The European Central Bank has issued on 29 July 2010, a Decision establishing that Central Banks will have access to transaction-level data on all participants of all TARGET2 components extracted from TARGET2 for the purposes of ensuring the efficient functioning of TARGET2 and its oversight. The nature of the data and operations managed under TARGET2 makes it necessary to preserve the highest level of confidentiality.

According to the European Central Bank Decision, Central Banks access to transaction-level data of all TARGET2 participants should be limited to what is necessary to enable the Central Banks, as operators and as overseers of TARGET2 System, to conduct quantitative analyses of transaction flows between TARGET2 participants or to make numerical simulations of the settlement process of TARGET2. Such Bank access should exclude all information on the participants’ customers except where such customers are indirect participants or addressable BIC holders.

It is of the utmost importance to preserve the confidentiality of transaction-level data. For this purpose, access to and use of transaction-level data should be limited to a small group of designated staff members from the Central Banks. In addition to the rules on professional conduct and confidentiality applicable to Central Banks staff members, the Payments and Settlement Systems Committee (PSSC) of the European System of Central Banks should establish specific rules for access to and use of transaction-level data.

The Decision sets forth that for each Central Bank, access to the data and their use for quantitative analyses and numerical simulations will be limited to one staff member and up to three alternates for both operation and oversight of TARGET2, respectively. The staff members and their alternates will be staff members dealing with the operation of TARGET2 and with market infrastructure oversight.

TARGET2

TARGET2 functions on the basis of a single technical platform called the Single Shared Platform (SSP), operated by the Deutsche Bundesbank, the Banque de France and the Banca d’Italia. It is legally structured as a multiplicity of real-time gross settlement systems, each of which is a TARGET2 component operated by a Eurosystem central bank.

The Eurosystem oversees TARGET2, with the ECB taking the lead.