# Decision (EU) 2015/929 of the European Central BankShow full title

Decision (EU) 2015/929 of the European Central Bank of 26 May 2015 amending Decision ECB/2007/7 concerning the terms and conditions            of TARGET2-ECB (ECB/2015/22)         

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U.K.

# Decision (EU) 2015/929 of the European Central Bank

# of 26 May 2015

# amending Decision ECB/2007/7 concerning the terms and conditions of TARGET2-ECB (ECB/2015/22)

THE EXECUTIVE BOARD OF THE EUROPEAN CENTRAL BANK,

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,                        

Having regard to the Statute of the European System of Central Banks and of the European Central Bank, and in particular Article                           3.1 and Articles 17, 18 and 22 thereof,                        

Whereas:

(1)On 2 April 2015, the Governing Council of the European Central Bank (ECB) adopted Guideline (EU) 2015/930 of the European                              Central Bank (ECB/2015/15)(1) amending Guideline ECB/2012/27(2) (the TARGET2 Guideline).

(2)One of the objectives of Guideline ECB/2015/15 was to ensure that all real-time settlement accounts holding central bank money,                              including Dedicated Cash Accounts (DCAs) used for the real-time settlement of cash transactions in connection with the TARGET2                              Securities (T2S) technical platform, are brought within the scope of TARGET2. As a result, a new Annex (Annex IIa) was inserted                              into the TARGET2 Guideline, setting out the harmonised conditions for the opening and operation of DCAs. Annex II to the TARGET2                              Guideline was also amended to cater for the inclusion of DCAs within the scope of TARGET2, and to distinguish TARGET2 payment                              module (PM) accounts from DCAs.

(3)Decision ECB/2007/7(3), which is concerned with the terms and conditions of TARGET2-ECB, should be amended accordingly, to reflect the harmonised                              conditions for the opening and operation of DCAs,

HAS ADOPTED THIS DECISION:

## Article 1U.K.Amendments

Decision ECB/2007/7 is amended as follows:

the footnote in Article 1(1)(c) is replaced by the following:

### ‘(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 transactions of19 July 2007; (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, subject to the judgment of 4 March 2015, *United Kingdom* v *European Central Bank*, T-496/11, ECLI:EU:T:2015:496.’;

Article 3 is replaced by the following:

### ‘Article 3Terms and conditions of TARGET2-ECB

The terms and conditions for the opening and operation of a PM account in TARGET2-ECB shall be those contained in Annex I                                 to this Decision. The terms and conditions for the opening and operation of a dedicated cash account in TARGET2-ECB shall                                 be those contained in Annex II to this Decision.’;                           

the Annex to Decision ECB/2007/7 is amended in accordance with the Annex to this Decision.

## Article 2U.K.Entry into force

This Decision shall enter into force on 22 June 2015.

Done at Frankfurt am Main, 26 May 2015.

*The President of the ECB*                            

Mario Draghi                            

## ANNEXU.K.

The Annex to Decision ECB/2007/7 is amended as follows:

in the Annex, the following definitions in Article 1 are replaced:
                      -  ‘“available liquidity” means a credit balance on a participant's PM account and, if applicable, any intraday credit line granted                                                by the relevant euro area NCB in relation to such account but not yet drawn upon;                                           
                      -  “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                                                ECB or any other CB, including:                                            (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 point (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 DCA 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;                                                   
 
                      -  “payment order” means a credit transfer order, a liquidity transfer order, a direct debit instruction or a PM to DCA liquidity                                                transfer order;                                           
                      -  “branch” means a branch within the meaning of point (17) of Article 4(1) of Regulation (EU) No 575/2013 of the European Parliament                                                and of the Council(4);                                           
                      -  “credit institution” means either: (a) a credit institution within the meaning of point (1) of Article 4(1) of Regulation                                                (EU) No 575/2013 and Section 2(1) no 2 and Section 2(6) no 2 of the (Kreditwesengesetz) KWG, that is subject to supervision                                                by a competent authority; or (b) another credit institution within the meaning of Article 123(2) of the Treaty that is subject                                                to scrutiny of a standard comparable to supervision by a competent authority;                                           
                      -  “participant” [or “direct participant”] means an entity that holds at least one PM account (PM account holder) and/or one                                                Dedicated Cash Account (DCA holder) with the ECB;;’                                           

in the Annex, the footnote to the definition ‘ancillary system’ is replaced by the following:

### ‘(*)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 transactions of 19 July 2007; (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, subject to the judgment of 4 March 2015, *United Kingdom* v *European Central Bank,* T-496/11, ECLI:EU:T:2015:496.’;

in the Annex, the following definitions are inserted in Article 1:
                -  ‘“Dedicated Cash Account (DCA)” means an account held by a DCA holder, opened in TARGET2-ECB, and used for cash payments in                                       relation to securities settlement in T2S;                                  
                -  “Main PM account” means the PM account to which a DCA is linked and on which any remaining balance must be automatically repatriated                                       from the DCA at the end of the day;                                  
                -  “PM to DCA liquidity transfer order” means the instruction to transfer a specified amount of funds from a PM account to a                                       DCA;’;                                  

in the Annex, the following Article 1a is inserted:

### ‘Article 1aScope

The present Conditions govern the relationship between the ECB and its PM account holder as far the opening and the operation                                 of the PM account is concerned.’;                           

in the Annex, paragraphs 1 and 2 of Article 3 are replaced by the following:

‘1.TARGET2 provides real-time gross settlement for payments in euro, with settlement in central bank money across PM accounts                                    and DCAs.                           

2.The following payment orders are processed in TARGET2-ECB:                           

(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;                           

(e)settlement of the cash leg of securities transactions;                           

(f)PM to DCA liquidity transfer orders; and                           

(g)any other payment orders in euro addressed to TARGET2 participants.’;                           

in the Annex, the following paragraphs 5 and 6 are added to Article 10:

‘5.A PM account holder accepting its PM account to be designated as the Main PM account defined in Annex II shall be bound by                                    any invoices related to the opening and operation of each Dedicated Cash Account linked to that PM account, as set out in                                    Appendix VI to this Annex, including any penalties levied in accordance with paragraph 9(d) of Annex IIIa, regardless of the                                    content of, or any non-compliance with, the contractual or other arrangements between that PM account holder and the DCA holder.                           

6.A Main PM account holder shall be bound by any invoices, as set out in Appendix VI to this Annex, for the linkage to each                                    DCA to which the PM account is linked.’;                           

in the Annex, Article 11 is replaced by the following:

### ‘Article 11Types of payment orders

The following are classified as payment orders for the purposes of TARGET2:                           

credit transfer orders;                                    

direct debit instructions carried out under a direct debit authorisation;                                    

liquidity transfer orders; and                                    

PM to DCA liquidity transfer orders.’;                                    

in the Annex, the second subparagraph of Article 13(2) is replaced by the following:

‘All payment instructions submitted by an ancillary system through the ASI to debit or credit the participants' PM accounts                                 and all PM to DCA liquidity transfer orders submitted shall be deemed to be highly urgent payment orders.’;                           

in the Annex, paragraph 2 of Article 32 is replaced by the following:

‘2.By derogation from paragraph 1, the participant agrees that the ECB may disclose payment, technical or organisational information                                    regarding the participant, participants from the same group or the participant's customers obtained in the course of the operation                                    of TARGET2-ECB to other CBs or third parties that are involved in the operation of TARGET2-ECB, to the extent that this is                                    necessary for the efficient functioning of TARGET2 or the monitoring of the participant's or its group's exposure, 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 ECB shall                                    not be liable for the financial and commercial consequences of such disclosure.’;                           

in the Annex, paragraph 2 of Article 40 is replaced by the following:

‘2.By requesting a PM account in TARGET2-ECB, applicant participants automatically agree to these Conditions between themselves                                    and in relation to the ECB.’;                           

in Appendix I to the Annex, the following point (d) is added to paragraph 8(8):

### ‘(d)by means of a PM to DCA liquidity transfer order.’;

in Appendix IV to the Annex, paragraph 6(d) is replaced by the following:

### ‘(d)The following types of payments shall be considered “critical” and the ECB may decide to initiate contingency processing in                                    relation to them:

payments in relation to the real-time settlement of interfaced securities settlement systems;                                    

additional payments, if required to avoid systemic risk; and                                    

DCA to PM liquidity transfer orders.’;                                    

in the Annex, Appendix VI is replaced by the following:

### ‘Appendix VI**FEE SCHEDULE AND INVOICING**

#### **Fees for direct participants**U.K.

##### 1.The monthly fee for the processing of payment orders in TARGET2-ECB for direct participants, depending on which option the                                 direct participant has chosen, shall be either:U.K.

EUR 150 per PM account plus a flat fee per transaction (debit entry) of EUR 0,80; or

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:                                    

Liquidity transfers between a participant's PM account and its sub-accounts shall not be subject to a charge.

PM to DCA liquidity transfer orders sent from a participant's PM account and DCA to PM liquidity transfer orders received                              on a participant's PM account shall be charged according to the pricing option (a) or (b) above chosen for that PM account.                           

