On Monday, 11 July 2016, the Johannesburg Stock Exchange (“JSE”) launched a T+3 settlement cycle. This is in line with international best practice and moves away from the previous standard T+5 settlement cycle. The result is that settlement, payment and funds release in respect of securities trades will be done in a total of four days, as opposed to six days (as was previously the case). The move is the culmination of a project initiated by the JSE in 2013.

T+3 settlement is expected to mitigate systemic and settlement risk, as well as increase market liquidity and transaction volume. Quicker settlement may also provide market participants with opportunities to participate in the securities lending market (particularly as the JSE seeks to identify potential lenders to assist with covering failed trades) and improve structured transactions and/or mitigate settlement and counterparty risk on securities trades.

Clients with existing trade documentation referencing, or otherwise depending on, the T+5 settlement cycle should take note of the change and determine whether this documentation needs to be revisited.

For assistance or more information, please contact:

Kelle Gagné

banking and finance foreign legal counsel - admitted in New York

[email protected]

+27 82 853 4312