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01/04/2014 2014/336 Trade Repository Supervision Work Plan 2014 Reference PDF
111.34 KB

The European Securities and Markets Authority (ESMA) is publishing a summary of its 2014 supervisory work plan in relation to trade repositories (TRs) with the aim of enhancing the transparency of its actions regarding TRs in the European Union. TRs centrally collect and maintain the records of derivative trades and play a central role in enhancing the transparency of derivative markets and reducing risks to financial stability. In November 2013, ESMA registered six TRs. The obligation for counterparties to report their derivative trades to registered TRs began on 12 February 2014. Under Titles VI and VII of Regulation EU 648/2012 (EMIR), the direct supervision of TRs has been entrusted to ESMA, who has started to supervise the six registered TRs. Supervision of TRs by ESMA is crucial to ensuring that TRs comply on an on-going basis with all EMIR requirements, thereby enabling regulators to access data and details of derivative contracts in order for them to fulfil their respective mandates.

07/05/2014 2014/478 Keynote Speech at AFME Post Trade Conference- The reform of financial markets: halfway there- Steven Maijoor, ESMA Chair Speech PDF
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Keynote Speech - The reform of financial markets: halfway there Steven Maijoor, ESMA Chair AFME Post Trade Conference, London Excerpt "Three challenges Ladies and gentlemen, so far so good about the completion of the legislation to meet our G20 commitments and developing a single rulebook for financial services. Let me now turn to the three main challenges I see in the current phase of regulatory reform. My main message is that while the legislative phase nears completion, it does not imply the completion of the regulatory reform programme. Let me explain that further by identifying three commitments for the next phase of regulatory reform. Firstly, commitment to the financial reform, its implementation and to adequate supervision. Legislation needs to be accompanied by good implementing measures, to ensure the legislation works in practice, and credible supervision. Secondly, a commitment to supervisory convergence in order to establish a truly internal market and to prevent regulatory arbitrage within the EU. Agreeing at EU level on a single rule book for all 28 Member States is a big step. However, ensuring that this single rule book is supervised consistently across the 28 Member States is an even bigger step. Thirdly, in order to prevent crises we need commitment to the lessons learned from the crisis regarding risk analysis and the availability of high quality data on financial markets. We need more information on securities markets. Since the beginning of the financial crisis securities regulators have learned a lot about how to deal with financial stability – an area that was beforehand mainly reserved for central bankers and banking regulators. Information on financial markets is key to achieve the financial stability objective. It is therefore no surprise that many pieces of recently introduced legislation already include data requirements. Securities regulators however also need to step up their role on this and need more resources to collect and analyse data. It goes without saying that more data and analysis will also support our other important objective of investor protection."

08/05/2014 2014/483 Letter to the European Commission- Frontloading requirement under EMIR Letter PDF
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This letter to the European Commission advances ESMA's intention to ease certain frontloading requirement under the European Markets Infrastructure Regulation (EMIR).  Frontloading is a term that refers to the clearing obligation under EMIR, which will oblige counterparties to centrally clear certain derivative trades through clearing houses (CCP). ESMA believes that the frontloading procedure creates uncertainties for derivatives end-users while the exact terms of the clearing obligation has not been defined which could have adverse impacts on risk hedging and financial stability. Therefore, ESMA informs the European Commission that it intends to establish the frontloading requirement in a manner that will minimise uncertainty. The clearing requirement began to apply with the first authorisation of an EU-based CCP which happened on 18 March 2014. Following the first CCP approval, EMIR requires ESMA to draft within six months technical standards which will define the derivatives classes subject to central clearing.  However, compulsory central clearing will only start with the entry-into-force of the technical standards which creates the need to ‘frontload’ those derivate trades since 18 March 2014.

