment order as one of the following:
(a) normal payment order (priority class 2);
(b) urgent payment order (priority class 1);
(c) highly urgent payment order (priority class 0).
If a payment order does not indicate the priority, it shall be treated as a normal payment order.
2. Highly
urgent
payment
orders
may
only
be
designated
by:
(a) CBs; and
(b) participants, in cases of payments to and from CLS International Bank and liquidity transfers in relation to ancillary
system settlement using the ASI.
All payment instructions submitted by an ancillary system through the ASI to debit or credit the participants’ PM
accounts shall be deemed to be highly urgent payment orders.
3. Liquidity
transfer
orders
initiated
via
the
ICM
are
urgent
payment
orders.
4. In the case of urgent and normal payment orders, the payer may change the priority via the ICM with immediate
effect. It shall not be possible to change the priority of a highly urgent payment order.
Article 16
Liquidity limits
1. A
participant
may
limit
the
use
of
available
liquidity
for
payment
orders
in
relation
to
other
TARGET2
participants,
except any of the CBs, by setting bilateral or multilateral limits. Such limits may only be set in relation to normal
payment orders.
2. Limits may only be set by or in relation to an AL group in its entirety. Limits shall not be set in relation to either a
single PM account of an AL group member or by AL group members in relation to each other.
3. By setting a bilateral limit, a participant instructs the [insert name of CB] that an accepted payment order shall not
be settled if the sum of its outgoing normal payment orders to another TARGET2 participant’s PM account minus the
sum of all incoming urgent and normal payments from such TARGET2 participant’s PM account would exceed this
bilateral limit.
4. A participant may set a multilateral limit for any relationship that is not subject to a bilateral limit. A multilateral
limit may only be set if the participant has set at least one bilateral limit. If a participant sets a multilateral limit, it
instructs the [insert name of CB] that an accepted payment order shall not be settled if the sum of its outgoing normal
payment orders to all TARGET2 participants’ PM accounts in relation to which no bilateral limit has been set, minus the
sum of all incoming urgent and normal payments from such PM accounts would exceed this multilateral limit.

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5. The minimum amount of any of the limits shall be EUR 1 million. A bilateral or a multilateral limit with an amount
of zero shall be treated as if no limit has been set. Limits between zero and EUR 1 million are not possible.
6.
Limits may be changed in real time with immediate effect or with effect from the next business day via the ICM. If a
limit is changed to zero, it shall not be possible to change it again on the same business day. The setting of a new
bilateral or multilateral limit shall only be effective from the next business day.
Article 17
Liquidity reservation facilities
1. Participants
may
reserve
liquidity
for
highly
urgent
or
urgent
payment
orders
via
the
ICM.
2.
The AL group manager may only reserve liquidity for the AL group in its entirety. Liquidity shall not be reserved for
single accounts within an AL group.
3. By
requesting
to
reserve
a
certain
amount
of
liquidity
for
highly
urgent
payment
orders,
a
participant
instructs
the
[insert name of CB] only to settle urgent and normal payment orders if there is available liquidity after the amount
reserved for highly urgent payment orders has been deducted.
4. By
requesting
to
reserve
a
certain
amount
of
liquidity
for
urgent
payment
orders,
a
participant
instructs
the
[insert
name of CB] only to settle normal payment orders if there is available liquidity after the amount reserved for urgent and
highly urgent payment orders has been deducted.
5. After receipt of the reservation request the [insert name of CB] shall check whether the amount of liquidity on the
participant’s PM account is sufficient for the reservation. If this is not the case, only the liquidity available on the PM
account shall be reserved. The rest of the requested liquidity shall be reserved if additional liquidity becomes available.
6. The level of the liquidity reservation may be changed. Participants may make a request via the ICM to reserve new
amounts with immediate effect or with effect from the next business day.
Article 17a
Standing instructions for liquidity reservation and dedication of liquidity
1. Participants may predefine the default amount of liquidity reserved for highly urgent or urgent payment orders via
the ICM. Such standing instruction or a change to such instruction shall take effect from the next business day.
2.
Participants may predefine via the ICM the default amount of liquidity set aside for ancillary system settlement. Such
standing instruction or a change to such instruction shall take effect from the next business day. Participants shall be
deemed to have instructed the [insert name of CB] to dedicate liquidity on their behalf if the relevant ancillary system so
requests.
Article 18
Predetermined settlement times
1. Instructing participants may predetermine the settlement time of the payment orders within a business day by using
the Earliest Debit Time Indicator or the Latest Debit Time Indicator.
2. When the Earliest Debit Time Indicator is used, the accepted payment order is stored and only entered into the
entry disposition at the indicated time.
3. When the Latest Debit Time Indicator is used, the accepted payment order shall be returned as non-settled if it
cannot be settled by the indicated debit time. 15 minutes prior to the defined debit time, the instructing participant shall
be sent an automatic notification via the ICM. Instructing participant may also use the Latest Debit Time Indicator solely
as a warning indicator. In such cases, the payment order concerned shall not be returned.
4. Instructing participants can change the Earliest Debit Time Indicator and the Latest Debit Time Indicator via the
ICM.

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5. Further technical details are contained in Appendix I.
Article 19
Payment orders submitted in advance
1. Payment
orders
may
be
submitted
up
to
five
business
days
before
the
specified
settlement
date
(warehoused
payment orders).
2. Warehoused payment orders shall be accepted and entered into the entry disposition on the date specified by the
instructing participant at the start of daytime processing, as referred to in Appendix V. They shall be placed in front of
payment orders of the same priority.
3. Article
15(3),
Article
22(2)
and
Article
29(1)(a)
shall
apply mutatis mutandis to warehoused payment orders.
Article 20
Settlement of payment orders in the entry disposition
1. Unless instructing participants have indicated the settlement time in the manner described in Article 18, accepted
payment orders shall be settled immediately or at the latest by the end of the business day on which they were accepted,
provided that sufficient funds are available on the payer’s PM account and taking into account any liquidity limits and
liquidity reservations as referred to in Articles 16 and 17.
2. Funding
may
be
provided
by:
(a) the available liquidity on the PM account; or
(b) incoming payments from other TARGET2 participants, subject to the applicable optimisation procedures.
3. For highly urgent payment orders the ‘first in, first out’ (FIFO) principle shall apply. This means that highly urgent
payment orders shall be settled in chronological order. Urgent and normal payment orders shall not be settled for as long
as highly urgent payment orders are queued.
4. For urgent payment orders the FIFO principle shall also apply. Normal payment orders shall not be settled if urgent
and highly urgent payment orders are queued.
5. By derogation from paragraphs 3 and 4, payment orders with a lower priority (or of the same priority but accepted
later) may be settled before payment orders with a higher priority (or of the same priority which were accepted earlier), if
the payment orders with a lower priority would net out with payments to be received and result on balance in a liquidity
increase for the payer.
6. Normal
payment
orders
shall
be
settled
in
accordance
with
the
FIFO
by-passing
principle.
This
means
that
they
may
be settled immediately (independently of other queued normal payments accepted at an earlier time) and may therefore
breach the FIFO principle, provided that sufficient funds are available.
7. Further details on the settlement of payment orders in the entry disposition are contained in Appendix I.
Article 21
Settlement and return of queued payment orders
1. Payment orders that are not settled immediately in the entry disposition shall be placed in the queues in accordance
with the priority to which they were designated by the relevant participant, as referred to in Article 15.
2. To optimise the settlement of queued payment orders, the [insert name of CB] may use the optimisation procedures
described in Appendix I.

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3. Except for highly urgent payment orders, the payer may change the queue position of payment orders in a queue,
i.e. reorder them, via the ICM. Payment orders may be moved either to the front or to the end of the respective queue
with immediate effect at any time during daytime processing, as referred to in Appendix V.
4. At the request of a payer, the [insert name of CB] or, in the case of an AL group, the CB of the AL group manager
may decide to change the queue position of a highly urgent payment order (except for highly urgent payment orders in
the context of settlement procedures 5 and 6) provided that this change would not affect the smooth settlement by
ancillary systems in TARGET2 or would not otherwise give rise to systemic risk.
5. Liquidity transfer orders initiated in the ICM shall be immediately returned as non-settled if there is insufficient
liquidity. Other payment orders shall be returned as non-settled if they cannot be settled by the cut-off times for the
relevant message type, as specified in Appendix V.
Article 22
Entry of payment orders into the system and their irrevocability
1. For the purposes of the first sentence of Article 3(1) of Directive 98/26/EC and [insert national law provisions
implementing this Article of Directive 98/26/EC], payment orders are deemed entered into TARGET2-[insert CB/country
reference] at the moment that the relevant participant’s PM account is debited.
2. Payment orders may be revoked until they are entered into TARGET2-[insert CB/country reference] in accordance
with paragraph 1. Payment orders that are included in an algorithm, as referred to in Appendix I, may not be revoked
during the period that the algorithm is running.
TITLE V
LIQUIDITY POOLING
Article 23
Liquidity pooling modes
The [insert name of CB] shall offer a consolidated account information (CAI) mode and an aggregated liquidity (AL)
mode.
Article 24
Consolidated account information mode
1. The
following
may
use
the
CAI
mode:
(a) a credit institution and/or its branches (whether or not such entities participate in the same TARGET2 component
system), provided that the entities concerned have several PM accounts identified by different BICs; or
(b) two or more credit institutions which belong to the same group and/or their branches, each having one or more PM
accounts identified by different BICs.
2. (a) Under the CAI mode, each member of the CAI group and their respective CBs are provided with the list of PM
accounts of the group members and the following additional information consolidated at the level of the CAI
group:
(i) intraday credit lines (if applicable);
(ii) balances, including balances on sub-accounts;
(iii) turnover;
(iv) settled payments;
(v) queued payment orders.
(b) The CAI group manager and its respective CB shall have access to information on each of the above items in
relation to any PM account of the CAI group.

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(c) Information referred to in this paragraph is provided via the ICM.
3. The CAI group manager shall be entitled to initiate liquidity transfers via the ICM between the PM accounts,
including their sub-accounts, forming part of the same CAI group.
4. A CAI group may also include PM accounts which are included in an AL group. In such a case, all the PM accounts
of the AL group shall form part of the CAI group.
5. Where two or more PM accounts form part of an AL group and, at the same time, of a CAI group (comprising
additional PM accounts), the rules applicable to the AL group shall prevail as to the relationship within the AL group.
6. A CAI group, which includes PM accounts of an AL group, may appoint a CAI group manager that is different from
the AL group manager.
7. The
procedure
for
obtaining
authorisation
to
use
the
AL
mode,
set
out
in
Article
25(4)
and
(5),
shall
apply mutatis
mutandis to the procedure for obtaining authorisation to use the CAI mode. The CAI group manager shall not address an
executed CAI mode agreement to the managing NCB.
Article 25
Aggregated liquidity mode
1. The
following
may
use
the
AL
mode:
(a) a credit institution and/or its branches (whether or not such entities participate in the same TARGET2 component
system), provided that the entities concerned are established in the euro area and have several PM accounts identified
by different BICs;
(b) branches established in the euro area (whether or not such branches participate in the same TARGET2 component
system) of a credit institution established outside the euro area, provided that such branches have several PM accounts
identified by different BICs; or
(c) two or more credit institutions referred to in subparagraph (a) and/or branches referred to in subparagraph (b) which
belong to the same group.
In each case referred in subparagraphs (a) to (c) it shall also be a requirement that the entities concerned have established
intraday credit arrangements with the respective euro area NCB.
2. Under the AL mode, for the purpose of checking whether a payment order is sufficiently covered, available liquidity
on all the AL group members’ PM accounts is aggregated. Notwithstanding the above, the bilateral PM account rela
tionship between the AL group member and its AL NCB shall continue to be governed by the arrangements of the
relevant TARGET2 component system, subject to the modifications set out in the AL agreement. Intraday credit extended
to any AL group member on its PM account may be covered by the available liquidity on the other PM accounts held by
such AL group member or PM accounts held by any other AL group members with the same or any other AL NCB.
3. In
order
to
use
the
AL
mode,
one
or
more
TARGET2
participants
meeting
the
criteria
in
paragraph
1
shall
enter
into an AL agreement with the [insert name of CB] and, if applicable, other CBs of the TARGET2 component systems in
which other AL group members participate. A TARGET2 participant may only enter into one AL agreement in relation to
a particular PM account. The AL agreement shall be in conformity with the relevant template in Appendix VII.
4. Each AL group shall designate an AL group manager. In the event that the AL group consists of only one
participant, this participant shall act as the AL group manager. The AL group manager shall address to the managing
NCB a written request to use the AL mode (containing static data collection forms as provided by [insert name of CB]),
together with the executed AL agreement on the basis of the template provided by the managing NCB. The remaining AL
group members shall address their written requests (containing static data collection forms as provided by [insert name of
CB]) to their respective AL NCBs. The managing NCB may request any additional information or document that it deems
appropriate in order to decide on the request. In addition, the managing NCB, in agreement with the other AL NCBs, may
require the insertion of any additional provision in the AL agreement that it deems appropriate in order to ensure the
proper and timely discharge of any existing and/or future obligation of all AL group members towards any AL NCB.

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5. The managing NCB shall verify whether the applicants fulfil the requirements to form an AL group and whether the
AL agreement has been properly executed. To this end, the managing NCB may liaise with the other AL NCBs. The
managing NCB’s decision shall be addressed, in writing, to the AL group manager within one month of receipt of the
request referred to in paragraph 4 by the managing NCB, or, if the managing NCB requests additional information, within
one month of receipt of such information by the managing NCB. Any rejection decision shall contain reasons for the
rejection.
6. AL
group
members
shall
automatically
have
access
to
the
CAI
mode.
7.
The provision of information and all interactive control measures within an AL group shall be accessed via the ICM.
[Insert if applicable:
Article 25a
Pledge/enforcement
1. The [insert name of CB]’s current and future claims arising from the legal relationship between an AL group
member and the [insert name of CB] and which are secured by the [insert the applicable term: pledge/floating charge]
under Article 36(1) and (2) of these Conditions shall include the [insert name of CB]’s claims against such AL group
member arising under the AL agreement to which both are party.
2. [Insert
if
required
under
the
laws
of
the
relevant
jurisdiction:
Without
prejudice
to
the
AL
agreement,
such
pledge
shall not prevent the participant from using the cash deposited in its PM accounts during the business day.]
3. [Insert
if
required
under
the
laws
of
the
relevant
jurisdiction:
Special
allocation
clause:
The
AL
group
member
allocates the cash deposited in its PM account for the execution of all its obligations arising from the [insert reference to
the arrangements implementing the Harmonised Conditions].]
[If applicable and if required under the laws of the relevant jurisdiction:
Article 25b
Enforcement of the pledge
Upon the occurrence of an enforcement event, the [insert name of CB] shall have an unrestricted right to realise the
pledge without any prior notice. [Insert if deemed appropriate under the laws of the relevant jurisdiction: in accordance
with [insert relevant national law provisions governing enforcement of the pledge].]
[If applicable and if required under the laws of the relevant jurisdiction:
Article 25c
Enforcement of collateral
Upon occurrence of the enforcement event, the [insert name of the CB] shall have the right to realise collateral under
Article 36.]
Article 26
Set-off of claims under Article 36(4) and (5)
On the occurrence of an enforcement event, any claim of the [insert name of CB] against such AL group member shall be
automatically and immediately accelerated and shall be subject to Article 36(4) and (5) of these Conditions.
TITLE VI
SECURITY REQUIREMENTS AND CONTINGENCY ISSUES
Article 27
Business continuity and contingency procedures
In the event of an abnormal external event or any other event which affects the operation of the SSP, the business
continuity and contingency procedures described in Appendix IV shall apply.

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Article 28
Security requirements
1. Participants
shall
implement
adequate
security
controls
to
protect
their
systems
from
unauthorised
access
and
use.
Participants shall be exclusively responsible for the adequate protection of the confidentiality, integrity and availability of
their systems.
2. Participants shall inform the [insert name of CB] of any security-related incidents in their technical infrastructure
and, where appropriate, security-related incidents that occur in the technical infrastructure of the third party providers.
The [insert name of CB] may request further information about the incident and, if necessary, request that the participant
take appropriate measures to prevent a recurrence of such an event.
3. The [insert name of CB] may impose additional security requirements on all participants and/or on participants that
are considered critical by the [insert name of CB].
TITLE VII
THE INFORMATION AND CONTROL MODULE
Article 29
Use of the ICM
1. The
ICM:
(a) allows participants to access information relating to their accounts and to manage liquidity;
(b) may be used to initiate liquidity transfer orders; and
(c) allows participants to initiate backup liquidity redistribution and backup contingency payments in the event of a
failure of the participant’s payment infrastructure.
2. Further technical details relating to the ICM are contained in Appendix I.
TITLE VIII
COMPENSATION, LIABILITY REGIME AND EVIDENCE
Article 30
Compensation scheme
If a payment order cannot be settled on the same business day on which it was accepted due to a technical malfunction
of TARGET2, the [insert name of CB] shall offer to compensate the direct participants concerned in accordance with the
special procedure laid down in Appendix II.
Article 31
Liability regime
1. In performing their obligations pursuant to these Conditions, the [insert name of CB] and the participants shall be
bound by a general duty of reasonable care in relation to each other.
2. The [insert name of CB] shall be liable to its participants in cases of fraud (including but not limited to wilful
misconduct) or gross negligence, for any loss arising out of the operation of TARGET2-[insert CB/country reference]. In
cases of ordinary negligence, the [insert name of CB]’s liability shall be limited to the participant’s direct loss, i.e. the
amount of the transaction in question and/or the loss of interest thereon, excluding any consequential loss.
3. The
[insert
name
of
CB]
is
not
liable
for
any
loss
that
results
from
any
malfunction
or
failure
in
the
technical
infrastructure (including but not limited to the [insert name of CB]’s computer infrastructure, programmes, data, appli
cations or networks), if such malfunction or failure arises in spite of the [insert name of CB] having adopted those
measures that are reasonably necessary to protect such infrastructure against malfunction or failure, and to resolve the
consequences of such malfunction or failure (the latter including but not limited to initiating and completing the business
continuity and contingency procedures referred to in Appendix IV).

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4. The
[insert
name
of
CB]
shall
not
be
liable:
(a) to the extent that the loss is caused by the participant; or
(b) if the loss arises out of external events beyond the [insert name of CB]’s reasonable control (force majeure).
5.
Notwithstanding the [insert national law provisions implementing Directive 2007/64/EC of the European Parliament
and of the Council of 13 November 2007 on payment services in the internal market amending Directives 97/7/EC,
2002/65/EC, 2005/60/EC and 2006/48/EC and repealing Directive 97/5/EC ( 1 ) paragraphs 1 to 4 shall apply to the extent
that the [insert name of CB]’s liability can be excluded.
6. The
[insert
name
of
CB]
and
the
participants
shall
take
all
reasonable
and
practicable
steps
to
mitigate
any
damage
or loss referred to in this Article.
7. In performing some or all of its obligations under these Conditions, the [insert name of CB] may commission third
parties in its own name, particularly telecommunications or other network providers or other entities, if this is necessary
to meet the [insert name of CB]’s obligations or is standard market practice. The [insert name of CB]’s obligation shall be
limited to the due selection and commissioning of any such third parties and the [insert name of CB]’s liability shall be
limited accordingly. For the purposes of this paragraph, the SSP-providing NCBs shall not be considered as third parties.
Article 32
Evidence
1. Unless otherwise provided in these Conditions, all payment and payment processing-related messages in relation to
TARGET2, such as confirmations of debits or credits, or statement messages, between the [insert name of CB] and
participants shall be made through the network service provider.
2. Electronic or written records of the messages retained by the [insert name of CB] or by the network service provider
shall be accepted as a means of evidence of the payments processed through the [insert name of CB]. The saved or
printed version of the original message of the network service provider shall be accepted as a means of evidence,
regardless of the form of the original message.
3. If a participant’s connection to the network service provider fails, the participant shall use the alternative means of
transmission of messages laid down in Appendix IV. In such cases, the saved or printed version of the message produced
by the [insert name of CB] shall have the same evidential value as the original message, regardless of its form.
4. The [insert name of CB] shall keep complete records of payment orders submitted and payments received by
participants for a period of [insert period required by relevant national law] from the time at which such payment orders
are submitted and payments are received, provided that such complete records shall cover a minimum of five years for
any participant in TARGET2 that is subject to continuous vigilance pursuant to restrictive measures adopted by the
Council of the European Union or Member States, or more if required by specific regulations.
5. The
[insert
name
of
CB]’s
own
books
and
records
(whether
kept
on
paper,
microfilm,
microfiche,
by
electronic
or
magnetic recording, in any other mechanically reproducible form or otherwise) shall be accepted as a means of evidence
of any obligations of the participants and of any facts and events that the parties rely on.
TITLE IX
TERMINATION OF PARTICIPATION AND CLOSURE OF ACCOUNTS
Article 33
Duration and ordinary termination of participation
1. Without
prejudice
to
Article
34,
participation
in
TARGET2-[insert
CB/country
reference]
is
for
an
indefinite
period
of time.
2. A
participant
may
terminate
its
participation
in
TARGET2-[insert
CB/country
reference]
at
any
time
giving
14
business days’ notice thereof, unless it agrees a shorter notice period with the [insert name of CB].
( 1 ) OJ L 319, 5.2.2007, p. 1.

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3. The
[insert
name
of
CB]
may
terminate
a
participant’s
participation
in
TARGET2-[insert
CB/country
reference]
at
any time giving three months’ notice thereof, unless it agrees a different notice period with that participant.
4. On termination of participation, the confidentiality duties laid down in Article 38 remain in force for a period of
five years starting on the date of termination.
5. On termination of participation, the PM accounts of the participant concerned shall be closed in accordance with
Article 35.
Article 34
Suspension and extraordinary termination of participation
1. A
participant’s
participation
in
TARGET2-[insert
CB/country
reference]
shall
be
immediately
terminated
without
prior notice or suspended if one of the following events of default occurs:
(a) the opening of insolvency proceedings; and/or
(b) the participant no longer meets the access criteria laid down in Article 4.
2. The
[insert
name
of
CB]
may
terminate
without
prior
notice
or
suspend
the
participant’s
participation
in
TARGET2-
[insert CB/country reference] if:
(a) one or more events of default (other than those referred to in paragraph 1) occur;
(b) the participant is in material breach of these Conditions;
(c) the participant fails to carry out any material obligation to the [insert name of CB];
(d) the participant is excluded from, or otherwise ceases to be a member of, a TARGET2 CUG;
(e) any other participant-related event occurs which, in the [insert name of CB]’s assessment, would threaten the overall
stability, soundness and safety of TARGET2-[insert CB/country reference] or of any other TARGET2 component
system, or which would jeopardise the [insert name of CB]’s performance of its tasks as described in [refer to relevant
national law] and the Statute of the European System of Central Banks and of the European Central Bank, or poses
risks on the grounds of prudence; and/or
(f) an NCB suspends or terminates the participant’s access to intraday credit pursuant to paragraph 12 of Annex III.
3. In
exercising
its
discretion
under
paragraph
2,
the
[insert
name
of
CB]
shall
take
into
account,
inter
alia,
the
seriousness of the event of default or events mentioned in subparagraphs (a) to (c).
4. (a)
In
the
event
that
the
[insert
name
of
CB]
suspends
or
terminates
a
participant’s
participation
in
TARGET2-
[insert CB/country reference] under paragraph 1 or 2, the [insert name of CB] shall immediately inform that
participant, other CBs and the other participants of such suspension or termination by means of an ICM
broadcast message.
(b) In the event that the [insert name of CB] is informed by another CB of a suspension or termination of a
participant in another TARGET2 component system, the [insert name of CB] shall immediately inform its
participants of such suspension or termination by means of an ICM broadcast message.
(c) Once such an ICM broadcast message has been received by the participants, the latter shall be deemed informed
of the termination/suspension of a participant’s participation in TARGET2-[insert CB/country reference] or
another TARGET2 component system. The participants shall bear any losses arising from the submission of
a payment order to participants whose participation has been suspended or terminated if such payment order
was entered into TARGET2-[insert CB/country reference] after receipt of the ICM broadcast message.

