Malaysia launched its first carbon market on Friday, aiming to give companies the option to offset greenhouse-gas emissions amid growing interest in carbon trading in Asia's financial centers.

The Bursa Carbon Exchange will permit the trade of voluntary carbon credits from projects that result in the avoidance, reduction or removal of greenhouse gas emissions, Bursa Malaysia, the exchange's operator, said.

The spot exchange, part of Malaysia's efforts to achieve net-zero greenhouse gas emissions by 2050, expects to begin its first trading via auction in March. Bursa Malaysia didn't specify which projects and companies plan to take part in the auction.

The carbon exchange is also Shariah-compliant, the first in the world to have that distinction, Bursa Malaysia said.

Muhamad Umar Swift, chief executive of Bursa Malaysia, described the launch as timely "given the growing impact of global warming, and the important role voluntary carbon markets will play to support financing for climate-friendly projects and solutions."

The launch comes as other trading hubs in Asia advance carbon markets of their own. Singapore has two such bourses, while Hong Kong launched a platform for the trading of voluntary credit credits in October.

The Accelerated Settlement Taskforce has been launched by the UK Government to explore the potential for faster settlement of financial trades.

Chancellor of Exchequer Jeremy Hunt formed the taskforce, which will be led by Charlie Geffen, former senior partner at law firm Ashurst and current senior adviser at consultancy Flint Global.

The industry taskforce will examine the case for trades to be settled more quickly in the UK, such as moving to a T+1 standard settlement period. The settlement period has shortened in recent decades in line with the capabilities of modern technology. The most common standard at present is T+2 — which requires most trades to be settled two days after the trade date, with some exceptions.

T+2 has been in place for the UK and the European Union since 2014, with the US transitioning to T+2 in 2017.

The US and Canada intend to move to T+1 by 2024, which would require most trades to settle the day after the trade date. India has already begun a gradual rollout of T+1 in the share trading market.

As the UK Government considers moving to T+1, it lays out four key objectives for the taskforce to undertake during its work.

The taskforce will explore the case for moving to an accelerated settlement cycle in the UK and outline how this could be implemented. It will evaluate current settlement performance across the UK sector, as well as assess potential improvements and reforms.

Furthermore, the taskforce aims to engage with the wider financial services sector while undertaking this work and will provide recommendations, including how any changes should be implemented by industry, regulators and government, and what the appropriate timetable should be.

The taskforce will publish its initial findings by December 2023, with a full report and recommendations made by December 2024.

he Depository Trust & Clearing Corporation (DTCC), the premier post-trade market infrastructure for the global financial services industry, today announced that its Alternative Investment Product (AIP) service has reached a new milestone, successfully processing over 500 million transactions since its inception as service adoption continues to increase. Today, AIP has over 8,000 unique funds leveraging the automated service to modernize trading and post-trade reporting of alternative investment products.

"DTCC is pleased to have reached this important milestone in our AIP business,” said Ann Bergin, DTCC Managing Director and General Manager, Wealth Management Services and Asset Services. “There has been remarkable growth in alternatives and AIP’s automation and standardization have provided a more efficient, scalable model supporting increased volumes. With AIP, firms can eliminate manual transactions, speed processes and lower operational risks and costs with increased transparency.”

DTCC’s AIP service is a central, standardized trading and reporting platform that links the alternative investments industry to exchange data, securely and efficiently. The service includes centralized money settlement for orders, distributions and other financial activity. AIP is strategically situated between product providers or issuers and distributors, acting as a transaction processing and trade execution channel.

Added Bergin, “AIP supports our clients as they navigate the complexities of the alternatives marketplace. DTCC looks forward to continuing to partner with our alternative investment clients, and in further enhancing the AIP service, delivering new and increased value for an evolving industry.”

The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has today published a Final Report including Guidelines on standard templates, forms and formats to apply for permission to operate a DLT market infrastructure.

These Guidelines include templates to be used by market participants to apply for specific permission to operate any type of DLT market infrastructure (DLT MI) under the DLT Pilot Regulation (DLTR), namely: a DLT MTF, a DLT settlement system or a DLT trading and settlement system. They also include templates for the applicants DLT MIs to request limited exemptions from specific requirements under MiFIR, MiFID II or CSDR, provided they comply with certain conditions. Instructions on how to submit this information should be published by the national competent authorities on their website.

Applicants are strongly encouraged to anticipate the formal entry into force of the guidelines, and to refer to the Guidelines included in this Final Report and liaise with their national competent authority to prepare their application for permission to operate a DLT MI.

The Final Report takes into account responses received to the Public Consultation conducted in July and August 2022.

Next steps

The Guidelines will be published on the ESMA website in the EU official languages in the coming weeks. The comply or explain procedure for authorities will follow, in accordance with Article 16(3) of ESMA Regulation. The Guidelines will enter into force on 23 March 2023.