28/05/2014 2014/576 Voting Procedures for CCP colleges under EMIR Opinion PDF
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11/07/2014 2014/799 Consultation paper Clearing Obligation no1 IRS Consultation Paper PDF
1.54 MB

With the overarching objective of reducing systemic risk, EMIR introduces the obligation to clear certain classes of OTC derivatives in central clearing houses (CCPs) that have been authorised (European CCPs) or recognised (third-country CCPs) under its framework.ESMA defined the IRS classes to be subject to central clearing following an analysis of all IRS classes which are currently offered for clearing by European CCPs. ESMA’s draft RTS propose to subject the following four classes: Basis swaps, fixed-to-float interest rate swaps, forward rate agreements and overnight index swaps on a range of currencies and maturities. The clearing obligation will take effect following a phased implementation depending on the types of counterparties.Responding to this paperThe European Securities and Markets Authority (ESMA) invites responses to the specific questions listed in the consultation paper on the clearing obligation no.1. Please use this “form to reply”Details on EMIR and the clearing obligation can be found at the following link: http://www.esma.europa.eu/page/OTC-derivatives-and-clearing-obligation

11/07/2014 2014/800 Consultation paper Clearing Obligation no2 CDS Consultation Paper PDF
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With the overarching objective of reducing systemic risk, EMIR introduces the obligation to clear certain classes of OTC derivatives in central clearing houses (CCPs) that have been authorised (European CCPs) or recognised (third-country CCPs) under its framework.Following a first consultation paper on the IRS classes to be subject to central clearing, in this second paper ESMA defined the CDS classes to be subject to the clearing obligation based on the analysis of all CDS classes which are currently offered for clearing by European CCPs. ESMA’s draft RTS propose to subject the following class: untranched European index CDS, for two indices. The clearing obligation will take effect following a phased implementation depending on the types of counterparties.Responding to this paperThe European Securities and Markets Authority (ESMA) invites responses to the specific questions listed in the consultation paper on the clearing obligation no.1. Please use this “form to reply”Details on EMIR and the clearing obligation can be found at the following link: http://www.esma.europa.eu/page/OTC-derivatives-and-clearing-obligation

30/01/2014 2014/83 Letter to Jonathan Faull (EC) regarding Technical Advice (Japan) Letter PDF
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06/10/2014 20141002 CSDR mandates Letter PDF
43.4 KB
30/06/2015 2015/1065 Draft Regulatory Technical Standards on the CSD Regulation-The Operation of the Buy-in Process Consultation Paper PDF
388.58 KB
02/07/2015 2015/1067 Final report on the extension of the scope of interoperability arrangements Final Report PDF
302.39 KB
07/07/2015 2015/1104 ESMA Opinion on the renewal of emergency measure by the Greek HCMC under the Short Selling Regulation , Opinion PDF
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OPINION Renewal of emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps I. Legal basis 1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances. 2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion. II. Background 3. In accordance with Article 26 of the Regulation, the Hellenic Capital Market Commission (HCMC) originally notified ESMA and competent authorities on the 29th of June 2015 of its intention to make use of its powers of intervention in exceptional circumstances and to introduce an emergency measure under Article 20 of the Regulation. 4. The original emergency measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC. 5. The original measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities. 6. In the original notification, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely: • closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included); • closure of The Electronic Secondary Market “HDAT” for government bonds operated for the same period; • suspension of redemption of mutual funds’ units; • suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”; • suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository; • trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States). 7. The reason for proposing a temporary prohibition for the creation, or increase, of net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of the investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within Greece, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market. 8. Following the issuance by ESMA of a positive opinion pursuant to Article 27 of the Regulation on the 29th of June, the original measure by the HCMC entered into force at 00:00:01 hours (CET) on 30th June 2015, and applied for a period of seven days, ending at 24:00:00 (CET) on 6th July 2015. 9. On the 6th of July 2015, the measures described in paragraph 6 were renewed by the Greek authorities and the bank holiday in Greece was also extended. On the same day, the HCMC proposed a renewal of the short selling measure, notifying ESMA and competent authorities accordingly. 10. In the notification for the renewal, the HCMC explains that it believes the circumstances that justified the imposition of the original measure did not improve during the last week and therefore the measure should be renewed. Moreover, all the other measures adopted by the Greek authorities were renewed or extended, and the short selling measure remains a relevant component to ensure the effectiveness of the other ones. 11. The proposed renewal would concern the same financial instruments of the original measure (see paragraph 5), but the HCMC specified in the new notification that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments. 12. The renewed measure shall apply for a period of seven days and shall be in force as of 00:00:01 hours (CET) on 7th July 2015 until 24:00:00 (CET) on 13th of July 2015. III. Opinion 13. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps: On the adverse events or developments ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist. On the appropriateness and proportionality of the measure ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Hellenic Republic. On the duration of the measure ESMA considers that the duration of the measure is justified and appreciates HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of the Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.
