October 08, 2018

The ESMA Chair Steven Maijoor delivered an opening statement to the Economic & Monetary Affair Committee (ECON) at the European Parliament, as part of the annual hearing of the chairs of ESAs. At this event, he focused on the progress of ESMA on the Capital Markets Union and the implementation of Markets in Financial Instruments Directive (MiFID II); work of ESMA on preparing for the withdrawal of the UK from EU; and on the work of the Joint Committee over the past year, focusing primarily on packaged retail investment and insurance products (PRIIPs) issues and developments in anti-money laundering.

He said that MiFID II has given a new perspective on the use of ESMA’s Opinions: in the last 12 months, ESMA issued nearly 400 Opinions to the national competent authorities on both pre-trade transparency waivers and position limits in commodity contracts, while a few hundred more will be finalized soon. He believes that "MiFID II implementation is a very good example of what ESMA’s contribution to investor protection, orderly markets, and financial stability in the EU financial markets can and should be." He also mentioned that this project is ongoing and significant allocation of resources—particularly for data and IT issues, market monitoring, and supervisory convergence work—continues to be planned over the next months.

With respect to the Capital Markets Union, ESMA has progressed swiftly on a number of Level 2 mandates assigned to it under the new Prospectus and Securitization Regulations. In both cases, the co-legislators arranged for a sufficiently long implementation period, which is helpful for planning and executing the work of ESMA, said Mr. Maijoor. Furthermore, ESMA has continued to support the Capital Markets Union project through its multiple supervisory convergence activities. This included, during the year, important peer reviews—on Guidelines dealing with Efficient Portfolio Management Techniques (EPM) for UCITS and on certain aspects of the compliance function under MiFID I—and the cross-sectoral project on the performance and fees of investment services, which has been conducted jointly with EBA and EIOPA. He believes it is important to keep the momentum of these convergence activities, as a number of areas in Capital Markets Union require further attention, including participation of retail investors in the capital markets.

Regarding Brexit preparations, ESMA Chair said that "as the supervisor of credit rating agencies and trade repositories in EU, with a number of them headquartered in London, ESMA required appropriate contingency planning from individual supervised entities. ESMA is carefully monitoring the execution of these plans to ensure that they are meeting all the requirements in the EU27 in case of a no-deal by the end of March 2019. With this date approaching quickly, ESMA continues to focus on the various areas of risk in case of a no-deal Brexit and is in constant dialog with other EU Institutions, including the other ESAs, EC, and ECB, in addition to the market participants. As a final comment on Brexit, he highlighted that this work takes up a significant portion of the limited resources of ESMA and it requires even stricter prioritization of activities than usual.


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Keywords: Europe, EU, Securities, MiFID II, Capital Markets Union, Brexit, ESMA