##### 2.The monthly fee for multi-addressee access shall be EUR 80 for each 8-digit BIC address other than the BIC of the direct participant's                                 account.U.K.

##### 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.U.K.

##### 4.The monthly fee for each registration by a direct participant of an indirect participant in the TARGET2 directory shall be                                 EUR 20.U.K.

##### 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.U.K.

##### 6.The monthly fee for each registration in the TARGET2 directory of an addressable BIC holder for a correspondent shall be EUR                                 5.U.K.

##### 7.The monthly fee for direct participants subscribing to the TARGET2 value-added services for T2S shall be EUR 50 for those                                 participants which have opted for option (a) in paragraph 1 above, and EUR 625 for those participants which have opted for                                 option (b) in paragraph 1 above.U.K.

#### **Fees for liquidity pooling**U.K.

##### 8.For the Consolidated Account Information (CAI) mode, the monthly fee shall be EUR 100 for each account included in the group.U.K.

##### 9.For the Aggregated Liquidity (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.U.K.

##### 10.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 participant's account.U.K.

##### 11.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.U.K.

#### **Fees for Main PM account holders**U.K.

##### 12.In addition to the fees set out above in this Appendix, a monthly fee of EUR 250 for each linked DCA shall be charged to Main                                 PM account holders.U.K.

##### 13.The Main PM account holders shall be charged the following fees for T2S services connected with the linked DCA(s). These items                                 shall be billed separately.U.K.

#### **Invoicing**U.K.

##### 14.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 relevant invoices 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 tenth working day of that month to the account specified by the ECB and shall be debited from that participant's PM account.’;”U.K.

the Annex is renamed Annex I, and its title is replaced by the following:

*‘ANNEX I***TERMS AND CONDITIONS FOR THE OPENING AND OPERATION OF A PM ACCOUNT IN TARGET2-ECB’;**

the following Annex II is added:

### ANNEX II

#### **TERMS AND CONDITIONS FOR THE OPENING AND OPERATION OF A DEDICATED CASH ACCOUNT IN TARGET2-ECB**U.K.

##### TITLE IU.K.**GENERAL PROVISIONS**U.K.

###### Article 1U.K.Definitions

For the purposes of these Harmonised Conditions (hereinafter the “Conditions”) the following definitions apply:
                -  “Auto-collateralisation” means intraday credit granted by the euro area national central bank (NCB) in central bank money                                    triggered when a DCA holder has insufficient funds to settle securities transactions, whereby such intraday credit is collateralised                                    either with the securities being purchased (collateral on flow), or with securities held by the DCA holder in favour of the                                    euro area NCB (collateral on stock),                                  
                -  “Dedicated Cash Account (DCA)” means an account held by a DCA holder, opened in TARGET2-ECB, and used for cash payments in                                    relation to securities settlement in T2S,                                  
                -  “Immediate liquidity transfer order” means an instruction to make a DCA to PM liquidity transfer order, a PM to DCA liquidity                                    transfer order or a DCA to DCA liquidity transfer order in real-time upon the receipt of the said instruction,                                  
                -  “Predefined liquidity transfer order” means an instruction to transfer a specified amount of funds from a DCA to a PM account                                    to be executed only once at a defined time or event,                                  
                -  “Liquidity adjustment” means the authorisation given by the DCA holder, to its participating CSD or the ECB by special contractual                                    arrangement duly documented and registered in the Static Data to initiate liquidity transfers between a DCA and a PM Account,                                    or between two DCAs,                                  
                -  “DCA to PM liquidity transfer order” means the instruction to transfer a specified amount of funds from a DCA to a PM account, 
                -  “PM to DCA liquidity transfer order” means the instruction to transfer a specified amount of funds from a PM account to a                                    DCA,                                  
                -  “DCA to DCA liquidity transfer order” means the instruction to transfer a specified amount of funds from (i) a DCA to a DCA                                    linked to the same Main PM account; or (ii) from a DCA to a DCA held by the same legal entity,                                  
                -  “Main PM account” means the PM Account to which a DCA is linked and on which any remaining balance will be automatically repatriated                                    at end-of-day,                                  
                -  “Standing liquidity transfer order” means an instruction to transfer a specified amount of cash or “all cash” available in                                    the T2S DCA from a DCA to a PM account to be executed repetitively at a defined time or event in the T2S processing cycle                                    until the order is deleted or the validity period expires,                                  
                -  “Static Data” means the set of business objects, specific to a DCA holder or central bank, in T2S and owned respectively by                                    that DCA holder or central bank, that T2S requires to process the transactional data related to that DCA holder or central                                    bank,                                  
                -  “Business Identifier Code (BIC)” means a code as defined by ISO Standard No 9362, 
                -  “ISO country code” means a code as defined by ISO Standard No 3166-1, 
                -  “business day” means any day on which TARGET2 is open for the settlement of payment orders, as set out in Appendix V, 
                -  “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 an NCB, other than a Eurosystem CB, which is connected to TARGET2 pursuant to a specific agreement, 
                -  “credit institution” means either: (a) a credit institution within the meaning of point (1) of Article 4(1) of Regulation                                    (EU) No 575/2013 and, Section 2(1) no 2 and Section 2(6) no 2 of the KWG that is subject to supervision by a competent authority;                                    or (b) another credit institution within the meaning of Article 123(2) of the Treaty that is subject to scrutiny of a standard                                    comparable to supervision by a competent authority,                                  
                -  “euro area NCB” means the 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                                    ECB or any other CB, including:                                   (a)
where the participant no longer meets the access criteria laid down in Article 5 or the requirements laid down in Article                                             6(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 point (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 DCA 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,
 
                -  “insolvency proceedings” means insolvency proceedings within the meaning of Article 2(j) of Directive 98/26/EC, 
                -  “TARGET2 network service provider” means a provider of computerised network connections appointed by the ECB's Governing Council                                    for the purpose of submitting payment messages in TARGET2,                                  
                -  “T2S network service provider” means an undertaking that has concluded a licence agreement with the Eurosystem to provide                                    connectivity services in the context of T2S,                                  
                -  “payee”, except where used in Article 28 of these Conditions, means a TARGET2 participant whose DCA will be credited as a                                    result of a payment order being settled,                                  
                -  “payer”, except where used in Article 28 of these Conditions, means a TARGET2 participant whose DCA will be debited as a result                                    of a payment order being settled,                                  
                -  “payment order” means a DCA to PM liquidity transfer order, a PM to DCA liquidity transfer order or a DCA to DCA liquidity                                    transfer order,                                  
                -  “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 Eurosystem 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 Eurosystem CB,
 
                -  “Single Shared Platform (SSP)” means the single technical platform infrastructure provided by the SSP-providing NCBs, 
                -  “TARGET2-Securities (T2S)” or “T2S Platform” means the set of hardware, software and other technical infrastructure components                                    through which the Eurosystem provides the services to participating CSDs and Eurosystem CBs that allow core, neutral and borderless                                    settlement of securities transactions on a delivery-versus-payment basis in central bank money,                                  
                -  “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,                                  
                -  “4CBs” means the Deutsche Bundesbank, the Banque de France, the Banca d'Italia and Banco de España in their capacity as the                                    CBs building and operating the T2S Platform for the Eurosystem's benefit,                                  
                -  “static data collection form” means a form developed by the ECB for the purpose of registering applicants for TARGET2-ECB                                    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 ECB,                                  
                -  “T2S GUI” means module on the T2S Platform which allows DCA holders to obtain on-line information and gives them the possibility                                    to submit payment orders,                                  
                -  “TARGET2-ECB” means the TARGET2 component system of the ECB, 
                -  “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 participant” means any participant in any TARGET2 component system, 
                -  “participant” or “direct participant” means an entity that holds at least one PM account (PM account holder) and/or one Dedicated                                    Cash Account (DCA holder) with a Eurosystem CB,                                  
                -  “technical malfunction of TARGET2” means any difficulty, defect or failure in the technical infrastructure and/or the computer                                    systems used by TARGET2-ECB including the SSP or T2S Platform, or any other event that makes it impossible to execute and                                    complete the same-day processing of payments in TARGET2-ECB,                                  
                -  “available liquidity” means the credit balance on the DCA decreased by the amount of any processed reservations of liquidity                                    or blocking of funds,                                  
                -  “participating Central Securities Depository” or “participating CSD” means a CSD that has signed the T2S Framework Agreement, 
                -  “A2A” or “Application-to-application” means a connectivity mode allowing the DCA holder to exchange information with the software                                    application of the T2S Platform,                                  
                -  “U2A” or “User-to-application” means a connectivity mode allowing the DCA holder to exchange information with software applications                                    on the T2S Platform through a graphical user interface,                                  
                -  “T2S Distinguished Name” or “T2S DN” means the network address for the T2S Platform which must be included in all messages                                    intended for the system,                                  
                -  “branch” means a branch within the meaning of point (17) of Article 4(1) of Regulation (EU) No 575/2013, 
                -  “non-settled payment order” means a payment order that is not settled on the same business day as that on which it is accepted, 
                -  “real-time gross settlement” means the processing and settlement of payment orders on a transaction by transaction basis in                                    real-time.                                  

