Issuance of the Euro-MTN programme in Italy

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Advantages of issuing in dematerialised form

The need to overcome barriers to efficiency and to identify areas of harmonisation in the bond issuance process has been highlighted by several market initiatives, including the recent activities of the European Central Bank’s Debt Issuance Market Contact Group (DIMCG).

The DIMCG has identified complexities in the issuance process, from pre-trade through to post-trade, and additional features of the issuance process that could benefit from efficiency improvements and cost reduction. In particular, the group has highlighted the benefits of increased digitalisation of the issuance process and the need to remove conflicts of laws issues which, among others, could be perceived as obstacles to the full dematerialisation of debt securities in the international market.

In this paper we analyse Italian issuers’ issuance practices in the Eurobond market – especially the use of the Global Note form – with the purpose of clarifying certain conflicts of law aspects that over time have been considered as preventing the issuer from choosing full dematerialisation.  It also describes the advantages of dematerialisation, from operational and legal simplification, to the significant enhancement of issuance digitalisation and lifecycle management.