13/07/2015 2015/1131 ESMA Opinion on the renewal of emergency measure by the Greek HCMC under short selling regulation , Opinion PDF
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OPINION Renewal of emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps I. Legal basis 1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances. 2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion. II. Background 3. On the 29th of June 2015, ESMA issued an opinion on the emergency measure introduced by the Hellenic Capital Market Commission (HCMC) under Article 20 of the Regulation. The measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC and was applied from 30th June 2015 at 00.00.01 CET to the 6th July 2015 at 24:00:00 (CET). 4. The measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities. 5. In the original notification to ESMA, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely: • closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included); • closure of The Electronic Secondary Market “HDAT” for government bonds operated for the same period; • suspension of redemption of mutual funds’ units; • suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”; • suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository; • trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States). 6. The reason for proposing a temporary prohibition for the creation, or increase, of net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of the investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within Greece, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market. 7. On the 6th of July 2015, the measures described in paragraph 5 were renewed by the Greek authorities and the bank holiday in Greece was also extended. On the same day, the HCMC notified ESMA and competent authorities of its intention to renew the short selling measure and ESMA issued a positive opinion concerning this first renewal pursuant to Article 27 of the Regulation. 8. The first renewal concerned the same financial instruments of the original measure (see paragraph 5), but the HCMC specified in the related notification that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments. 9. This renewal entered into force at 00:00:01 hours (CET) on 7th July 2015 and will expire at 24:00:00 (CET) on 13th July 2015. 10. On the 13th of July 2015, the measures described in paragraph 5 were renewed again by the Greek authorities and the bank holiday in Greece was also extended. On the same day, in accordance with Article 26 of the Regulation, the HCMC has notified ESMA and other competent authorities of its intention to make use of its powers of intervention in exceptional circumstances and to renew again the current emergency measure under Article 20 of the Regulation. 11. In the notification for this second renewal, the HCMC explains that it believes the circumstances that justified the imposition of the original measure and of the first renewal did not improve yet and therefore the measure should be extended again. Moreover, all the other measures adopted by the Greek authorities were extended, and the short selling measure remains a relevant component to ensure the effectiveness of the other ones. 12. The proposed second renewal would concern exactly the same instruments as of the first renewal. 13. The renewed measure shall apply for a period of seven days and shall be in force as of 00:00:01 hours (CET) on 14th July 2015 until 24:00:00 (CET) on 20th of July 2015. III. Opinion 14. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps: On the adverse events or developments ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist. On the appropriateness and proportionality of the measure ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Hellenic Republic. On the duration of the measure ESMA considers that the duration of the measure is justified and appreciates HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of the Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.
21/07/2015 2015/1139 ESMA Opinion on the renewal of emergency measure by the Greek HCMC under the Short Selling Regulation , Opinion PDF
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OPINION Renewal of emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps I. Legal basis 1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances. 2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion. II. Background 3. On the 29th of June 2015, ESMA issued an opinion on the emergency measure introduced by the Hellenic Capital Market Commission (HCMC) under Article 20 of the Regulation. The measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC and was applied from 30th June 2015 at 00.00.01 CET to the 6th July 2015 at 24:00:00 (CET). 4. The measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities. 5. In the original notification to ESMA, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely: • closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included); • closure of The Electronic Secondary Market “HDAT” for government bonds operated for the same period; • suspension of redemption of mutual funds’ units; • suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”; • suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository; and • trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States). 6. The reason for proposing a temporary prohibition for the creation, or increase, of net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of the investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within the Hellenic Republic, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market. 