###### Article 2U.K.Scope

The present Conditions govern the relationship between the ECB and its DCA holder as far the opening and the operation of                              the DCA is concerned.                           

###### Article 3U.K.Appendices

1.The following Appendices form an integral part of these Conditions:                           

:

Parameters of the dedicated cash accounts — Technical specifications;

:

TARGET2 compensation scheme in relation to the opening and the operation of the DCA;

:

Terms of reference for capacity and country opinions;

:

Business continuity and contingency procedures;

:

Operating schedule;

:

Fee schedule.

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 4U.K.General description of T2S and TARGET2

1.TARGET2 provides real-time gross settlement for payments in euro, with settlement in central bank money across PM accounts                                 and DCAs. By virtue of Guideline ECB/2012/27 (*), TARGET2 also provides real-time gross settlement services in respect of                                 T2S transactions for DCA holders having ensured a link with a securities account at a participating CSD. Such services are                                 provided on the T2S Platform, enabling the exchange of standardised messages in respect of the transfers from and to the DCAs                                 opened on the books of the relevant euro area NCB in TARGET2.                           

2.The following transactions are processed in TARGET2-ECB:                           

(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;                           

(e)settlement of the cash leg of securities transactions;                           

(f)DCA to DCA liquidity transfer orders, DCA to PM liquidity transfer orders and PM to DCA liquidity transfer orders; and                           

(g)any other payment orders in euro addressed to TARGET2 participants.                           

3.TARGET2 provides real-time gross settlement for payments in euro, with settlement in central bank money across PM accounts                                 and DCAs. TARGET2 is established and functions on the basis of the SSP through which all payment orders are submitted and                                 processed and through which payments are ultimately received in the same technical manner. As far as the technical operation                                 of the Dedicated Cash Accounts on T2S is concerned, TARGET2 is technically established and functions on the basis of the T2S                                 Platform. The ECB is the provider of services under these Conditions. Acts and omissions of the SSP-providing NCBs and the                                 4CBs shall be considered acts and omissions of the ECB, for which it shall assume liability in accordance with Article 21                                 below. Participation pursuant to these Conditions shall not create a contractual relationship between participants and SSP-providing                                 NCBs or the 4CBs when any of the latter act in that capacity. Instructions, messages or information which a participant receives                                 from, or sends to, the SSP or T2S Platform in relation to the services provided under these Conditions are deemed to be received                                 from, or sent to, the ECB.                           

4.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-ECB is designated as a “system” under                                 the national laws implementing Directive 98/26/EC. TARGET2-ECB is designated as a system under Section 1(16) of the KWG.                           

5.Participation in TARGET2 takes effect via participation in a TARGET2 component system. These Conditions describe the mutual                                 rights and obligations of DCA holders in TARGET2-ECB and the ECB. The rules on the processing of payment orders under these                                 Conditions (Title IV of this Annex and Appendix I) refer to all payment orders submitted or payments received by any TARGET2                                 participant.                           

##### TITLE IIU.K.**PARTICIPATION**U.K.

###### Article 5U.K.Access criteria

Entities managing ancillary systems (including entities established outside the EEA) and acting in that capacity, whose access                              to TARGET2-ECB has been approved by the Governing Council, shall be the only entities that are eligible to become DCA holders                              upon request in TARGET2-ECB.                           

###### Article 6U.K.Application procedure

1.In order for the ECB to open a DCA for an entity, such entity must comply with the access criteria of Article 5 and shall:                           

(a)fulfil the following technical requirements:                           

install, manage, operate and monitor and ensure the security of the necessary IT infrastructure to provide a technical connection                                       to the SSP and/or the T2S Platform and submit payment orders to it. In doing so, applicant participants may involve third                                       parties, but retain sole liability. In particular, when connecting directly to the T2S Platform, applicant DCA holders shall                                       enter into an agreement with a T2S network service provider to obtain the necessary connection and admissions, in accordance                                       with the technical specifications in Appendix I; and                                    

have passed the certification testing and obtained the authorisation required by the ECB; and

(b)fulfil the following legal requirements:                           

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 ECB in another context; and                                    

for entities established outside the EEA, acting through a branch established in the EEA, 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 ECB in another context.                                    

2.Entities wishing to open a DCA shall apply in writing to the ECB, as a minimum enclosing the following documents/information:                           

(a)completed static data collection forms as provided by the ECB;                           

(b)the capacity opinion, if required by the ECB; and                           

(c)the country opinion, if required by the ECB.                           

3.The ECB may also request any additional information it deems necessary to decide on the application to participate.                           

4.The ECB shall reject the application to open a DCA if:                           

(a)the access criteria referred to in Article 5 are not met;                           

(b)one or more of the participation criteria referred to in paragraph 1 are not met; and/or                           

(c)in the ECB's assessment, opening a DCA would endanger the overall stability, soundness and safety of TARGET2-ECB or of any                                 other TARGET2 component system, or would jeopardise the ECB's performance of its tasks as described in 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 ECB shall communicate its decision on the application to open a DCA to the applicant within one month of the ECB's receipt                                 thereof. Where the ECB requests additional information pursuant to paragraph 3, the decision shall be communicated within                                 one month of the ECB's receipt of this information from the applicant. Any rejection decision shall contain reasons for the                                 rejection.                           

###### Article 7U.K.DCA holders

DCA holders in TARGET2-ECB shall comply with the requirements set out in Article 6. They shall have at least one DCA with                              the ECB.                           

###### Article 8U.K.Links between securities accounts and DCAs

1.A DCA holder may request the ECB to link its DCA to one or more securities account(s) held on its own behalf or on behalf                                 of its clients which hold securities accounts in one or more participating CSD.                           

2.DCA holders linking their DCA to securities account(s) on behalf of clients as set out in paragraph 1 are responsible for                                 establishing and maintaining the list of linked securities accounts and, where relevant, the set-up of the client-collateralisation                                 feature.                           

3.As a result of the request under paragraph 1, the DCA holder is deemed to have given a mandate to the CSD where such linked                                 securities accounts are maintained to debit the DCA with the amounts resulting from securities transactions taking place on                                 these securities accounts.                           

4.Paragraph 3 shall apply regardless of any agreements the DCA holder has with the CSD and/or the securities account holders.                           

##### TITLE IIIU.K.**OBLIGATIONS OF THE PARTIES**U.K.

###### Article 9U.K.Obligations of the ECB and the DCA holders

1.The ECB shall open upon request of the DCA holder and operate one or more DCA(s) denominated in euro. Save where otherwise                                 provided in these Conditions or required by law, the ECB shall use all reasonable means within its power to perform its obligations                                 under these Conditions, without guaranteeing a result.                           

2.The fees for DCA services are laid down in Appendix VI. The holder of the Main PM account to which the DCA is linked is liable                                 for paying these fees.                           

3.DCA holders shall ensure that they are connected to TARGET2-ECB on business days, in accordance with the operating schedule                                 in Appendix V.                           

4.The DCA holder represents and warrants to the ECB 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.                           

5.DCA holders shall ensure that the liquidity in the DCA during the day is properly managed. This obligation shall include but                                 is not limited to obtaining regular information on their liquidity position. The ECB shall provide a daily statement of accounts                                 to any DCA holder that has opted for such service on the T2S Platform provided that the DCA holder is connected to the T2S                                 Platform via a T2S network service provider.                           

###### Article 10U.K.Cooperation and information exchange

1.In performing their obligations and exercising their rights under these Conditions, the ECB and DCA holders shall cooperate                                 closely to ensure the stability, soundness and safety of TARGET2-ECB. 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 ECB shall establish and maintain a system support desk to assist DCA holders in relation to difficulties arising in connection                                 with system operations.                           

3.Up-to-date information on the operational status of the TARGET2 platform and the T2S Platform shall be available on the TARGET2                                 Information System (T2IS) and the TARGET2-Securities Information System respectively. The T2IS and the TARGET2 Securities                                 Information System may be used to obtain information on any event affecting the normal operation of the respective platforms.                           

4.The ECB may either communicate messages to DCA holders by means of broadcast messages or by any other means of communication.                                 DCA holders may collect information via the ICM, to the extent they also hold a PM account, or otherwise via the T2S GUI.                           

5.DCA holders are responsible for the timely update of existing static data collection forms and the submission of new static                                 data collection forms to the ECB. DCA holders are responsible for verifying the accuracy of information relating to them that                                 is entered into TARGET2-ECB by the ECB.                           

6.The ECB shall be deemed to be authorised to communicate to the SSP-providing NCBs or the 4CBs any information relating to                                 DCA holders which the former may need in their role as service administrators, in accordance with the contract entered into                                 with the TARGET2 network service provider and/or the T2S network service provider.                           

7.DCA holders shall inform the ECB about any change in their legal capacity and relevant legislative changes affecting issues                                 covered by the country opinion relating to them.                           

