ESMA stalls on buy-in technical standards
30 September 2015 Paris
Image: Shutterstock
The European Securities and Markets Authority (ESMA) has delayed the release of further clarification on the mandatory buy-in provisions in the Central Securities Depositaries Regulation (CSDR).
ESMA’s regulatory technical standards for the buy-in process for settlement discipline have been delayed following a consultation period with the market.
There is concern in the market that the penalties imposed may be disruptive to normal market activity, according to ESMA.
The CSDR itself assumes that transactions that are due to fail can be remedied by market participants borrowing securities temporarily.
Participating member states will be able to decide themselves when they introduce a tax on other instruments, such as fixed income or derivatives, before coming together again to consolidate their efforts.
Finalised technical standards to promote greater transparency, investor safety and resilience in European financial markets were published by ESMA today (30 September) on the Markets in Financial Instruments Directive (MiFID II) and the Markets Abuse Regulation (MAR), as well as other aspects of the CSDR.
The standards aim to translate how the legislation will apply in practice to market participants, market infrastructures and national supervisors.
After CSDR, which entered into force in 2014, MAR and MiFID II will enter into force in 2016 and 2017 respectively.
“The rules put out by ESMA today on MiFID II, MAR and CSDR will notably change the way Europe’s secondary markets function. And this will no doubt impact market participants and regulators alike,” said Steven Maijoor, chair of ESMA.
“The magnitude of this change should not be underestimated. But the past has taught us that change is needed in order to make markets more transparent, efficient, and safer to invest in.”
“This will entail a certain cost but we should not forget the other side of this equation, which is the great benefits safer and sounder markets will bring to everybody.”
ESMA’s regulatory technical standards for the buy-in process for settlement discipline have been delayed following a consultation period with the market.
There is concern in the market that the penalties imposed may be disruptive to normal market activity, according to ESMA.
The CSDR itself assumes that transactions that are due to fail can be remedied by market participants borrowing securities temporarily.
Participating member states will be able to decide themselves when they introduce a tax on other instruments, such as fixed income or derivatives, before coming together again to consolidate their efforts.
Finalised technical standards to promote greater transparency, investor safety and resilience in European financial markets were published by ESMA today (30 September) on the Markets in Financial Instruments Directive (MiFID II) and the Markets Abuse Regulation (MAR), as well as other aspects of the CSDR.
The standards aim to translate how the legislation will apply in practice to market participants, market infrastructures and national supervisors.
After CSDR, which entered into force in 2014, MAR and MiFID II will enter into force in 2016 and 2017 respectively.
“The rules put out by ESMA today on MiFID II, MAR and CSDR will notably change the way Europe’s secondary markets function. And this will no doubt impact market participants and regulators alike,” said Steven Maijoor, chair of ESMA.
“The magnitude of this change should not be underestimated. But the past has taught us that change is needed in order to make markets more transparent, efficient, and safer to invest in.”
“This will entail a certain cost but we should not forget the other side of this equation, which is the great benefits safer and sounder markets will bring to everybody.”
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