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5. Upon
termination
of
a
participant’s
participation,
TARGET2-[insert
CB/country
reference]
shall
not
accept
any
new
payment orders from such participant. Payment orders in the queue, warehoused payment orders or new payment orders
in favour of such participant shall be returned.
6. If
a
participant
is
suspended
from
TARGET2-[insert
CB/country
reference],
all
its
incoming
payments
and
outgoing
payment orders shall be stored and only entered into the entry disposition after they have been explicitly accepted by the
suspended participant’s CB.
Article 35
Closure of PM accounts
1. Participants may close their PM accounts at any time provided they give the [insert name of CB] 14 business days’
notice thereof.
2. On termination of participation, pursuant to either Article 33 or 34, the [insert name of CB] shall close the PM
accounts of the participant concerned, after having:
(a) settled or returned any queued payment orders; and
(b) made use of its rights of pledge and set-off under Article 36.
TITLE X
FINAL PROVISIONS
Article 36
The [insert name of CB]’s rights of pledge and set-off
1. [Insert if applicable: The [insert name of CB] shall have a pledge over the participant’s existing and future credit
balances on its PM accounts, thereby collateralising any current and future claims arising out of the legal relationship
between the parties.]
1a. [Insert if applicable: A participant’s current and future claims towards the [insert name of the CB] arising from a
credit balance on the PM account shall be transferred to the [insert name of the CB] as collateral, i.e. as a fiduciary
transfer, for any current or future claim of the [insert name of the CB] towards the participant arising out of the [insert
reference to the arrangement implementing these Conditions]. Such collateral shall be established by the mere fact that
the funds have been credited to the participant’s PM account.]
1b. [Insert
if
applicable:
The
[insert
name
of
CB]
shall
have
a
floating
charge
over
the
participant’s
existing
and
future
credit balances on their PM accounts, thereby collateralising any current and future claims arising out of the legal
relationship between the parties.]
2. [Insert if applicable: The [insert name of CB] shall have the right referred to in paragraph 1 even if its claims are
only contingent or not yet due.]
3. [Insert
if
applicable:
The
participant,
acting
in
its
capacity
as
a
PM
account
holder,
hereby
acknowledges
the
creation
of a pledge in favour of [insert name of CB], with whom that account has been opened; this acknowledgement shall
constitute the provision of pledged assets to the [insert name of CB] referred to under [insert relevant national adjective]
law. Any amounts paid into the PM account whose balance is pledged shall, by the mere fact of being paid in, be
irrevocably pledged, without any limitation whatsoever, as collateral security for the full performance of the secured
obligations.]
4. On
the
occurrence
of:
(a) an event of default, referred to in Article 34(1); or

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(b) any other event of default or event referred to in Article 34(2) that has led to the termination or suspension of the
participant’s participation, notwithstanding the commencement of any insolvency proceedings in respect of a
participant and notwithstanding any assignment, judicial or other attachment or other disposition of or in respect
of the participant’s rights, all obligations of the participant shall be automatically and immediately accelerated, without
prior notice and without the need for any prior approval of any authority, so as to be immediately due. In addition,
the mutual obligations of the participant and the [insert name of CB] shall automatically be set off against each other,
and the party owing the higher amount shall pay to the other the difference.
5. The [insert name of CB] shall promptly give the participant notice of any set-off pursuant to paragraph 4 after such
set-off has taken place.
6. The [insert name of CB] may without prior notice debit any participant’s PM account by any amount which the
participant owes the [insert name of CB] resulting from the legal relationship between the participant and the [insert
name of CB].
Article 37
Security rights in relation to funds on sub-accounts
1. The
[insert
name
of
CB]
shall
have
[insert
reference
to
a
collateralisation
technique
under
the
applicable
legal
system] over the balance on a participant’s sub-account opened for the settlement of ancillary system-related payment
instructions under the arrangements between the relevant ancillary system and its CB. Such balance shall collateralise the
participant’s obligation referred to in paragraph 7 towards the [insert name of CB] in relation to such settlement.
2. The [insert name of CB] shall freeze the balance on the sub-account of the participant upon communication by the
ancillary system (via a ‘start-of-cycle’ message). Where applicable, the [insert name of CB] shall thereafter increase or
reduce the frozen balance by crediting or debiting cross-system settlement payments to or from the sub-account or
crediting liquidity transfers to the sub-account. Such freezing shall expire upon communication by the ancillary system
(via an ‘end-of-cycle’ message).
3. By confirming the freezing of the balance on the participant’s sub-account, the [insert name of CB] guarantees to
the ancillary system payment up to the amount of this particular balance. By confirming, where applicable, the increase or
reduction of the frozen balance upon crediting or debiting cross-system settlement payments to or from the sub-account
or crediting liquidity transfers to the sub-account, the guarantee is automatically increased or reduced in the amount of
the payment. Without prejudice to the abovementioned increase or reduction of the guarantee, the guarantee shall be
irrevocable, unconditional and payable on first demand. If the [insert name of CB] is not the ancillary system’s CB, the
[insert name of CB] shall be deemed instructed to issue the abovementioned guarantee to the ancillary system’s CB.
4. In the absence of any insolvency proceedings in relation to the participant, the ancillary system-related payment
instructions for the squaring of the participant’s settlement obligation shall be settled without drawing on the guarantee
and without recourse to the security right over the balance on the participant’s sub-account.
5. In the event of the participant’s insolvency, the ancillary system-related payment instruction for the squaring of the
participant’s settlement obligation shall be a first demand for payment under the guarantee; the debiting of the instructed
amount from the participant’s sub-account (and crediting of the ancillary system’s technical account) shall therefore
equally involve the discharge of the guarantee obligation by the [insert name of the CB] and a realisation of its collateral
right over the balance on the participant’s sub-account.
6. The guarantee shall expire upon communication by the ancillary system that the settlement has been completed (via
an ‘end-of-cycle’ message).
7. The participant shall be obliged to reimburse to the [insert name of CB] any payment made by the latter under such
guarantee.
Article 38
Confidentiality
1. The
[insert
name
of
CB]
shall
keep
confidential
all
sensitive
or
secret
information,
including
when
such
information
relates to payment, technical or organisational information belonging to the participant or the participant’s customers,
unless the participant or its customer has given its written consent to disclose [insert the following phrase if applicable
under national law: or such disclosure is permitted or required under [insert adjective relating to country name] law].

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2.
By derogation from paragraph 1, the participant agrees that the [insert name of CB] may disclose payment, technical
or organisational information regarding the participant or the participant’s customers obtained in the course of the
operation of TARGET2-[insert CB/country reference] to other CBs or third parties that are involved in the operation of
TARGET2-[insert CB/country reference], to the extent that this is necessary for the efficient functioning of TARGET2, or
to supervisory and oversight authorities of Member States and the Union to the extent that this is necessary for the
performance of their public tasks, and provided in all such cases that the disclosure is not in conflict with the applicable
law. The [insert name of CB] shall not be liable for the financial and commercial consequences of such disclosure.
3. By
derogation
from
paragraph
1
and
provided
this
does
not
make
it
possible,
whether
directly
or
indirectly,
to
identify the participant or the participant’s customers, the [insert name of CB] may use, disclose or publish payment
information regarding the participant or the participant’s customers for statistical, historical, scientific or other purposes in
the exercise of its public functions or of functions of other public entities to whom the information is disclosed.
4. Information relating to the operation of TARGET2-[insert CB/country reference] to which participants have had
access, may only be used for the purposes laid down in these Conditions. Participants shall keep such information
confidential, unless the [insert name of CB] has explicitly given its written consent to disclose. Participants shall ensure
that any third parties to whom they outsource, delegate or subcontract tasks which have or may have an impact on the
performance of their obligations under these Conditions are bound by the confidentiality requirements in this Article.
5. The [insert name of CB] shall be authorised, in order to settle payment orders, to process and transfer the necessary
data to the network service provider.
Article 39
Data protection, prevention of money laundering, administrative or restrictive measures and related issues
1. Participants shall be deemed to be aware of, and shall comply with, all obligations on them relating to legislation on
data protection, prevention of money laundering and the financing of terrorism, proliferation-sensitive nuclear activities
and the development of nuclear weapons delivery systems, in particular in terms of implementing appropriate measures
concerning any payments debited or credited on their PM accounts. Participants shall also acquaint themselves with the
network service provider’s data retrieval policy prior to entering into the contractual relationship with the network service
provider.
2. Participants shall be deemed to have authorised the [insert name of CB] to obtain any information relating to them
from any financial or supervisory authority or trade body, whether national or foreign, if such information is necessary
for the participant’s participation in TARGET2-[insert CB/country reference].
3. Participants,
when
acting
as
the
payment
service
provider
of
a
payer
or
payee,
shall
comply
with
all
requirements
resulting from administrative or restrictive measures imposed pursuant to Article 75 or 215 of the Treaty to which they
are subject, including with respect to notification and/or the obtaining of consent from a competent authority in relation
to the processing of transactions. In addition:
(a) when the [insert name of CB] is the payment service provider of a participant that is a payer:
(i) the participant shall make the required notification or obtain consent on behalf of the central bank that is
primarily required to make notification or obtain consent, and shall provide the [insert name of CB] with
evidence of having made a notification or having received consent;
(ii) the participant shall not enter any credit transfer order into TARGET2 until it has obtained confirmation from the
[insert name of CB] that the required notification has been made or the consent has been obtained by or on
behalf of the payment service provider of the payee;
(b) when the [insert name of CB] is a payment service provider of a participant that is a payee, the participant shall make
the required notification or obtain consent on behalf of the central bank that is primarily required to make
notification or obtain consent, and shall provide the [insert name of CB] with evidence of having made a notification
or having received consent.
For the purposes of this paragraph, the terms ‘payment service provider’, ‘payer’ and ‘payee’ shall have the meanings
ascribed to them in the applicable administrative or restrictive measures.

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Article 40
Notices
1. Except where otherwise provided for in these Conditions, all notices required or permitted pursuant to these
Conditions shall be sent by registered post, facsimile or otherwise in writing or by an authenticated message through
the network service provider. Notices to the [insert name of CB] shall be submitted to the head of the [insert payment
systems department or relevant CB unit] of [insert name of CB], [include relevant address of CB] or to the [insert BIC
address of the CB]. Notices to the participant shall be sent to it at the address, fax number or its BIC address as the
participant may from time to time notify to the [insert name of CB].
2. To prove that a notice has been sent, it shall be sufficient to prove that the notice was delivered to the relevant
address or that the envelope containing such notice was properly addressed and posted.
3. All
notices
shall
be
given
in
[insert
relevant
national
language
and/or
‘English’].
4. Participants shall be bound by all forms and documents of the [insert name of CB] that the participants have filled
in and/or signed, including but not limited to static data collection forms, as referred to in Article 8(2)(a), and information
provided under Article 11(5), which were submitted in compliance with paragraphs 1 and 2 and which the [insert name
of CB] reasonably believes to have received from the participants, their employees or agents.
Article 41
Contractual relationship with network service provider
1. For the purposes of these Conditions, the network service provider is SWIFT. Each participant shall enter into a
separate agreement with SWIFT regarding the services to be provided by SWIFT in relation to the participant’s use of
TARGET2-[insert CB/country reference]. The legal relationship between a participant and SWIFT shall be exclusively
governed by SWIFT’s terms and conditions.
2. Each participant shall also participate in a TARGET2 CUG, as specified by the SSP-providing NCBs acting as the
SWIFT service administrator for the SSP. Admission and exclusion of a participant to or from a TARGET2 CUG shall take
effect once communicated to SWIFT by the SWIFT service administrator.
3. Participants shall comply with the TARGET2 SWIFT Service Profile, as made available by the [insert name of CB].
4. The services to be provided by SWIFT shall not form part of the services to be performed by the [insert name of
CB] in respect of TARGET2.
5. The [insert name of CB] shall not be liable for any acts, errors or omissions of SWIFT (including its directors, staff
and subcontractors) as provider of SWIFT services, or for any acts, errors or omissions of network providers selected by
participants to gain access to the SWIFT network.
Article 42
Amendment procedure
The [insert name of CB] may at any time unilaterally amend these Conditions, including its Appendices. Amendments to
these Conditions, including its Appendices, shall be announced by means of [insert relevant means of announcement].
Amendments shall be deemed to have been accepted unless the participant expressly objects within 14 days of being
informed of such amendments. In the event that a participant objects to the amendment, the [insert name of CB] is
entitled immediately to terminate that participant’s participation in TARGET2-[insert CB/country reference] and close any
of its PM accounts.
Article 43
Third party rights
1. Any
rights,
interests,
obligations,
responsibilities
and
claims
arising
from
or
relating
to
these
Conditions
shall
not
be
transferred, pledged or assigned by participants to any third party without the [insert name of CB]’s written consent.
2. These Conditions do not create any rights in favour of or obligations in relation to any entity other than the [insert
name of CB] and participants in TARGET2-[insert CB/country reference].

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Article 44
Governing law, jurisdiction and place of performance
1. The
bilateral
relationship
between
the
[insert
name
of
CB]
and
participants
in
TARGET2-[insert
CB/country
reference] shall be governed by [insert adjective relating to country name] law.
2. Without prejudice to the competence of the Court of Justice of the European Union, any dispute arising from a
matter relating to the relationship referred to in paragraph 1 falls under the exclusive competence of the competent courts
of [insert place of the seat of the CB].
3. The
place
of
performance
concerning
the
legal
relationship
between
the
[insert
reference
to
CB]
and
the
participants
shall be [insert place of the seat of the CB].
Article 45
Severability
If any provision in these Conditions is or becomes invalid, this shall not prejudice the applicability of all the other
provisions of these Conditions.
Article 46
Entry into force and binding nature
1. These
Conditions
become
effective
from
[insert
relevant
date].
2. [Insert
if
appropriate
under
relevant
national
law:
By
participating
in
TARGET2-[insert
CB/country
reference],
participants automatically agree to these Conditions between themselves and in relation to the [insert name of CB].]

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Union L
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Appendix I
TECHNICAL SPECIFICATIONS FOR THE PROCESSING OF PAYMENT ORDERS
In addition to the Harmonised Conditions, the following rules shall apply to the processing of payment orders:
1. Technical requirements for participation in TARGET2-[insert CB/country reference] regarding infrastructure,
network and formats
(1) TARGET2 uses SWIFT services for the exchange of messages. Each participant therefore needs a connection to
SWIFT’s Secure IP Network. Each participant’s PM account shall be identified by an eight- or 11-digit SWIFT BIC.
Furthermore, each participant shall pass a series of tests to prove its technical and operational competence before it
may participate in TARGET2-[insert CB/country reference].
(2) For the submission of payment orders and the exchange of payment messages in the PM the SWIFTNet FIN
Y-copy service shall be used. A dedicated SWIFT Closed User Group (CUG) shall be set up for this purpose.
Payment orders within such TARGET2 CUG shall be directly addressed to the receiving TARGET2 participant by
entering its BIC in the header of the SWIFTNet FIN message.
(3) For the information and control services the following SWIFTNet services may be used:
(a) SWIFTNet InterAct;
(b) SWIFTNet FileAct; and/or
(c) SWIFTNet Browse.
(4) The security of the message exchange between participants shall rely exclusively on SWIFT’s Public Key Infra
structure (PKI) service. Information on the PKI service is available in the documentation provided by SWIFT.
(5) The ‘bilateral relationship management’ service provided by SWIFT’s Relationship Management Application (RMA)
shall only be used with the central destination BIC of the SSP and not for payment messages between TARGET2
participants.
2. Payment message types
(1) The following SWIFTNet FIN/SWIFT system message types are processed:
Message Type Type
of
use Description
MT 103 Mandatory Customer
payment
MT 103+ Mandatory Customer
payment
(Straight
Through
Processing)
MT 202 Mandatory Bank-to-bank
payment
MT 202COV Mandatory Cover
payments
MT 204 Optional Direct
debit
payment
MT 011 Optional Delivery
notification
MT 012 Optional Sender
notification
MT 019 Mandatory Abort
notification
MT 900 Optional Confirmation
of
debit/Credit
line
change
MT 910 Optional Confirmation
of
credit/Credit
line
change
MT 940/950 Optional (Customer)
statement
message
MT 011, MT 012 and MT 019 are SWIFT system messages.

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(2) When they register with TARGET2-[insert CB/country reference], direct participants shall declare which optional
message types they will use, with the exception of MT 011 and MT 012 messages in relation to which direct
participants shall decide from time to time whether or not to receive them with reference to specific messages.
(3) Participants shall comply with the SWIFT message structure and field specifications, as defined in the SWIFT
documentation and under the restrictions set out for TARGET2, as described in Chapter 9.1.2.2 of the User
Detailed Functional Specifications (UDFS), Book 1.
(4) Field contents shall be validated at the level of TARGET2-[insert country/CB reference] in accordance with the
UDFS requirements. Participants may agree among each other on specific rules regarding the field contents.
However, in TARGET2-[insert country/CB reference] there shall be no specific checks as to whether participants
comply with any such rules.
(5) MT 202COV messages shall be used for making cover payments, i.e. payments made by correspondent banks to
settle (cover) credit transfer messages which are submitted to a customer’s bank by other, more direct means.
Customer details contained in MT 202COV shall not be displayed in the ICM.
3. Double-entry check
(1) All payment orders shall pass a double-entry check, the aim of which is to reject payment orders that have been
submitted more than once by mistake.
(2) The following fields of the SWIFT message types shall be checked:
Details Part
of
the
SWIFT
message Field
Sender Basic
header LT
address
Message type Application
header Message
type
Receiver Application
header Destination
address
Transaction reference number (TRN) Text
block :20
Related reference Text
block :21
Value date Text
block :32
Amount Text
block :32
(3) If all the fields described in subparagraph 2 in relation to a newly submitted payment order are identical to those
in relation to a payment order that has already been accepted, the newly submitted payment order shall be
returned.
4. Error codes
If a payment order is rejected, the instructing participant shall receive an abort notification (MT 019) indicating the
reason for the rejection by using error codes. The error codes are defined in Chapter 9.4.2 of the UDFS.
5. Predetermined settlement times
(1) For payment orders using the Earliest Debit Time Indicator, the codeword ‘/FROTIME/’ shall be used.
(2) For payment orders using the Latest Debit Time Indicator, two options shall be available.
(a) Codeword ‘/REJTIME/’: if the payment order cannot be settled by the indicated debit time, the payment order
shall be returned.
(b) Codeword ‘/TILTIME/’: if the payment order cannot be settled by the indicated debit time, the payment order
shall not be returned but shall be kept in the relevant queue.

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Under both options, if a payment order with a Latest Debit Time Indicator is not settled 15 minutes prior to the
time indicated therein, a notification shall automatically be sent via the ICM.
(3) If the codeword ‘/CLSTIME/’ is used, the payment shall be treated in the same way as a payment order referred to
in subparagraph 2(b).
6. Settlement of payment orders in the entry disposition
(1) Offsetting checks and, if appropriate, extended offsetting checks (both terms as defined in paragraphs 2 and 3)
shall be carried out on payment orders entered into the entry disposition to provide quick, liquidity-saving gross
settlement of payment orders.
(2) An offsetting check shall determine whether the payee’s payment orders that are at the front of the highly urgent
or, if inapplicable, the urgent queue are available to be offset against the payer’s payment order (hereinafter
‘offsetting payment orders’). If an offsetting payment order does not provide sufficient funds for the respective
payer’s payment order in the entry disposition, it shall be determined whether there is sufficient available liquidity
on the payer’s PM account.
(3) If the offsetting check fails, the [insert name of CB] may apply an extended offsetting check. An extended offsetting
check determines whether offsetting payment orders are available in any of the payee’s queues regardless of when
they joined the queue. However, if in the queue of the payee there are higher priority payment orders addressed to
other TARGET2 participants, the FIFO principle may only be breached if settling such an offsetting payment order
would result in a liquidity increase for the payee.
7. Settlement of payment orders in the queue
(1) The treatment of payment orders placed in queues depends on the priority class to which it was designated by the
instructing participant.
(2) Payment orders in the highly urgent and urgent queues shall be settled by using the offsetting checks described in
paragraph 6, starting with the payment order at the front of the queue in cases where there is an increase in
liquidity or there is an intervention at queue level (change of queue position, settlement time or priority, or
revocation of the payment order).
(3) Payments orders in the normal queue shall be settled on a continuous basis including all highly urgent and urgent
payment orders that have not yet been settled. Different optimisation mechanisms (algorithms) are used. If an
algorithm is successful, the included payment orders will be settled; if an algorithm fails, the included payment
orders will remain in the queue. Three algorithms (1 to 3) shall be applied to offset payment flows. By means of
Algorithm 4, settlement procedure 5 (as defined in Chapter 2.8.1 of the UDFS) shall be available for the settlement
of payment instructions of ancillary systems. To optimise the settlement of highly urgent ancillary system trans
actions on participants’ sub-accounts, a special algorithm (Algorithm 5) shall be used.
(a) Under Algorithm 1 (‘all-or-nothing’) the [insert name of CB] shall, both for each relationship in respect of
which a bilateral limit has been set and also for the total sum of relationships for which a multilateral limit has
been set:
(i) calculate the overall liquidity position of each TARGET2 participant’s PM account by establishing whether
the aggregate of all outgoing and incoming payment orders pending in the queue is negative or positive
and, if it is negative, check whether it exceeds that participant’s available liquidity (the overall liquidity
position shall constitute the ‘total liquidity position’); and
(ii) check whether limits and reservations set by each TARGET2 participant in relation to each relevant PM
account are respected.
If the outcome of these calculations and checks is positive for each relevant PM account, the [insert name of
CB] and other CBs involved shall settle all payments simultaneously on the PM accounts of the TARGET2
participants concerned.
(b) Under Algorithm 2 (‘partial’) the [insert name of CB] shall:
(i) calculate and check the liquidity positions, limits and reservations of each relevant PM account as under
Algorithm 1; and

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(ii) if the total liquidity position of one or more relevant PM accounts is negative, extract single payment
orders until the total liquidity position of each relevant PM account is positive.
Thereafter, the [insert name of CB] and the other CBs involved shall, provided there are sufficient funds, settle
all remaining payments (except the extracted payment orders) simultaneously on the PM accounts of the
TARGET2 participants concerned.
When extracting payment orders, the [insert name of CB] shall start from the TARGET2 participant’s PM
account with the highest negative total liquidity position and from the payment order at the end of the queue
with the lowest priority. The selection process shall only run for a short time, to be determined by the [insert
name of CB] at its discretion.
(c) Under Algorithm 3 (‘multiple’) the [insert name of CB] shall:
(i) compare pairs of TARGET2 participants’ PM accounts to determine whether queued payment orders can be
settled within the available liquidity of the two TARGET2 participants’ PM accounts concerned and within
the limits set by them (by starting from the pair of PM accounts with the smallest difference between the
payment orders addressed to each other), and the CBs involved shall book those payments simultaneously
on the two TARGET2 participants’ PM accounts; and
(ii) if, in relation to a pair of PM accounts as described under point (i), liquidity is insufficient to fund the
bilateral position, extract single payment orders until there is sufficient liquidity. In this case the CBs
involved shall settle the remaining payments, except the extracted ones, simultaneously on the two
TARGET2 participants’ PM accounts.
After performing the checks specified under subparagraphs (i) to (ii), the [insert name of CB] shall check the
multilateral settlement positions (between a participant’s PM account and other TARGET2 participants’ PM
accounts in relation to which a multi-lateral limit has been set). For this purpose, the procedure described
under subparagraphs (i) to (ii) shall apply mutatis mutandis.
(d) Under Algorithm 4 (‘partial plus ancillary system settlement’) the [insert name of CB] shall follow the same
procedure as for Algorithm 2, but without extracting payment orders in relation to the settlement of an
ancillary system (which settles on a simultaneous multilateral basis).
(e) Under Algorithm 5 (‘ancillary system settlement via sub-accounts’) the [insert name of CB] shall follow the
same procedure as for Algorithm 1, subject to the modification that the [insert name of CB] shall start
Algorithm 5 via the ASI and shall only check whether sufficient funds are available on participants’ sub-
accounts. Moreover, no limits and reservations shall be taken into account. Algorithm 5 shall also run during
night-time settlement.
(4) Payment orders entered into the entry disposition after the start of any of Algorithms 1 to 4 may nevertheless be
settled immediately in the entry disposition if the positions and limits of the TARGET2 participants’ PM accounts
concerned are compatible with both the settlement of these payment orders and the settlement of payment orders
in the current optimisation procedure. However, two algorithms shall not run simultaneously.
(5) During daytime processing the algorithms shall run sequentially. As long as there is no pending simultaneous
multilateral settlement of an ancillary system, the sequence shall be as follows:
(a) Algorithm 1;
(b) if Algorithm 1 fails, then algorithm 2;
(c) if Algorithm 2 fails, then Algorithm 3, or if Algorithm 2 succeeds, repeat Algorithm 1.
When simultaneous multilateral settlement (‘procedure 5’) in relation to an ancillary system is pending, Algorithm
4 shall run.
(6) The algorithms shall run flexibly by setting a pre-defined time lag between the application of different algorithms
to ensure a minimum interval between the running of two algorithms. The time sequence shall be automatically
controlled. Manual intervention shall be possible.

