DTCC derivatives depository fined by ESMA
12 July 2021 UK
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The European Securities and Markets Authority (ESMA) has fined DTCC Derivatives Repository Plc (DDRL) €408,000 for breaches of the European Market Infrastructure Regulation (EMIR).
According to the EU securities market regulator, this related to seven infringements which included allowing asset managers to access data that they were not permitted to view and configuring its IT systems in a way that changed the content of information reported to the depository.
DDRL was also found guilty of failing to provide immediate and direct access for financial supervisors to data required to fulfil their regulatory responsibilities.
Headquartered in London, DDRL is a trade repository owned by US-based market infrastructure provider DTCC which provides post-trade record keeping and reporting for over-the-counter equity, credit and interest rate derivatives.
These infringements of the EMIR regulation each took place between 2014 and 2018 and were, according to ESMA, the result of negligence by DDRL.
This regulation contains provisions to protect the integrity and confidentiality of data reported to trade repositories and requires repositories to provide this data to regulators. “This is an essential requirement in facilitating the monitoring and identification of systemic risks in derivatives markets,” ESMA says.
DDRL was found to have generated reports for financial regulators that contained inaccurate data. It also failed to provide to certain regulators transaction data that they were entitled to receive.
ESMA indicated that this is the first time that it has identified breaches by a trade repository relating to its obligations to ensure confidentiality and integrity of data reported under EMIR.
DDRL will be allowed to appeal against the decision to the Board of Appeal of the European Supervisory Authorities.
ESMA explains that this appeal will not have a suspensive effect, although the Board of Appeal may suspend application of the decision in line with Article 60(3) of the ESMA regulation.
ESMA interim chair Anneli Tuominen says: “Today’s actions against DDRL emphasises the importance ESMA places on trade repositories complying with their obligations on data confidentiality, integrity and access.”
“The provision of timely, accurate and confidential data to central counterparty (CCP) and derivatives markets supervisors is an essential requirement in facilitating the monitoring and identification of systemic risk in EU derivative markets,” says Tuominen.
In March 2016, ESMA fined DDRL €64,000 for negligently failing to put in place systems capable of providing regulators with direct and immediate access to derivatives trading data.
According to the EU securities market regulator, this related to seven infringements which included allowing asset managers to access data that they were not permitted to view and configuring its IT systems in a way that changed the content of information reported to the depository.
DDRL was also found guilty of failing to provide immediate and direct access for financial supervisors to data required to fulfil their regulatory responsibilities.
Headquartered in London, DDRL is a trade repository owned by US-based market infrastructure provider DTCC which provides post-trade record keeping and reporting for over-the-counter equity, credit and interest rate derivatives.
These infringements of the EMIR regulation each took place between 2014 and 2018 and were, according to ESMA, the result of negligence by DDRL.
This regulation contains provisions to protect the integrity and confidentiality of data reported to trade repositories and requires repositories to provide this data to regulators. “This is an essential requirement in facilitating the monitoring and identification of systemic risks in derivatives markets,” ESMA says.
DDRL was found to have generated reports for financial regulators that contained inaccurate data. It also failed to provide to certain regulators transaction data that they were entitled to receive.
ESMA indicated that this is the first time that it has identified breaches by a trade repository relating to its obligations to ensure confidentiality and integrity of data reported under EMIR.
DDRL will be allowed to appeal against the decision to the Board of Appeal of the European Supervisory Authorities.
ESMA explains that this appeal will not have a suspensive effect, although the Board of Appeal may suspend application of the decision in line with Article 60(3) of the ESMA regulation.
ESMA interim chair Anneli Tuominen says: “Today’s actions against DDRL emphasises the importance ESMA places on trade repositories complying with their obligations on data confidentiality, integrity and access.”
“The provision of timely, accurate and confidential data to central counterparty (CCP) and derivatives markets supervisors is an essential requirement in facilitating the monitoring and identification of systemic risk in EU derivative markets,” says Tuominen.
In March 2016, ESMA fined DDRL €64,000 for negligently failing to put in place systems capable of providing regulators with direct and immediate access to derivatives trading data.
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