SFTR RTS expected in Q4
12 January 2017 London
Image: Shutterstock
The final draft of the regulatory technical standards (RTS) of the Securities Financing Transaction Regulation (SFTR) is not expected to be released until Q4 2017, according to International Securities Lending Association (ISLA).
The European Securities and Markets Authority is expected to submit its final draft RTS to the European Commission in late March and with the full formal adoption procedure triggered thereafter.
With this timeline, ISLA described the chances of the SFTR RTS coming before Q4 as “unlikely”, meaning that phase-in is likely to begin in Q4 2018.
The latest prediction of SFTR’s development comes from a joint effort between the association and US-based public relations and marketing agency Fleishman Hillard and is based on a “smooth-sailing scenario”, which ISLA acknowledged is open to disruption and revision.
Despite a large number of remaining concerns with the RTS that were voiced at the November public hearing, ESMA is eager to close off the RTS without further delaying implementation, as it is already well behind the 13 January deadline mandated in the level one text.
In explaining its reasoning, ISLA laid out the foundation of its calculation, stating that, once the commission receives the draft RTS, it has three months to adopt the standards via delegated regulation.
The commission, in turn, then has to submit the delegated regulation to the European Parliament and Council for review for one month if the RTS is unamended, or three months if amended.
Once there is agreement on the RTS, it will be prepared for distribution and entered into the EU official journal, which should be completed by October.
The European Securities and Markets Authority is expected to submit its final draft RTS to the European Commission in late March and with the full formal adoption procedure triggered thereafter.
With this timeline, ISLA described the chances of the SFTR RTS coming before Q4 as “unlikely”, meaning that phase-in is likely to begin in Q4 2018.
The latest prediction of SFTR’s development comes from a joint effort between the association and US-based public relations and marketing agency Fleishman Hillard and is based on a “smooth-sailing scenario”, which ISLA acknowledged is open to disruption and revision.
Despite a large number of remaining concerns with the RTS that were voiced at the November public hearing, ESMA is eager to close off the RTS without further delaying implementation, as it is already well behind the 13 January deadline mandated in the level one text.
In explaining its reasoning, ISLA laid out the foundation of its calculation, stating that, once the commission receives the draft RTS, it has three months to adopt the standards via delegated regulation.
The commission, in turn, then has to submit the delegated regulation to the European Parliament and Council for review for one month if the RTS is unamended, or three months if amended.
Once there is agreement on the RTS, it will be prepared for distribution and entered into the EU official journal, which should be completed by October.
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