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(7) While included in a running algorithm, a payment order shall not be reordered (change of the position in a queue)
or revoked. Requests for reordering or revocation of a payment order shall be queued until the algorithm is
complete. If the payment order concerned is settled while the algorithm is running, any request to reorder or
revoke shall be rejected. If the payment order is not settled, the participant’s requests shall be taken into account
immediately.
8. Use of the ICM
(1) The ICM may be used for obtaining information and managing liquidity. SWIFT’s Secure IP Network (SIPN) shall
be the underlying technical communications network for exchanging information and running control measures.
(2) With the exception of warehoused payment orders and static data information, only data in relation to the current
business day shall be available via the ICM. The screens shall be offered in English only.
(3) Information shall be provided in ‘pull’ mode, which means that each participant has to ask to be provided with
information.
(4) The following modes shall be available for using the ICM:
(a) Application-to-application mode (A2A)
In A2A, information and messages are transferred between the PM and the participant’s internal application.
The participant therefore has to ensure that an appropriate application is available for the exchange of XML
messages (requests and responses) with the ICM via a standardised interface. Further details are contained in the
ICM User Handbook and in Book 4 of the UDFS.
(b) User-to-application mode (U2A)
U2A permits direct communication between a participant and the ICM. The information is displayed in a
browser running on a PC system (SWIFT Alliance WebStation or another interface, as may be required by
SWIFT). For U2A access the IT infrastructure has to be able to support cookies and JavaScript. Further details
are described in the ICM User Handbook.
(5) Each participant shall have at least one SWIFT Alliance WebStation, or another interface, as may be required by
SWIFT, to have access to the ICM via U2A.
(6) Access rights to the ICM shall be granted by using SWIFT’s ‘Role Based Access Control’. The SWIFT ‘Non-
repudiation of emission’ (NRE) service, which may be used by participants, allows the recipient of an XML
message to prove that such message has not been altered.
(7) If a participant has technical problems and is unable to submit any payment order, it may generate preformatted
backup liquidity redistribution and backup contingency payments by using the ICM. The [insert name of CB] shall
open such functionality upon request of the participant.
(8) Participants may also use the ICM to transfer liquidity:
(a) [insert if applicable] from their PM account to their account outside the PM;
(b) between the PM account and the participant’s sub-accounts; and
(c) from the PM account to the mirror account managed by the ancillary system.
9. The UDFS and the ICM User Handbook
Further details and examples explaining the above rules are contained in the UDFS and the ICM User Handbook, as
amended from time to time and published on the [insert name of CB]’s website and the ECB’s website in English.

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Appendix II
TARGET2 COMPENSATION SCHEME
1. General principles
(a) If there is a technical malfunction of TARGET2, direct participants may submit claims for compensation in
accordance with the TARGET2 compensation scheme laid down in this Appendix.
(b) Unless otherwise decided by the ECB’s Governing Council, the TARGET2 compensation scheme shall not apply if
the technical malfunction of TARGET2 arises out of external events beyond the reasonable control of the CBs
concerned or as a result of acts or omissions by third parties.
(c) Compensation under the TARGET2 compensation scheme shall be the only compensation procedure offered in the
event of a technical malfunction of TARGET2. Participants may, however, use other legal means to claim for losses.
If a participant accepts a compensation offer under the TARGET2 compensation scheme, this shall constitute the
participant’s irrevocable agreement that it thereby waives all claims in relation to the payment orders concerning
which it accepts compensation (including any claims for consequential loss) it may have against any CB, and that
the receipt by it of the corresponding compensation payment constitutes full and final settlement of all such
claims. The participant shall indemnify the CBs concerned, up to a maximum of the amount received under the
TARGET2 compensation scheme, in respect of any further claims which are raised by any other participant or any
other third party in relation to the payment order or payment concerned.
(d) The making of a compensation offer shall not constitute an admission of liability by the [insert name of CB] or
any other CB in respect of a technical malfunction of TARGET2.
2. Conditions for compensation offers
(a) A payer may submit a claim for an administration fee and interest compensation if, due to a technical malfunction
of TARGET2 a payment order was not settled on the business day on which it was accepted.
(b) A payee may submit a claim for an administration fee if due to a technical malfunction of TARGET2 it did not
receive a payment that it was expecting to receive on a particular business day. The payee may also submit a claim
for interest compensation if one or more of the following conditions are met:
(i) in the case of participants that have access to the marginal lending facility: due to a technical malfunction of
TARGET2, a payee had recourse to the marginal lending facility; and/or
(ii) in the case of all participants: it was technically impossible to have recourse to the money market or such
refinancing was impossible on other, objectively reasonable grounds.
3. Calculation of compensation
(a) With respect to a compensation offer for a payer:
(i) the administration fee shall be EUR 50 for the first non-settled payment order, EUR 25 for each of the next
four such payment orders and EUR 12,50 for each further such payment order. The administration fee shall be
calculated separately in relation to each payee;
(ii) interest compensation shall be determined by applying a reference rate to be fixed from day to day. This
reference rate shall be the lower of the euro overnight index average (EONIA) rate and the marginal lending
rate. The reference rate shall be applied to the amount of the payment order not settled as a result of the
technical malfunction of TARGET2 for each day in the period from the date of the actual or, in relation to
payment orders referred to in paragraph 2(b)(ii), intended submission of the payment order until the date on
which the payment order was or could have been successfully settled. Any proceeds made by placing funds
resulting from non-settled payment orders on deposit with the Eurosystem shall be deducted from the amount
of any compensation; and
(iii) no interest compensation shall be payable if and in so far as funds resulting from non-settled payment orders
were placed in the market or used to fulfil minimum reserve requirements.

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(b) With respect to a compensation offer for a payee:
(i) the administration fee shall be EUR 50 for the first non-settled payment order, EUR 25 for each of the next
four such payment orders and EUR 12,50 for each further such payment order. The administration fee shall be
calculated separately in relation to each payer;
(ii) the method set out in subparagraph (a)(ii) for calculating interest compensation shall apply except that interest
compensation shall be payable at a rate equal to the difference between the marginal lending rate and the
reference rate, and shall be calculated on the amount of any recourse to the marginal lending facility occurring
as a result of the technical malfunction of TARGET2.
4. Procedural rules
(a) A claim for compensation shall be submitted on the claim form available on the website of the [insert name of CB]
in English (see [insert reference to website of CB]). Payers shall submit a separate claim form in respect of each
payee and payees shall submit a separate claim form in respect of each payer. Sufficient additional information and
documents shall be provided to support the information indicated in the claim form. Only one claim may be
submitted in relation to a specific payment or payment order.
(b) Within four weeks of a technical malfunction of TARGET2, participants shall submit their claim forms to the
[insert name of CB]. Any additional information and evidence requested by the [insert name of CB] shall be
supplied within two weeks of such request being made.
(c) The [insert name of CB] shall review the claims and forward them to the ECB. Unless otherwise decided by the
ECB’s Governing Council and communicated to the participants, all received claims shall be assessed no later than
14 weeks after the technical malfunction of TARGET2 occurs.
(d) The [insert name of CB] shall communicate the result of the assessment referred to in subparagraph (c) to the
relevant participants. If the assessment entails a compensation offer, the participants concerned shall, within four
weeks of the communication of such offer, either accept or reject it, in respect of each payment or payment order
comprised within each claim, by signing a standard letter of acceptance (in the form available on the website of the
[insert name of CB] (see [insert reference to website of CB]). If such letter has not been received by the [insert
name of CB] within four weeks, the participants concerned shall be deemed to have rejected the compensation
offer.
(e) The [insert name of CB] shall make compensation payments on receipt of a participant’s letter of acceptance of
compensation. No interest shall be payable on any compensation payment.

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Appendix III
TERMS OF REFERENCE FOR CAPACITY AND COUNTRY OPINIONS
Terms of reference for capacity opinions for participants in TARGET2
[Insert name of CB]
[address]
Participation in the [name of the system]
[location]
[date]
Dear Sir or Madam,
We have been asked to provide this Opinion as [in-house or external] legal advisers to [specify name of Participant or
branch of Participant] in respect of issues arising under the laws of [jurisdiction in which the Participant is established;
hereinafter the ‘jurisdiction’] in connection with the participation of [specify name of Participant] (hereinafter the ‘Par
ticipant’) in the [name of the TARGET2 component system] (hereinafter the ‘System’).
This Opinion is confined to the laws of [jurisdiction] as they exist as on the date of this Opinion. We have made no
investigation of the laws of any other jurisdiction as a basis for this Opinion, and do not express or imply any opinion in
this regard. Each of the statements and opinions presented below applies with equal accuracy and validity under the laws
of [jurisdiction], whether or not the Participant acts through its head office or one or more branches established inside or
outside of [jurisdiction] in submitting payment orders and receiving payments.
I. DOCUMENTS EXAMINED
For the purposes of this Opinion, we have examined:
(1) a certified copy of the [specify relevant constitutional documents] of the Participant such as is/are in effect on the
date hereof;
(2) [if applicable] an extract from the [specify relevant company register] and [if applicable] [register of credit
institutions or analogous register];
(3) [to the extent applicable] a copy of the Participant’s licence or other proof of authorisation to provide banking,
investment, funds transfer or other financial services in [jurisdiction];
(4) [if applicable] a copy of a resolution adopted by the board of directors or the relevant governing body of the
Participant on [insert date], [insert year], evidencing the Participant’s agreement to adhere to the System Docu
ments, as defined below; and
(5) [specify all powers of attorney and other documents constituting or evidencing the requisite power of the person
or persons signing the relevant System Documents (as defined below) on behalf of the Participant];
and all other documents relating to the Participant’s constitution, powers and authorisations necessary or appropriate
for the provision of this Opinion (hereinafter the ‘Participant Documents’).
For the purposes of this Opinion, we have also examined:
(1) the [insert reference to the arrangements implementing the Harmonised Conditions for participation in
TARGET2] for the System dated [insert date] (hereinafter the ‘Rules’); and

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(2) […].
The Rules and the […] shall be referred to hereinafter as the ‘System Documents’ (and collectively with the Participant
Documents as the ‘Documents’).
II. ASSUMPTIONS
For the purposes of this Opinion we have assumed in relation to the Documents that:
(1) the System Documents with which we have been provided are originals or true copies;
(2) the terms of the System Documents and the rights and obligations created by them are valid and legally binding
under the laws of [insert reference to the Member State of the System] by which they are expressed to be
governed, and the choice of the laws of [insert reference to the Member State of the System] to govern the System
Documents is recognised by the laws of [insert reference to the Member State of the System];
(3) the Participant Documents are within the capacity and power of and have been validly authorised, adopted or
executed and, where necessary, delivered by the relevant parties; and
(4) the Participant Documents are binding on the parties to which they are addressed, and there has been no breach
of any of their terms.
III. OPINIONS REGARDING THE PARTICIPANT
A. The Participant is a corporation duly established and registered or otherwise duly incorporated or organised under
the laws of [jurisdiction].
B. The Participant has all the requisite corporate powers to execute and perform the rights and obligations under the
System Documents to which it is party.
C. The adoption or execution and the performance by the Participant of the rights and obligations under the System
Documents to which the Participant is party will not in any way breach any provision of the laws or regulations
of [jurisdiction] applicable to the Participant or the Participant Documents.
D. No additional authorisations, approvals, consents, filings, registrations, notarisations or other certifications of or
with any court or govern-mental, judicial or public authority that is competent in [jurisdiction] are required by the
Participant in connection with the adoption, validity or enforceability of any of the System Documents or the
execution or performance of the rights and obligations thereunder.
E. The Participant has taken all necessary corporate action and other steps necessary under the laws of [jurisdiction]
to ensure that its obligations under the System Documents are legal, valid and binding.
This Opinion is stated as of its date and is addressed solely to [insert name of CB] and the [Participant]. No other
persons may rely on this Opinion, and the contents of this Opinion may not be disclosed to persons other than its
intended recipients and their legal counsel without our prior written consent, with the exception of the European
Central Bank and the national central banks of the European System of Central Banks [and [the national central
bank/relevant regulatory authorities] of [jurisdiction]].
Yours faithfully,
[signature]
Terms of reference for country opinions for non-EEA participants in TARGET2
[Insert name of CB]
[address]

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[name of the system]
[location],
[date]
Dear Sir or Madam,
We have been asked as [external] legal advisers to [specify name of Participant or branch of Participant] (the ‘Participant’)
in respect of issues arising under the laws of [jurisdiction in which the Participant is established; hereinafter the
‘jurisdiction’] to provide this Opinion under the laws of [jurisdiction] in connection with the participation of the
Participant in a system which is a component of TARGET2 (hereinafter the ‘System’). References herein to the laws of
[jurisdiction] include all applicable regulations of [jurisdiction]. We express an opinion herein under the law of [juris
diction], with particular regard to the Participant established outside [insert reference to the Member State of the System]
in relation to rights and obligations arising from participation in the System, as presented in the System Documents
defined below.
This Opinion is confined to the laws of [jurisdiction] as they exist on the date of this Opinion. We have made no
investigation of the laws of any other jurisdiction as a basis for this Opinion, and do not express or imply any opinion in
this regard. We have assumed that there is nothing in the laws of another jurisdiction which affects this Opinion.
1. DOCUMENTS
EXAMINED
For the purposes of this Opinion, we have examined the documents listed below and such other documents as we
have deemed necessary or appropriate:
(1) the [insert reference to the arrangements implementing the Harmonised Conditions for participation in
TARGET2] for the System dated [insert date] (hereinafter the ‘Rules’); and
(2) any other document governing the System and/or the relationship between the Participant and other
participants in the System, and between the participants in the System and the [insert name of CB].
The Rules and the […] shall be referred to hereinafter as the ‘System Documents’.
2. ASSUMPTIONS
For the purposes of this Opinion we have assumed in relation to the System Documents that:
(1) the System Documents are within the capacity and power of and have been validly authorised, adopted or
executed and, where necessary, delivered by the relevant parties;
(2) the terms of the System Documents and the rights and obligations created by them are valid and legally
binding under the laws of [insert reference to the Member State of the System], by which they are expressed to
be governed, and the choice of the laws of [insert reference to the Member State of the System] to govern the
System Documents is recognised by the laws of [insert reference to the Member State of the System];
(3) the participants in the System through which any payment orders are sent or payments are received, or
through which any rights or obligations under the System Documents are executed or performed, are
licensed to provide funds transfer services, in all relevant jurisdictions; and
(4) the documents submitted to us in copy or as specimens conform to the originals.
3. OPINION
Based on and subject to the foregoing, and subject in each case to the points set out below, we are of the opinion
that:

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3.1. Country-specific
legal
aspects
[to
the
extent
applicable]
The following characteristics of the legislation of [jurisdiction] are consistent with and in no way set aside the
obligations of the Participant arising out of the System Documents: [list of country-specific legal aspects].
3.2. General
insolvency
issues
3.2.a. Types of insolvency proceedings
The only types of insolvency proceedings (including composition or rehabilitation) which, for the purpose of this
Opinion, shall include all proceedings in respect of the Participant’s assets or any branch it may have in [juris
diction] to which the Participant may become subject in [jurisdiction], are the following: [list proceedings in
original language and English translation] (together collectively referred to as ‘Insolvency Proceedings’).
In addition to Insolvency Proceedings, the Participant, any of its assets, or any branch it may have in [jurisdiction]
may become subject in [jurisdiction] to [list any applicable moratorium, receivership, or any other proceedings as a
result of which payments to and/or from the Participant may be suspended, or limitations can be imposed in
relation to such payments, or similar proceedings in original language and English translation] (hereinafter collec
tively referred to as ‘Proceedings’).
3.2.b. Insolvency treaties
[jurisdiction] or certain political subdivisions within [jurisdiction], as specified, is/are party to the following
insolvency treaties: [specify, if applicable which have or may have an impact on this Opinion].
3.3. Enforceability
of
System
Documents
Subject to the points set out below, all provisions of the System Documents will be binding and enforceable in
accordance with their terms under the laws of [jurisdiction], in particular in the event of the opening of any
Insolvency Proceedings or Proceedings with respect to the Participant.
In particular, we are of the opinion that:
3.3.a. Processing of payment orders
The provisions on processing of payment orders [list of sections] of the Rules are valid and enforceable. In
particular, all payment orders processed pursuant to such sections will be valid, binding and will be enforceable
under the laws of [jurisdiction]. The provision of the Rules which specifies the precise point in time at which
payment orders submitted by the Participant to the System become enforceable and irrevocable ([add section of the
Rules]) is valid, binding and enforceable under the laws of [jurisdiction].
3.3.b. Authority of the [insert name of CB] to perform its functions
The opening of Insolvency Proceedings or Proceedings in respect of the Participant will not affect the authority and
powers of the [insert name of CB] arising out of the System Documents. [Specify [to the extent applicable] that: the
same opinion is also applicable in respect of any other entity which provides the Participants with services directly
and necessarily required for participation in the System, e.g. network service provider].
3.3.c. Remedies in the event of default
[Where applicable to the Participant, the provisions contained in [list of sections] of the Rules regarding accelerated
performance of claims which have not yet matured, the set-off of claims for using the deposits of the Participant,
the enforcement of a pledge, suspension and termination of participation, claims for default interest, and
termination of agreements and transactions ([insert other relevant clauses of the Rules or the System Documents])
are valid and enforceable under the laws of [jurisdiction].]
3.3.d. Suspension and termination
Where applicable to the Participant, the provisions contained in [list of sections] of the Rules (in respect of
suspension and termination of the Participant’s participation in the System on the opening of Insolvency
Proceedings or Proceedings or other events of default, as defined in the System Documents, or if the Participant
represents any kind of systemic risk or has serious operational problems) are valid and enforceable under the laws
of [jurisdiction].
3.3.e. Penalty regime
Where applicable to the Participant, the provisions contained in [list of sections] of the Rules in respect of penalties
imposed on a Participant which is unable to reimburse intraday credit or overnight credit, where applicable, on
time are valid and enforceable under the laws of [jurisdiction].

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3.3.f. Assignment of rights and obligations
The rights and obligations of the Participant cannot be assigned, altered or otherwise transferred by the Participant
to third parties without the prior written consent of the [insert name of CB].
3.3.g. Choice of governing law and jurisdiction
The provisions contained in [list of sections] of the Rules, and in particular in respect of the governing law, the
resolution of a dispute, competent courts, and service of process are valid and enforceable under the laws of
[jurisdiction].
3.4. Voidable
preferences
We are of the opinion that no obligation arising out of the System Documents, the performance thereof, or
compliance therewith prior to the opening of any Insolvency Proceedings or Proceedings in respect of the
Participant may be set aside in any such proceedings as a preference, voidable transaction or otherwise under
the laws of [jurisdiction].
In particular, and without limitation to the foregoing, we express this opinion in respect of any payment orders
submitted by any participant in the System. In particular, we are of the opinion that the provisions of [list of
sections] of the Rules establishing the enforceability and irrevocability of payment orders will be valid and
enforceable and that a payment order submitted by any participant and processed pursuant to [list of sections]
of the Rules may not be set aside in any Insolvency Proceedings or Proceedings as a preference, voidable trans
action or otherwise under the laws of [jurisdiction].
3.5. Attachment
If a creditor of the Participant seeks an attachment order (including any freezing order, order for seizure or any
other public or private law procedure that is intended to protect the public interest or the rights of the Participant’s
creditors) — hereinafter referred to as an ‘Attachment’ — under the laws of [jurisdiction] from a court or
governmental, judicial or public authority that is competent in [jurisdiction], we are of the opinion that [insert
the analysis and discussion].
3.6. Collateral
[if
applicable]
3.6.a. Assignment of rights or deposit of assets for collateral purposes, pledge and/or repo
Assignments for collateral purposes will be valid and enforceable under the laws of [jurisdiction]. Specifically, the
creation and enforcement of a pledge or repo under the [insert reference to the relevant arrangement with the CB]
will be valid and enforceable under the laws of [jurisdiction].
3.6.b. Priority of assignees’, pledgees’ or repo purchasers’ interest over that of other claimants
In the event of Insolvency Proceedings or Proceedings in respect of the Participant, the rights or assets assigned for
collateral purposes, or pledged by the Participant in favour of the [insert reference to CB] or other participants in
the System, will rank in priority of payment above the claims of all other creditors of the Participant and will not
be subject to priority or preferential creditors.
3.6.c. Enforcing title to security
Even in the event of Insolvency Proceedings or Proceedings in respect of the Participant, other participants in the
System and the [insert name of CB] as [assignees, pledgees or repo purchasers as applicable] will still be free to
enforce and collect the Participant’s rights or assets through the action of the [insert name of CB] pursuant to the
Rules.
3.6.d. Form and registration requirements
There are no form requirements for the assignment for collateral purposes of, or the creation and enforcement of a
pledge or repo over the Participant’s rights or assets and it is not necessary for the [assignment for collateral
purposes, pledge or repo, as applicable], or any particulars of such [assignment, pledge or repo, as applicable,] to
be registered or filed with any court or governmental, judicial or public authority that is competent in [jurisdic
tion].
3.7. Branches
[to
the
extent
applicable]
3.7.a. Opinion applies to action through branches
Each of the statements and opinions presented above with regard to the Participant applies with equal accuracy and
validity under the laws of [jurisdiction] in situations where the Participant acts through its one or more of its
branches established outside [jurisdiction].