7. On the 6th and 13th of July 2015, the measures described in paragraph 5 were renewed by the Greek authorities and the bank holiday in the Hellenic Republic was also extended. On the same days, the HCMC notified ESMA and competent authorities of its intention to renew the short selling measure and ESMA issued in both cases a positive opinion concerning these renewals pursuant to Article 27 of the Regulation. 8. The renewals concerned the same financial instruments of the original measure (see paragraph 5), but the HCMC specified in the related notification that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments. 9. The renewal notified on the 13th July entered into force at 00:00:01 hours (CET) on 14th July 2015 and will expire at 24:00:00 (CET) on 20th July 2015. 10. On the 20th of July 2015, the measures described in paragraph 5 were renewed again by the Greek authorities. On the same day, in accordance with Article 26 of the Regulation, the HCMC has notified ESMA and other competent authorities of its intention to make use of its powers of intervention in exceptional circumstances and to renew again the current emergency measure under Article 20 of the Regulation. 11. In the notification for this third renewal, the HCMC explains that it believes the circumstances that justified the imposition of the original measure and of the previous renewals did not improve yet and therefore the measure should be extended again. Moreover, all the other measures adopted by the Greek authorities were extended, and the short selling measure remains a relevant component to ensure the effectiveness of the other ones. 12. The proposed third renewal would concern exactly the same instruments as of the previous renewals. In the latest notification to ESMA and competent authorities, the HCMC revised its wording to the benefit of legal certainty regarding the nature of the emergency measure and the scope of the financial instruments concerned. In particular, the HCMC latest notification refers to short sales of shares under Article 20(2)(a) and any transaction referred to in Article 20(2)(b) of the Regulation (EU) N0 236/2012. The notification also lists explicitly all the categories of financial instruments relating to the concerned shares to which the measure will apply, rather than identifying these related instruments by cross referring to the Annex of Commission Regulation No 918/2012. Thus, the following financial instruments under MiFID are included: options, covered warrants, futures, index-related instruments, contracts for difference, shares/units of exchange-traded funds, swaps, spread bets, packaged retail or professional investment products, complex derivatives, certificates linked to shares, and global depositary receipts. 13. The renewed measure shall apply for a period of seven days and shall be in force as of 00:00:01 hours (CET) on 21st July 2015 until 24:00:00 (CET) on 27Th of July 2015. III. Opinion 14. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps: On the adverse events or developments ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist. Comparing the current situation in the Hellenic Republic with related events over the past few years, the threat to financial stability and investor protection at least in the Hellenic Republic is obvious. Despite the partial reopening of credit institutions on 20 July 2015, the situation of fragility in the financial system and in the broader Greek economy persists. The relation between this situation and the financial markets is clear, as evidenced by the closure of Greek financial markets. On the appropriateness and proportionality of the measure ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Hellenic Republic. Allowing short positions to be built at this stage could exacerbate the threats to financial stability, especially as regards the financial sector. Besides, the inclusion of short positions built through related instruments is appropriate and proportionate since tolerating the build-up of over-the-counter (OTC) short positions and short positions through related instruments would put retail investors at a disadvantage compared to professional investors (who can access OTC wholesale markets more easily), given the main markets are still closed for trading, and would ultimately undermine the overall efficiency of the measure. On the duration of the measure ESMA considers that the duration of the measure is justified. It is a relatively short renewal period that indicates that the measure is linked with specific events and allows its reconsideration at short intervals, which ensures that the assessment of the risks is also performed frequently. Besides, ESMA appreciates HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.
28/07/2015 2015/1218 ESMA Opinion on the renewal of emergency measure by the Greek HCMC under the Short Selling Regulation , Opinion PDF
