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The U.K. will be joining the move to T+1 securities settlement in 2027.

Earlier this month, an industry group issued a report that recommended shortening the settlement cycle in U.K. financial markets by the end of 2027. Today, the HM Treasury said that the government has accepted all of the group’s recommendations, and will be pursuing the transition on the same timeline as the European Union (EU).

The Treasury said that the U.K. government, the Financial Conduct Authority (FCA) and the Bank of England all support the move from the current T+2 standard, which will be led by an industry taskforce.

While the industry taskforce will oversee the transition, the government confirmed that it will bring forward legislation to implement the change, including formally setting the date for the transition as Oct. 11 2027, alongside the EU.

Representatives from the European Union and Switzerland have been invited to join the implementation group as observers to help align the U.K.’s work with the efforts to adopt T+1 settlement in those markets too.

Canada and the U.S. made the move to T+1 in May 2024.

The HM Treasury said it supports the move to T+1 to align the U.K. with other major international markets, to strengthen the competitiveness of its capital markets, and to cut costs for investors.

“Shortening the UK securities settlement cycle to T+1 will bring important financial stability benefits from reduced counterparty credit risk in financial markets. It is important that firms and settlement infrastructures have robust plans for an orderly transition in October 2027,” said Andrew Bailey, governor of the Bank of England, in a release.

In an effort to keep industry firms informed about the status of the work needed to facilitate shorter settlement, the FCA launched a webpage devoted to the transition.