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3.7.b. Conformity with law
Neither the execution and performance of the rights and obligations under the System Documents nor the
submission, transmission or receipt of payment orders by a branch of the Participant will in any respect breach
the laws of [jurisdiction].
3.7.c. Required authorisations
Neither the execution and performance of the rights and obligations under the System Documents nor the
submission, transmission or receipt of payment orders by a branch of a Participant will require any additional
authorisations, approvals, consents, filings, registrations, notarisations or other certifications of or with any court or
governmental, judicial or public authority that is competent in [jurisdiction].
This Opinion is stated as of its date and is addressed solely to the [insert name of CB] and the [Participant]. No other
persons may rely on this Opinion, and the contents of this Opinion may not be disclosed to persons other than its
intended recipients and their legal counsel without our prior written consent, with the exception of the European Central
Bank and the national central banks of the European System of Central Banks [and [the national central bank/relevant
regulatory authorities] of [jurisdiction]].
Yours faithfully,
[signature]

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Appendix IV
BUSINESS CONTINUITY AND CONTINGENCY PROCEDURES
1. General provisions
(a) This Appendix sets out the arrangements between the [insert name of CB] and participants, or ancillary systems, if
one or more components of the SSP or the telecommunications network fail or are affected by an abnormal
external event, or if the failure affects any participant or ancillary system.
(b) All references to specific times in this Appendix are to the local time at the seat of the ECB, i.e. Central European
Time (CET ( 1 )).
2. Measures of business continuity and contingency processing
(a) In the event that an abnormal external event occurs and/or there is a failure of the SSP or the telecommunications
network which affects the normal operation of TARGET2, the [insert name of CB] shall be entitled to adopt
business continuity and contingency processing measures.
(b) The following main business continuity and contingency processing measures shall be available in TARGET2:
(i) relocating the operation of the SSP to an alternative site;
(ii) changing the SSP’s operating hours; and
(iii) initiating contingency processing of very critical and critical payments, as defined in paragraph 6(c) and (d)
respectively.
(c) In relation to business continuity and contingency processing measures, the [insert name of CB] shall have full
discretion regarding whether and which measures are adopted to settle payment orders.
3. Incident communication
(a) Information about the failure of the SSP and/or an abnormal external event shall be communicated to participants
through the domestic communication channels, the ICM and T2IS. In particular, communications to participants
shall include the following information:
(i) a description of the event;
(ii) the anticipated delay in processing (if known);
(iii) information on the measures already taken; and
(iv) the advice to participants.
(b) In addition, the [insert name of CB] may notify participants of any other existing or anticipated event which has
the potential to affect the normal operation of TARGET2.
4. Relocation of the operation of the SSP to an alternative site
(a) In the event that any of the events referred to in paragraph 2(a) occurs, the operation of the SSP may be relocated
to an alternative site, either within the same region or in another region.
(b) In the event that the operation of the SSP is relocated to another region, the participants shall use best efforts to
reconcile their positions up to the point of the failure or the occurrence of the abnormal external event and
provide to the [insert name of CB] all relevant information in this respect.
( 1 ) CET takes into account the change to Central European Summer Time.

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5. Change of operating hours
(a) The daytime processing of TARGET2 may be extended or the opening time of a new business day may be delayed.
During any extended operating time of TARGET2, payment orders shall be processed in accordance with the
[insert reference to arrangements implementing the Harmonised Conditions], subject to the modifications
contained in this Appendix.
(b) Daytime processing may be extended and the closing time thereby delayed if an SSP failure has occurred during the
day but has been resolved before 18.00. Such a closing time delay shall in normal circumstances not exceed two
hours and shall be announced as early as possible to participants. If such a delay is announced before 16.50, the
minimum period of one hour between the cut-off time for customer and interbank payment orders shall remain in
place. Once such a delay is announced it may not be withdrawn.
(c) The closing time shall be delayed in cases where an SSP failure has occurred before 18.00 and has not been
resolved by 18.00. The [insert name of CB] shall immediately communicate the delay of closing time to partici
pants.
(d) Upon recovery of the SSP, the following steps shall take place:
(i) the [insert name of CB] shall seek to settle all queued payments within one hour; this time is reduced to 30
minutes in the event that the SSP failure occurs at 17.30 or later (in cases where the SSP failure was on-going
at 18.00);
(ii) participants’ final balances shall be established within one hour; this time shall be reduced to 30 minutes in
the event that the SSP failure occurs at 17.30 or later, in cases where the SSP failure was on-going at 18.00;
(iii) at the cut-off time for interbank payments, the end-of-day processing, including recourse to the Eurosystem
standing facilities shall take place;
(e) ancillary systems that require liquidity in the early morning need to have established means to cope with cases
where the daytime processing cannot be started in time due to an SSP failure on the previous day.
6. Contingency processing
(a) If it deems it necessary to do so, the [insert name of CB] shall initiate the contingency processing of payment
orders in the Contingency Module of the SSP. In such cases, only a minimum service level shall be provided to
participants. The [insert name of CB] shall inform its participants of the start of contingency processing by means
of any available means of communication.
(b) In contingency processing, payment orders shall be processed manually by the [insert name of CB].
(c) The following payments shall be considered as ‘very critical’ and the [insert name of CB] shall use best efforts to
process them in contingency situations:
(i) CLS Bank International-related payments;
(ii) end-of-day settlement of EURO1;
(iii) central counterparty margin calls.
(d) The following types of payments shall be considered as ‘critical’ and the [insert name of CB] may decide to initiate
contingency processing in relation to them:
(i) payments in relation to the real-time settlement of interfaced securities settlement systems; and
(ii) additional payments, if required to avoid systemic risk.
(e) Participants shall submit payment orders for contingency processing and information to payees shall be provided
through [insert communication means]. Information concerning account balances and debit and credit entries may
be obtained via the [insert name of CB].

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(f) Payment orders that have already been submitted to TARGET2-[insert CB/country reference], but are queued, may
also undergo contingency processing. In such cases the [insert name of CB] shall endeavour to avoid the double
processing of payment orders, but the participants shall bear the risk of such double processing if it occurred.
(g) For contingency processing of payment orders, participants shall provide additional collateral. During contingency
processing, incoming contingency payments may be used to fund outgoing contingency payments. For the
purposes of contingency processing, participants’ available liquidity may not be taken into account by the
[insert name of CB].
7. Failures linked to participants or ancillary systems
(a) In the event that a participant has a problem that prevents it from settling payments in TARGET2 it shall be its
responsibility to resolve the problem. In particular, a participant may use in-house solutions or the ICM func
tionality, i.e. backup liquidity redistribution payments and backup contingency payments (CLS, EURO1, STEP2 pre-
fund).
(b) If a participant decides to use the ICM functionality for making backup liquidity redistribution payments, the
[insert name of CB] shall, if the participant so requests, open this functionality via the ICM. If the participant so
requests, the [insert name of CB] shall transmit an ICM broadcast message to inform other participants about the
participant’s use of backup liquidity redistribution payments. The participant shall be responsible for sending such
backup liquidity redistribution payments exclusively to other participants with which it has bilaterally agreed on
the use of such payments and for any further steps in relation to such payments.
(c) If the measures referred to in subparagraph (a) are exhausted or if they are inefficient, the participant may request
support from the [insert name of CB].
(d) In the event that a failure affects an ancillary system, that ancillary system shall be responsible for resolving the
failure. If the ancillary system so requests, the [insert name of CB] may act on its behalf. The [insert name of CB]
shall have discretion to decide what support it gives to the ancillary system, including during the night-time
operations of the ancillary system. The following contingency measures may be taken:
(i) the ancillary system initiates clean payments, i.e. payments that are not linked to the underlying transaction,
via the Participant Interface;
(ii) the [insert name of CB] creates and/or processes XML instructions/files on behalf of the ancillary system;
and/or
(iii) the [insert name of CB] makes clean payments on behalf of the ancillary system.
(e) The detailed contingency measures with respect to ancillary systems shall be contained in the bilateral
arrangements between the [insert name of CB] and the relevant ancillary system.
8. Other provisions
(a) In the event that certain data are unavailable because one of the events referred to in paragraph 3(a) has occurred,
the [insert name of CB] is entitled to start or continue processing payment orders and/or operate TARGET2-[insert
CB/country reference] on the basis of the last available data, as determined by the [insert name of CB]. If so
requested by the [insert name of CB], participants and ancillary systems shall resubmit their FileAct/Interact
messages or take any other action deemed appropriate by the [insert name of CB].
(b) In the event of a failure of the [insert name of CB], some or all of its technical functions in relation to TARGET2-
[insert CB/country reference] may be performed by other Eurosystem CBs.
(c) The [insert name of CB] may require that the participants participate in regular or ad hoc testing of business
continuity and contingency processing measures, training or any other preventive arrangements, as deemed
necessary by the [insert name of CB]. Any costs incurred by the participants as a result of such testing or
other arrangements shall be borne solely by the participants.

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Appendix V
OPERATING SCHEDULE
1. TARGET2 is open on all days, except Saturdays, Sundays, New Year’s Day, Good Friday and Easter Monday (according
to the calendar applicable at the seat of the ECB), 1 May, Christmas Day and 26 December.
2. The reference time for the system is the local time at the seat of the ECB, i.e. CET.
3. The current business day is opened during the evening of the previous business day and operates to the following
schedule:
Time Description
6.45-7.00 Business
window
to
prepare
daytime
operations
(*)
7.00-18.00 Daytime
processing
17.00 Cut-off
time
for
customer
payments,
i.e.
payments
where
the
originator
and/or the beneficiary of a payment is not a direct or indirect
participant as identified in the system by the use of an MT 103 or
MT 103+ message
18.00 Cut-off
time
for
interbank
payments,
i.e.
payments
other
than
customer
payments
18.00-18.45 (**) End-of-day
processing
18.15 (**) General
cut-off
time
for
the
use
of
standing
facilities
(Shortly after) 18.30 (***) Data
for
the
update
of
accounting
systems
are
available
to
CBs
18.45-19.30 (***) Start-of-day
processing
(new
business
day)
19.00 (***)-19.30 (**) Provision
of
liquidity
on
the
PM
account
19.30 (***) ‘Start-of-procedure’
message
and
settlement
of
the
standing
orders
to
transfer liquidity from the PM accounts to the sub-accounts/mirror
account (ancillary system-related settlement)
19.30 (***)-22.00 Execution
of
additional
liquidity
transfers
via
the
ICM
before
the
ancillary system sends the ‘start-of-cycle’ message; settlement period
of night-time ancillary system operations (only for ancillary system
settlement procedure 6)
22.00-1.00 Technical
maintenance
period
1.00-7.00 Settlement
procedure
of
night-time
ancillary
system
operations
(only
for ancillary system settlement procedure 6)
(*) ‘Daytime operations’ means daytime processing and end-of-day processing.
(**) Ends 15 minutes later on the last day of the Eurosystem reserve maintenance period.
(***) Starts 15 minutes later on the last day of the Eurosystem reserve maintenance period.
4. The ICM is available for liquidity transfers from 19.30 ( 1 ) until 18.00 the next day, except during the technical
maintenance period from 22.00 until 1.00.
5. The operating hours may be changed in the event that business continuity measures are adopted in accordance with
paragraph 5 of Appendix IV.
( 1 ) Starts 15 minutes later on the last day of the Eurosystem reserve maintenance period.

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Appendix VI
FEE SCHEDULE AND INVOICING
Fees for direct participants
1. The monthly fee for the processing of payment orders in TARGET2-[insert CB/country reference] for direct partici
pants, depending on which option the direct participant has chosen, shall be either:
(a) EUR 150 per PM account plus a flat fee per transaction (debit entry) of EUR 0,80; or
(b) EUR 1 875 per PM account plus a fee per transaction (debit entry) determined as follows, based on the volume of
transactions (number of processed items) per month:
Band From To Price
(EUR)
1
1 10
000 0,60
2 10
001 25
000 0,50
3 25
001 50
000 0,40
4 50
001 100
000 0,20
5 Above
100
000
— 0,125
Liquidity transfers between a participant’s PM account and its sub-accounts shall not be subject to a charge.
2. The monthly fee for multi-addressee access shall be EUR 80 for each eight-digit BIC address other than the BIC of the
direct participant’s account.
3. There shall be an additional monthly fee for direct participants who do not wish the BIC of their account to be
published in the TARGET2 directory of EUR 30 per account.
4. The monthly fee for each registration by a direct participant of an indirect participant in the TARGET2 directory shall
be EUR 20.
5. The one time fee for each registration in the TARGET2 directory of an addressable BIC holder, for branches of direct
and indirect participants, branches of correspondents and addressable BIC holders that are members of the same
group, as defined in Article 1, shall be EUR 5.
6. The monthly fee for each registration in the TARGET2 directory of an addressable BIC holder for a correspondent
shall be EUR 5.
Fees for liquidity pooling
7. For the CAI mode, the monthly fee shall be EUR 100 for each account included in the group.
8. For the AL mode, the monthly fee shall be EUR 200 for each account included in the AL group. If the AL group uses
the CAI mode, accounts not included in the AL mode shall pay the CAI monthly fee of EUR 100 per account.
9. For both the AL mode and the CAI mode, the degressive transaction fee structure set out in the table in paragraph
1(b) shall apply to all payments by the participants in the group, as if these payments were sent from one partici
pant’s account.
10. The monthly fee of EUR 1 875 referred to in paragraph 1(b) shall be paid by the relevant group manager, and the
monthly fee of EUR 150 referred to in paragraph 1(a) shall be paid by all other members of the group. If an AL
group is part of a CAI group, and the AL group manager is the same as the CAI group manager, the monthly fee of
EUR 1 875 shall only be paid once. If the AL group is a part of a CAI group and the CAI group manager is different
from the AL group manager, then the CAI group manager shall pay an additional monthly fee of EUR 1 875. In such
cases the invoice for the total fees for all the accounts in the CAI group (including the AL group accounts) shall be
sent to the CAI group manager.

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Invoicing
11. In the case of direct participants, the following invoicing rules apply. The direct participant (the AL group or CAI
group manager in the event that the AL or CAI modes are used) shall receive the invoice for the previous month
specifying the fees to be paid, no later than on the fifth business day of the following month. Payment shall be made
at the latest on the 10th working day of that month to the account specified by the [insert name of CB] and shall be
debited from that participant’s PM account.

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Appendix VII
AGGREGATED LIQUIDITY AGREEMENT — VARIANT A
Template for use of the AL mode by more than one credit institution
Between, on the one hand:
[participant], holder of PM accounts No […], with [insert name of CB] represented by […], acting as […],
[participant], holder of PM accounts No […], with [insert name of CB] represented by […], acting as […],
[participant], holder of PM accounts No […], with [insert name of CB] represented by […], acting as […],
(hereinafter the ‘AL group members’) and on the other hand, [insert name of AL NCB] [insert name of AL NCB] [insert
name of AL NCB] (hereinafter the ‘AL NCBs’)
(AL group members and AL NCBs hereinafter collectively referred to as the ‘Parties’)
Whereas:
(1)
TARGET2 is legally structured as a multiplicity of payment systems, each of which is designated as a system under
the relevant national legislation implementing Directive 98/26/EC of the European Parliament and of the Council
of 19 May 1998 on settlement finality in payment and securities settlement systems ( 1 ).
(2) Participants
in
one
or
more
TARGET2
component
systems
may,
under
certain
conditions
laid
down
in
the
respective conditions for participation in TARGET2 component systems, set up an AL group, whereby the
liquidity on the PM accounts of the AL group members is aggregated.
(3) Aggregation
of
liquidity
enables
the
AL
group
members
to
settle
payment
orders
for
an
amount
exceeding
the
available liquidity on their respective PM accounts, provided that the total value of all such payment orders never
exceeds the aggregate amount of the available liquidity on all such PM accounts. The resulting debit position on
one or more of these PM accounts constitutes intraday credit, the provision of which is governed by the respective
national arrangements, subject to the modifications described in this agreement; in particular, such debit position
is collateralised with the available liquidity on the PM accounts of other AL group members.
(4)
The effect of this mechanism is in no way to merge the various PM accounts, which, subject to the limitations
described in this agreement, continue to be exclusively held by their respective holders.
(5)
Such a mechanism aims to avoid the fragmentation of liquidity in the different TARGET2 component systems and
simplify the liquidity management within a group of credit institutions.
(6)
This mechanism improves the overall efficiency of settlement of payments in TARGET2.
(7)
[Participant], [participant] and [participant] are respectively connected to TARGET2-[insert CB/country reference],
TARGET2-[insert CB/country reference], and TARGET2-[insert CB/country reference] and are bound by the [insert
reference to the arrangements implementing the Harmonised Conditions] of [insert relevant dates],
Now, therefore, the Parties agree the following:
Article 1
Effectiveness of this agreement
This agreement and any amendment made hereto shall only be effective when the managing NCB, after having obtained
any information or documents that it deems appropriate, confirms in writing that this agreement or amendments thereto
comply with the requirements laid down in the respective conditions for participation in the TARGET2 component
systems.
( 1 ) OJ L 166, 11.6.1998, p. 45.

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Union L
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Article 2
Mutual interest of AL group members and of AL NCBs
1. The
AL
group
members
expressly
declare
and
acknowledge
that
their
entry
into
this
agreement
serves
their
mutual
economic, social and financial interests since the payment orders of all AL group members may be settled in their
respective TARGET2 component systems, up to an amount corresponding to the available liquidity on all the AL group
members’ PM accounts, thereby leveraging the liquidity available in other TARGET2 component systems.
2. The
AL
NCBs
have
a
mutual
interest
in
providing
intraday
credit
to
the
AL
group
members,
as
this
promotes
the
overall efficiency of settling payments in TARGET2. The intraday credit is collateralised in accordance with Article 18 of
the Statute of the European System of Central Banks and of the European Central Bank since the debit balance resulting
from the execution of a payment order is covered by the available liquidity on the PM accounts held by the other AL
group members with their respective AL NCBs, which are collateralised for the discharge of the obligations owed by any
of the AL group members to the AL NCBs.
Article 3
AL group members’ rights and obligations
1. AL group members shall be jointly and severally liable towards all AL NCBs in relation to all claims resulting from
the settlement in their respective TARGET2 component system of the payment order of any AL group member. AL group
members shall not be entitled to rely on any internal group arrangements on the division of liabilities to avoid any
liability to the AL NCBs in relation to the aggregation of all abovementioned liabilities.
2. The
total
value
of
all
payment
orders
settled
by
the
AL
group
members
on
their
PM
accounts
may
never
exceed
the
aggregate amount of all available liquidity on all such PM accounts.
3. AL group members shall be authorised to use the CAI mode, as described in the [insert the reference to the
arrangements implementing the Harmonised Conditions].
4. The
AL
group
members
shall
ensure
that
there
is
an
internal
agreement
between
them
containing
inter
alia:
(a) the rules of internal organisation of the AL group;
(b) the conditions under which the AL group manager has a duty to report to the AL group members;
(c) the costs of the AL mode (including their allocation between AL group members); and
(d) the fees to be paid as remuneration between the AL group members for the services under the AL agreement and the
rules for calculating the financial consideration.
With the exception of subparagraph (d), the AL group members may decide whether or not to disclose this internal
agreement or parts of it to the AL NCBs. The AL group members shall disclose information referred to in subparagraph
(d) to the AL NCBs.
Article 4
AL NCBs’ rights and obligations
1. When
an
AL
group
member
submits
a
payment
order
to
its
respective
TARGET2
component
system
for
an
amount
exceeding the available liquidity on that AL group member’s PM account, its respective AL NCB shall extend intraday
credit that is collateralised with the available liquidity on other PM accounts held by the AL group member with its
respective AL NCB or on the PM accounts held by the other AL group members with their respective AL NCBs. Such
intraday credit shall be governed by the rules applicable to the provision of intraday credit by such AL NCB.
2. Payment orders submitted by any of the AL group members which have the effect of exceeding the available
liquidity on all PM accounts of the AL group members shall be queued until sufficient liquidity is available.
3. Except on the opening of insolvency proceedings against one or more AL group members, an AL NCB may claim
from each of the AL group members the full discharge of all obligations resulting from the settlement of payment orders
of any AL group member in the latter’s TARGET2 component system.

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Article 5
Designation and role of the AL group manager
1. The AL group members hereby designate as AL group manager [indicate the participant designated as AL group
manager], which shall be the contact point for all administrative matters relating to the AL group.
2. All AL group members shall provide their respective AL NCB, as well as the AL group manager, with any
information which may affect the validity, enforceability and implementation of this agreement, including, without
limitation, any modification or ending of the links between the AL group members needed to comply with the definition
of a group laid down in the [insert reference to the relevant provisions in the arrangements implementing the
Harmonised Conditions], the occurrence of any events of default within the meaning of the [insert reference to the
arrangements implementing the Harmonised Conditions] or any event which may affect the validity and/or enforceability
of the [insert reference to the pledge, close-out netting provisions or any other relevant provisions of the arrangements
implementing the Harmonised Conditions].
3. The AL group manager shall immediately convey to the managing NCB any information described in paragraph 2
relating to itself or to any other AL group member.
4. The AL group manager shall be responsible in respect of intraday monitoring of the liquidity available within the
AL group.
5. The AL group manager shall have power of attorney over the PM accounts of the AL group members and, in
particular, shall act as agent of the AL group members in respect of the following operations:
(a) any ICM operations in respect of the AL group members’ PM accounts, including, but not limited to, any change in
priority of a payment order, revocation, change of settlement time, liquidity transfers (including from and to sub-
accounts), reordering of queued transactions, reservation of liquidity in respect of the AL group, and setting and
changes of limits in respect of the AL group;
(b) all end-of-day liquidity transactions between the PM accounts of the AL group members ensuring that all balances of
the AL group members’ PM accounts are levelled out, so that none of these accounts have a debit balance at the end
of the day or, where applicable, a debit balance not secured by eligible collateral (hereinafter such procedure is
referred to as ‘levelling out’);
(c) general instructions according to which automatic levelling out shall be performed, i.e. defining the sequence of AL
group members’ PM accounts with available liquidity to be debited within the levelling out;
(d) in the absence of any explicit instructions by the AL group manager, as set out in subparagraphs (b) and (c),
automatic levelling out shall be performed starting with the PM account with the highest credit balance towards
the PM account with the highest debit balance.
The same criteria as defined in subparagraphs (c) and (d) shall be used if an enforcement event, as defined in [insert
reference to the relevant provisions in the arrangements implementing the Harmonised Conditions], occurs.
6. The AL group members explicitly waive any rights they may have against the AL group manager under [insert, if
applicable, a reference to the relevant provision of national law], resulting from the combination of such manager’s
capacity as a PM account holder and AL group member with its capacity as AL group manager.
Article 6
Role of the managing NCB
1. The managing NCB shall be the contact point for all administrative matters relating to the AL group.
2. All of the AL NCBs shall immediately provide the managing NCB with any information relating to their respective
AL group members which may affect the validity, enforceability and implementation of this agreement, including, but not
limited to, any modification or ending of the links between the AL group members needed to comply with the definition
of a group, the occurrence of any events of default within the meaning of the [insert reference to the arrangements
implementing the Harmonised Conditions] or events which may affect the validity and/or enforceability of the [insert
reference to the pledge, close-out netting or any other relevant provisions of the arrangements implementing the
Harmonised Conditions].

