Commission Delegated Regulation

Delegated Regulations Under MiFID II Directive and BMR Published in OJ

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The following Delegated Regulations were published on January 17, 2018 in the Official Journal of the EU (OJ):

Commission Delegated Regulation (EU) 2018/63, which amends Delegated Regulation (EU) 2017/571 supplementing the MiFID II Directive (2014/65/EU) with regard to regulatory technical standards on the authorization, organizational requirements and the publication of transactions for data-reporting services providers. The Commission adopted this Delegated Regulation on September 26, 2017.

Commission Delegated Regulation (EU) 2018/64, which supplements Regulation (EU) 2016/1011 (BMR) on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds with regard to specifying how the criteria of Article 20(1)(c)(iii) of the BMR are to be applied for assessing whether certain events would result in significant and adverse impacts on market integrity, financial stability, consumers, the real economy or the financing of households and businesses in one or more member states.

Commission Delegated Regulation (EU) 2018/65, which specifies technical elements of the definitions laid down in Article 3(1) of the BMR.

Commission Delegated Regulation (EU) 2018/66, which supplements the BMR specifying how the nominal amount of financial instruments other than derivatives, the notional amount of derivatives and the net asset value (NAV) of investment funds are to be assessed. The Commission adopted Delegated Regulations (EU) 2018/64, (EU) 2018/65 and (EU) 2018/66 on September 29, 2017.

Commission Delegated Regulation (EU) 2018/67, which supplements the BMR with regard to the establishment of the conditions to assess the resulting impact from the cessation of or change to existing benchmarks. The Commission adopted this Delegated Regulation on October 3, 2017.

All the Delegated Regulations will enter into force twenty days after their publication in the OJ on February 6, 2018.

Delegated Regulation on RTS Specifying Criteria for Setting MREL under BRRD published in OJ

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On September 3, 2016, the Commission Delegated Regulation ((EU) 2016/1450) supplementing the Bank Recovery and Resolution Directive (2014/59/EU) (BRRD) with regulatory technical standards (RTS) highlighting the criteria relating to the methodology for setting the minimum requirement for own funds and eligible liabilities (MREL) has been published in the Official Journal of the EU (OJ).

Article 45(6) of the BRRD specifies certain criteria that a resolution authority must consider when determining the level of MREL for a BRRD institution. Article 45(2) of the BRRD gave the European Commission the power to adopt a Delegated Regulation containing RTS further specifying the Article 45(6) assessment criteria.

The RTS contain provisions relating to the interpretation of the six assessment criteria set out in Article 45(6). They also permit resolution authorities to provide a transitional period for reaching the final MREL for firms or entities to which resolution tools have been applied.

The Delegated Regulation was adopted by the Commission on May 23, 2016. It shall enter into force 20 days after its publication in the OJ (i.e. September 23, 2016).

Delegated Regulation on Recovery and Resolution Planning under BRRD Published in OJ

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On July 8, 2016, the Commission Delegated Regulation ((EU) 2016/1075) supplementing the Bank Recovery and Resolution Directive (2014/59/EU) (“BRRD”) on recovery and resolution planning, was published in the Official Journal of the EU (“OJ”). The Delegated Regulation details regulatory technical standards (“RTS’) outlining the following:

  • the content of recovery plans, resolution plans and group resolution plans;
  • the minimum criteria that the competent authority is to assess regarding recovery plans and group recovery plans;
  • the conditions for group financial support;
  • the requirements for independent valuers;
  • the contractual recognition of write-down and conversion powers; and
  • the procedures and contents of notification requirements and of notice of suspension and the operational functioning of the resolution colleges.

It is hoped that the above RTS will be included in a single Delegated Regulation to ensure coherence between the provisions dealing with the resolution framework laid down in the BRRD.

The Delegated Regulation was adopted by the Commission on March 23, 2016. It comes into force twenty days after publication in the OJ and as such on July 28, 2016.