Tuesday July 7 2015

News Source: Global Exchanges

Focus: Other

Type: General




The European Securities and Markets Authority (ESMA) has published a consultation paper on draft regulatory technical standards (RTS) on the buy-in process under the Central Securities Depositories Regulation (CSDR).

On 7 March 2012 the European Commission (EC) proposed a Regulation on improving securities settlement in the European Union (EU) and on central securities depositories (CSDs) and amending Directives 98/26/EC and 2014/65/EU and Regulation (EU) No 236/2012 (CSDR). On 18 December 2013, the European Parliament and the Council of the European Union agreed the CSDR text. On 26 February 2014, the Permanent Representatives Committee, on behalf of the Council of the European Union, confirmed the agreement with the European Parliament (EP). On 15 April 2014, CSDR was formally adopted by the EP. On 16 July 2014 the EP and the Council published the agreed text, ready for publication in the OJ. Finally, the CSDR was published in the OJ on 28 August 2014 and entered into force on 17 September 2014.

CSDR introduces a buy-in process and confers to ESMA the power to draft technical standards on this matter.

ESMA has consulted on all the CSDR technical standards from 18 December 2014 to 19 February 2015. The consultation received 65 responses. Many of the responses called for changing the approach on buy-in with a move of the responsibility for the execution of the buy-in at trading level. ESMA has further analysed the issue and identify possible options that will serve as the basis for its cost-benefit analysis. This second Consultation Paper (CP) is limited to the provisions on buy-in of the draft RTS and is seeking input and quantitative elements from stakeholders on the different options reported below.

The following options are analysed in thE consultation paper. For each option the strengths and weaknesses of it are described. Stakeholders have been invited to provide feedback and quantitative elements to sustain those on the relevant options and arguments associated to each option:

  • Option 1 – Trading level execution
  • Option 2 – Trading level with fall-back option execution
  • Option 3 – CSD participant level execution

Click on the link above for further details.