ESMA published its letter to the EC, stating its views on the recent proposals for improvements in the way EU deals with third countries on financial services. The areas of improvement suggested by EC include access to information, timely identification of changes in third-country legal and regulatory frameworks, practices or infrastructures, and supervisory approaches.
In its letter, ESMA stated its consensus with EC that the mentioned areas of improvement should be strengthened to facilitate a level playing field, avoid regulatory arbitrage, and ensure financial stability and investor protection in the EU. ESMA further noted that a significant number of market infrastructures and the corresponding activity will be located outside the EU, as United Kingdom will be leaving the EU. This will reinforce the need to build Capital Markets Union and increase the importance of third-country issues for EU financial markets. In this context, ESMA takes note of the EC’s proposal (dated June 13, 2017) for a regulation amending European Market Infrastructure Regulation (EMIR; Regulation (EU) No 648/2012) in relation to the requirements for the recognition of third-country central counterparties (CCPs), which strengthens the third-country CCP regimes. ESMA highlighted additional areas where changes should be considered, including the third-country regimes for credit rating agencies, trade repositories, benchmarks, and possibly trading venues and data providers.
Keywords: ESMA, Europe, EC, Banking, Securities, Third Country Regimes, EMIR, CCP
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