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OPINION Renewal of emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps I. Legal basis 1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances. 2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion. II. Background 3. On the 29th of June 2015, ESMA issued an opinion on the emergency measure introduced by the Hellenic Capital Market Commission (HCMC) under Article 20 of the Regulation. The measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC and was applied from 30th June 2015 at 00.00.01 CET to the 6th July 2015 at 24:00:00 (CET). 4. The measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities. 5. In the original notification to ESMA, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely: • closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included); • closure of The Electronic Secondary Market “HDAT” for government bonds operated for the same period; • suspension of redemption of mutual funds’ units; • suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”; • suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository; • trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States). 6. The reason for proposing a temporary prohibition for the creation, or increase, of net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of the investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within the Hellenic Republic, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market. 7. On the 6th, the 13th and the 20th of July 2015, the measures described in paragraph 5 were renewed by the Greek authorities. On the same days, the HCMC notified ESMA and competent authorities of its intention to renew the short selling measure and ESMA issued in all cases a positive opinion concerning these renewals pursuant to Article 27 of the Regulation. 8. The renewals concerned the same financial instruments of the original measure (see paragraph 5), but the HCMC specified in the related notification that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments. 9. The renewal notified on the 20th of July entered into force at 00:00:01 hours (CET) on the 21th of July 2015 and will expire at 24:00:00 (CET) on the 27th of July 2015. 10. On the 27th of July 2015, while the measures described in paragraph 5 were still in force. in accordance with Article 26 of the Regulation, the HCMC has notified ESMA and other competent authorities of its intention to make use of its powers of intervention in exceptional circumstances and to renew again the current emergency measure under Article 20 of the Regulation. 11. In the notification for this fourth renewal, the HCMC explains that it believes the circumstances that justified the imposition of the original measure and of the previous renewals did not improve yet and therefore the measure should be extended again. Moreover, being the other measures adopted by the Greek authorities still in force, the short selling measure remains a relevant component to ensure their effectiveness. 12. The proposed fourth renewal would concern exactly the same instruments as of the previous renewals. The latest notification featured the same wording used in the 20th of July 2015 notification to ESMA and competent authorities, where the HCMC revised its previous wording to the benefit of legal certainty regarding the nature of the emergency measure and the scope of the financial instruments concerned. In particular, the HCMC latest notification refers to short sales of shares under Article 20(2)(a) and any transaction referred to in Article 20(2)(b) of the Regulation (EU) No 236/2012. The notification also lists explicitly all the categories of financial instruments relating to the concerned shares to which the measure will apply, rather than identifying these related instruments by cross referring to the Annex of Commission Regulation No 918/2012. Thus, the following financial instruments under MiFID are included: options, covered warrants, futures, index-related instruments, contracts for difference, shares/units of exchange-traded funds, swaps, spread bets, packaged retail or professional investment products, complex derivatives, certificates linked to shares, and global depositary receipts. 13. The renewed measure shall apply for a period of seven days and shall be in force as of 00:00:01 hours (CET) on the 28th of July 2015 until 24:00:00 (CET) on the 3rd of August 2015. III. Opinion 14. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps: On the adverse events or developments ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist. Comparing the current situation in the Hellenic Republic with related events over the past few years, the threat to financial stability and investor protection at least in the Hellenic Republic is obvious. Despite the partial reopening of credit institutions on 20 July 2015, the situation of fragility in the financial system and in the broader Greek economy persists. The relation between this situation and the financial markets is clear, as evidenced by the continued closure of Greek financial markets. On the appropriateness and proportionality of the measure ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Hellenic Republic. Allowing short positions to be built at this stage could exacerbate the threats to financial stability, especially as regards the financial sector. Besides, the inclusion of short positions built through related instruments is appropriate and proportionate since tolerating the build-up of over-the-counter (OTC) short positions and short positions through related instruments would put retail investors at a disadvantage compared to professional investors (who can access OTC wholesale markets more easily), given that the main markets are still closed for trading, and would ultimately undermine the overall efficiency of the measure. On the duration of the measure ESMA considers that the duration of the measure is justified. It is a relatively short renewal period that indicates that the measure is linked with specific events and allows its reconsideration at short intervals, which ensures that the assessment of the risks is also performed frequently. Besides, ESMA appreciates HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.