8.DCA holders shall inform the ECB of:                           

(a)any new holder of a securities account linked to the DCA pursuant to Article 8(1), which they accept; and                           

(b)any changes related to the holders of securities accounts listed in point (a).                           

9.DCA holders shall immediately inform the ECB if an event of default occurs in relation to themselves.                           

###### Article 11U.K.Designation, suspension or termination of the Main PM account

1.The DCA holder shall designate a Main PM account to which the DCA is linked. The Main PM account may be held in a TARGET2                                 component system other than TARGET2-ECB and may belong to a different legal entity from the DCA holder.                           

2.A participant using internet based access cannot be designated as a Main PM account holder.                           

3.If the holder of the Main PM account and the holder of the DCA are different legal entities and in the event that the participation                                 of that designated Main PM account holder is suspended or terminated, the ECB and the DCA holder shall take all reasonable                                 and practicable steps to mitigate any ensuing damage or loss. The DCA holder shall take all necessary steps to designate a                                 new Main PM account without undue delay which will then be liable for any outstanding invoices. On the day of the suspension                                 or termination of the Main PM account holder and until a new Main PM account holder has been designated, any funds remaining                                 on the DCA at the end of the day shall be moved to an account of the ECB. These funds will be subject to the remuneration                                 conditions of Article 10(3) of Annex I to this Decision.                           

4.The ECB shall not be liable for any losses incurred by the DCA holder as a consequence of the suspension or termination of                                 the Main PM account holder's participation.                           

##### TITLE IVU.K.**OPENING AND MANAGEMENT OF THE DCA AND PROCESSING OF OPERATIONS**U.K.

###### Article 12U.K.Opening and management of the DCA

1.The ECB shall open and operate at least one DCA for each DCA holder. A DCA shall be identified by means of a unique 34 character                                 account number which will be structured as follows.                           

2.No debit balance shall be allowed on DCAs.                           

3.The DCA shall not hold any funds overnight. At the beginning and end of a business day, there shall be a zero balance on the                                 DCAs. DCA holders shall be deemed to have instructed the ECB to transfer any remaining balance at the end of a business day                                 as defined in Appendix V to the Main PM account referred to in Article 11(1).                           

4.The DCA shall only be used within the period between the T2S start-of-day and T2S end-of-day as defined in the T2S User Detailed                                 Functional Specifications (UDFS).                           

5.DCAs shall be interest free.                           

###### Article 13U.K.Operations that may be carried out through the DCA

Subject to the DCA holder designating the necessary securities account(s), the DCA holder may carry out the following operations                              through the DCA either on its own behalf or on behalf of its customers:                           

DCA to PM liquidity transfer orders;

DCA to DCA liquidity transfer orders;

the settlement of cash instructions stemming from the T2S Platform; and

cash transfers between the DCA and the DCA of the ECB in the particular context of paragraphs 8 and 9 of Annex IIIa to Guideline                                       ECB/2012/27.                                    

###### Article 14U.K.Acceptance and rejection of payment orders

1.Payment orders submitted by DCA holders are deemed accepted by the ECB if:                           

(a)the payment message complies with the rules established by the T2S network service provider;                           

(b)the payment message complies with the formatting rules and conditions of TARGET2-ECB 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.                           

2.The ECB shall immediately reject any payment order that does not fulfil the conditions laid down in paragraph 1. The ECB shall                                 inform the DCA holder of any rejection of a payment order, as specified in Appendix I.                           

3.The T2S Platform determines the timestamp for the processing of payment orders on the basis of the time when it receives and                                 accepts the payment order.                           

###### Article 15U.K.Reservation and blocking of liquidity

1.Participants may reserve or block liquidity on their DCA. This does not constitute a settlement guarantee in favour of any                                 third party.                           

2.By requesting to reserve or block an amount of liquidity, a participant instructs the ECB to decrease the available liquidity                                 by this amount.                           

3.A reservation request is an instruction by which, if the available liquidity is equal to or higher than the amount to be reserved,                                 the reservation is processed. If the available liquidity is lower, it is reserved and the shortfall may be met by incoming                                 liquidity until the full amount of the reservation is available.                           

4.A blocking request is an instruction by which, if the available liquidity is equal to or higher than the amount to be blocked,                                 the blocking request is processed. If the available liquidity is lower, no amount is blocked and the blocking request is resubmitted,                                 until the full amount of the blocking request can be met by available liquidity.                           

5.The participant may at any time during the business day on which a request to reserve or block liquidity has been processed,                                 instruct the ECB to cancel the reservation or blocking. Partial cancelation shall not be permitted.                           

6.All requests for reservation or blocking of liquidity under this article shall expire at the end of the business day.                           

###### Article 16U.K.Moment of entry, moment of irrevocability

1.For the purposes of the first sentence of Article 3(1) and Article 5 of Directive 98/26/EC, and the third sentence of Section                                 116, Section 96(2), Section 82 and Section 340(3) of the German Insolvency Code *(Insolvenzordnung)* and the last sentence of Section 46(2) of the KWG, DCA to DCA liquidity transfer orders or DCA to PM liquidity transfer orders                                 are deemed entered into TARGET2-ECB and are irrevocable at the moment that the relevant DCA holder's DCA is debited. PM to                                 DCA liquidity transfer orders are governed by the Harmonised Conditions for the Opening and Operation of a PM account in TARGET2                                 applicable to the TARGET2 component system from which they originate.                           

2.For the purposes of the first sentence of Article 3(1) and Article 5 of Directive 98/26/EC, and the third sentence of Section                                 116, Section 96(2), Section 82 and Section 340(3) of the German Insolvency Code *(Insolvenzordnung)* and the last sentence of Section 46(2) of the KWG, and for all transactions settling on DCAs and which are subject to matching                                 of two separate transfer orders, such transfer orders are deemed entered into TARGET2-ECB and are irrevocable at the moment                                 that the relevant DCA holder's DCA is debited.                           

3.The rules provided for in paragraph 2 shall be replaced by the rules below two weeks after the Governing Council of the ECB                                 has determined that an agreement has been signed between the Eurosystem CBs and the Connected NCBs, on the one hand, and all                                 CSDs participating in T2S at the date of such agreement, on the other hand, on the provision of information and liability.                           

(a)For all transactions settling on DCAs and which are subject to matching of two separate transfer orders, such transfer orders                                 are deemed entered into TARGET2-ECB at the moment at which they have been declared compliant with the technical rules of T2S                                 by the T2S Platform and irrevocable at the moment the transaction has been given the status “matched” on the T2S Platform;                                 or                           

(b)As an exception to point (a), for transactions involving one participating CSD having a separate matching component where                                 transfer orders are sent directly to that participating CSD to be matched in its separate matching component, transfer orders                                 are deemed entered into TARGET2-ECB at the moment at which they have been declared compliant with the technical rules of T2S                                 by that participating CSD and irrevocable from the moment the transaction has been given the status “matched” on the T2S Platform.                                 A list of CSDs for which this point (b) applies is available on the website of the ECB.                           

##### TITLE VU.K.**SECURITY REQUIREMENTS, CONTINGENCY ISSUES AND USER INTERFACES**U.K.

###### Article 17U.K.Business continuity and contingency procedures

In the event of an abnormal external event or any other event which affects transactions on the DCAs, the business continuity                              and contingency procedures described in Appendix IV shall apply.                           

###### Article 18U.K.Security requirements

1.DCA holders shall implement adequate security controls to protect their systems from unauthorised access and use. DCA holders                                 shall be exclusively responsible for adequate protection to ensure the confidentiality, integrity and availability of their                                 systems.                           

2.DCA holders shall inform the ECB 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 ECB may request further                                 information about the incident and request that the DCA holders take appropriate measures to prevent a recurrence of such                                 an event.                           

3.The ECB may impose additional security requirements on all DCA holders and/or on DCA holders that are considered critical                                 by the ECB.                           

###### Article 19U.K.User interfaces

1.The DCA holder, or the Main PM account holder acting on its behalf, shall use either one or both of the following means to                                 access that DCA:                           

(a)direct connection to the T2S Platform in either U2A or A2A modes; or                           

(b)the TARGET2 ICM in combination with TARGET2 value-added services for T2S.                           

2.A direct connection to the T2S Platform allows DCA holders:                           

(a)to access and, when applicable, amend information relating to their accounts;                           

(b)to manage liquidity and to initiate liquidity transfer orders from the DCAs.                           

3.The TARGET2 ICM in combination with TARGET2 value-added services for T2S allows the holder of the Main PM account:                           

(a)to access information relating to their accounts;                           

(b)to manage liquidity and to initiate liquidity transfer orders to and from the DCAs.                           

Further technical details relating to the TARGET2 ICM are contained in [insert national provisions implementing Appendix I                              to Annex II to the Guideline].                           

##### TITLE VIU.K.**COMPENSATION, LIABILITY REGIME AND EVIDENCE**U.K.

###### Article 20U.K.Compensation scheme

In the event that funds remain overnight on a DCA due to a technical malfunction of either the SSP or the T2S Platform, the                              ECB shall offer to compensate the participants concerned in accordance with the special procedure laid down in Appendix II.                           

