STANDARDISATION CONVERGENCE: A CHINESE PUZZLE l HOW TO COMBINE IN THE SHORT, MEDIUM and LONG TERM? –Concrete and pragmatic solutions –Convergence within the financial domain –Harmonisation between finance and other domains

What is the right way? How to combine all pieces? Who will get a rabbit out of his hat?

REMIND YOU THREE YEARS AGO l For banks: –SWIFT was standardising bank to bank –TBG 5 was standardising bank to client –ISO TC 68 Finance was focusing on limited areas –Most of the representatives in one of these organisations didn't even know they had colleagues representing their bank in other organisations l For clients: –Treasurers didn't know they had company experts in UN/CEFACT and vice versa

SINCE THEN l ADOPTION of a COMMON METHODOLOGY –Defined by UN/CEFACT & OASIS, –Standardised as ISO in ISO TC154 –But standardised also in parallel l in ISO TC68 Finance, l firstly for securities, l called ISO version 2, changed recently to ISO l slightly different from ISO 15000

Reminder on standardisation TARGET for FINANCE l To enable communication interoperability between: –financial institutions, –their market infrastructures and –their end-user communities l But, most of end-user companies are not members of the financial sphere =>

FINANCE IS NOT AN ISOLATED ISLAND

Facing the risk of multiple standards l Within Finance, with so many (>40) standardisation organisations l Outside Finance, in the cross-domain environment l An increasing need of cross-domain interoperability because of: –the desire for end to end STP –more and more actors involved in one operation

Examples of cross-domain projects between finance and other UN/CEFACT l E-Invoice l Remittance Advice l Electronic Tendering l Accounting Token Projects not directly financial, but often with links

WHICH GIVES THE FOLLOWING SITUATION l Solutions developed by SWIFT: available for clients l A unique methodology for finance, presently slightly different from UN/CEFACT l A new ongoing organisation for financial standardisation l A risk of competitive standards l A clear willing for cross-domain harmonisation, especially with UN/CEFACT, which requires time and agreements

AVAILABLE SOLUTIONS IN SWIFT Lien hypertexte

ONGOING ACTIONS l Finance has engaged two complementary actions: –CONVERGENCE within the financial sphere –HARMONISATION essentially with UN/CEFACT

CONVERGENCE l ISO 20022, also called UNIFI, approved for all finance –Registration Management Group (RMG) created in January –Standards Evaluation Groups (SEGs) to be created l Payments, Securities: immediately l Treasury, Trade Finance l ISO TC68 becoming the hub for finance –40 organisations to convince –New organisation to be finalised and efficient

HARMONISATION with UN/CEFACT l Already started or agreed: –Agreement signed in June 2004: TC68, TBG5 & SWIFT –Ongoing convergence work plan for Core Components l Gap analysis, investigates changes, submit recommendations,… –June's co-operation agreement confirmed by RMG –Immediate submission of a pilot project approved by RMG l Still to be done: –Research of compatibility between workflows –Organisation of registries between ISO and UN/CEFACT

WHICH INTEREST for UN/CEFACT? l Co-operate as much as possible with domains standardising more outside than inside UN/CEFACT (Finance, Transportation, Customs, Insurance, …) to facilitate cross-domain exchanges. Not specifically for Finance. l Pull other organisations with same methodology l Lead standardisation process... –Uniqueness of the methodology –Uniqueness of a logical repository l … without appearing as dictatorial

TBG 5 ROLE: Interface Data Dictionary Business Process Catalogue ebXML Registry / Repository Core Components Common Business Processes ISO TC68 Finance UN/CEFACT All industries UNIFI ISO UN TBG5

Bi-directional Roles for TBG5 l From financial sphere to inter-sectorial: Guarantee financial standards are recognised and unique –Be the supporting/forwarding arm for all sub-domains –Support forum harmonisation and validation –Market financial solutions within TBG –Market messages to clients l From UN/CEFACT to financial sphere: –Bring expertise in "ebXML" and methods –Be a pool for resources in customer to bank & payments –Support evolution of forum workflow to facilitate the workflow with external organisations (ISO 20022, but also GS1 (EAN), WCO, …)

Finally? Which organisation is doing what? l There are various types of standardisation organisations l None of them will disappear quickly l It is then required to adapt roles to the new situation l Based on the acceptance of: –unique methodology –unique registry –(partial lost of independence)

Roles of Organisations l World-wide & cross-domain Organisations : ISO, UN/CEFACT –Definition of methods –Responsible for transversal coherence (registry) l World-wide domain Organisations : SWIFT –A standardisation body for banks –Operator: RA + Modelling l Business Requirements: IST, TWIST, RosettaNet, FpML,... l Regional Coherence: –Cross-sectorial: CEN, eBES, ANSI, –Sectorial : EPC, ECBS

FINALLY, WHY THIS PRESENTATION? l To show that there are solutions available l To explain the approach followed in the Financial Sphere to minimise divergences in standards –because Finance is surely not alone to face similar issues –and because it could require some flexibility in UN/CEFACT rules l Because some issues require UN/CEFACT participation

UN/CEFACT PARTICIPATION l Reception of the first submitted project, Payment Initiation: –Follow up the normal approval workflow, –but with an open mind to detect potential improvement(s) for this workflow l Participate to the convergence work plan : TBG 5 & 17 + ICG (federated registry) + to be defined. l Find consensus solutions for cross domain projects l Agree on a common message with clients: no purist quarrels!

WHICH PRESENTATION FOR CLIENTS? l Proprietary solutions are already available l Standardisation under ISO is ongoing l Standardisation in UN/CEFACT is ongoing l Some user organisations are supporting Payment Initiation as developed by SWIFT l But ISO is not aligned on ISO TC154 l A convergence work plan is on-going l Users can -depending on the market they are in- in cooperation with their customers assess the situation and start using solutions available with the potential risk of having to migrate once the standardisation & convergence activities are finalised

Pending Questions l Interoperable or unique standards? l A unique federated repository? ISO being one decentralised part? l Which solution for client - bank secured exchanges in parallel with MA CUGs? AS2? l ????