05/08/2015 2015/1219 Final Report- Technical Advice under the CSD Regulation Technical Advice PDF
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03/08/2015 2015/1243 ESMA Opinion on the renewal of emergency measure by the Greek HCMC under the Short Selling Regulation , Opinion PDF
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OPINION Renewal of emergency measure by the Greek HCMC under Section 1 of Chapter V of Regulation No 236/2012 on short selling and certain aspects of credit default swaps I. Legal basis 1. According to Article 27(2) of Regulation (EU) No 236/2012 of the European Parliament and of the Council of 14 March 2012 on short selling and certain aspects of credit default swaps (the Regulation), the European Securities and Markets Authority (ESMA) shall within 24 hours of the notification having been made by a competent authority under Article 26 of the Regulation issue an opinion on whether it considers the measure or proposed measure necessary to address the exceptional circumstances. 2. ESMA’s competence to deliver an opinion is based on Article 29(1) (a) of Regulation (EC) No 1095/2010 (ESMA Regulation). In accordance with Article 44(1) of the ESMA Regulation the Board of Supervisors has adopted this opinion. II. Background 3. On the 29th of June 2015, ESMA issued an opinion on the emergency measure introduced by the Hellenic Capital Market Commission (HCMC) under Article 20 of the Regulation. The measure consisted of a temporary prohibition of transactions in any financial instrument that create, or increase, a net short position on any of the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” (Alternative Market of the Athens Exchange) of which the relevant Competent Authority is HCMC and was applied from 30th June 2015 at 00.00.01 CET to the 6th July 2015 at 24:00:00 (CET). 4. The measure concerned the following financial instruments: all shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A”, as well as all related instruments included in the calculation of the net short position in accordance with Regulation (EU) N0 236/2012 and Commission Regulation (EU) No 918/2012 of 5 July 2012 (see in particular Annex I, Part I thereof). It applied to any person irrespective of their country of residence, and did not envisage any exemption for market maker activities. 5. In the original notification to ESMA, the HCMC indicated that the measure was a complementary action to the ones already established on the 29th of June 2015 by the Greek Authorities, namely: • closure of the ATHEX regulated market and the Multilateral Trading Facility of “EN.A” until the 6th of July (included); • closure of the Electronic Secondary Market “HDAT” for government bonds operated for the same period; • suspension of redemption of mutual funds’ units; • suspension of operation of ATHEXClear for the securities traded on the Greek market and the MTF “EN.A”; • suspension of the settlement of securities traded on the Greek market by the Hellenic Central Securities Depository; • trading suspension of all the securities of listed companies covered by the above measures, as well as the related financial instruments (the trading suspension is effective also in other Member States). 6. The reason for proposing a temporary prohibition for the creation, or increase, of net short position on the shares admitted to trading on the Athens Exchange and on “EN.A” was that the HCMC deemed it necessary for the protection of the investors and the preservation of financial stability. In fact, such prohibition was considered a relevant component to ensure the effectiveness of the other measures adopted by the Greek authorities. The HCMC also stated that given that the main liquidity and trading activity on those instruments normally is located within the Hellenic Republic, the measure would have not created disproportionate negative effects, since it would have affected a fairly small part of the EU overall market. 7. On the 6th, the 13th, the 20th and the 27th of July 2015, the measures described in paragraph 5 were renewed by the Greek authorities. On the same days, the HCMC notified ESMA and competent authorities of its intention to renew the short selling measure and ESMA issued in all cases a positive opinion concerning these renewals pursuant to Article 27 of the Regulation. 8. The renewals concerned the same financial instruments of the original measure (see paragraph 5), but the HCMC specified in the related notifications that although the ban covers all transactions in the financial instruments listed in Part I of Annex I of Commission Regulation (EU) No 918/2012, transactions in index-related instruments and ETFs are included to the extent that the shares admitted to trading on the Athens Exchange and the Multilateral Trading Facility of “EN.A” of which the relevant Competent Authority is the HCMC represent more than 5% of the total value (or composition) of these instruments. 9. The renewal notified on the 27th of July entered into force at 00:00:01 hours (CET) on the 28th of July 2015 and will expire at 24:00:00 (CET) on the 3rd of August 2015. 10. On the 3rd of August 2015, following and due to the Decision of the Greek Minister of Finance “Lifting of the restrictions of the Act of Legislative Content of 18.07.2015 (A’84) regarding transactions in financial instruments on Greek regulated markets”, the HCMC decided to reopen the ATHEX regulated market, the Multilateral Trading Facility of “EN.A”, the Electronic Secondary Market “HDAT” for government bonds, and to restart the operations of settlement of securities traded in Greek regulated markets, by the Hellenic Central Securities Depository. 11. On the same day, in accordance with Article 26 of the Regulation, the HCMC has notified ESMA and other competent authorities of its intention to make use of its powers of intervention in exceptional circumstances and to renew again the current emergency measure under Article 20 of the Regulation. 12. In the notification for this fifth renewal, the HCMC explains that since the Athens Exchange and the MTF “EN.A” have reopened after a period of more than one month, domestic capital market activity and securities’ prices are expected to be volatile. In particular, given that the markets will reopen after such an unprecedented closure and time may be necessary until their complete normalisation, additional pressure on stock valuations due to net short positions would pose a significant risk of deterioration of market conditions. 