###### Article 21U.K.Liability regime

1.In performing their obligations pursuant to these Conditions, the ECB and the DCA holders shall be bound by a general duty                                 of reasonable care in relation to each other.                           

2.The ECB shall be liable to its DCA holders in cases of fraud (including but not limited to wilful misconduct) or gross negligence,                                 for any loss arising out of the operation of TARGET2-ECB. In cases of ordinary negligence, the ECB's liability shall be limited                                 to the DCA holder'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 ECB is not liable for any loss that results from any malfunction or failure in the technical infrastructure (including                                 but not limited to the ECB's computer infrastructure, programmes, data, applications or networks), if such malfunction or                                 failure arises in spite of the ECB 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).                           

4.The ECB shall not be liable:                           

(a)to the extent that the loss is caused by the DCA holder; or                           

(b)if the loss arises out of external events beyond the ECB's reasonable control *(force majeure).*                           

5.Notwithstanding Sections 675u, 675v, 675x, 675y 675z, 676a, 676c of the German Civil Code *(Bürgerliches Gesetzbuch)*, paragraphs 1 to 4 shall apply to the extent that the ECB's liability can be excluded.                           

6.The ECB and the DCA holders 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 ECB may commission third parties in its own name,                                 particularly telecommunications or other network providers or other entities, if this is necessary to meet the ECB's obligations                                 or is standard market practice. The ECB's obligation shall be limited to the due selection and commissioning of any such third                                 parties and the ECB's liability shall be limited accordingly. For the purposes of this paragraph, the SSP-providing NCBs and                                 the 4CBs shall not be considered as third parties.                           

###### Article 22U.K.Evidence

1.Unless otherwise provided in these Conditions, all payment and payment processing-related messages in relation to the DCAs,                                 such as confirmations of debits or credits, or statement messages, between the ECB and the DCA holders shall be made through                                 the T2S network service provider.                           

2.Electronic or written records of the messages retained by the ECB or by the T2S network service provider shall be accepted                                 as a means of evidence of the payments processed through the ECB. The saved or printed version of the original message of                                 the T2S network service provider shall be accepted as a means of evidence, regardless of the form of the original message.                           

3.If a DCA holder's connection to the T2S network service provider fails, the DCA holder shall use an alternative means of transmission                                 of messages agreed with the ECB. In such cases, the saved or printed version of the message produced by the ECB shall have                                 the same evidential value as the original message, regardless of its form.                           

4.The ECB shall keep complete records of payment orders submitted and payments received by DCA holders for a period of 10 years                                 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 DCA holder 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 ECB'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 DCA                                 holders and of any facts and events that the parties rely on.                           

##### TITLE VIIU.K.**TERMINATION AND CLOSURE OF DCAS**U.K.

###### Article 23U.K.Duration and ordinary termination of DCAs

1.Without prejudice to Article 24, a DCA in TARGET2-ECB is opened for an indefinite period of time.                           

2.A DCA holder may terminate its DCA in TARGET2-ECB at any time giving 14 business days' notice thereof, unless it agrees a                                 shorter notice period with the ECB.                           

3.The ECB may terminate a DCA holder's DCA in TARGET2-ECB at any time giving three months' notice thereof, unless it agrees                                 a different notice period with that DCA holder.                           

4.On termination of the DCA, the confidentiality duties laid down in Article 27 remain in force for a period of five years starting                                 on the date of termination.                           

5.On termination of the DCA, it shall be closed in accordance with Article 25.                           

###### Article 24U.K.Suspension and extraordinary termination of participation

1.A DCA holder's participation in TARGET2-ECB 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 DCA holder no longer meets the access criteria laid down in Article 5.                           

2.The ECB may terminate without prior notice or suspend the DCA holder's participation in TARGET2-ECB if:                           

(a)one or more events of default (other than those referred to in paragraph 1) occur;                           

(b)the DCA holder is in material breach of these Conditions;                           

(c)the DCA holder fails to carry out any material obligation to the ECB;                           

(d)the DCA holder is excluded from, or otherwise ceases to be a member of, a T2S Closed Group of Users (CGU); and/or                           

(e)any other event related to the DCA holder occurs which, in the ECB's assessment, would threaten the overall stability, soundness                                 and safety of TARGET2-E CB reference or of any other TARGET2 component system, or which would jeopardise the ECB's performance                                 of its tasks as described in the Statute of the European System of Central Banks and of the European Central Bank, or poses                                 risks on the grounds of prudence.                           

3.In exercising its discretion under paragraph 2, the ECB shall take into account, inter alia, the seriousness of the event                                 of default or events mentioned in points (a) to (c).                           

4.(a)In the event that the ECB suspends or terminates a DCA holder's participation in TARGET2-ECB under paragraph 1 or 2, the ECB                                 shall immediately inform that DCA holder, other CBs and the other participants of such suspension or termination by means                                 of an ICM broadcast message or a T2S broadcast message depending on which technical option provided for in Article 19 the                                 DCA holder uses.

(b)In the event that the ECB is informed by another CB of a suspension or termination of a participant in another TARGET2 component                                 system, the ECB shall immediately inform its participants of such suspension or termination by means of an ICM broadcast message                                 or of a T2S broadcast message depending on which technical option provided for in Article 19 the DCA holder uses.                           

(c)Once such an ICM broadcast message (in the case of PM account holders) or T2S broadcast message (in the case of DCA holders)                                 has been received by the participants, such participants shall be deemed informed of the termination/suspension of a DCA holder's                                 participation in TARGET2-ECB 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-ECB after receipt of the ICM broadcast message or of the T2S broadcast message depending on which technical                                 option provided for in Article 19 the DCA holder uses.                           

5.Upon termination of a DCA holder's participation, TARGET2-ECB shall not accept any new payment orders to or from that DCA                                 holder.                           

6.If a DCA holder is suspended from TARGET2-ECB, all its incoming and outgoing payment orders shall only be presented for settlement                                 after they have been explicitly accepted by the suspended DCA holder's CB.                           

###### Article 25U.K.Closure of DCAs

1.DCA holders may request the ECB to close their DCAs at any time provided they give the ECB 14 business days' notice thereof.                           

2.On termination of participation, pursuant to either Article 23 or 24, the ECB shall close the DCA of the DCA holder concerned,                                 after having settled or returned any unsettled payment orders and made use of its rights of pledge and set-off under Article                                 26.                           

##### TITLE VIIIU.K.**FINAL PROVISIONS**U.K.

###### Article 26U.K.The ECB's rights of pledge and set-off

1.The ECB shall have a pledge over the DCA holder's existing and future credit balances on its DCAs, thereby collateralising                                 any current and future claims arising out of the legal relationship between the parties.                           

2.On the occurrence of:                           

(a)an event of default referred to in Article 24(1); or                           

(b)any other event of default or event referred to in Article 24(2) that has led to the termination or suspension of the DCA                                 holder's participation, notwithstanding the commencement of any insolvency proceedings in respect of a DCA holder and notwithstanding                                 any assignment, judicial or other attachment or other disposition of or in respect of the DCA holder's rights;                           

all obligations of the DCA holder 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 DCA                              holder and the ECB shall automatically be set off against each other, and the party owing the higher amount shall pay to the                              other the difference.                           

3.The ECB shall promptly give the DCA holder notice of any set-off pursuant to paragraph 4 after such set-off has taken place.                           

4.The ECB may without prior notice debit any DCA holder's DCA by any amount which the DCA holder owes the ECB resulting from                                 the legal relationship between the DCA holder and the ECB.                           

###### Article 27U.K.Confidentiality

1.The ECB shall keep confidential all sensitive or secret information, including when such information relates to payment, technical                                 or organisational information belonging to the DCA holder or the DCA holder's customers, unless the DCA holder or its customer                                 has given its written consent to disclose.                           

2.By derogation from paragraph 1, the DCA holder agrees that the ECB may disclose payment order, technical or organisational                                 information regarding the DCA holder, other DCAs held by DCA holders of the same group, or the DCA holder's customers obtained                                 in the course of the operation of TARGET2-ECB to other CBs or third parties that are involved in the operation of TARGET2-ECB,                                 to the extent that this is necessary for the efficient functioning of TARGET2, or the monitoring of the DCA holder's or its                                 group's exposure, 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 ECB 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                                 DCA holder or the DCA holder's customers, the ECB may use, disclose or publish payment information regarding the DCA holder                                 or the DCA holder'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-ECB to which DCA holders have had access, may only be used for the purposes                                 laid down in these Conditions. DCA holders shall keep such information confidential, unless the ECB has explicitly given its                                 written consent to disclose. DCA holders 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 ECB shall be authorised, in order to settle payment orders, to process and transfer the necessary data to the T2S network                                 service provider.                           

###### Article 28U.K.Data protection, prevention of money laundering, administrative or restrictive measures and related issues

1.DCA holders 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 payment orders debited or credited on their DCAs. Prior to entering into the contractual relationship with its T2S network                                 service provider, DCA holders shall acquaint themselves with its data retrieval policy.                           