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3. The managing NCB shall have access to all relevant information in respect of all PM accounts of the AL group
members, including, but not limited to, information in respect of any credit line, the balance, total turnover, settled
payments, queued payments, as well as information on the AL group members’ limits and liquidity reservations.
Article 7
Duration and termination of this agreement
1. This
agreement
shall
be
of
unlimited
duration.
2. Each of the AL group members may unilaterally terminate its participation in this agreement, provided it gives 14
business days’ written notice to the AL NCB in whose TARGET2 component system it participates and to the managing
NCB. The managing NCB shall confirm to that AL group member the date of its termination of participation in the AL
agreement and shall communicate such date to all AL NCBs which shall inform their AL group members accordingly. If
that AL group member was the AL group manager, the remaining AL group members shall immediately appoint a new
AL group manager.
3. This agreement or the participation of any AL group member in this agreement, as the case may be, shall auto
matically be terminated without prior notice and with immediate effect if one or more of the following events occurs:
(a) modification or ending of the links between all AL group members needed to comply with the definition of a group,
as laid down in the [insert reference to the arrangements implementing the Harmonised Conditions], or affecting one
or more AL group members; and/or
(b) any other requirements for using the AL mode, as described in the [insert reference to the arrangements implementing
the Harmonised Conditions] are no longer met by all AL group members, or one or more AL group members.
4. Notwithstanding the occurrence of any of the events described in paragraph 3, a payment order that has already
been submitted by any AL group member into the relevant TARGET2 component system shall remain valid and
enforceable in respect of all AL group members and the AL NCBs. [Insert if relevant: In addition, the [insert reference
to pledge and/or close-out netting or other relevant security arrangement] shall remain valid after the termination of this
agreement until all debit positions on the PM accounts whose liquidity was aggregated are fully discharged by the AL
group members.]
5. Without prejudice to paragraph 3, the managing NCB, in agreement with the relevant AL NCB, may at any time
terminate without prior notice and with immediate effect the participation of any AL group member in this agreement if
such AL group member is in breach of any of the provisions hereof. Such decision shall be addressed in writing to all the
AL group members setting out the reasons for the decision. If participation is terminated in this way, the AL group
members whose participation in this agreement has not been terminated are entitled to terminate their participation in
this agreement provided that they give the managing NCB and the relevant AL NCB five business days’ written notice
thereof. If the AL group manager’s participation is terminated, the remaining AL group members shall immediately
appoint a new AL group manager.
6. The managing NCB, in agreement with the other AL NCBs, may terminate this agreement without prior notice and
with immediate effect if the maintenance of it would endanger the overall stability, soundness and safety of TARGET2 or
jeopardise the performance by the AL NCBs of their tasks pursuant to the Statute of the European System of Central
Banks and of the European Central Bank. Any decision to do so shall be addressed in writing to the AL group members,
setting out the reasons for the decision.
7. This
agreement
shall
remain
valid
for
as
long
as
there
are
at
least
two
AL
group
members.
Article 8
Amendment procedure
Any change to this agreement, including the extension of the AL group to other participants, shall only be valid and
enforceable if expressly agreed to by all parties in writing.
Article 9
Governing law
This agreement shall be governed, construed and implemented in accordance with the [insert reference to the law
governing the PM account of the AL group manager held with the managing NCB]. This shall be without prejudice to:

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(a) the relationship between an AL group member and its respective AL NCB governed by the law of the respective AL
NCB; and
(b) the rights and obligations between the AL NCBs governed by the law of the AL NCB which maintains the PM account
of the AL group member whose available liquidity is used as collateral.
Article 10
Application of the [insert reference to the arrangements implementing the Harmonised Conditions]
1. In relation to each of the AL group members and their respective AL NCBs, the relevant provisions of the [insert
reference to the arrangements implementing the Harmonised Conditions] shall govern any matter not expressly governed
by this agreement.
2. [Insert reference to the arrangements implementing the Harmonised Conditions] and this agreement shall be
deemed to form part of the same contractual relationship.
Made, in as many copies as there are parties, the […date….]
AGGREGATED LIQUIDITY AGREEMENT — VARIANT B
Template for use of the AL mode by one credit institution
Between, on the one hand: [name and address of a credit institution] represented by […], acting as [participant], holder of
PM accounts No […], with [insert name of CB],
[participant], holder of PM accounts No […], with [insert name of CB],
[participant], holder of PM accounts No […], with [insert name of CB],
(the participants hereinafter mentioned as the ‘AL group members’)
and on the other hand, [insert name of AL NCB] [insert name of AL NCB] [insert name of AL NCB] (hereinafter the ‘AL
NCBs’)
(AL group members and AL NCBs hereinafter collectively referred to as the ‘Parties’)
Whereas:
(1)
TARGET2 is legally structured as a multiplicity of payment systems, each of which is designated as a system under
the relevant national legislation implementing Directive 98/26/EC of the European Parliament and of the Council
of 19 May 1998 on settlement finality in payment and securities settlement systems ( 1 ).
(2)
A credit institution with several PM accounts in one or more TARGET2 component systems may, under certain
conditions laid down in the respective conditions for participation in TARGET2 component systems, set up an AL
group, whereby the liquidity on such PM accounts of the AL group members is aggregated.
(3) Aggregation
of
liquidity
enables
the
AL
group
members
to
settle
payment
orders
for
an
amount
exceeding
the
available liquidity on one PM account, provided that the total value of all such payment orders never exceeds the
aggregate amount of the available liquidity on all PM accounts of the AL group members. The resulting debit
position on one or more of these PM accounts constitutes intraday credit, the provision of which is governed by
the respective national arrangements, subject to the modifications described in this agreement; in particular, such
debit position is collateralised with the available liquidity on all PM accounts of the AL group members.
( 1 ) OJ L 166, 11.6.1998, p. 45.

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(4)
The effect of this mechanism is in no way to merge the various PM accounts, which, subject to the limitations
described in this agreement, continue to be separately held by the AL group members.
(5)
Such a mechanism aims to avoid the fragmentation of liquidity in the different TARGET2 component systems and
simplify the liquidity management of the AL group members.
(6)
This mechanism improves the overall efficiency of settlement of payments in TARGET2.
(7)
[Participant], [participant] and [participant] are respectively connected to TARGET2-[insert CB/country reference],
TARGET2-[insert CB/country reference], and TARGET2-[insert CB/country reference] and are bound by the [insert
reference to the arrangements implementing the Harmonised Conditions] of [insert relevant dates],
Now, therefore, the Parties agree the following:
Article 1
Effectiveness of this agreement
This agreement and any amendment made hereto shall only be effective when the managing NCB, after having obtained
any information or documents that it deems appropriate, confirms in writing that this agreement or amendments thereto
comply with the requirements laid down in the respective conditions for participation in TARGET2 component systems.
Article 2
Mutual interest of AL NCBs
The AL NCBs have a mutual interest in providing intraday credit to the AL group members, as this promotes the overall
efficiency of settling payments in TARGET2. The intraday credit is collateralised in accordance with Article 18 of the
Statute of the European System of Central Banks and of the European Central Bank since the debit balance resulting from
the execution of a payment order is covered by the available liquidity on the PM accounts held by the AL group members
with their respective AL NCBs, which are collateralised for the discharge of the obligations owed by the AL group
members to the AL NCBs.
Article 3
AL group members’ rights and obligations
1. AL group members shall be liable towards all AL NCBs in relation to all claims resulting from the settlement in
their respective TARGET2 component systems of the payment orders of any AL group member.
2. The
total
value
of
all
payment
orders
settled
by
the
AL
group
members
on
their
PM
accounts
may
never
exceed
the
aggregate amount of the available liquidity on all such PM accounts.
3. The
AL
group
members
shall
be
authorised
to
use
the
consolidated
account
information
(CAI)
mode,
as
described
in
the [insert the reference to the arrangements implementing the Harmonised Conditions].
Article 4
AL NCBs’ rights and obligations
1. When the AL group member submits a payment order to a TARGET2 component system for an amount exceeding
the available liquidity on that AL group member’s PM account, the relevant AL NCB shall extend intraday credit that is
collateralised with the available liquidity on other PM accounts held by the AL group member with its respective AL NCB
or on PM accounts held by other AL group members with their respective AL NCBs. Such intraday credit shall be
governed by the rules applicable to the provision of intraday credit by such AL NCBs.
2. Payment orders submitted by the AL group members which have the effect of exceeding the available liquidity on
all PM accounts of the AL group members shall be queued until sufficient liquidity is available.
3. Each AL NCB may claim from the AL group members the full discharge of all obligations resulting from the
settlement of payment orders of the AL group members in the TARGET2 component systems in which they hold PM
accounts.

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Article 5
Designation and role of the AL group manager
1. The AL group members hereby designate as AL group manager [indicate the participant designated as AL group
manager], which shall be the contact point for all administrative matters relating to the AL group.
2. The AL group members shall provide the relevant AL NCBs with any information which may affect the validity,
enforceability and implementation of this agreement, including, without limitation, the occurrence of any events of
default within the meaning of the [insert reference to the relevant provisions in the arrangements implementing the
Harmonised Conditions] or any event which may affect the validity and/or enforceability of the [insert reference to the
pledge, close-out netting provisions or any other relevant provisions of the arrangement s implementing the Harmonised
Conditions].
3. The AL group manager shall immediately convey to the managing NCB any information described in paragraph 2.
4. The AL group manager shall be responsible in respect of intraday monitoring of the liquidity available within the
AL group.
5. The AL group manager shall have power of attorney over all PM accounts of the AL group members and, in
particular, shall conduct the following operations:
(a) any ICM operations in respect of the AL group members’ PM accounts, including, but not limited to, any change in
priority of a payment order, revocation, change of settlement time, liquidity transfers (including from and to sub-
accounts), reordering of queued transactions, reservation of liquidity in respect of the AL group, and setting and
changes of limits in respect of the AL group;
(b) all end-of-day liquidity transactions between the PM accounts of the AL group members ensuring that all balances of
the AL group members’ PM accounts are levelled out, so that none of these accounts have a debit balance at the end
of the day or, where applicable, a debit balance not secured by eligible collateral (hereinafter such procedure is
referred to as ‘levelling out’);
(c) general instructions according to which an automatic levelling out shall be performed, i.e. defining the sequence of AL
group members’ PM accounts with available liquidity to be debited within the levelling out;
(d) in the absence of any explicit instructions by the AL group manager, as set out in subparagraphs (b) and (c), an
automatic levelling out shall be performed starting with the PM account with the highest credit balance towards the
PM account with the highest debit balance.
The same criteria as defined in subparagraphs (c) and (d) shall be used if an enforcement event, as defined in [insert
reference to the relevant provisions in the arrangements implementing the Harmonised Conditions], occurs.
Article 6
Role of the managing NCB
1. The managing NCB shall be the contact point for all administrative matters relating to the AL group.
2. All of the AL NCBs shall immediately provide the managing NCB with any information relating to the AL group
member which may affect the validity, enforceability and implementation of this agreement, including, but not limited to,
the occurrence of any events of default within the meaning of the [insert reference to the relevant provisions in the
arrangements implementing the Harmonised Conditions] or events which may affect the validity and/or enforceability of
the [insert reference to the pledge, close-out netting or any other relevant provisions of the arrangements implementing
the Harmonised Conditions].
3. The managing NCB shall have access to all relevant information in respect of all PM accounts of the AL group
members, including, but not limited to, information in respect of any credit line, the balance, total turnover, settled
payments, queued payments, as well as information on the AL group members’ limits and liquidity reservations.

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Article 7
Duration and termination of this agreement
1. This
agreement
shall
be
of
unlimited
duration.
2. Each of the AL group members may unilaterally terminate its participation in this agreement, provided it gives 14
business days’ written notice to the AL NCB in whose TARGET2 component system it participates and to the managing
NCB. The managing NCB shall confirm to the AL group member the date of its termination of participation in the AL
agreement and shall communicate such date to all AL NCBs which shall inform their AL group members accordingly. If
that AL group member was the AL group manager, the remaining AL group members shall immediately appoint a new
AL group manager.
3.
This agreement shall automatically be terminated without prior notice and with immediate effect if the requirements
for using the AL mode, as described in the [insert reference to the arrangements implementing the Harmonised
Conditions] are no longer met.
4. Notwithstanding the occurrence of an event described in paragraph 3, a payment order that has already been
submitted by the AL group member into the relevant TARGET2 component system shall remain valid and enforceable in
respect of all AL group members and the AL NCBs. [Insert if relevant: In addition, the [insert reference to pledge and/or
close-out netting or other relevant security arrangement] shall remain valid after the termination of this agreement until
all debit positions on the PM accounts whose liquidity was aggregated are fully discharged by the AL group members.]
5. Without prejudice to paragraph 3, the managing NCB, in agreement with the AL NCBs, may at any time terminate
this agreement if any AL group member is in breach of any of the provisions hereof. Such decision shall be addressed in
writing to all the AL group members setting out the reasons for the decision.
6. The managing NCB, in agreement with the other AL NCBs, may terminate this agreement if the maintenance of it
would endanger the overall stability, soundness and safety of TARGET2 or jeopardise the performance by the AL NCBs of
their tasks pursuant to the Statute of the European System of Central Banks and of the European Central Bank. Any
decision to terminate this agreement shall be addressed in writing to the AL group members, setting out the reasons for
the decision.
Article 8
Amendment procedure
Any change to this agreement, including the extension of the AL group to other participants, shall only be valid and
enforceable if expressly agreed to by all parties in writing.
Article 9
Governing law
This agreement shall be governed, construed and implemented in accordance with the [insert reference to the law
governing the PM account of the AL group manager]. This shall be without prejudice to:
(a) the relationship between the AL group members and their respective AL NCBs governed by the law of the respective
AL NCB; and
(b) the rights and obligations between the AL NCBs governed by the law of the AL NCB which maintains the PM account
in which available liquidity is used as collateral.
Article 10
Application of the [insert reference to the arrangements implementing the Harmonised Conditions]
1. In relation to each of the PM accounts of the AL group members, the relevant provisions of the [insert reference to
the arrangements implementing the Harmonised Conditions] shall govern any matter not expressly governed by this
agreement.
2. The [insert reference to the arrangements implementing the Harmonised Conditions] and this agreement shall be
deemed to form part of the same contractual relationship.
Made, in as many copies as there are parties, the […date….]

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ANNEX III
PROVISION OF INTRADAY CREDIT
Definitions
For the purposes of this Annex:
(1) ‘credit institution’ means either: (a) a credit institution within the meaning of Article 2 and Article 4(1)(a) of Directive
2006/48/EC of the European Parliament and of the Council of 14 June 2006 relating to the taking up and pursuit of
the business of credit institutions ( 1 ) as implemented in national law, that is subject to supervision by a competent
authority; or (b) another credit institution within the meaning of Article 123(2) of the Treaty on the Functioning of
the European Union that is subject to scrutiny of a standard comparable to supervision by a competent authority;
(2) ‘marginal lending facility’ means a Eurosystem standing facility which counterparties may use to receive overnight
credit from an NCB at the pre-specified marginal lending rate;
(3) ‘marginal lending rate’ means the interest rate applicable to the marginal lending facility;
(4) ‘branch’ means a branch within the meaning of Article 4(3) of Directive 2006/48/EC, as implemented in national law;
(5) ‘public sector body’ means an entity within the ‘public sector’, the latter term as defined in Article 3 of Council
Regulation (EC) No 3603/93 of 13 December 1993 specifying definitions for the application of the prohibitions
referred to in Articles 104 and 104b (1) of the Treaty ( 2 );
(6) ‘investment firm’ means an investment firm within the meaning of Article 4(1)(1) of Directive 2004/39/EC of the
European Parliament and of the Council of 21 April 2004 on markets in financial instruments amending Council
Directives 85/611/EEC and 93/6/EEC and Directive 2000/12/EC of the European Parliament and of the Council and
repealing Council Directive 93/22/EEC ( 3 ), excluding the institutions specified in Article 2(1) of Directive 2004/39/EC,
provided that the investment firm in question is: (a) authorised and supervised by a recognised competent authority,
which has been designated as such under Directive 2004/39/EC; and (b) entitled to carry out the activities referred to
under items 2, 3, 6 and 7 of Section A of Annex I to Directive 2004/39/EC;
(7) ‘close links’ means close links within the meaning of Chapter 6 of Annex I to Guideline ECB/2011/14 of
20 September 2011 on monetary policy instruments and procedures of the Eurosystem ( 4 );
(8) ‘insolvency proceedings’ means insolvency proceedings within the meaning of Article 2(j) of Directive 98/26/EC;
(9) ‘event of default’ means any impending or existing event, the occurrence of which may threaten the performance by
an entity of its obligations under the national arrangements implementing this Guideline or any other rules (including
those specified by the Governing Council with respect to Eurosystem monetary policy operations) applying to the
relationship between that entity and any of the Eurosystem CBs, including:
(a) where the entity no longer meets the access criteria and/or technical requirements laid down in Annex II and, if
applicable, Annex V or where its eligibility as a counterparty for Eurosystem monetary policy operations has been
suspended or terminated;
(b) the opening of insolvency proceedings in relation to the entity;
(c) the submission of an application relating to the proceedings referred to in subparagraph (b);
(d) the issue by the entity of a written declaration of its inability to pay all or any part of its debts or to meet its
obligations arising in relation to intraday credit;
( 1 ) OJ L 177, 30.6.2006, p. 1.
( 2 ) OJ L 332, 31.12.1993, p. 1.
( 3 ) OJ L 145, 30.4.2004, p. 1.
( 4 ) OJ L 331, 14.12.2011, p. 1.

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(e) the entry of the entity into a voluntary general agreement or an arrangement with its creditors;
(f) where the entity is, or is deemed by the relevant euro area NCB to be, insolvent or unable to pay its debts;
(g) where the entity’s credit balance on its PM account or all or a substantial part of the entity’s assets are subject to a
freezing order, attachment, seizure or any other procedure that is intended to protect the public interest or the
rights of the entity’s creditors;
(h) where participation of the entity in another TARGET2 component system and/or in an ancillary system has been
suspended or terminated;
(i) where any material representation or pre-contractual statement made by the entity or which is implied to have
been made by the entity under the applicable law is incorrect or untrue; or
(j) the assignment of all or a substantial part of the entity’s assets.
Eligible entities
1. Each euro area NCB shall provide intraday credit to the entities referred to in paragraph 2 and which have an account
with the relevant euro area NCB, provided that such entities are not subject to restrictive measures adopted by the
Council of the European Union or Member States pursuant to Article 65(1)(b), Article 75 or Article 215 of the
Treaty, [the implementation of which, in the view of [CB/country reference] after informing the ECB, is incompatible
with the smooth functioning of TARGET2]. However, no intraday credit may be granted to an entity established in a
country other than the Member State in which the seat of the euro area NCB with which that entity has an account is
located.
2. Intraday credit may only be granted to the following entities:
(a) credit institutions established in the EEA that are eligible counterparties for Eurosystem monetary policy oper
ations and have access to the marginal lending facility, including when those credit institutions act through a
branch established in the EEA and including branches established in the EEA of credit institutions that are
established outside the EEA;
(b) credit institutions established in the EEA that are not eligible counterparties for Eurosystem monetary policy
operations and/or do not have access to the marginal lending facility, including when they act through a branch
established in the EEA and including branches established in the EEA of credit institutions that are established
outside the EEA;
(c) treasury departments of central or regional governments of Member States active in the money markets and
public sector bodies of Member States authorised to hold accounts for customers;
(d) investment firms established in the EEA provided that they have concluded an arrangement with a Eurosystem
monetary policy counterparty to ensure that any residual debit position at the end of the relevant day is covered;
and
(e) entities other than those falling within subparagraphs (a) and (b) that manage ancillary systems and act in that
capacity, provided that the arrangements for granting intraday credit to such entities have been submitted to the
Governing Council in advance and have been approved by the Governing Council.
3. For the entities mentioned in paragraph 2(b) to (e), intraday credit shall be limited to the day in question and no
extension to overnight credit shall be possible.
By way of derogation, the Governing Council may decide to exempt, by means of a reasoned prior decision, certain
eligible central counterparties (CCPs) from the prohibition on overnight credit extension. Such eligible CCPs are those
that, at all relevant times:
(a) are eligible entities for the purposes of paragraph 2(e), provided also that those eligible entities are authorised as
CCPs in accordance with the applicable Union or national legislation;