13. The proposed fifth renewal would concern exactly the same instruments as of the previous renewals. The latest notification featured the same wording used in the 20th of July 2015 notification to ESMA and competent authorities, where the HCMC revised its previous wording to the benefit of legal certainty regarding the nature of the emergency measure and the scope of the financial instruments concerned. In particular, the HCMC latest notification refers to short sales of shares under Article 20(2)(a) and any transaction referred to in Article 20(2)(b) of the Regulation (EU) No 236/2012. The notification also lists explicitly all the categories of financial instruments relating to the concerned shares to which the measure will apply, rather than identifying these related instruments by cross referring to the Annex of Commission Regulation No 918/2012. Thus, the following financial instruments under MiFID are included: options, covered warrants, futures, index-related instruments, contracts for difference, shares/units of exchange-traded funds, swaps, spread bets, packaged retail or professional investment products, complex derivatives, certificates linked to shares, and global depositary receipts. 14. The proposed fifth renewal of the short selling measure would apply to any natural or legal person, irrespective of their country of residence, but would be subject to the exemption for market making activities, provided that short positions have been entered into for hedging purposes. The exemption for market makers is a new element of this latest renewal of the short position ban, and it is justified by the fact that the Greek financial markets are now open and market making activities are important providers of liquidity for the Greek shares, as well as for warrants, derivatives, index derivatives and ETF related to Greek shares. 15. The renewed measure shall apply for a period of twenty-eight days and shall be in force as of 00:00:01 hours (CET) on the 4th of August 2015 until 24:00:00 (CET) on the 31st of August 2015. The proposed renewal is longer than the previous ones, which all were of seven days each. The HCMC justified such a longer renewal explaining that upon reopening of Greek financial markets, considerable pressure is anticipated: capital controls are still in force and the return to normality will probably require a longer period of time. As a result, HCMC considers the short selling measure as an important element for the transitional period. III. Opinion 16. ESMA is adopting the following opinion on the notified measure, on the basis of Article 27(2) of Regulation 236/2012 on Short selling and certain aspects of credit default swaps: On the adverse events or developments ESMA considers that adverse developments which constitute a serious threat to market confidence in the Greek market still persist. Comparing the current situation in the Hellenic Republic with related events over the past few years, the threat to financial stability and investor protection at least in the Hellenic Republic is obvious. Despite the partial reopening of credit institutions on 20 July 2015, and the reopening on 3 August 2015 of the ATHEX regulated market, the Multilateral Trading Facility of “EN.A”, and of the Electronic Secondary Market “HDAT” for government bonds, the situation of fragility in the financial system and in the Greek economy persists, as highlighted by the extreme volatility already experienced on the ATHEX in the course of the first hours of reopening. On the appropriateness and proportionality of the measure ESMA considers that the measure is appropriate and proportionate to address the above mentioned threats that persist in the Greek financial markets. Allowing short positions to be built at this stage could exacerbate the threats to financial stability, especially as regards the financial sector. The new exemption foreseen for market making activities is justified by the fact that Greek financial markets are now open, and therefore market makers should be allowed to properly carry out their activity, thus enhancing the liquidity on the Greek shares and related instruments, and contributing to the normalisation of the activities on the Greek financial markets. On the duration of the measure ESMA considers that the duration of the measure is justified. In the previous extensions, measures were always proposed for a seven day period each, considering that the moment in which the Greek financial markets would have reopened was not known at that time. This is no longer the case, since Greek financial markets have reopened after more than one month. An unusual degree of volatility on the Greek financial markets is therefore anticipated in the short term. Such expectation is exacerbated considering that the month of August is generally characterised by lower volumes of transactions. Under these circumstances, ESMA considers it is necessary and appropriate for HCMC to impose a net short position ban that would last until the end of the month, in view of supporting the proper functioning of the Greek financial markets in this transitional period. Besides, ESMA takes into consideration HCMC’s statement in its notification of intent that the measure may be lifted before the end of the established period or renewed in accordance with the provisions of Regulation (EU) No 236/2012 if circumstances that justified the imposition of the measure improve, persist or worsen.
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13/08/2015 2015/1252 EMIR Review Report no.2- Review on the efficiency of margining requirements to limit procyclicality Final Report PDF
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13/08/2015 2015/1253 EMIR Review Report no.3- Review on the segregation and portability requirements Final Report PDF
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13/08/2015 2015/1254 EMIR Review Report no.4- ESMA input as part of the Commission consultation on the EMIR Review Final Report PDF
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