2.DCA holders shall be deemed to have authorised the ECB 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 DCA holders' participation                                 in TARGET2-ECB.                           

3.DCA holders, 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 Articles 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 ECB is the payment service provider of a DCA holder that is a payer:                           

the DCA holder 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 ECB with evidence of having made a notification or having received                                       consent;                                    

the DCA holder shall not enter any DCA to PM liquidity transfer order or DCA to DCA liquidity transfer order into TARGET2                                       until it has obtained confirmation from the ECB 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 ECB is a payment service provider of a DCA holder that is a payee, the DCA holder 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 ECB 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.                           

###### Article 29U.K.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 T2S network service                                 provider. Notices to the ECB shall be submitted to the Director-General of the ECB's Directorate-General Payment Systems and                                 Market Infrastructure, Sonnemannstrasse 20, 60314 Frankfurt am Main, Germany, or to the BIC address of the ECB. Notices to                                 the DCA holder shall be sent to it at the address, fax number or its BIC address as the DCA holder may from time to time notify                                 to the ECB.                           

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 English.                           

4.DCA holders shall be bound by all forms and documents of the ECB that the DCA holders have filled in and/or signed, including                                 but not limited to static data collection forms, as referred to in Article 6(2)(a), and information provided under Article                                 10(5), which were submitted in compliance with paragraphs 1 and 2 and which the ECB reasonably believes to have received from                                 the DCA holders, their employees or agents.                           

###### Article 30U.K.Contractual relationship with T2S network service provider

1.Each DCA holder may enter into a separate agreement with a T2S network service provider regarding the services to be provided                                 in relation to the DCA holder's use of the DCA. The legal relationship between a DCA holder and the T2S network service provider                                 shall be exclusively governed by the terms and conditions of their separate agreement.                           

2.The services to be provided by the T2S network service provider shall not form part of the services to be performed by the                                 ECB in respect of TARGET2.                           

3.The ECB shall not be liable for any acts, errors or omissions of the T2S network service provider (including its directors,                                 staff and subcontractors), or for any acts, errors or omissions of third parties selected by DCA holders to gain access to                                 the T2S network service provider's network.                           

###### Article 31U.K.Amendment procedure

The ECB may at any time unilaterally amend these Conditions, including their Appendices. Amendments to these Conditions, including                              their Appendices, shall be announced by means of communication in writing to the participants. Amendments shall be deemed                              to have been accepted unless the DCA holder expressly objects within 14 days of being informed of such amendments. In the                              event that a DCA holder objects to the amendment, the ECB is entitled immediately to terminate and close that DCA holder's                              DCA in TARGET2-ECB.                           

###### Article 32U.K.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 DCA holders to any third party without the ECB's written consent.                           

2.These Conditions do not create any rights in favour of or obligations in relation to any entity other than the ECB and DCA                                 holders in TARGET2-ECB.                           

###### Article 33U.K.Governing law, jurisdiction and place of performance

1.The bilateral relationship between the ECB and DCA holders in TARGET2-ECB shall be governed by German 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 courts of Frankfurt am Main.                           

3.The place of performance concerning the legal relationship between the ECB and the DCA holders shall be Frankfurt am Main,                                 Germany.                           

###### Article 34U.K.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 35U.K.Entry into force and binding nature

1.These Conditions become effective from 22 June 2015.                           

2.By requesting a DCA in TARGET2-ECB, applying entities automatically agree to these Conditions between themselves and in relation                                 to the ECB.                           

#### Appendix I**PARAMETERS OF THE DEDICATED CASH ACCOUNTS — TECHNICAL SPECIFICATIONS**

In addition to the Conditions, the following rules shall apply to the interaction with the T2S Platform:

##### 1.**Technical requirements for participation in TARGET2-ECB regarding infrastructure, network and formats**U.K.

###### (1)T2S uses the services of a T2S network service provider for the exchange of messages. Each DCA holder using a direct connection                                 shall have a connection to at least one T2S network service provider's secure IP network.U.K.

###### (2)Each DCA holder shall pass a series of tests to prove its technical and operational competence before it may participate in                                 TARGET2-ECB.U.K.

###### (3)For the submission of liquidity transfer orders in the DCA the services of the T2S network service providers shall be used.                                 Liquidity transfer orders shall be directly addressed to the T2S DN and must contain the following information:U.K.

in the case of liquidity transfers between two DCAs, the unique 34 character account numbers of both the sending and the receiving                                       DCA holder; or                                    

in the case of liquidity transfers from a DCA to a PM account, the unique 34 character account number of the sending DCA holder                                       and the account number of the receiving PM account.                                    

###### (4)For the exchange of information with the T2S Platform either A2A or U2A modes may be used. The security of the message exchange                                 between DCA and the T2S Platform shall rely on the Public Key Infrastructure (PKI) service offered by a T2S network service                                 provider. Information on the PKI service is available in the documentation provided by such T2S network service provider.U.K.

###### (5)DCA holders shall comply with the ISO20022 message structure and field specifications. All messages shall include a Business                                 Application Header (BAH). Message structure, field specifications and BAHs are defined in the ISO documentation, under the                                 restrictions set out for T2S, as described in Chapter 3.3.3 Cash Management (camt) of the T2S UDFS.U.K.

###### (6)Field contents shall be validated at the level of the T2S Platform in accordance with the T2S UDFS requirements.U.K.

##### 2.**Message types**U.K.

The following system message types are processed, subject to subscription:

##### 3.**Double-entry check**U.K.

###### (1)All liquidity transfer orders shall pass a double-entry check, the aim of which is to reject liquidity transfer orders that                                 have been submitted more than once.U.K.

###### (2)The following parameters shall be checked:U.K.

                -  Order Reference (End to End Id); 
                -  Debit and Credit Account (DCA or PM account); and 
                -  instructed Amount. 

###### (3)If all the fields described in point (2) in a newly submitted liquidity transfer order are identical to those in a liquidity                                 transfer order which has been accepted but not yet settled or a liquidity transfer order that has been settled within the                                 past three business days, the newly submitted liquidity transfer order shall be rejected.U.K.

##### 4.**Error codes**U.K.

If a liquidity transfer order is rejected on grounds of non-compliance with the fields in paragraph 3(2), the DCA holder shall                              receive a status advice message [camt.025], as described in Chapter 4.1 of the T2S UDFS.                           

##### 5.**Settlement triggers**U.K.

###### (1)For immediate liquidity transfer orders, no specific XML tag is required;U.K.

###### (2)Predefined liquidity transfer orders and standing liquidity transfer orders may be triggered by a specific time or event on                                 the day of settlement:U.K.

                -  for settlement at a specific time, the XML tag “Time(/ExctnTp/Tm/)” shall be used; 
                -  for settlement upon occurrence of a specific event, the XML tag “(EventType/ExctnTp/Evt/)” shall be used. 

###### (3)The validity period for standing liquidity transfer orders shall be set by the following XML tags: “FromDate/VldtyPrd/FrDt/”                                 and “ToDate/VldtyPrd/ToDt/”.U.K.

##### 6.**Settlement of liquidity transfer orders**U.K.

Liquidity transfer orders are not recycled, queued or offset.

The different statuses for liquidity transfer orders are described in Chapter 1.6.4 of the T2S UDFS.

##### 7.**Use of the U2A and A2A mode**U.K.

###### (1)The U2A and A2A modes may be used for obtaining information and managing liquidity. The T2S network service providers' networks                                 shall be the underlying technical communications networks for exchanging information and running control measures. The following                                 modes shall be available for use by DCA holders:U.K.

Application-to-application mode (A2A)

In A2A, information and messages are transferred between the T2S Platform and the DCA holder's internal application. The DCA                                       holder therefore has to ensure that an appropriate application is available for the exchange of XML messages (requests and                                       responses).                                    

User-to-application mode (U2A)

U2A permits direct communication between a DCA holder and the T2S GUI. The information is displayed in a browser running on                                       a PC system. For U2A access the IT infrastructure has to be able to support cookies and JavaScript. Further details are described                                       in the T2S User Handbook.                                    

###### (2)Static data shall be available to view in U2A mode. The screens shall be offered in English only.U.K.

###### (3)Information shall be provided in “pull” mode, which means that each DCA holder has to ask to be provided with information.U.K.

###### (4)Access rights to the U2A and A2A mode shall be granted by using T2S GUI.U.K.

###### (5)The “Non-Repudiation of Origin” (NRO) signature allows the recipient of a message to prove that such message has been issued                                 and has not been altered.U.K.

###### (6)If a DCA holder has technical problems and is unable to submit any liquidity transfer order, it may contact its central bank                                 which will on a best efforts basis act on behalf of the DCA holder.U.K.

##### 8.**Relevant documentation**U.K.

Further details and examples explaining the above rules are contained in the T2S UDFS and the T2S User Handbook, as amended                              from time to time and published on the ECB's website in English.                           

