Europe’s post-trade infrastructure is vital to the functioning of capital markets, but persistent fragmentation and inefficiencies continue to drive up costs for investors and limit the competitiveness of EU companies. Euronext Securities is moving decisively with a pan-European strategy that brings competitive choice, technological innovation and long-term scalability to the core of post-trade services. A recent economic report by Oxera Consulting LLP sponsored by Euronext has demonstrated why this approach is adapted to the current fragmented post-trade markets. The report sheds light on the challenges facing the EU’s post-trade infrastructure and the growing opportunity to drive down costs, boost efficiency and improve market resilience through smarter, interoperable infrastructure.
An economic analysis of EU CSD services
The report, titled The Design and Functioning of CSD Services in the EU, explores the structure of Central Securities Depository (CSD) services across the EU. It responds to a growing policy focus driven by the Draghi and Letta reports (2024) and the European Commission’s recent work on the need for further consolidation or integration of market infrastructures. The analysis assesses whether Europe’s current framework can deliver more competitive and efficient outcomes for issuers and investors.
Fragmentation and missed opportunities
The EU is home to over 30 CSDs, mostly defined by national boundaries. This fragmentation has long been seen as a source of inefficiency and complexity, particularly for cross-border trading and settlement. However, the report challenges the idea that the only path to improvement is full consolidation into a single EU-wide CSD. Instead, it argues that effective competition can be equally powerful if the right conditions are in place.
Competition is an effective way to address fragmentation, provided all CSDs use T2S
The report explains that economies of scale, scope and network effects are key drivers of efficiency in the Central Securities Depository (CSD) market. TARGET2-Securities (T2S), along with regulations such as CSDR and MiFID, has established the technical and legal foundations necessary to support competition. Importantly, the report emphasises that competition does not lead to fragmentation. As long as CSDs remain connected through platforms like T2S, network effects are maintained, and users can continue to access services seamlessly.
What’s needed now
While the foundations for competition exist, the report notes that effective issuer and settlement competition has yet to emerge. The lack of competitive pressure has contributed to persistently high costs, limited service innovation and slower market integration. The analysis concludes that the market is now at a critical juncture, and with the right strategic interventions, competitive dynamics could deliver meaningful benefits for all market participants.
Turning analysis into action: Euronext’s strategic response
Euronext Securities’ strategy is a credible and ambitious response to the challenges of Europe’s post-trade. It provides the benefits of both choice and consolidation to clients.
The strategy is anchored in three priorities:
-
Offer market participants (trading firms, custodians, settlement agents, etc.) a single point of entry to European markets: Starting September 2026, clients will become able to consolidate settlement and custody for the Belgian, Dutch and French markets in Euronext Securities, alongside Italy, Denmark, Norway and Portugal.
-
Offer issuers the best access to Euronext, Europe’s single liquidity pool: By joining Euronext Securities, issuers can support the liquidity of their shares, broaden their investor base or simplify their journey on capital markets. Euronext offers a credible alternative for the first time, which it has already proven by migrating its own share issuance to Euronext Securities.
-
Deliver technology and service innovation: Euronext is rolling out a new, future-proof, harmonised CSD platform across all CSDs it operates, delivering a better, integrated client experience and value-added services to clients.
Together, these steps are designed to enable true pan-European post-trade integration, delivering lower costs, greater operational efficiency and more competitive services. In doing so, the expansion project also contributes to strengthening the EU’s financial sovereignty and strategic autonomy by supporting a more resilient, interconnected and autonomous capital markets infrastructure.
Choice against fragmentation
Euronext is offering clients a choice that did not exist before: starting September 2026, for the first time in decades, clients will be able to manage multiple European markets (France, Belgium, the Netherlands, Italy) in one single CSD.
Euronext is building an open model: Clients can use Euronext Securities’ offering even if they trade or clear on other trading and clearing venues. Conversely, Euronext trading members will have the possibility to settle at another CSD than Euronext Securities – provided the applicable regulatory framework (CSDR and MiFID) is respected.
Euronext’s proposal fosters market integration, thanks to the use of Target2-Securities: T2S has been designed to allow settlement across multiple CSDs with no friction or extra cost. Hence, offering a choice of CSD (provided T2S is used), like Euronext offers, does not break the liquidity pool. It rather offers clients willing to do so the ability to consolidate European markets in one CSD.
Leading the market towards integration
As Pierre Davoust, Head of Euronext Securities, explains: “Europe’s post-trade should be completely integrated. Capital market participants should be able to manage their operations as if Europe was a single domestic market.”
To advance this vision, Euronext is investing in modern, value-added services, from tailored data solutions to tax processing, with the launch of its European offering in September 2026. The hub will enable participants to manage post-trade activity across Belgium, France, Italy and the Netherlands from a single securities account, simplifying operations and enhancing scale.
Shaping the future of capital markets
The Oxera report highlights a clear opportunity: with the right strategic action, Europe can foster meaningful competition in post-trade services. Euronext Securities is acting on that opportunity by building on regulatory progress, infrastructure scalability and operational expertise to help reshape the European post-trade environment. As the EU continues its journey toward more integrated capital markets, Euronext Securities is helping ensure it does so with purpose, scale and resilience.
For more insights, read the original report, The Design and Functioning of CSD Services in the EU.