ESMA updates Q&A on EMIR. The European Securities and Markets Authority updated its questions and answers on the European Markets Infrastructure Regulation to include new information on the clearing obligation and clarifications on how counterparties should address situations where some of their counterparties fail to identify their categorization. (6/6/2016) ESMA press release.
ESMA report examines order duplication and liquidity in the EU equity markets.ESMA released an economic report on order duplication and liquidity measurement in the European Union equity markets. The report found that overall multi-venue trading has increased liquidity in the EU equity markets but 20 percent of orders across European venues are duplicated and nearly a quarter of duplicated trades are immediately cancelled if unmatched, resulting in an overestimation of available liquidity in fragmented markets. (6/6/2016) ESMA press release.
FCA responds to preliminary recommendations from CMA’s retail banking market investigation. The UK Financial Conduct Authority responded to the Competition and Markets Authority’s provisional decision of remedies related to its retail banking market investigation, which proposes several reforms to protect overdraft users and foster competition in personal current accounts and in banking services for small and medium-sized enterprises. The FCA confirmed initial support for the recommendations and announced plans to publish a response with details about the work it will undertake to address the CMA’s concerns after the CMA finalizes its investigation. (6/3/2016) FCA press release.
ESMA updates Q&A guidance on AIFMD. ESMA updated its questions and answers on the application of the Alternative Investment Fund Managers Directive to include new information regarding the domicile of EU Alternative Investment Funds marketed in the AIF Manager’s home Member state, the marketing of EU feeder AIFs, and the influence of committed capital on the calculation of the total value of assets under management and additional own funds. (6/3/2016) ESMA press release.
ECB announces final details of CSPP. The European Central Bank announced the final details of the corporate sector purchase program, which is set to begin on June 8, 2016. The ECB clarified the remaining details on issuer eligibility, explained how public undertakings that meet the eligibility criteria of both the CSPP and the public sector purchase program will be categorized, and indicated that a list of the bonds purchased will be published weekly for the purpose of securities lending. (6/2/2016) ECB press release.
ESMA statement on firm responsibilities when selling bail-in securities. ESMA issued a statement that reminds banking and investment firms of their responsibilities under Banking Recovery and Resolution Directive rules to act in their clients’ best interests when selling bail-in securities by providing investors with complete information regarding risks, managing conflicts of interest, and ensuring products are suitable and appropriate for investors. (6/2/2016) ESMA press release.
ESMA consults on use of distributed ledger technologies in the securities markets. ESMA published a Discussion Paper that seeks public input regarding the potential risks and benefits of the broader use of distributed ledger technology in the securities markets. Comments are due by September 2, 2016. (6/2/2016)ESMA press release.
EBA makes final decision on data for supervisory benchmarking. The European Banking Authority issued its Decision on data for supervisory benchmarking. The Decision requires Competent Authorities to submit institutions’ data for the 2016 benchmarking exercise. Institutions must provide data to authorities by June 30, 2016. (6/2/2016) EBA press release.
ESMA offers additional Q&As on CFDs and other speculative products. ESMA updated its question and answers document on the application of the Markets in Financial Instruments Directive to the marketing and sale of financial contracts for difference and other speculative products. The updated guidance offers new information regarding the conflicts of interest that national competent authorities should consider when firms that offer speculative products to retail investors use other parties to perform activities on their behalf. (6/1/2016) ESMA press release.
EBA and EIB examine opportunities and challenges of synthetic securitization in the banking sector. The EBA and the European Investment Banking Group hosted a seminar focused on the opportunities and challenges presented by the use of credit guarantees and synthetic securitization in the banking sector. Participants discussed the development of a transparent prudential and predictable operational framework for these instruments to address existing shortages in credit supply. (5/31/2016) EBA press release.
ESMA proposes guidelines for participant default rules and procedures under the CSDR. ESMA requested comments on proposed guidelines on participant default rules and procedures under the Central Securities Depository Regulation. The proposed guidelines establish the steps that a CSD should set out in its rules and follow in the event one or more of its participants become subject to insolvency proceedings. Comments are due on or before June 30, 2016. (5/31/2016) ESMA press release.
ESMA updates Q&A on EuSEF and EuVECA. ESMA published an updated version of its questions and answers regarding the application of the European Social Entrepreneurship Funds and the European Venture Capital Funds Regulations. The revised guidance offers new information regarding the use of the designations of EuSEF and EuVECA funds when marketed only in their home Member State. (5/31/2016) ESMA press release.
ESMA offers guidance on implementation of MAR. ESMA published a new question and answer document on the implementation of the Market Abuse Regulation. The MAR Q&A addresses practical issues regarding the implementation of MAR and clarifies the scope of firms that are required to detect and report suspicious orders and transactions. (5/30/2016) ESMA press release.
ESMA publishes consultation paper on proposed implementing measures for Benchmarks Regulation. ESMA requested comments on a draft Technical Advice that proposes the regulatory framework for benchmarks under the Benchmarks Regulation. Comments are due on or before June 30, 2016. (5/27/2016) ESMA press release.
ESMA issues draft RTS on indirect clearing under MiFIR and EMIR. ESMA published two draft regulatory technical standards on indirect clearing under the Markets in Financial Instruments Regulation and the European Market Infrastructure Regulation. The draft RTS clarify provisions of indirect clearing arrangements for over-the-counter and exchange-traded derivatives relating to default management, choice of account structures, and long chains. (5/26/2016)ESMA press release.
FCA consults on cap on early exit charges for pension contracts. The FCA published a consultation paper that proposes the level of the cap on early exit charges in certain pension contracts. The FCA has proposed to limit exit charges for contract-based personal pensions, including workplace personal pensions, at one percent of the value of a member’s pension. Comments are due on or before August 18, 2016. (5/26/2016) FCA press release.
FCA publishes final rules implementing CMA recommendations on high-cost short-term credit. The FCA published a policy statement that responds to the feedback it received to its consultation on proposed new rules and guidance prompted by the CMA’s investigation into payday lending. The policy statement also sets out the final rules for price comparison websites that compare high-cost short-term credit products, which will become effective on December 1, 2016. (5/26/2016) FCA press release.
PRA consults on monitoring model drift and standard formula SCR reporting under Solvency II. The Prudential Regulation Authority requested comments on a consultation paper that proposes the PRA’s approach to monitoring model drift and establishes the PRA’s expectations for firms with an approved internal model to privately report their standard formula Solvency Capital Requirement information on an annual basis. Comments are due on or before August 17, 2016. (5/25/2016)PRA press release.
FCA publishes Primary Market Bulletin 15. The FCA has published Primary Market Bulletin No. 15, a short special edition that focuses mainly on how issuers are expected to file PDMR notifications, as well as notifications for delayed disclosure of inside information, with the FCA under the EU Market Abuse Regulation, which comes into effect on July 3rd. (5/25/2016)
FCA warns that people over 55 years old face a heightened risk of fraud. In a bid to help combat widespread investment fraud, the FCA published a study urging retirees to take necessary precautions before making investments. The study reveals that the current low interest rate environment is one of the key reasons that those over 55 are considering investing in a wider range of unfamiliar types of investment products. (5/25/2016) FCA press release.