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(b) are established in the euro area;
(c) are subject to supervision and/or oversight by competent authorities;
(d) comply with the oversight requirements for the location of infrastructures offering services in euro, as amended
from time to time and published on the ECB’s website ( 1 );
(e) have accounts in the Payments Module (PM) of TARGET2;
(f) have access to intraday credit.
All overnight credit granted to eligible CCPs shall be subject to the terms of this Annex (including, for the avoidance
of doubt, the provisions in relation to eligible collateral).
For the avoidance of doubt, the sanctions provided for in paragraphs 10 and 11 of this Annex shall apply in cases of
non-reimbursement by eligible CCPs of the overnight credit extended to them by their NCB.
Eligible collateral
4. Intraday credit shall be based on eligible collateral and granted by means of collateralised intraday overdrafts and/or
intraday repurchase transactions in compliance with the additional minimum common features (including the events
of default therein listed, as well as their respective consequences) that the Governing Council specifies with respect to
Eurosystem monetary policy operations. Eligible collateral shall consist of the same assets and instruments as eligible
assets for Eurosystem monetary policy operations, and shall be subject to the same valuation and risk control rules as
those laid down in Annex I to Guideline ECB/2011/14.
5. Debt instruments issued or guaranteed by the entity, or by any other third party with which the entity has close
links, may only be accepted as eligible collateral in the situations laid down in Section 6.2 of Annex I to Guideline
ECB/2011/14.
6. The Governing Council may, upon a proposal by the relevant euro area NCB, exempt the treasury departments
referred to in paragraph 2(c) from the requirement to provide adequate collateral before obtaining intraday credit.
Credit extension procedure
7. Access to intraday credit may only be granted on business days.
8. Intraday credit shall be provided free of interest.
9. The failure by an entity referred to in paragraph 2(a) to reimburse the intraday credit at the end of the day shall
automatically be considered as a request by such entity for recourse to the marginal lending facility.
10. The failure by an entity referred to in paragraph 2(b), (d) or (e) to reimburse the intraday credit at the end of the day
for whatever reason shall render that entity liable to the following penalties:
(a) if the entity in question has a debit balance on its account at the end of the day for the first time within any 12-
month period, then this entity shall incur penalty interest calculated at a rate of five percentage points above the
marginal lending rate on the amount of such debit balance;
(b) if the entity in question has a debit balance on its account at the end of the day for at least the second time
within the same 12-month period, then the penalty interest mentioned in subparagraph (a) shall be increased by
2,5 percentage points for each time additional to the first that a debit position has occurred within this
12-month period.
( 1 ) The Eurosystem’s current policy for the location of infrastructures is set out in the following statements, which are all published on the
ECB’s website at www.ecb.europa.eu: (a) the Policy statement on euro payment and settlement systems located outside the euro area of
3 November 1998; (b) The Eurosystem’s policy line with regard to consolidation in central counterparty clearing’ of 27 September
2001; (c) The Eurosystem policy principles on the location and operation of infrastructures settling in euro-denominated payment
transactions of 19 July 2007; and (d) The Eurosystem policy principles on the location and operation of infrastructures settling euro-
denominated payment transactions: specification of legally and operationally located in the euro area of 20 November 2008; (e) The
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11. The Governing Council may decide to waive or reduce the penalties imposed pursuant to paragraph 10, if the end-of-
day debit balance of the entity in question is attributable to force majeure and/or technical malfunction of TARGET2,
the latter phrase as defined in Annex II.
Suspension, limitation or termination of intraday credit
12. (a) euro area NCBs shall suspend or terminate access to intraday credit if one of the following events of default
occurs:
(i) the account of the entity with the euro area NCB is suspended or closed;
(ii) the entity concerned ceases to meet any of the requirements laid down in this Annex for the provision of
intraday credit;
(iii) a decision is made by a competent judicial or other authority to implement in relation to the entity a
procedure for the winding-up of the entity or the appointment of a liquidator or analogous officer over the
entity or any other analogous procedure;
(iv) the entity becomes subject to the freezing of funds and/or other measures imposed by the Union restricting
the entity’s ability to use its funds;
(v) the entity’s eligibility as a counterparty for Eurosystem monetary policy operations has been suspended or
terminated.
(b) euro area NCBs may suspend or terminate access to intraday credit if an NCB suspends or terminates the
participant’s participation in TARGET2 pursuant to Article 34(2)(b) to (e) of Annex II, or one or more events
of default (other than those referred to in Article 34(2)(a)) occur.
(c) If the Eurosystem decides to suspend, limit or exclude counterparties’ access to monetary policy instruments on
the grounds of prudence or otherwise in accordance with Section 2.4 of Annex I to Guideline ECB/2011/14, euro
area NCBs shall implement that decision in respect of access to intraday credit pursuant to provisions in the
contractual or regulatory arrangements applied by the respective NCBs.
(d) euro area NCBs may decide to suspend, limit or terminate a participant’s access to intraday credit if the
participant is deemed to pose risks on the grounds of prudence. In such cases, the euro area NCB shall
immediately notify the ECB and other euro area NCBs and connected NCBs thereof in writing. Where appro
priate, the Governing Council shall decide upon uniform implementation of the measures taken in all TARGET2
component systems.
13. Where a euro area NCB decides to suspend, limit or terminate a Eurosystem monetary policy counterparty’s access to
intraday credit in accordance with paragraph 12(d) above, such decision shall not take effect until the ECB has
approved it.
14. By derogation from paragraph 13, in urgent circumstances a euro area NCB may suspend a Eurosystem monetary
policy counterparty’s access to intraday credit with immediate effect. In such cases the euro area NCB concerned shall
immediately notify the ECB thereof in writing. The ECB shall have the power to reverse the euro area NCB’s action.
However, if the ECB does not send the euro area NCB notice of such reversal within 10 business days of the ECB’s
receipt of notification, the ECB shall be deemed to have approved the euro area NCB’s action.

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ANNEX IV
SETTLEMENT PROCEDURES FOR ANCILLARY SYSTEMS
1. Definitions
For the purposes of this Annex and further to the definitions in Article 2:
(1) ‘credit instruction’ means a payment instruction submitted by an ancillary system and addressed to the ASCB to
debit one of the accounts kept and/or managed by the ancillary system in the PM, and to credit a settlement
bank’s PM account or sub-account by the amount specified therein,
(2) ‘debit instruction’ means a payment instruction addressed to the SCB and submitted by an ancillary system to
debit a settlement bank’s PM account or sub-account by the amount specified therein, on the basis of a debit
mandate, and to credit either one of the ancillary system’s accounts in the PM or another settlement bank’s PM
account or sub-account,
(3) ‘payment instruction’ or ‘ancillary system payment instruction’ means a credit instruction or a debit instruction,
(4) ‘ancillary system central bank (ASCB)’ means the Eurosystem CB with which the relevant ancillary system has a
bilateral arrangement for the settlement of ancillary system payment instructions in the PM,
(5) ‘settlement central bank (SCB)’ means a Eurosystem CB holding a settlement bank’s PM account,
(6) ‘settlement bank’ means a participant whose PM account or sub-account is used to settle ancillary system
payment instructions,
(7) ‘Information and Control Module (ICM)’ means the SSP module that allows participants to obtain on-line
information and gives them the possibility to submit liquidity transfer orders, manage liquidity and initiate
payment orders in contingency situations,
(8) ‘ICM broadcast message’ means information made simultaneously available to all or a selected group of
TARGET2 participants via the ICM,
(9) ‘debit mandate’ means an authorisation by a settlement bank in the form provided by the Eurosystem CBs in
the static data forms addressed to both its ancillary system and its SCB, entitling the ancillary system to submit
debit instructions, and instructing the SCB to debit the settlement bank’s PM account or sub-account as a result
of debit instructions,
(10) ‘short’ means owing money during the settlement of ancillary system payment instructions,
(11) ‘long’ means being owed money during the settlement of ancillary system payment instructions,
(12) ‘cross-system settlement’ means the real-time settlement of debit instructions under which payments are
executed from a settlement bank of one ancillary system using settlement procedure 6 to a settlement bank
of another ancillary system using settlement procedure 6,
(13) ‘Static Data (Management) Module’ means the SSP module in which static data are collected and recorded.
2. Role of SCBs
Each Eurosystem CB shall act as the SCB in relation to any settlement bank for which it holds a PM account.
3. Management of relationship between CBs, ancillary systems and settlement banks
(1) The ASCBs shall ensure that the ancillary systems with which they have bilateral arrangements provide a list of
settlement banks containing the settlement banks’ PM account details, which the ASCB shall store in the Static
Data (Management) Module of the SSP. Any ancillary system may access the list of its respective settlement banks
via the ICM.

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(2) The ASCBs shall ensure that the ancillary systems with which they have bilateral arrangements inform them
without delay of any changes with regard to the list of settlement banks. The ASCBs shall inform the relevant
SCB regarding any such changes via an ICM broadcast message.
(3) The ASCBs shall ensure that the ancillary systems with which they have bilateral arrangements collect the debit
mandates and other relevant documents from their settlement banks and submit them to the ASCB. Such
documents shall be provided in English and/or the ASCB’s relevant national languages. If the ASCB’s national
language(s) is/are not identical with the SCB’s national languages, the necessary documents shall be provided in
English only or both in English and in the ASCB’s relevant national language(s). In the case of ancillary systems
that settle via TARGET2-ECB, the documents shall be provided in English.
(4) If a settlement bank is a participant in the relevant ASCB’s TARGET2 component system, the ASCB shall verify
the validity of the debit mandate given by the settlement bank and make any necessary entries in the Static Data
(Management) Module. If a settlement bank is not a participant in the relevant ASCB’s TARGET2 component
system, the ASCB shall forward the debit mandate (or an electronic copy thereof, if so agreed between ASCB and
SCB) to the relevant SCBs for verification of its validity. The SCBs shall perform such verification and shall inform
the relevant ASCB of the outcome of verification within five business days after receipt of such request. After
verification, the ASCB shall update the list of settlement banks in the ICM.
(5) The verification undertaken by the ASCB shall be without prejudice to the ancillary system’s responsibility to
restrict payment instructions to the list of settlement banks referred to in subparagraph 1.
(6) Unless they are one and the same, the ASCBs and SCBs shall exchange information regarding any significant
event during the settlement process.
(7) The ASCBs shall ensure that the ASs with which they have bilateral arrangements provide the name and the BIC
of the ancillary system with which they intend to execute cross-system settlement and the date from which cross-
system settlement with a particular ancillary system should begin or stop. This information shall be recorded in
the Static Data (Management) Module.
4. Initiation of payment instructions via the ASI
(1) All payment instructions submitted by an ancillary system via the ASI shall be in the form of XML messages.
(2) All payment instructions submitted by an ancillary system via the ASI shall be considered as ‘highly urgent’ and
shall be settled in accordance with the provisions laid down in Annex II.
(3) A payment instruction shall be deemed accepted if:
(a) the payment instruction complies with the rules established by the network service provider;
(b) the payment instruction complies with the formatting rules and conditions of the ASCB’s TARGET2
component system;
(c) the settlement bank is on the list of settlement banks referred to in paragraph 3(1);
(d) in the case of a cross-system settlement, the relevant ancillary system is on the list of ASs with which cross-
system settlement may be executed;
(e) in the event that a settlement bank’s participation in TARGET2 has been suspended, the explicit consent of
the SCB of the suspended settlement bank has been obtained.
5. Entry of payment instructions into the system and their irrevocability
(1) Credit instructions shall be deemed to be entered in the relevant TARGET2 component system at the moment
and irrevocable from the moment that they are accepted by the ASCB. Debit instructions shall be deemed to be
entered in the relevant TARGET2 component system at the moment and irrevocable from the moment that they
are accepted by the SCB.

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(2) The application of subparagraph 1 shall not have any effect on any rules of ASs which stipulate a moment of
entry into the ancillary system and/or irrevocability of transfer orders submitted to such ancillary system at a
point in time earlier than the moment of entry of the respective payment instruction in the relevant TARGET2
component system.
6. Settlement procedures
(1) If an ancillary system requests use of a settlement procedure, the ASCB concerned shall offer one or more of the
settlement procedures specified below:
(a) settlement procedure 1 (liquidity transfer);
(b) settlement procedure 2 (real-time settlement);
(c) settlement procedure 3 (bilateral settlement);
(d) settlement procedure 4 (standard multilateral settlement);
(e) settlement procedure 5 (simultaneous multilateral settlement);
(f) settlement procedure 6 (dedicated liquidity and cross-system settlement).
(2) The SCBs shall support the settlement of ancillary system payment instructions in accordance with the choice of
settlement procedures referred to in subparagraph 1 by, inter alia, settling payment instructions on the settlement
banks’ PM accounts or sub-accounts.
(3) Further details relating to the settlement procedures referred to in subparagraph 1 are contained in paragraphs 9
to 14.
7. No obligation to open PM account
ASs shall not be obliged to become direct participants in a TARGET2 component system or to maintain a PM
account while using the ASI.
8. Accounts to support settlement procedures
(1) In addition to PM accounts, the following types of accounts may be opened in the PM and used by ASCBs, ASs
and settlement banks for the settlement procedures referred to in paragraph 6(1):
(a) technical accounts;
(b) mirror accounts;
(c) guarantee fund accounts;
(d) sub-accounts.
(2) When an ASCB offers settlement procedure 4, 5 or 6 for interfaced models, it shall open a technical account in
its TARGET2 component system for the ASs concerned. Such accounts may be offered by the ASCB as an option
for settlement procedures 2 and 3. Separate technical accounts shall be opened in respect of settlement
procedures 4 and 5. The balance on technical accounts shall be zero or positive at the end of the relevant
ancillary system’s settlement process and the end-of-day balance shall be zero. Technical accounts shall be
identified by means of the relevant ancillary system’s BIC.
(3) When offering settlement procedure 1 or 6 for integrated models, an ASCB shall, and when offering settlement
procedure 3 or 6 for interfaced models, an ASCB may open mirror accounts in its TARGET2 component system.
Mirror accounts are specific PM accounts held by the ASCB in its TARGET2 component system for use by the
ancillary system. Mirror accounts are identified by the relevant ASCB’s BIC.

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(4) When offering settlement procedure 4 or 5, an ASCB may open a guarantee fund account in its TARGET2
component system for ASs. The balances of these accounts shall be used to settle the ancillary system’s payment
instructions in the event that there is no available liquidity on the settlement bank’s PM account. Guarantee fund
account holders may be ASCBs, ASs or guarantors. Guarantee fund accounts are identified by the relevant
accounts holder’s BIC.
(5) When settlement procedure 6 is offered by an ASCB for interfaced models, SCBs shall open one or more sub-
accounts in their TARGET2 component systems for settlement banks, to be used for dedicating liquidity and, if
relevant, cross-system settlement. Sub-accounts shall be identified by the BIC of the PM account to which they
relate, in combination with an account number that is specific to the relevant sub-account. The account number
is composed of the country code plus up to 32 characters (depending on the relevant national bank account
structure).
(6) The accounts referred to in subparagraph 1(a) to (d) shall not be published in the TARGET2 directory. If so
requested by the participant, the relevant statements of accounts (MT 940 and MT 950) for all such accounts
may be provided to the account holder at the end of every business day.
(7) The detailed rules on the opening of the account types mentioned in this paragraph and on their application
while supporting the settlement procedures may be further specified in bilateral arrangements between the ASs
and the ASCBs.
9. Settlement procedure 1 — Liquidity transfer
(1) When offering settlement procedure 1, the ASCBs and SCBs shall support the liquidity transfer from a mirror
account to a settlement bank’s PM account via the ASI. The liquidity transfer can be initiated either by the
ancillary system or by the ASCB acting on the ancillary system’s behalf.
(2) Settlement procedure 1 shall only be used for the integrated model where the relevant ancillary system has to use
a mirror account, firstly to collect the necessary liquidity that has been dedicated by its settlement bank and,
secondly, to transfer this liquidity back to the PM account of the settlement bank.
(3) The ASCBs may offer the settlement of payment instructions within certain time limits to be defined by the
ancillary system, as referred to in paragraph 15(2) and (3).
(4) The settlement banks and ASs shall have access to information via the ICM. The ASs shall be notified on
completion or failure of the settlement. If the ancillary system initiates the liquidity transfer from the mirror
account to the settlement bank’s PM account, the settlement banks accessing TARGET2 via the network service
provider shall be informed of the crediting via a SWIFT MT 202 message. Participants using internet-based access
shall be informed by a message on the ICM.
10. Settlement procedure 2 — Real-time settlement
(1) When offering settlement procedure 2, the ASCBs and SCBs shall support the settlement of the cash leg of
ancillary system transactions by settling payment instructions submitted by the ancillary system on an individ
ualised basis, rather than in batches. If a payment instruction to debit a short settlement bank’s PM account is
queued in line with Annex II, the SCB concerned shall inform the settlement bank via an ICM broadcast message.
(2) Settlement procedure 2 may also be offered to the ancillary system for the settlement of multilateral balances and
in such cases the ASCB shall open a technical account for such ancillary system. Furthermore, the ASCB shall not
offer the ancillary system the service of properly managing the sequence of incoming and outgoing payments as
may be required for such multilateral settlement. The ancillary system itself shall assume responsibility for the
necessary sequencing.
(3) The ASCB may offer the settlement of payment instructions within certain time limits to be defined by the
ancillary system, as referred to in paragraph 15(2) and (3).
(4) The settlement banks and ASs shall have access to information via the ICM. The ASs shall be notified on
completion or failure of the settlement by a message on the ICM. If they so request, settlement banks
accessing TARGET2 via the network service provider shall be notified of the successful settlement via a
SWIFT MT 900 or MT 910 message. Participants using internet-based access shall be informed by a message
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11. Settlement procedure 3 — Bilateral settlement
(1) When offering settlement procedure 3, the ASCBs and SCBs shall support settlement of the cash leg of ancillary
system transactions by settling payment instructions which the ancillary system submits in batch mode. If a
payment instruction to debit a short settlement bank’s PM account is queued in line with Annex II, the SCB
concerned shall inform this settlement bank via an ICM broadcast message.
(2) Settlement procedure 3 may also be offered to the ancillary system for the settlement of multilateral balances.
Paragraph 10(2) shall apply mutatis mutandis, subject to the modifications that:
(a) payment instructions: (i) to debit the short settlement banks’ PM accounts and credit the ancillary system’s
technical account; and (ii) to debit the ancillary system’s technical account and credit the long settlement
banks’ PM accounts are submitted in separate files; and
(b) the long settlement banks’ PM accounts shall be credited only after all short settlement banks’ PM accounts
are debited.
(3) If multilateral settlement fails (for example, because not all collections from short settlement banks’ accounts are
successful), the ancillary system shall submit payment instructions in order to reverse already settled debit
transactions.
(4) The ASCBs may offer:
(a) the settlement of payment instructions within certain time limits defined by the ancillary system, as referred
to in paragraph 15(3); and/or
(b) the ‘information period’ functionality, as referred to in paragraph 15(1).
(5) The settlement banks and ASs shall have access to information via the ICM. The ASs shall be notified on
completion or failure of the settlement based on the selected option — single or global notification. If they
so request, settlement banks shall be notified of the successful settlement via a SWIFT MT 900 or MT 910
message. Participants using internet-based access shall be informed by a message on the ICM.
12. Settlement procedure 4 — Standard multilateral settlement
(1) When offering settlement procedure 4, the ASCBs and SCBs shall support the settlement of multilateral cash
balances of ancillary system transactions by settling payment instructions submitted by the ancillary system in
batch mode. The ASCBs shall open a specific technical account for such an ancillary system.
(2) The ASCBs and SCBs shall ensure the required sequencing of payment instructions. They shall only book credits
if all debits have been collected successfully. Payment instructions: (a) to debit short settlement banks’ accounts
and credit the ancillary system’s technical account; and (b) to credit long settlement banks’ accounts and debit the
ancillary system’s technical account are submitted in a single file.
(3) Payment instructions to debit the short settlement banks’ PM account and to credit the ancillary system’s
technical account will be settled first; only upon settlement of all such payment instructions (including
possible funding of the technical account by a guarantee fund mechanism), the PM accounts of the long
settlement banks shall be credited.
(4) If a payment instruction to debit a short settlement bank’s PM account is queued in line with Annex II, the SCBs
shall inform such settlement bank via an ICM broadcast message.
(5) If a short settlement bank has insufficient funds on its PM account, a guarantee fund mechanism shall be
activated by the ASCB if that is provided for in the bilateral arrangement between the ASCB and the ancillary
system.
(6) If no guarantee fund mechanism is provided for and the entire settlement fails, then the ASCBs and SCBs shall be
deemed to have been instructed to return all payment instructions in the file and shall reverse payment
instructions which have already been settled.
(7) The ASCBs shall inform settlement banks of a settlement failure via an ICM broadcast message.

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(8) The ASCBs may offer:
(a) the settlement of payment instructions within certain time limits defined by the ancillary system, as referred
to in paragraph 15(3);
(b) the ‘information period’ functionality, as referred to in paragraph 15(1);
(c) a guarantee fund mechanism, as referred to in paragraph 15(4).
(9) The settlement banks and ASs shall have access to information via the ICM. ASs shall be notified on completion
or failure of the settlement. If they so request, settlement banks shall be notified of the successful settlement via a
SWIFT MT 900 or MT 910 message. Participants using internet-based access shall be informed by a message on
the ICM.
13. Settlement procedure 5 — Simultaneous multilateral settlement
(1) When offering settlement procedure 5, the ASCBs and SCBs shall support the settlement of multilateral cash
balances of ancillary system transactions by settling payment instructions submitted by the ancillary system. In
order to settle relevant payment instructions Algorithm 4 shall be used (see Appendix I to Annex II). Unlike in
settlement procedure 4, settlement procedure 5 operates on an ‘all-or-nothing’ basis. In this procedure the
debiting of short settlement banks’ PM accounts and the crediting of long settlement banks’ PM accounts
shall be done simultaneously (rather than sequentially, as in settlement procedure 4). Paragraph 12 shall apply
mutatis mutandis subject to the following modification. If one or more of the payment instructions cannot be
settled, all payment instructions shall be queued, and Algorithm 4, as described in paragraph 16(1), shall be
repeated in order to settle the ancillary system’s payment instructions in the queue.
(2) The ASCBs may offer:
(a) the settlement of payment instructions within certain time limits defined by the ancillary system, as referred
to in paragraph 15(3);
(b) the ‘information period’ functionality, as referred to in paragraph 15(1);
(c) a guarantee fund mechanism, as referred to in paragraph 15(4).
(3) The settlement banks and ASs shall have access to information via the ICM. The ASs shall be notified on
completion or failure of the settlement. If they so request, settlement banks shall be notified of successful
settlement via a SWIFT MT 900 or MT 910 message. Participants using internet-based access shall be
informed by a message on the ICM.
(4) If a payment instruction to debit a short settlement bank’s PM account is queued in line with Annex II, the SCB
concerned shall inform the settlement banks via an ICM broadcast message.
14. Settlement procedure 6 — Dedicated liquidity and cross-system settlement
(1) Settlement procedure 6 can be used for both the interfaced and the integrated model, as described in subpara
graphs 4 to 13 and 14 to 18 below, respectively. In the case of the integrated model, the relevant ancillary
system has to use a mirror account to collect the necessary liquidity set aside by its settlement banks. In the case
of the interfaced model, the settlement bank has to open at least one sub-account relating to a specific ancillary
system.
(2) If they so request, the settlement banks shall be notified via a SWIFT MT 900 or MT 910 message and
participants using internet-based access shall be informed by a message on the ICM of the crediting and
debiting of their PM accounts and, if applicable, of their sub-accounts.
(3) When offering cross-system settlement under settlement procedure 6, the ASCBs and SCBs shall support cross-
system settlement payments, if they are initiated by the relevant ASs. An ancillary system can only initiate cross-
system settlement during its processing cycle, and settlement procedure 6 has to be running in the ancillary
system receiving the payment instruction. Cross-system settlement shall be offered for both daytime and night-
time processing under settlement procedure 6. The possibility to execute cross-system settlement between two
individual ASs shall be recorded in the Static Data (Management) Module.