#### Appendix II**TARGET2 COMPENSATION SCHEME IN RELATION TO THE OPENING AND THE OPERATION OF THE DCA**

##### 1.**General principles**U.K.

###### (a)If there is a technical malfunction of TARGET2, DCA holders may submit claims for compensation in accordance with the TARGET2                                 compensation scheme laid down in this Appendix.U.K.

###### (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.U.K.

###### (c)Compensation under the TARGET2 compensation scheme shall be the only compensation procedure offered in the event of a technical                                 malfunction of the TARGET2. DCA holders may, however, use other legal means to claim for losses. If a DCA holder accepts a                                 compensation offer under the TARGET2 compensation scheme, this shall constitute the DCA holder'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 DCA holder 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.U.K.

###### (d)The making of a compensation offer shall not constitute an admission of liability by the ECB or any other CB in respect of                                 a technical malfunction of the TARGET2.U.K.

##### 2.**Conditions for compensation offers**U.K.

###### (a)A payer may submit a claim for an administration fee and interest compensation if, due to a technical malfunction of TARGET2,                                 a liquidity transfer order was not settled on the business day on which it was accepted.U.K.

###### (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:U.K.

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                                    

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**U.K.

###### (a)With respect to a compensation offer for a payer:U.K.

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;                                    

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 the 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                                    

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.                                    

###### (b)With respect to a compensation offer for a payee:U.K.

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;                                    

the method set out in point (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**U.K.

###### (a)A claim for compensation shall be submitted on the claim form available on the website of the ECB in English (see www.ecb.int).                                 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.U.K.

###### (b)Within four weeks of a technical malfunction of TARGET2, DCA holders shall submit their claim forms to the ECB. Any additional                                 information and evidence requested by the ECB shall be supplied within two weeks of such request being made.U.K.

###### (c)The ECB shall review the claims and forward them to the ECB. Unless otherwise decided by the ECB's Governing Council and communicated                                 to the DCA holders, all received claims shall be assessed no later than 14 weeks after the technical malfunction of TARGET2                                 occurs.U.K.

###### (d)The ECB shall communicate the result of the assessment referred to in point (c) to the relevant DCA holders. If the assessment                                 entails a compensation offer, the DCA holders 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 ECB (see www.ecb.int). If such letter has not been received by                                 the ECB within four weeks, the DCA holders concerned shall be deemed to have rejected the compensation offer.U.K.

###### (e)The ECB shall make compensation payments on receipt of a DCA holder's letter of acceptance of compensation. No interest shall                                 be payable on any compensation payment.U.K.

#### Appendix III**TERMS OF REFERENCE FOR CAPACITY AND COUNTRY OPINIONS**

##### TERMS OF REFERENCE FOR CAPACITY OPINIONS FOR DCA HOLDERS IN TARGET2U.K.

The European Central Bank

Sonnemannstrasse 20

60314 Frankfurt am Main

Germany

**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 DCA holder or branch                              of DCA holder] in respect of issues arising under the laws of [jurisdiction in which the DCA holder is established; hereinafter                              the “jurisdiction”] in connection with the participation of [specify name of DCA holder] (hereinafter the “DCA holder”) in                              the TARGET2-ECB (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 DCA holder acts through its head office or one or more branches established inside or outside of [jurisdiction]                              in submitting liquidity transfer orders and receiving liquidity transfers.                           

###### I.DOCUMENTS EXAMINEDU.K.

For the purposes of this Opinion, we have examined:

a certified copy of the [specify relevant constitutional documents] of the DCA holder such as is/are in effect on the date                                       hereof;                                    

[if applicable] an extract from the [specify relevant company register] and [if applicable] [register of credit institutions                                       or analogous register];                                    

[to the extent applicable] a copy of the DCA holder's licence or other proof of authorisation to provide banking, investment,                                       funds transfer or other financial services in [jurisdiction];                                    

[if applicable] a copy of a resolution adopted by the board of directors or the relevant governing body of the DCA holder                                       on [insert date], [insert year], evidencing the DCA holder's agreement to adhere to the System Documents, as defined below;                                       and                                    

[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 DCA holder];                                    

and all other documents relating to the DCA holder's constitution, powers, and authorisations necessary or appropriate for                              the provision of this Opinion (hereinafter the “DCA holder's Documents”).                           

For the purposes of this Opinion, we have also examined:

the terms and conditions for the Opening and Operation of a Dedicated Cash Account in TARGET2-ECB (hereinafter the “Rules”);                                       and                                    

[...].

The Rules and the [...] shall be referred to hereinafter as the “System Documents” (and collectively with the DCA holder's Documents                              as the “Documents”).                           

###### II.ASSUMPTIONSU.K.

For the purposes of this Opinion we have assumed in relation to the Documents that:

the System Documents with which we have been provided are originals or true copies;

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];                                    

the DCA holder's 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                                    

the DCA holder's 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 DCA HOLDERU.K.

###### A.The DCA holder is a corporation duly established and registered or otherwise duly incorporated or organised under the laws                                 of [jurisdiction].U.K.

###### B.The DCA holder has all the requisite corporate powers to execute and perform the rights and obligations under the System Documents                                 to which it is party.U.K.

###### C.The adoption or execution and the performance by the DCA holder of the rights and obligations under the System Documents to                                 which the DCA holder is party will not in any way breach any provision of the laws or regulations of [jurisdiction] applicable                                 to the DCA holder or the DCA holder Documents.U.K.

###### D.No 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] are required by the DCA holder                                 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.U.K.

###### E.The DCA holder 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.U.K.

This Opinion is stated as of its date and is addressed solely to the ECB and the DCA holder. 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 DCA HOLDERS IN TARGET2U.K.

The European Central Bank

Sonnemannstrasse 20

60314 Frankfurt am Main

Germany

**TARGET2-ECB**                            

[location],

[date]

Dear Sir or Madam,

We have been asked as [external] legal advisers to [specify name of DCA holder or branch of DCA holder] (the “DCA holder”)                              in respect of issues arising under the laws of [jurisdiction in which the DCA holder is established; hereinafter the “jurisdiction”]                              to provide this Opinion under the laws of [jurisdiction] in connection with the participation of the DCA holder 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 [jurisdiction], with particular regard to the                              DCA holder 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 EXAMINEDU.K.

For the purposes of this Opinion, we have examined the documents listed below and such other documents as we have deemed necessary                              or appropriate:                           

the terms and conditions for the Opening and Operation of a Dedicated Cash Account in TARGET2] for the System dated [insert                                       date] (hereinafter the “Rules”); and                                    

any other document governing the System and/or the relationship between the DCA holder and other participants in the System,                                       and between the participants in the System and the ECB.                                    

The Rules and the [.] shall be referred to hereinafter as the “System Documents”.

###### 2.ASSUMPTIONSU.K.

For the purposes of this Opinion we have assumed in relation to the System Documents that:

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;                                    

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];                                    

the documents submitted to us in copy or as specimens conform to the originals.

###### 3.OPINIONU.K.

Based on and subject to the foregoing, and subject in each case to the points set out below, we are of the opinion that:

###### 3.1**Country-specific legal aspects [to the extent applicable]**U.K.

The following characteristics of the legislation of [jurisdiction] are consistent with and in no way set aside the obligations                              of the DCA holder arising out of the System Documents: [list of country-specific legal aspects].                           

###### 3.2**General insolvency issues**U.K.

###### 3.2.a.*Types of insolvency proceedings*U.K.

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 DCA holder's assets or any branch it may have in [jurisdiction] to which the                              DCA holder 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 DCA holder, 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 payment orders to and/or from the DCA holder may be suspended, or limitations can be imposed in relation to such payment                              orders, or similar proceedings in original language and English translation] (hereinafter collectively referred to as “Proceedings”).                           

###### 3.2.b.*Insolvency treaties*U.K.

[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**U.K.

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 DCA holder.                           

In particular, we are of the opinion that:

###### 3.3.a.*Processing of liquidity transfer orders*U.K.

The provisions on processing of liquidity transfer orders [list of sections] of the Rules are valid and enforceable. In particular,                              all liquidity transfer 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 liquidity transfer orders                              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 ECB to perform its functions*U.K.

The opening of Insolvency Proceedings or Proceedings in respect of the DCA holder will not affect the authority and powers                              of the ECB 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 DCA holders with services directly and necessarily required for participation                              in the System, e.g. network service providers].                           

###### 3.3.c.*Remedies in the event of default*U.K.

[Where applicable to the DCA holder, the provisions contained in the Rules regarding accelerated performance of claims which                              have not yet matured, the set-off of claims for using the deposits of the DCA holder, the enforcement of a pledge, suspension                              and termination of participation, claims for default interest, and termination of agreements and transactions are valid and                              enforceable under the laws of [jurisdiction].]                           

###### 3.3.d.*Suspension and termination*U.K.

Where applicable to the DCA holder, the provisions contained in the Rules (in respect of suspension and termination of the                              DCA holder'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 DCA holder represents any kind of systemic risk or has serious operational problems)                              are valid and enforceable under the laws of [jurisdiction].                           

