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ESMA CSA on the risk management function
The European Securities and Markets Authority (ESMA) launched a Common Supervisory Action (CSA) on the risk management function of UCITS management companies and alternative investment fund managers (AIFMs) across the European Union. The CSA will be conducted throughout 2026 and 2027, in close collaboration with national competent authorities (NCAs).
The objective of the CSA is to assess how market participants comply with key risk–related provisions under the UCITS and AIFMD frameworks. The focus will be on the effectiveness, independence and expertise of the risk management function.
ESMA’s press release emphasises that risk management is a core function of investor protection and financial stability. It ensures that material risks, such as market, credit, liquidity, counterparty, and operational risks, are properly identified, measured, monitored and managed.
NCAs will focus on three key areas:
Throughout the exercise, NCAs will share knowledge and supervisory experiences through ESMA, further supporting supervisory convergence in the oversight of risk management function.
ESMA will publish a final report with the results of the exercise in 2028.
EMIR 3 active account requirement
ESMA published preliminary findings on the implementation and effectiveness of the EMIR 3 Active Account Requirement, together with the first annual report of the Joint Monitoring Mechanism. ESMA reported that approximately 500 entities had notified ESMA and their national competent authorities that they were subject to the requirement by February 2026. These entities accounted for more than 90% of the notional outstanding held by EU entities within scope.
ESMA identified early signs of increased clearing activity at EU CCPs, particularly among smaller entities, although the movement of market share away from systemically important third–country CCPs remained gradual and limited. Entities subject to the requirement were also required to make their first regulatory submission by 31 July 2026 using ESMA’s prescribed reporting templates.
Fund managers and funds falling within scope should ensure that their AAR analysis, notifications, account operationalisation, representativeness testing and regulatory submissions are appropriately documented.
ESMA transaction reporting simplification report
ESMA published its final report on simplifying financial transaction reporting under MiFIR, EMIR and SFTR. ESMA recommends moving in the longer term towards an integrated “report once” framework, supported by shorter–term measures to reduce duplication, reconciliation requirements and the impact of unsynchronised regulatory changes.
The recommendations do not make immediate changes to firms’ reporting obligations. However, they indicate the likely direction of future EU reform and may ultimately affect reporting models, data standards, delegated reporting arrangements and relationships with trade repositories and other reporting service providers.
T+1 settlement
ESMA has published a statement highlighting key deadlines and action points to be ready for the transition to a T+1 settlement cycle in EU financial markets. With the move scheduled for 11 October 2027, ESMA underlines that 2026 is a critical year for market participants to finalise their preparations. The statement outlines key milestones, including the first regulatory deadline on 7 December 2026 for allocations and confirmations processes.
For more information on these topics please contact any member of A&L Goodbody's Asset Management & Investment Funds team.
Date published: 12 August 2026