DOMESTIC:

Central Bank publishes Markets Update - Issue 3 2017

The Markets Update advises interested parties of recent policy developments related to the way the Central Bank supervises financial markets, investment funds and their service providers and investment firms. The Update contained information on topics such as the Central Bank's Discussion Paper on Exchange Traded Funds, the Twenty-Fifth Edition of the Alternative Investment Fund Managers (AIFMD) Q&A, the 17th Edition of Undertakings for Collective Investment in Transferable Securities (UCITS) Q&A and the Central Bank's letter to Fund Administrators on outsourcing activities. EUROPEAN:

European Securities and Markets Authority publishes Final Report on Product Governance Guidelines under the Markets in Financial Instruments Directive II

ESMA published its final report on guidelines on product governance requirements under the Markets in Financial Instruments Directive II (MiFID II). MiFID II introduces product governance requirements to ensure that firms who manufacture and distribute financial instruments act in their clients' best interests during all the stages of the life-cycle of products and services. These guidelines apply from 3 January 2018 and once it published in all of the official languages of the EU a two-month period will be triggered during which National Competent Authorities (NCAs) must notify ESMA whether they comply, or intend to comply, with the guidelines.

European Securities and Markets Authority publishes opinion on determining third-country trading venues for the purpose of transparency under MiFID II/Markets in Financial Instruments Regulation

In the Opinion ESMA set out that only third-country trading facilities who meet the following objective criteria should be considered as a trading venue for the purposes of the Markets in Financial Instruments Regulation (MiFIR) post-trade transparency regime:

i. it operates a multilateral system, i.e. a system or facility in which multiple third-party buying and selling interests in financial instruments are able to interact;

ii. it is subject to authorisation in accordance with the legal and supervisory framework of the third-country;

iii. it is subject to supervision and enforcement on an ongoing basis in accordance with the legal and supervisory framework of the third-country by a competent authority that is a full signatory to the IOSCO Multilateral Memorandum of Understanding (MMoU) concerning Consultation and Cooperation and the Exchange of Information; and

iv. it has a post-trade transparency regime in place which ensures that transactions concluded on that trading venue are published as soon as possible after the transaction was executed or, in clearly defined situations, after a deferral period.

European Securities and Markets Authority publishes opinion on determining third-country trading venues for the purpose of position limits under the Markets in Financial Instruments Directive II

In the Opinion ESMA sets out that only third-country trading facilities who meet the following objective criteria should be considered as a trading venue for the purposes of the MiFID II position limit regime:

i. it operates a multilateral system, i.e. a system or facility in which multiple third-party buying and selling interests in financial instruments are able to interact;

ii. it is subject to authorisation in accordance with the legal and supervisory framework of the third-country; and

iii. it is subject to supervision and enforcement on an ongoing basis in accordance with the legal and supervisory framework of the third-country by a competent authority that is a full signatory to the IOSCO MMoU concerning Consultation and Cooperation and the Exchange of Information.

European Securities and Markets Authority publishes updated Questions and Answers in relation to the implementation of MIFID II

The updated Q&As published by the ESMA in relation to the implementation MiFID II and MiFIR are on the following topics:

  • market structures;
  • commodity derivatives; and
  • transparency.

European Securities and Markets Authority clarifies "traded on a trading" venue under the MiFID

ESMA published an opinion in relation to the concept of 'traded on a trading venue' in relation to over the counter (OTC) derivatives following requests from NCAs as the concept was not defined in MiFID II or MiFIR. ESMA specified that only OTC derivatives sharing the same reference data details as derivatives for which trading venues submitted reference data should be subject to the MiFIR transparency and transaction reporting requirements.

European Securities and Markets Authority publishes Follow-up Report to the Peer Review on MiFID Conduct of Business rules relating to fair, clear and not misleading information

The Report addresses action taken by ten NCAs following the identification of decencies in the 2014 Peer Review on MiFID Conduct of Business rules relating to fair, clear and not-misleading information which looked at NCAs' supervision of information and marketing communications under MiFID. ESMA noted that they expect NCAs to continue to address deficiencies that remain under the MiFID II and MiFIR which will be applicable from 3 January 2018.

European Commission publishes a proposal for a Regulation amending the European Market Infrastructure Regulation

The proposed Regulation, amending European Market Infrastructure Regulation(EU) No 648/2012 (EMIR), attempts to amend the clearing obligation, the suspension of the clearing obligation, the reporting requirements, the risk-mitigation techniques for OTC derivatives contracts not cleared by a central counterparty (CCP), the registration and supervision of trade repositories and the requirements for trade repositories.

The Regulation also propose extending the scope of "financial counterparties", changing the way non-financial counterparties calculate their clearing thresholds and extending the exemption, granted to pension scheme arrangements, from the clearing obligation for a further three years.

European Commission publishes Questions and Answers on the proposal to amend the EMIR

The Q&A on the proposal to amend the EMIR follows a public consultation and the publication of a report in 2016 on the regulation (EMIR Report). The EMIR Report indicated that there should be no fundamental changes to the core requirements but proposed amendments several amendments to the EMIR.

Delegated Regulation 2017/751 of 16 March 2017 enters force

The Delegated Regulation amending Delegated Regulations (EU) 2015/2205, (EU) 2016/592 and (EU) 2016/1178 entered force on the 19 May 2017. The Delegated Regulation has extended the application of requirements on smaller EMIR financial counterparties to clear certain OTC interest rate derivatives and index credit default swaps until 21 June 2019.

European Council adopts adopted new rules on prospectuses for the issuing and offering of securities

The Council of the EU announced that it has adopted new rules on prospectuses in relation to the issuing and offering of securities. The rules will replace Directive 2003/71/EC and they aim to simplify administrative obligation in relation to the publication of prospectuses. The European Parliament previously approved the text on 5 April 2017.