COVID-19

The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, has renewed its decision to temporarily require the holders of net short positions in shares traded on a European Union (EU) regulated market to notify the relevant national competent authority (NCA) if the position exceeds 0.1% of the issued share capital.

ESMA considers that its renewed measure will maintain the ability of NCAs to deal with any threats to market integrity, orderly functioning of markets and financial stability at an early stage, allowing them and ESMA to timely address such threats in case of signs of market stress.

The COVID-19 pandemic continues to have serious adverse effects on the real economy in the EU with any outlook for a future recovery remaining uncertain. While EU financial markets have partially recovered since 16 March 2020, this uncertainty is potentially threatening their future development and the stability of the financial system in the EU.

The measure applies from 17 June 2020 for a period of three months. The temporary transparency obligations apply to any natural or legal person, irrespective of their country of residence. They do not apply to shares admitted to trading on a regulated market where the principal venue for the trading of the shares is located in a third country, market making or stabilisation activities.

ESMA, in coordination with NCAs, continues to monitor developments in financial markets as a result of the COVID-19 situation and is prepared to use its powers to ensure the orderly functioning of markets, financial stability and investor protection.

The EFTA Surveillance Authority, in cooperation with ESMA, adopted a corresponding decision today, also effective as of 17 June, applicable to EEA EFTA States' markets

The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, is issuing a public statement to clarify the application of the MiFIR open access provisions (OAP) for trading venues (TVs) and central counterparties (CCPs) in light of the recent adverse developments related to COVID-19.

It also aims to coordinate the supervisory actions of national competent authorities (NCAs) by setting out the issues they should consider when assessing OAP requests.

ESMA considers that the current market environment, with a high degree of uncertainty and volatility driven by the COVID-19 pandemic, may negatively impact CCPs and TVs operations and increase their operational risk. These increased risks, combined with limited capacity for assessing access requests and for managing the migration of transactions flows, may impact the orderly functioning of markets or financial stability.  

NCAs are expected to take into consideration, to the extent relevant, the relevant adverse developments when taking decisions on open access requests.

ESMA expects CCPs and trading venues to have the necessary operational capacity to process access requests once the exceptional market circumstances have cleared up.

The current exemptions under MiFIR, which allow NCAs to temporarily exempt TVs and CCPs from the OAP for exchange traded derivatives (ETDs), expire on 3 July and from 4 July the OAP for ETDs will apply.

The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, has decided, in view of the effects of the ongoing COVID-19 pandemic on stakeholders and market participants, to extend the response date for the consultation on the technical standards on reporting, data quality, data access and registration of Trade Repositories under EMIR REFIT to 3 July 2020.

The decision has been taken in recognition of market participants’ current focus on crisis work and their operational constraints, as well as taking into account the high number and the technical complexity of issues on which feedback is requested.

The end of the consultation period is extended from 19 June to 3 July 2020.

The European Securities and Markets Authority (ESMA), the EU Securities Markets regulator, today publishes a Public Statement addressing the implications of the COVID-19 pandemic on the half-yearly financial reports of listed issuers.

The Public Statement provides recommendations on areas of focus identified by ESMA and highlights:

-        the importance of providing relevant and reliable information, which may require issuers to make use of the time allowed by national law to publish half-yearly financial reports while not unduly delaying the timing of publication;

-        the importance of updating the information included in the latest annual accounts to adequately inform stakeholders of the impacts of COVID-19, in particular in relation to significant uncertainties and risks, going concern, impairment of non-financial assets and presentation in the statement of profit or loss; and

-        the need for entity-specific information on the past and expected future impact of COVID-19 on the strategic orientation and targets, operations, performance of issuers as well as any mitigating actions put in place to address the effects of the pandemic.

The Public Statement is also applicable to financial statements in other interim periods when IAS 34 Interim Financial Reporting is applied. It calls on the management, administrative and supervisory bodies, including audit committees, of issuers and, where applicable, their auditors, to take due consideration of the recommendations included within the statement. ESMA further emphasises the role of audit committees in promoting high-quality half-yearly financial reports at this difficult junction in time.

Next steps

ESMA and European national enforcers will monitor and supervise the application of the IFRS requirements as well as any other relevant provisions outlined in the Statement, with national authorities incorporating them into their examinations and taking corrective actions where appropriate. ESMA will collect data on how EU listed entities have applied the recommendations and will take into account those findings, amongst other considerations, in setting the enforcement priorities for the annual financial statements for the year 2020. These findings will be reported on in ESMA’s Report on the 2020 enforcement activities.

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