Tracker, Financial Services Regulation & Compliance - Investment Firms


ESMA confirms renewal of Greek HCMC short selling ban

The European Securities and Markets Authority (ESMA) renewed the prohibition on emergency short selling in Greece. The ban took effect on 4 August 2015 and remains in place until 24:00:00 (CET) on 31 August 2015. It temporarily prohibits transactions in any financial instrument that creates, or increases, a net short position on any of the shares admitted to trading on the Athens Exchange and Multilateral Trading Facility. The renewal differs from the previous restrictions as it includes an exemption for market makers as the Greek financial markets are now open and market making activities are important providers of liquidity for the Greek shares, as well as for warrants, derivatives, index derivatives and ETF related to Greek shares.

ESMA opens a public consultation on Article 26 of its RTS (153/2013) under the European Market Infrastructure Regulation (EMIR) which deals with CCPs’ client accounts

In particular, responses are sought from central counterparties (CCPs), their clearing members as well as the financial and non-financial counterparties accessing CCP services as clients of clearing members with the view to drafting a revised regulation if determined necessary. Responses are being accepted until 30 September, 2015.

ESMA recommends changes to EMIR framework

The European Securities and Markets Authority (ESMA) published four reports focused on how the European Markets Infrastructure Regulation (EMIR) framework has been functioning and providing input and recommendations to the European Commission’s EMIR Review. Three of the reports are required under Article 85 of EMIR, and cover non-financial counterparties (NFCs), pro-cyclicality and the segregation and portability for central counterparty clearing houses (CCPs). The fourth report responds to the Commission’s Review including recommendations on amending EMIR in relation to the clearing obligation, the recognition of third country CCPs and the supervision and enforcement procedures for trade repositories.

ESMA advises Commission on implementation of CSD Regulation

The European Securities and Markets Authority (ESMA) has delivered the Technical Advice on the level of penalties for settlement fails, and the substantial importance of a Central Securities Depository (CSD) for the functioning of the securities markets and the protection of the investors in a host Member State, as well as the related Impact Assessment. The technical advice will assist the Commission on the possible content of the delegated acts required by the CSDR.

ESMA publishes responses received to the call for evidence on the impact of best practice principles

The European Securities and Markets Authority (ESMA) published the responses received to its call for evidence on the Impact of the Best Practice Principles for Providers of Shareholder Voting Research and Analysis. Responses came from a wide array of financial services providers including asset management firms, investment services firms, issuers and the insurance sector.

ESMA announces new Consultative Working Group for the Investment Protection and Intermediaries Standing Committee

Following the call for interest for the renewal of the Consultative Working Group for the Investor Protection and Intermediaries Standing Committee, ESMA announced the composition of the new group. The Standing Committee is responsible for developing and providing technical advice to the European Commission, and for preparing technical standards, guidelines and recommendations relating to the provisions of the Markets in Financial Instruments Directive (MiFID) applicable to investment services and activities. This includes, for example, the authorisation of investment firms, conduct of business, organisational arrangements and pass-porting.

EBA launches a public consultation on exemption of NFCs from CVA risk charge

The EBA launched a public consultation on Regulatory Technical Standards (RTS) on the procedures for excluding transactions with non-financial counterparties (NFCs) established in a third country from the own funds requirement for credit valuation adjustment risk. The proposed RTS align the treatment of NFCs established in a third country with the treatment of EU NFCs. As in some instances, it could be disproportionate to require NFCs established in a third country to compute the EMIR clearing threshold at the inception of each trade, the EBA is consulting on two options, the first one requires institutions to meet the requirements of these RTS at trade inception, while the second option introduces a quarterly frequency for institutions' due diligence requirements. The consultation runs until 5 November 2015 with a public hearing on 12 October 2015.

Commission passes delegated regulation on central clearing for interest rate derivatives

The European Commission adopted the first delegated regulation to implement the clearing obligation under the European Market Infrastructure Regulation (EMIR) that makes it mandatory for certain over-the-counter (OTC) interest rate derivative contracts to be cleared through central counterparties. It covers interest rate swaps denominated in euro, pounds sterling, Japanese yen or US dollars that have specific features, including the index used as a reference for the derivative, its maturity, and the notional type (i.e. the nominal or face amount that is used to calculate payments made on the derivative).The clearing obligations will enter into force subject to scrutiny by the European Parliament and Council of the EU and will be phased in over three years to allow additional time for smaller market participants to begin complying.

For further information please contact a member of the Financial Regulation team.

Date published: 04 September 2015