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(A) Interfaced model
(4) When offering settlement procedure 6, the ASCBs and SCBs shall support the settlement of bilateral and/or
multilateral cash balances of ancillary system transactions by:
(a) enabling a settlement bank to pre-fund its prospective settlement obligation through liquidity transfers from
its PM account into its sub-account (hereinafter ‘dedicated liquidity’) prior to the ancillary system processing;
and
(b) settling the ancillary system’s payment instructions subsequent to the completion of the ancillary system
processing: in relation to short settlement banks by debiting their sub-accounts (within the limits of the
funds provided on such account) and crediting the ancillary system’s technical account and in relation to
long settlement banks by crediting their sub-accounts and debiting the ancillary system’s technical account.
(5) When offering settlement procedure 6:
(a) the SCBs shall open at least one sub-account in relation to a single ancillary system for each settlement
bank; and
(b) the ASCB shall open a technical account for the ancillary system for: (i) crediting funds collected from the
sub-accounts of the short settlement banks; and (ii) debiting funds when making credits to the dedicated
sub-accounts of the long settlement banks.
(6) Settlement procedure 6 shall be offered both for daytime processing and night-time operations of ASs. In the
latter case, the new business day shall start immediately upon fulfilment of the minimum reserve requirements;
any debit or credit made on the relevant accounts thereafter shall be for value of the new business day.
(7) Under settlement procedure 6 and with regard to dedicating liquidity, the ASCBs and SCBs shall offer the
following types of liquidity transfer service into and from the sub-account:
(a) standing orders which settlement banks may submit or modify at any time during a business day via the
ICM (when it is available). Standing orders submitted after the sending of the ‘start-of-procedure’ message on
a given business day shall be valid only for the next business day. If there are several standing orders to
credit different sub-accounts, they shall be settled in the order of their amount, starting with the highest.
During night-time ancillary system operations, if there are standing orders for which there are insufficient
funds on the PM account, such orders shall be settled following a pro-rata reduction of all orders;
(b) current orders, which may only be submitted either by a settlement bank (via the ICM) or the relevant
ancillary system via an XML message during the running of settlement procedure 6 (identified by the time
span from the ‘start-of-procedure’ to the ‘end-of-procedure’ message) and which will be settled only as long
as the ancillary system processing cycle has not yet started. If there is a current order submitted by the
ancillary system for which there are insufficient funds on the PM account, such order shall be partially
settled;
(c) SWIFT orders that go via an MT 202 message or by automatic mapping to an MT202 from the screens for
participants using internet-based access, which may only be submitted during the running of settlement
procedure 6 and only during daytime processing. Such orders shall be settled immediately.
(8) Settlement procedure 6 shall start by means of a ‘start-of-procedure’ message and finish by means of an ‘end-of-
procedure’ message, with both messages to be sent by the ancillary system. However, for night-time ancillary
system operations, the ‘start-of-procedure’ message is sent by the ASCB. ‘Start-of-procedure’ messages shall
trigger the settlement of standing orders for the transfer of liquidity into the sub-accounts. The ‘end-of-
procedure’ message leads to an automatic retransfer of liquidity from the sub-account to the PM account.

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(9) Under settlement procedure 6, dedicated liquidity on the sub-accounts shall be frozen as long as the ancillary
system processing cycle is running (starting with a ‘start-of-cycle’ message and ending with an ‘end-of-cycle’
message, both to be sent by the ancillary system) and released thereafter. The frozen balance can be changed
during the processing cycle as a result of cross-system settlement payments or if a settlement bank transfers
liquidity from its PM account. The ASCB shall notify the ancillary system of the reduction or increase of
liquidity on the sub-account as a result of cross-system settlement payments. If the ancillary system so requests,
the ASCB shall also notify it of the increased liquidity on the sub-account as a result of liquidity transfer by the
settlement bank.
(10) Within each ancillary system processing cycle, payment instructions shall be settled out of dedicated liquidity
whereby Algorithm 5 (as referred to in Appendix I to Annex II) shall be used as a rule.
(11) Within each ancillary system processing cycle, a settlement bank’s dedicated liquidity can be increased by
crediting certain incoming payments directly to its sub-accounts, i.e. coupons and redemption payments. In
such cases, the liquidity first has to be credited on the technical account, then debited from such account before
crediting the liquidity on the sub-account (or on the PM account).
(12) Cross-system settlement between two interfaced ASs can only be initiated by an ancillary system (or its ASCB
on its behalf) whose participant’s sub-account is debited. The payment instruction is settled by debiting the
amount indicated in the payment instruction from the sub-account of a participant of the ancillary system
initiating the payment instruction and crediting the sub-account of a participant of another ancillary system.
The ancillary system initiating the payment instruction and the other ancillary system shall be notified on
completion of the settlement. If they so request, settlement banks shall be notified of successful settlement via a
SWIFT MT 900 or MT 910 message. Participants using internet-based access shall be informed by a message on
the ICM.
(13) Cross-system settlement from an ancillary system using the interfaced model to an ancillary system using the
integrated model can be initiated by the ancillary system using the interfaced model (or its ASCB on its behalf).
The payment instruction is settled by debiting the amount indicated in the payment instruction from the sub-
account of a participant of the ancillary system using the interfaced model and crediting the mirror account
used by the ancillary system using the integrated model. The payment instruction cannot be initiated by the
ancillary system using the integrated model whose mirror account will be credited.
The ancillary system initiating the payment instruction and the other ancillary system shall be notified on
completion of the settlement. If they so request, settlement banks shall be notified of successful settlement via a
SWIFT MT 900 or MT 910 message. Participants using internet-based access shall be informed by a message on
the ICM.
(B) Integrated model
(14) When offering settlement procedure 6 for integrated models, the ASCBs and SCBs shall support such
settlement. In the event that settlement procedure 6 is used for the integrated model during daytime processing,
only limited functionality is offered.
(15) Under settlement procedure 6 and with regard to the integrated model, the ASCBs and SCBs shall offer the
following types of liquidity transfer service into a mirror account:
(a) standing orders (for daytime processing and for night-time ancillary system operations), which settlement
banks may submit or modify at any time during a business day via the ICM (when it is available). Standing
orders submitted after the sending of the ‘start-of-procedure’ message on a given business day shall be valid
only for the next business day. If there are several standing orders, they shall be settled in the order of their
amount, starting with the highest. If a standing order for daytime processing is not covered, it will be
rejected. During night-time ancillary system operations, if there are standing orders for which there are
insufficient funds on the PM account, such orders shall be settled following a pro-rata reduction of all
orders;
(b) current orders, which may only be submitted either by a settlement bank (via the ICM) or the relevant
ancillary system via an XML message during the running of settlement procedure 6 (identified by the time
span from the ‘start-of-procedure’ to the ‘end-of-procedure’ message) and which will be settled only as long
as the ancillary system processing cycle has not yet started. If there is a current order for which there are
insufficient funds on the PM account, such order shall be partially settled;

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(c) SWIFT orders that go via an MT 202 message, which may only be submitted during daytime processing.
Such orders shall be settled immediately.
(16) The rules regarding the ‘start-of-procedure’ and ‘end-of-procedure’ messages, as well as regarding the start and
end of cycle for the interfaced model, shall apply mutatis mutandis.
(17) Cross-system settlement between two ASs using the integrated model can only be initiated by an ancillary
system (or its ASCB on its behalf) whose mirror account is debited. The payment instruction is settled by
debiting the amount indicated in the payment instruction from the mirror account used by the ancillary system
initiating the payment instruction and crediting the mirror account used by another ancillary system. The
payment instruction cannot be initiated by the ancillary system whose mirror account will be credited.
The ancillary system initiating the payment instruction and the other ancillary system shall be notified on
completion of the settlement. If they so request, settlement banks shall be notified of successful settlement via a
SWIFT MT 900 or MT 910 message. Participants using internet-based access shall be informed by a message on
the ICM.
(18) Cross-system settlement from an ancillary system using the integrated model to an ancillary system using the
interfaced model can be initiated by the ancillary system using the integrated model (or its ASCB on its behalf).
The payment instruction is settled by debiting the amount indicated in the payment instruction from the mirror
account used by the ancillary system using the integrated model and crediting the sub-account of a participant
of another ancillary system. The payment instruction cannot be initiated by the ancillary system using the
interfaced model whose participant’s sub-account will be credited.
The ancillary system initiating the payment instruction and the other ancillary system shall be notified on
completion of the settlement. If they so request, settlement banks shall be notified of successful settlement via a
SWIFT MT 900 or MT 910 message. Participants using internet-based access shall be informed by a message on
the ICM.
15. Optional connected mechanisms
(1) The optional connected mechanism ‘information period’ may be offered by the ASCBs for settlement procedures
3, 4 and 5. If the ancillary system (or its ASCB on its behalf) has specified an optional ‘information period’ time,
the settlement bank shall receive an ICM broadcast message indicating the time until which the settlement bank
may request a reversal of the relevant payment instruction. Such request shall be taken into account by the SCB
only if it is communicated via and approved by the ancillary system. The settlement shall start if the SCB does
not receive such request until the ‘information period’ time has elapsed. Upon receipt by the SCB of such request
within the ‘information period’:
(a) when settlement procedure 3 is used for bilateral settlement, the relevant payment instruction shall be
reversed; and
(b) when settlement procedure 3 is used for the settlement of multilateral balances, or if in settlement procedure
4 the entire settlement fails, all payment instructions in the file shall be reversed and all settlement banks and
the ancillary system shall be informed via an ICM broadcast message.
(2) If an ancillary system sends the settlement instructions before the scheduled settlement time (‘from’), the
instructions are stored until the scheduled time is reached. In this case, the payment instructions are only
submitted to the entry disposition when the ‘from’ time is reached. This optional mechanism can be used in
settlement procedures 1 and 2.
(3) The settlement period (till) makes it possible to allocate a limited period of time for ancillary system settlement in
order not to prevent or delay the settlement of other ancillary system-related or TARGET2 transactions. If any
payment instruction is not settled until the ‘till’ time is reached or within the defined settlement period, these
payment instructions are either returned or, in the case of settlement procedures 4 and 5, the guarantee fund
mechanism may be activated. The settlement period (till) can be specified for settlement procedures 1 to 5.
(4) The guarantee fund mechanism may be used if a settlement bank’s liquidity is insufficient to cover its obligations
stemming from ancillary system settlement. In order to allow the settlement of all payment instructions involved
in an ancillary system settlement, this mechanism is used to provide the complementary liquidity needed. This
mechanism may be used for settlement procedures 4 and 5. If the guarantee fund mechanism is to be used, it is
necessary to maintain a special guarantee fund account where ‘emergency liquidity’ is available or made available
on demand.

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16. Algorithms used
(1) Algorithm 4 supports settlement procedure 5. To facilitate settlement and to reduce the liquidity needed, all
ancillary system payment instructions are included (regardless of their priority). Ancillary system payment
instructions to be settled following settlement procedure 5 bypass the entry disposition and are kept in the
PM separately until the end of the current optimisation process. In the same run of Algorithm 4, several ASs
using settlement procedure 5 will be included if they intend to settle at the same time.
(2) In settlement procedure 6, the settlement bank can dedicate a liquidity amount to settle balances coming from a
specific ancillary system. Dedication is brought about by setting aside the necessary liquidity on a specific sub-
account (interfaced model). Algorithm 5 is used both for night-time ancillary system operations and daytime
processing. The settlement process takes place by means of debiting the short settlement banks’ sub-accounts in
favour of the ancillary system technical account and then debiting the ancillary system technical account in
favour of the long settlement banks’ sub-accounts. In the case of credit balances the booking can take place
directly — if indicated by the ancillary system within the relevant transaction — on the settlement bank’s PM
account. If the settlement of one or more debit instructions is unsuccessful, i.e. as the result of an ancillary
system’s error, the payment concerned is queued on the sub-account. Settlement procedure 6 can make use of
Algorithm 5 running on sub-accounts. Furthermore, Algorithm 5 does not have to take account of any limits or
reservations. For every settlement bank the total position is calculated and if all total positions are covered, all
transactions will be settled. Transactions which are not covered are put back into the queue.
17. Effect of suspension or termination
If suspension or termination of the use of the ASI by an ancillary system takes effect during the settlement cycle of
ancillary system payment instructions, the ASCB shall be deemed to be authorised to complete the settlement cycle
on behalf of the ancillary system.
18. Fee schedule and invoicing
(1) An ancillary system using the ASI or the Participant Interface, irrespective of the number of any accounts it may
hold with the ASCB and/or the SCB, shall be subject to a fee schedule consisting of three elements, as set out
below.
(a) A fixed monthly fee of EUR 1 000 to be charged to each ancillary system (Fixed Fee I).
(b) A second monthly fixed fee of between EUR 417 and EUR 4 167, in proportion to the underlying gross value
of the ancillary system’s euro cash settlement transactions (Fixed Fee II):
Band From
(EUR
million/day) To
(EUR
million/day) Annual
fee
(EUR) Monthly
fee
(EUR)
1
0 below
1
000 5
000 417
2 1
000 below
2
500 10
000 833
3 2
500 below
5
000 20
000 1
667
4 5
000 below
10
000 30
000 2
500
5 10
000 below
50
000 40
000 3
333
6 Above
50
000
— 50
000 4
167
The gross value of the ancillary system’s euro cash settlement transactions shall be calculated by the ASCB
once a year on the basis of such gross value during the previous year and the calculated gross value shall be
applied for calculating the fee as from 1 January of each calendar year.
(c) A transaction fee calculated on the same basis as the schedule established for TARGET2 participants in
Appendix VI to Annex II. The ancillary system may choose one of the two options: either to pay a flat
EUR 0,80 fee per payment instruction (Option A) or to pay a fee calculated on a degressive basis (Option B),
subject to the following modifications:
(i) for Option B, the limits of the bands relating to volume of payment instructions are divided by two; and

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(ii) a monthly fixed fee of EUR 150 (under Option A) or EUR 1 875 (under Option B) shall be charged in
addition to Fixed Fee I and Fixed Fee II.
(2) Any fee payable in relation to a payment instruction submitted or payment received by an ancillary system, via
either the Participant Interface or the ASI, shall be exclusively charged to this ancillary system. The Governing
Council may establish more detailed rules for the determination of billable transactions settled via the ASI.
(3) Each ancillary system shall receive an invoice from its respective ASCB for the previous month based on the fees
referred to in subparagraph 1, no later than the fifth business day of the following month. Payments shall be
made no later than the 10th business day of this month to the account specified by the ASCB or shall be debited
from an account specified by the ancillary system.
(4) For the purposes of this paragraph, each ancillary system that has been designated under Directive 98/26/EC shall
be treated separately, even if two or more of them are operated by the same legal entity. The same rule shall
apply to the ASs that have not been designated under Directive 98/26/EC, in which case the ASs shall be
identified by reference to the following criteria: (a) a formal arrangement, based on a contractual or legislative
instrument, e.g. an agreement among the participants and the system operator; (b) with multiple membership; (c)
common rules and standardised arrangements; and (d) for the clearing, netting and/or settlement of payments
and/or securities between the participants.

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ANNEX V
SUPPLEMENTAL AND MODIFIED HARMONISED CONDITIONS FOR PARTICIPATION IN TARGET2 USING
INTERNET-BASED ACCESS
Article 1
Scope
The Conditions set out in Annex II apply to participants using internet-based access to access one or more PM accounts
subject to the provisions of this Annex.
Article 2
Definitions
For the purposes of this Annex, in addition to the definitions laid down in Annex II, the following definitions apply:
(1) ‘certification authorities’ means one or more NCBs designated as such by the Governing Council to act on behalf of
the Eurosystem to issue, manage, revoke and renew electronic certificates;
(2) ‘electronic certificates’ or ‘certificates’ means an electronic file, issued by the certification authorities, that binds a
public key with an identity and which is used for the following: to verify that a public key belongs to an individual, to
authenticate the holder, to check a signature from this individual or to encrypt a message addressed to this individual.
Certificates are held on a physical device such as a smart card or USB stick, and references to certificates include such
physical devices. The certificates are instrumental in the authentication process of the participants accessing TARGET2
through the internet and submitting payment messages or control messages;
(3) ‘certificate holder’ means a named, individual person, identified and designated by a TARGET2 participant as auth
orised to have internet-based access to the participant’s TARGET2 account. Their application for certificates will have
been verified by the participant’s home NCB and transmitted to the certification authorities, which will in turn have
delivered certificates binding the public key with the credentials that identify the participant;
(4) ‘Internet-based access’ means that the participant has opted for a PM account that can only be accessed via the
internet and the participant submits payment messages or control messages to TARGET2 by means of the internet;
(5) ‘Internet service provider’ means the company or organisation, i.e. the gateway, used by the TARGET2 participant for
the purpose of accessing their TARGET2 account using internet-based access.
Article 3
Inapplicable provisions
The following provisions of Annex II shall not apply with regard to internet-based access:
Article 4(1)(c) and (2)(d); Article 5(2), (3) and (4); Articles 6 and 7; Article 11(8); Article 14(1)(a); Article 17(2); Articles
23 to 26; Article 41; and Appendices I, VI and VII.
Article 4
Supplemental and modified provisions
The following provisions of Annex II shall apply with regard to internet-based access as modified below:
(1) Article 2(1) is replaced by the following:
‘1. The
following
Appendices
form
an
integral
part
of
these
Conditions
and
apply
to
participants
accessing
a
PM
account using internet-based access:
Appendix IA to Annex V: Technical specifications for the processing of payment orders for internet-based access
Appendix IIA to Annex V: Fee schedule and invoicing for internet-based access
Appendix II: TARGET2 compensation scheme

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Appendix III: Terms of reference for capacity and country opinions
Appendix IV, except paragraph 7(b) thereof: Business continuity and contingency procedures
Appendix V: Operating schedule.’.
(2) Article 3 is modified as follows:
(a) paragraph 4 is replaced by the following:
‘4. The [insert name of CB] is the provider of services under these Conditions. Acts and omissions of the SSP-
providing NCBs and/or of the certification authorities shall be considered acts and omissions of [insert name of
CB], for which it shall assume liability in accordance with Article 31 below. Participation pursuant to these
Conditions shall not create a contractual relationship between participants and the SSP-providing NCBs when the
latter act in that capacity. Instructions, messages or information which a participant receives from, or sends to,
the SSP in relation to the services provided under these Conditions are deemed to be received from, or sent to,
[insert name of CB].’; and
(b) paragraph 6 is replaced by the following:
‘6. Participation in TARGET2 takes effect via participation in a TARGET2 component system. These
Conditions describe the mutual rights and obligations of participants in TARGET2-[insert CB/country reference]
and the [insert name of CB]. The rules on the processing of payment orders (Title IV) refer to all payment orders
submitted or payments received by any TARGET2 participant and shall apply subject to Annex V.’.
(3) Article 4(2)(e) is replaced by the following:
‘(e) credit institutions or any of the entities of the types listed under subparagraphs (a) to (c), in both cases where
these are established in a country with which the Union has entered into a monetary agreement allowing access
by any of such entities to payment systems in the Union, subject to the conditions set out in the monetary
agreement and provided that the relevant legal regime applying in the country is equivalent to the relevant
Union legislation.’.
(4) Article 8 is modified as follows:
(a) paragraph 1(a)(i) is replaced by the following:
‘1. To
open
an
internet-accessible
PM
account
in
TARGET2-[insert
CB/country
reference],
applicant
participants shall:
(a) fulfil the following technical requirements:
(i) install, manage, operate and monitor and ensure the security of the necessary IT infrastructure to connect
to TARGET2-[insert CB/country reference] and submit payment orders to it, in accordance with the
technical specifications in Appendix IA to Annex V. In doing so, applicant participants may involve
third parties, but retain sole liability; and’; and
(b) the following paragraph 1(c) is added:
‘(c) specify that they wish to access their PM account by means of the internet, and apply for a separate PM
account in TARGET2 if they wish in addition to be able to access TARGET2 via the network service
provider. Applicants shall submit a duly completed application form for the issuance of the electronic
certificates needed to access TARGET2 through internet-based access.’.
(5) Article 9 is modified as follows:
(a) paragraph 3 is replaced by the following:

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‘3. Participants
using
internet-based
access
shall
only
be
permitted
to
view
the
TARGET2
directory
online
and
may not distribute it either internally or externally.’; and
(b) paragraph 5 is replaced by the following:
‘5. Participants
acknowledge
that
the
[insert
name
of
CB]
and
other
CBs
may
publish
participant’s
names
and
BICs.’.
(6) Article 10 is modified as follows:
(a) paragraphs 1 and 2 are replaced by the following:
‘1. The [insert name of CB] shall offer internet-based access described in Annex V. Save where otherwise
provided in these Conditions or required by law, the [insert name of CB] shall use all reasonable means within
its power to perform its obligations under these Conditions, without guaranteeing a result.
2. Participants
using
internet-based
access
to
TARGET2
shall
pay
the
fees
laid
down
in
Appendix
IIA
to
Annex V.’; and
(b) the following paragraph 5 is added:
‘5. Participants
shall
do
both
of
the
following:
(a) actively check, at regular intervals throughout each business day, all information made available to them on
the ICM, in particular for information relating to important system events (such as messages regarding the
settlement of ancillary systems) and events of exclusion or suspension of a participant. The [insert name of
CB] shall not be held responsible for any losses, direct or indirect, arising from a participant’s failure to make
these checks; and
(b) at all times both ensure compliance with the security requirements specified in Appendix IA to Annex V, in
particular with respect to the safekeeping of certificates, and maintain rules and procedures to ensure that
certificate holders are aware of their responsibilities with respect to the safeguarding of certificates.’.
(7) Article 11 is modified as follows:
(a) the following paragraph 5a is added:
‘5a. Participants are responsible for the timely update of forms for the issuance of electronic certificates
needed to access TARGET2 using internet-based access and for the submission of new forms for the
issuance of such electronic certificates to the [insert name of CB]. Participants are responsible for verifying
the accuracy of information relating to them that is entered into TARGET2-[insert CB/country reference] by the
[insert name of CB].’; and
(b) paragraph 6 is replaced by the following:
‘6. The [insert name of CB] shall be deemed to be authorised to communicate to certification authorities any
information relating to participants which the certification authorities may need.’.
(8) Article 12(7) is replaced by the following:
‘7. The [insert name of CB] shall make available a daily statement of accounts to any participant that has opted
for such service.’.
(9) Article 13(b) is replaced by the following;
‘(b) direct debit instructions received under a direct debit authorisation. Participants using internet-based access shall
not be able to send direct debit instructions from their PM account’.

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(10) Article 14(1)(b) is replaced by the following:
‘(b) the payment message complies with the formatting rules and conditions of TARGET2-[insert CB/country
reference] and passes the double-entry check described in Appendix IA to Annex V’.
(11) Article 16(2) is replaced by the following:
‘2. Participants
using
internet-based
access
shall
not
be
allowed
to
use
the
AL
group
functionality
in
respect
of
their internet-accessible PM account, or to combine that internet-accessible PM account with any other TARGET2
account they hold. Limits may only be set in relation to an AL group in its entirety. Limits shall not be set in
relation to a single PM account of an AL group member.’.
(12) Article 18(3) is replaced by the following:
‘3.
When the Latest Debit Time Indicator is used, the accepted payment order shall be returned as non-settled if it
cannot be settled by the indicated debit time. 15 minutes prior to the defined debit time, the instructing participant
shall be informed via the ICM, rather than sent an automatic notification via the ICM. Instructing participant may
also use the Latest Debit Time Indicator solely as a warning indicator. In such cases, the payment order concerned
shall not be returned.’.
(13) Article 21(4) is replaced by the following:
‘4. At the request of a payer, the [insert name of CB] may decide to change the queue position of a highly urgent
payment order (except for highly urgent payment orders in the context of settlement procedures 5 and 6) provided
that this change would not affect the smooth settlement by ancillary systems in TARGET2 or would not otherwise
give rise to systemic risk.’.
(14) Article 28 is modified as follows:
(a) paragraph 1 is replaced by the following:
‘1. Participants
using
internet-based
access
shall
implement
adequate
security
controls,
in
particular
those
specified in Appendix IA to Annex V, to protect their systems from unauthorised access and use. Participants
shall be exclusively responsible for the adequate protection of the confidentiality, integrity and availability of
their systems.’; and
(b) the following paragraph 4 is added:
‘4. Participants
using
internet-based
access
shall
inform
[insert
name
of
CB]
immediately
of
any
event
that
may affect the validity of the certificates, in particular those events specified in Appendix IA to Annex V,
including, without limitation, any loss or improper use.’.
(15) Article 29 is replaced by the following:
‘Article 29
Use of the ICM
1. The
ICM:
(a) allows participants to input payments;
(b) allows participants to access information relating to their accounts and to manage liquidity;
(c) may be used to initiate liquidity transfer orders; and
(d) allows participants to access system messages.