###### 3.3.e.*Assignment of rights and obligations*U.K.

The rights and obligations of the DCA holder cannot be assigned, altered or otherwise transferred by the DCA holder to third                              parties without the prior written consent of the ECB.                           

###### 3.3.f.*Choice of governing law and jurisdiction*U.K.

The provisions contained in 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**U.K.

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 DCA holder 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 transfer orders submitted                              by any participant in the System. In particular, we are of the opinion that the provisions of the Rules establishing the enforceability                              and irrevocability of transfer orders will be valid and enforceable and that a transfer order submitted by any participant                              and processed pursuant to the Rules may not be set aside in any Insolvency Proceedings or Proceedings as a preference, voidable                              transaction or otherwise under the laws of [jurisdiction].                           

###### 3.5**Attachment**U.K.

If a creditor of the DCA holder 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 DCA holder'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]**U.K.

###### 3.6.a.*Assignment of rights or deposit of assets for collateral purposes, pledge and/or repo*U.K.

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 Rules 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*U.K.

In the event of Insolvency Proceedings or Proceedings in respect of the DCA holder, the rights or assets assigned for collateral                              purposes, or pledged by the DCA holder in favour of the ECB or other participants in the System, will rank in priority of                              payment above the claims of all other creditors of the DCA holder and will not be subject to priority or preferential creditors.                           

###### 3.6.c.*Enforcing title to security*U.K.

Even in the event of Insolvency Proceedings or Proceedings in respect of the DCA holder, other participants in the System                              and the ECB as [assignees, pledgees or repo purchasers as applicable] will still be free to enforce and collect the DCA holder's                              rights or assets through the action of the ECB pursuant to the Rules.                           

###### 3.6.d.*Form and registration requirements*U.K.

There are no form requirements for the assignment for collateral purposes of, or the creation and enforcement of a pledge                              or repo over the DCA holder'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 [jurisdiction].                           

###### 3.7**Branches [to the extent applicable]**U.K.

###### 3.7.a.*Opinion applies to action through branches*U.K.

Each of the statements and opinions presented above with regard to the DCA holder applies with equal accuracy and validity                              under the laws of [jurisdiction] in situations where the DCA holder acts through its one or more of its branches established                              outside [jurisdiction].                           

###### 3.7.b.*Conformity with law*U.K.

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 DCA holder will in any respect breach the laws of [jurisdiction].                           

###### 3.7.c.*Required authorisations*U.K.

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 DCA holder 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 ECB and the DCA holder. 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]

#### Appendix IV**BUSINESS CONTINUITY AND CONTINGENCY PROCEDURES**

##### 1.**General provisions**U.K.

###### (a)This Appendix sets out the arrangements between the ECB and DCA holders, if one or more components of TARGET2 or a network                                 service provider fail or are affected by an abnormal external event, or if the failure affects any DCA holder.U.K.

###### (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) (**).U.K.

##### 2.**Measures of business continuity**U.K.

###### (a)In the event that an abnormal external event occurs and/or there is a failure of the SSP, the T2S Platform or a network service                                 provider which affects the normal operation of TARGET2, the ECB shall be entitled to adopt business continuity measures.U.K.

###### (b)The following main business continuity and contingency measures shall be available for the SSP:U.K.

relocating the operation of the SSP to an alternative site;

changing the SSP's operating hours; and

initiating contingency processing of very critical and critical payment orders, as defined in paragraph 6(c) and (d) of Appendix                                       IV to Annex II.                                    

###### (c)The following main business continuity and contingency measures shall be available for the T2S Platform:U.K.

relocating the operation of the T2S Platform to an alternative site;

rescheduling events in the T2S Settlement day.

###### (d)In relation to business continuity processing measures, the ECB shall have full discretion regarding what measures are adopted.U.K.

##### 3.**Incident communication**U.K.

###### (a)Information about a failure of the TARGET2 and/or an abnormal external event shall be communicated to DCA holders through                                 the domestic communication channels, the ICM, the T2S GUI and the T2S-information system as defined in the T2S UDFS. In particular,                                 communications to DCA holders shall include the following information:U.K.

a description of the event;

the anticipated delay in processing (if known);

information on the measures already taken.

###### (b)In addition, the ECB may notify DCA holders of any other existing or anticipated event which has the potential to affect the                                 normal operation of TARGET2.U.K.

##### 4.**Relocation of the operation of the SSP and/or T2S Platform to an alternative site**U.K.

###### (a)In the event that any of the events referred to in paragraph 2(a) occurs, the operation of the SSP and/or the T2S Platform                                 may be relocated to an alternative site, either within the same region or in another region.U.K.

###### (b)In the event that the operation of the T2S Platform is relocated to another region, the DCA holders shall (i) refrain from                                 sending new instructions to the T2S Platform and (ii) at the request of the ECB perform a reconciliation and resubmit any                                 instructions identified as missing submitted within a maximum of five minutes prior to the time of failure or the occurrence                                 of the abnormal external event and provide the ECB with all relevant information in this respect.U.K.

##### 5.**Change of operating hours**U.K.

###### (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 this Appendix.U.K.

###### (b)TARGET2 daytime processing may be extended and the closing time thereby delayed, if a T2S Platform or 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 DCA holders. Once such a delay is announced it may not be withdrawn.U.K.

##### 6.**Failures linked to DCA holders**U.K.

###### (a)In the event that a DCA holder has a problem that prevents it from settling payment orders in TARGET2-ECB, it shall be its                                 responsibility to resolve the problem.U.K.

###### (b)In the event that a DCA holder unexpectedly submits an abnormally high number of messages, which threaten the stability of                                 the T2S Platform, and does not, upon request of the ECB, refrain from such behaviour without delay, the ECB may block from                                 the T2S Platform all further messages submitted by such DCA holder.U.K.

##### 7.**Other provisions**U.K.

###### (a)In the event of a failure of the ECB, some or all of its technical functions in relation to TARGET2-ECB may be performed by                                 other Eurosystem CBs.U.K.

###### (b)The ECB may require that the DCA holders 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 ECB. Any costs incurred by the DCA holders                                 as a result of such testing or other arrangements shall be borne solely by the DCA holders.U.K.

#### 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, 25 December and 26 December.U.K.

##### 2.The reference time for the system is the local time at the seat of the ECB, i.e. CET (**).U.K.

##### 3.The current business day is opened during the evening of the previous business day and operates according to the schedule                                 set out in the T2S Scope Defining Set of Documents.U.K.

##### 4.The T2S Platform is available for U2A and A2A mode during the whole settlement day, except during the technical maintenance                                 period from 03:00 until 05:00. During the technical maintenance period messages sent using the A2A mode will be queued. It                                 will not be possible to submit messages via the U2A mode.U.K.

##### 5.The operating hours may be changed in the event that business continuity measures are adopted in accordance with paragraph                                 2 of Appendix IV.U.K.

##### 6.An overview of the operating hours and significant business events during the day is shown in the following table:U.K.

###### *Notes to table:*U.K.

###### (1)Plus 15 minutes on the last day of the reserve maintenance period.U.K.

###### (2)Over a weekend or on a holiday, the technical window will last throughout the weekend or the holiday, i.e., from 22:00 on                                 Friday until 1:00 on Monday or, in the case of a holiday, from 22:00 on the last business day until 1:00 on the next business                                 day.U.K.

###### (3)Over a weekend or on a holiday, the technical window will last throughout the weekend or the holiday, i.e., from 03:00 a.m.                                 on Saturday until 05:00 a.m. on Monday or, in the case of a holiday, from 03:00 a.m. on the holiday until 05:00 a.m. on the                                 next business day.U.K.

###### (4)Real-time settlement preparation and real-time settlement may start before the maintenance window if the last night-time settlement                                 cycle ends before 03:00 am.U.K.

###### (5)Each partial settlement window lasts for 15 minutes. The partial settlement applies to unsettled payment instructions eligible                                 for partial settlement and that have failed to settle due to a lack of securities.U.K.

#### Appendix VI**FEE SCHEDULE**

##### **Fees for T2S services**U.K.

The following fees for T2S services connected with DCAs shall be charged to the Main PM account holders:

###### (*)Guideline ECB/2012/27 of 5 December 2012 on a Trans-European Automated Real-time Gross settlement Express Transfer system                                 (TARGET2) (OJ L 30, 30.1.2013, p. 1).U.K.

###### (**)CET takes into account the change to Central European Summer Time.”U.K.

1

Guideline (EU) 2015/930 of the European Central Bank of 2 April 2015 amending Guideline ECB/2012/27 on a Trans-European Automated                              Real-time Gross settlement Express Transfer system (TARGET2) (ECB/2015/15) (see page 38 of this Official Journal).                           

2

Guideline ECB/2012/27 of 5 December 2012 on a Trans-European Automated Real-time Gross settlement Express Transfer system                              (TARGET2) (OJ L 30, 30.1.2013, p. 1).                           

3

Decision ECB/2007/7 of 24 July 2007 concerning the terms and conditions of TARGET2-ECB (2007/601/EC) (OJ L 237, 8.9.2007, p. 71).                           

4

Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit                              institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1).’