Oversight of CLS and Target2 is based on the international Principles for Financial Market Infrastructures and takes place in accordance with Danmarks Nationalbank's Policy for Oversight of the Danish Financial Infrastructure.
The Federal Reserve System (Fed) is the primary oversight authority of CLS. The central banks of the currencies connected to CLS, including Danmarks Nationalbank, have joint oversight powers over CLS and participate in the CLS Oversight Committee. The cooperative oversight has been formalised in a Protocol for the Cooperative Oversight Arrangement of CLS. Danmarks Nationalbank's oversight is focused on matters of importance to the settlement of transactions in Danish kroner.
The European Central Bank (ECB) is the primary oversight authority of Target2. Danmarks Nationalbank participates in the cooperative oversight of the system and is responsible for oversight of the Danish Target2 components, including the Danish connection to the system and the national helpdesk for Danish participants.
The activities in relation to current oversight of CLS and Target2 are described in the annual oversight report, Oversight of the Financial Infrastructure.