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2. Further technical details relating to the ICM to be used in connection with internet-based access are contained
in Appendix IA to Annex V.’.
(16) Article 32 is modified as follows:
(a) paragraph 1 is replaced with the following:
‘1. Unless otherwise provided in these Conditions, all payment and payment processing-related messages in
relation to TARGET2, such as confirmations of debits or credits, or statement messages, between the [insert
name of CB] and participants shall be made available for the participant on the ICM.’; and
(b) paragraph 3 is replaced by the following:
‘3. If
a
participant’s
connection
fails,
the
participant
shall
use
the
alternative
means
of
transmission
of
messages laid down in Appendix IV to Annex II. In such cases, the saved or printed version of the message
produced by the [insert name of CB] shall be accepted as evidence.’.
(17) Article 34(4)(c) is replaced by the following:
‘(c) Once such an ICM broadcast message has been made available to participants using internet-based access, those
participants shall be deemed informed of the termination/- suspension of a participant’s participation in
TARGET2-[insert CB/country reference] or another TARGET2 component system. The participants shall bear
any losses arising from the submission of a payment order to participants whose participation has been
suspended or terminated if such payment order was entered into TARGET2-[insert CB/country reference]
after the ICM broadcast message was made available.’.
(18) Article 39(1) is replaced by the following:
‘1. Participants shall be deemed to be aware of, and shall comply with, all obligations on them relating to
legislation on data protection, prevention of money laundering and the financing of terrorism, proliferation-sensitive
nuclear activities and the development of nuclear weapons delivery systems, in particular in terms of implementing
appropriate measures concerning any payments debited or credited on their PM accounts. Prior to entering into a
contractual relationship with an internet service provider, participants using internet-based access shall acquaint
themselves with that internet service provider’s data retrieval policy.’.
(19) Article 40(1) is replaced by the following:
‘1. Except where otherwise provided for in these Conditions, all notices required or permitted pursuant to these
Conditions shall be sent by registered post, facsimile or otherwise in writing. Notices to the [insert name of CB] shall
be submitted to the head of the [insert payment systems department or relevant CB unit] of [insert name of CB],
[include relevant address of CB] or to the [insert BIC address of the CB]. Notices to the participant shall be sent to it
at the address, fax number or its BIC address as the participant may from time to time notify to the [insert name of
CB].’.
(20) Article 45 is replaced by the following:
‘Article 45
Severability
If any provision in these Conditions or Annex V is or becomes invalid, this shall not prejudice the applicability of all
the other provisions of these Conditions or Annex V.’.

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Appendix IA
TECHNICAL SPECIFICATIONS FOR THE PROCESSING OF PAYMENT ORDERS FOR INTERNET-BASED
ACCESS
In addition to the Conditions, the following rules shall apply to the processing of payment orders using internet-based
access:
1. Technical requirements for participation in TARGET2-[insert CB/country reference] regarding infrastructure,
network and formats
(1) Each participant using internet-based access must connect to the ICM of TARGET2 using a local client, operating
system and internet browser as specified in the Annex ‘Internet-based participation — System requirements for
internet access’ to the User Detailed Functional Specifications (UDFS), with settings defined. Each participant’s PM
account shall be identified by an eight- or 11-digit BIC. Furthermore, each participant shall pass a series of tests
to prove its technical and operational competence before it may participate in TARGET2-[insert CB/country
reference].
(2) For the submission of payment orders and the exchange of payment messages in the PM the TARGET2 platform
BIC, TRGTXEPMLVP, will be used as the message sender/receiver. Payment orders sent to a participant using
internet-based access should identify that receiving participant in the beneficiary institution field. Payment orders
made by a participant using internet-based access will identify that participant as the ordering institution.
(3) Participants using internet-based access shall use public key infrastructure services as specified in the ‘User
Manual: internet Access for the public-key certification service’.
2. Payment message types
(1) Internet-based participants can make the following types of payments:
(a) customer payments, i.e. credit transfers for which the ordering and/or beneficiary customer are not financial
institutions;
(b) customer payments STP, i.e. credit transfers for which the ordering and/or beneficiary customer are not
financial institutions, executed in straight through processing mode;
(c) bank-to-bank transfers to request the movement of funds between financial institutions;
(d) cover payments to request the movement of funds between financial institutions related to an underlying
customer credit transfer.
In addition, participants using internet-based access to a PM account can receive direct debit orders.
(2) Participants shall comply with the field specifications, as defined in Chapter 9.1.2.2 of the UDFS, Book 1.
(3) Field contents shall be validated at the level of TARGET2-[insert country/CB reference] in accordance with the
UDFS requirements. Participants may agree among each other on specific rules regarding the field contents.
However, in TARGET2-[insert country/CB reference] there shall be no specific checks as to whether participants
comply with any such rules.
(4) Participants using internet-based access may make cover payments via TARGET2, i.e. payments made by
correspondent banks to settle (cover) credit transfer messages which are submitted to a customer’s bank by
other, more direct means. Customer details contained in these cover payments shall not be displayed in the ICM.
3. Double-entry check
(1) All payment orders shall pass a double-entry check, the aim of which is to reject payment orders that have been
submitted more than once by mistake.

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(2) The following fields of the message types shall be checked:
Details Part
of
the
message Field
Sender Basic
Header BIC
Address
Message Type Application
Header Message
Type
Receiver Application
Header Destination
Address
Transaction Reference Number (TRN) Text
Block :20
Related Reference Text
Block :21
Value Date Text
Block :32
Amount Text
Block :32
(3) If all the fields described in subparagraph 2 in relation to a newly submitted payment order are identical to those
in relation to a payment order that has already been accepted, the newly submitted payment order shall be
returned.
4. Error codes
If a payment order is rejected, an abort notification shall be provided via the ICM indicating the reason for the
rejection by using error codes. The error codes are defined in Chapter 9.4.2 of the UDFS.
5. Predetermined settlement times
(1) For payment orders using the Earliest Debit Time Indicator, the codeword ‘/FROTIME/’ shall be used.
(2) For payment orders using the Latest Debit Time Indicator, two options shall be available.
(a) Codeword ‘/REJTIME/’: if the payment order cannot be settled by the indicated debit time, the payment order
shall be returned.
(b) Codeword ‘/TILTIME/’: if the payment order cannot be settled by the indicated debit time, the payment order
shall not be returned but shall be kept in the relevant queue.
Under both options, if a payment order with a Latest Debit Time Indicator is not settled 15 minutes prior to the
time indicated therein, a notification shall automatically be provided via the ICM.
(3) If the codeword ‘/CLSTIME/’ is used, the payment shall be treated in the same way as a payment order referred to
in subparagraph 2(b).
6. Settlement of payment orders in the entry disposition
(1) Offsetting checks and, if appropriate, extended offsetting checks (both terms as defined in paragraphs 2 and 3)
shall be carried out on payment orders entered into the entry disposition to provide quick, liquidity-saving gross
settlement of payment orders.
(2) An offsetting check shall determine whether the payee’s payment orders that are at the front of the highly urgent
or, if inapplicable, the urgent queue are available to be offset against the payer’s payment order (hereinafter
‘offsetting payment orders’). If an offsetting payment order does not provide sufficient funds for the respective
payer’s payment order in the entry disposition, it shall be determined whether there is sufficient available liquidity
on the payer’s PM account.
(3) If the offsetting check fails, the [insert name of CB] may apply an extended offsetting check. An extended
offsetting check determines whether offsetting payment orders are available in any of the payee’s queues
regardless of when they joined the queue. However, if in the queue of the payee there are higher priority
payment orders addressed to other TARGET2 participants, the FIFO principle may only be breached if settling
such an offsetting payment order would result in a liquidity increase for the payee.

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7. Settlement of payment orders in the queue
(1) The treatment of payment orders placed in queues depends on the priority class to which it was designated by
the instructing participant.
(2) Payment orders in the highly urgent and urgent queues shall be settled by using the offsetting checks described in
paragraph 6, starting with the payment order at the front of the queue in cases where there is an increase in
liquidity or there is an intervention at queue level (change of queue position, settlement time or priority, or
revocation of the payment order).
(3) Payments orders in the normal queue shall be settled on a continuous basis including all highly urgent and
urgent payment orders that have not yet been settled. Different optimisation mechanisms (algorithms) are used. If
an algorithm is successful, the included payment orders will be settled; if an algorithm fails, the included payment
orders will remain in the queue. Three algorithms (1 to 3) shall be applied to offset payment flows. By means of
Algorithm 4, settlement procedure 5 (as defined in Chapter 2.8.1 of the UDFS) shall be available for the
settlement of payment instructions of ancillary systems. To optimise the settlement of highly urgent ancillary
system transactions on participants’ sub-accounts, a special algorithm (Algorithm 5) shall be used.
(a) Under Algorithm 1 (‘all-or-nothing’) the [insert name of CB] shall, both for each relationship in respect of
which a bilateral limit has been set and also for the total sum of relationships for which a multilateral limit
has been set:
(i) calculate the overall liquidity position of each TARGET2 participants’ PM account by establishing whether
the aggregate of all outgoing and incoming payment orders pending in the queue is negative or positive
and, if it is negative, check whether it exceeds that participant’s available liquidity (the overall liquidity
position shall constitute the ‘total liquidity position’); and
(ii) check whether limits and reservations set by each TARGET2 participant in relation to each relevant PM
account are respected.
If the outcome of these calculations and checks is positive for each relevant PM account, the [insert name of
CB] and other CBs involved shall settle all payments simultaneously on the PM accounts of the TARGET2
participants concerned.
(b) Under Algorithm 2 (‘partial’) the [insert name of CB] shall:
(i) calculate and check the liquidity positions, limits and reservations of each relevant PM account as under
Algorithm 1; and
(ii) if the total liquidity position of one or more relevant PM accounts is negative, extract single payment
orders until the total liquidity position of each relevant PM account is positive.
Thereafter, the [insert name of CB] and the other CBs involved shall, provided there are sufficient funds, settle
all remaining payments (except the extracted payment orders) simultaneously on the PM accounts of the
TARGET2 participants concerned.
When extracting payment orders, the [insert name of CB] shall start from the TARGET2 participants’ PM
account with the highest negative total liquidity position and from the payment order at the end of the queue
with the lowest priority. The selection process shall only run for a short time, to be determined by the [insert
name of CB] at its discretion.
(c) Under Algorithm 3 (‘multiple’) the [insert name of CB] shall:
(i) compare pairs of TARGET2 participants’ PM accounts to determine whether queued payment orders can
be settled within the available liquidity of the two TARGET2 participants’ PM accounts concerned and
within the limits set by them (by starting from the pair of PM accounts with the smallest difference
between the payment orders addressed to each other), and the CBs involved shall book those payments
simultaneously on the two TARGET2 participants’ PM accounts; and

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(ii) if, in relation to a pair of PM accounts as described under point (i), liquidity is insufficient to fund the
bilateral position, extract single payment orders until there is sufficient liquidity. In this case the CBs
involved shall settle the remaining payments, except the extracted ones, simultaneously on the two
TARGET2 participants’ PM accounts.
After performing the checks specified under subparagraphs (i) to (ii), the [insert name of CB] shall check the
multilateral settlement positions (between a participant’s PM account and other TARGET2 participants’ PM
accounts in relation to which a multi-lateral limit has been set). For this purpose, the procedure described
under subparagraphs (i) to (ii) shall apply mutatis mutandis.
(d) Under Algorithm 4 (‘partial plus ancillary system settlement’) the [insert name of CB] shall follow the same
procedure as for Algorithm 2, but without extracting payment orders in relation to the settlement of an
ancillary system (which settles on a simultaneous multilateral basis).
(e) Under Algorithm 5 (‘ancillary system settlement via sub-accounts’) the [insert name of CB] shall follow the
same procedure as for Algorithm 1, subject to the modification that the [insert name of CB] shall start
Algorithm 5 via the Ancillary System Interface and shall only check whether sufficient funds are available on
participants’ sub-accounts. Moreover, no limits and reservations shall be taken into account. Algorithm 5
shall also run during night-time settlement.
(4) Payment orders entered into the entry disposition after the start of any of Algorithms 1 to 4 may nevertheless be
settled immediately in the entry disposition if the positions and limits of the TARGET2 participants’ PM accounts
concerned are compatible with both the settlement of these payment orders and the settlement of payment
orders in the current optimisation procedure. However, two algorithms shall not run simultaneously.
(5) During daytime processing the algorithms shall run sequentially. As long as there is no pending simultaneous
multilateral settlement of an ancillary system, the sequence shall be as follows:
(a) Algorithm 1;
(b) if Algorithm 1 fails, then Algorithm 2;
(c) if Algorithm 2 fails, then Algorithm 3, or if Algorithm 2 succeeds, repeat Algorithm 1.
When simultaneous multilateral settlement (‘procedure 5’) in relation to an ancillary system is pending, Algorithm
4 shall run.
(6) The algorithms shall run flexibly by setting a pre-defined time lag between the application of different algorithms
to ensure a minimum interval between the running of two algorithms. The time sequence shall be automatically
controlled. Manual intervention shall be possible.
(7) While included in a running algorithm, a payment order shall not be reordered (change of the position in a
queue) or revoked. Requests for reordering or revocation of a payment order shall be queued until the algorithm
is complete. If the payment order concerned is settled while the algorithm is running, any request to reorder or
revoke shall be rejected. If the payment order is not settled, the participant’s requests shall be taken into account
immediately.
8. Use of the ICM
(1) The ICM may be used for inputting payment orders.
(2) The ICM may be used for obtaining information and managing liquidity.
(3) With the exception of warehoused payment orders and static data information, only data in relation to the
current business day shall be available via the ICM. The screens shall be offered in English only.
(4) Information shall be provided in ‘pull’ mode, which means that each participant has to ask to be provided with
information. Participants shall check the ICM regularly throughout the business day for important messages.

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(5) Only user-to-application mode (U2A) shall be available for participants using internet-based access. U2A permits
direct communication between a participant and the ICM. The information is displayed in a browser running on
a PC. Further details are described in the ICM User Handbook.
(6) Each participant shall have at least one workstation with internet access to access the ICM via U2A.
(7) Access rights to the ICM shall be granted by using certificates, the use of which is described more fully in
paragraphs 10 to 13.
(8) Participants may also use the ICM to transfer liquidity:
(a) [insert if applicable] from their PM account to their account outside the PM;
(b) between the PM account and the participant’s sub-accounts; and
(c) from the PM account to the mirror account managed by the ancillary system.
9. The UDFS, the ICM User Handbook and the ‘User Manual: internet Access for the Public Key Certification
Service’
Further details and examples explaining the above rules are contained in the UDFS and the ICM User Handbook, as
amended from time to time and published on the [insert name of CB]’s website and the TARGET2 website in English,
and in the ‘User Manual: internet Access for the Public Key Certification Service’.
10. Issuance, suspension, reactivation, revocation and renewal of certificates
(1) The participant shall request from [insert name of CB] the issuance of certificates to allow them to access
TARGET2 [insert CB/country reference] using internet-based access.
(2) The participant shall request from [insert name of CB] the suspension and reactivation of certificates, as well as
the revocation and renewal of certificates, when a certificate holder no longer wishes to have access to TARGET2
or if the participant ceases its activities in TARGET2-[insert CB/country reference], e.g. as the result of a merger
or acquisition.
(3) The participant shall adopt every precaution and organisational measure to ensure that certificates are used only
in conformity with the Harmonised Conditions.
(4) The participant shall promptly notify [insert name of CB] of any material change to any of the information
contained in the forms submitted to [insert name of CB] in connection with the issuance of certificates.
11. Handling of certificates by the participant
(1) The participant shall ensure the safekeeping of all certificates and adopt robust organisational and technical
measures to avoid injury to third parties and to ensure that each certificate is only used by the specific certificate
holder to which it was issued.
(2) The participant shall promptly provide all information requested by [insert name of CB] and guarantee the
reliability of that information. Participants shall at all times remain fully responsible for the continued accuracy of
all information provided to [insert name of CB] in connection with the issuance of certificates.
(3) The participant shall assume full responsibility for ensuring that all of its certificate holders keep their assigned
certificates separate from the secret PIN and PUK codes.
(4) The participant shall assume full responsibility for ensuring that none of its certificate holders use the certificates
for functions or purposes other than those for which the certificates were issued.
(5) The participant shall immediately inform [insert name of CB] of any request and rationale for suspension,
reactivation, revocation or renewal of certificates.

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(6) The participant shall immediately request [insert name of CB] to suspend any certificates, or the keys contained
therein, that are defective or that are no longer in the possession of its certificate holders.
(7) The participant shall immediately notify the [insert name of CB] of any loss or theft of certificates.
12. Security requirements
(1) The computer system that a participant uses to access TARGET2 using internet-based access shall be located in
premises owned or leased by the participant. Access to TARGET2-[insert CB/country reference] shall only be
allowed from such premises, and, for the avoidance of doubt, no remote access shall be allowed.
(2) The participant shall run all software on computer systems that are installed and customised in accordance with
current international IT security standards, which as a minimum shall include the requirements detailed in
paragraph 12(3) and paragraph 13(4). The participant shall establish appropriate measures, including in particular
anti-virus and malware protection, anti-phishing measures, hardening, and patch management procedures. All
such measures and procedures shall be regularly updated by the participant.
(3) The participant shall establish an encrypted communication link with TARGET2-[insert CB/country reference] for
internet access.
(4) User computer accounts in the participant’s workstations shall not have administrative privileges. Privileges shall
be assigned in accordance with the ‘least privilege’ principle.
(5) The participant shall at all times protect the computer systems used for TARGET2-[insert CB/country reference]
internet access as follows:
(a) They shall protect the computer systems and workstations from unauthorised physical and network access, at
all times using a firewall to shield the computer systems and workstations from incoming internet traffic, and
the workstations from unauthorised access over the internal network. They shall use a firewall that protects
against incoming traffic, as well as a firewall on work-stations that ensures that only authorised programs
communicate with the outside.
(b) Participants shall only be permitted to install on workstations the software that is necessary to access
TARGET2 and that is authorised under the participant’s internal security policy.
(c) Participants shall at all times ensure that all software applications that run on the workstations are regularly
updated and patched with the latest version. This applies in particular in respect of the operating system, the
internet browser and plug-ins.
(d) Participants shall at all times restrict outgoing traffic from the workstations to business-critical sites, as well as
to sites required for legitimate and reasonable software updates.
(e) Participants shall ensure that all critical internal flows to or from the workstations are protected against
disclosure and malicious changes, especially if files are transferred through a network.
(6) The participant shall ensure that its certificate holders at all times follow secure browsing practices, including:
(a) reserving certain workstations to access sites of the same criticality level and only accessing those sites from
those workstations;
(b) always restarting the browser session before and after accessing TARGET2-[insert CB/country reference]
internet access;
(c) verifying any server’s SSL certificate authenticity at each logon to TARGET2-[insert CB/country reference]
internet access;
(d) being suspicious of e-mails that appear to come from TARGET2-[insert CB/country reference], and never
providing the certificate’s password if asked for that password, as TARGET2-[insert CB/country reference] will
never ask for a certificate’s password in an e-mail or otherwise.

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(7) The participant shall at all times implement the following management principles to alleviate risks to its system:
(a) establishing user management practices which ensure that only authorised users are created and remain on
the system and maintaining an accurate and up-to-date list of authorised users;
(b) reconciling daily payment traffic to detect mismatches between authorised and actual daily payment traffic,
both sent and received;
(c) ensuring that a certificate holder does not simultaneously browse any other internet site at the same time as it
accesses TARGET2-[insert CB/country reference].
13. Additional security requirements
(1) The participant shall at all times ensure by means of appropriate organisational and/or technical measures that
user IDs disclosed for the purpose of controlling access rights (Access Right Review) are not abused, and, in
particular, that no unauthorised persons gain knowledge of them.
(2) The participant shall have in place a user administration process to ensure the immediate and permanent deletion
of the related user ID in the event that an employee or other user of a system on the premises of a participant
leaves the participant’s organisation.
(3) The participant shall have in place a user administration process and shall immediately and permanently block
user IDs that are in any way compromised, including in cases where certificates are lost or stolen, or where a
password has been phished.
(4) If a participant is unable to eliminate security-related faults or configuration errors, e.g. resulting from malware
infected systems, after three occurrences, the SSP-providing NCBs may permanently block all the participant’s
user IDs.
Appendix IIA
FEE SCHEDULE AND INVOICING FOR INTERNET-BASED ACCESS
Fees for direct participants
1. The monthly fee for the processing of payment orders in TARGET2-[insert CB/country reference] for direct
participants shall be EUR 70 per PM account internet access fee plus EUR 150 per PM account plus a flat fee per
transaction (debit entry) of EUR 0,80;
2. There shall be an additional monthly fee for direct participants who do not wish the BIC of their account to be
published in the TARGET2 directory of EUR 30 per account.
3. The [insert name of CB] shall issue and maintain up to five active certificates per participant for each PM account free
of charge. The [insert name of CB] shall charge a fee of EUR 50 for the issuance of each additional subsequent active
certificate. The [insert name of CB] shall charge an annual maintenance fee of EUR 11 per each additional subsequent
active certificate. Active certificates shall be valid for three years.
Invoicing
4. In the case of direct participants, the following invoicing rules apply. The direct participant shall receive the invoice for
the previous month specifying the fees to be paid, no later than on the fifth business day of the following month.
Payment shall be made at the latest on the 10th working day of that month to the account specified by the [insert
name of CB] and shall be debited from that participant’s PM account.

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ANNEX VI
REPEALED GUIDELINE WITH ITS SUCCESSIVE AMENDMENTS
Guideline ECB/2007/2 (OJ L 237, 8.9.2007, p. 1).
Guideline ECB/2009/9 (OJ L 123, 19.5.2009, p. 94).
Guideline ECB/2009/21 (OJ L 260, 3.10.2009, p. 31).
Guideline ECB/2010/12 (OJ L 261, 5.10.2010, p. 6).
Guideline ECB/2011/2 (OJ L 86, 1.4.2011, p. 75).
Guideline ECB/2011/15 (OJ L 279, 26.10.2011, p. 5).
ANNEX VII
CORRELATION TABLE
Guideline ECB/2007/2 This
Guideline
Articles 1-4 Articles
1-4
— Articles
5-6
Article 5 Article
7
Article 6 Article
8
— Articles
9-11
Article 7 Article
12
Article 8 Article
13
Article 9 Article
14
Article 10 Article
15
Article 11 Article
16
— Articles
17-24
Article 12 Article
25
Article 14 Article
26
Article 15 Article
27
Article 16 Article
28
Annexes I-V Annexes
I-V

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