OJ

ECB Publishes Decision Revising Format of MIB and Repealing Decision Establishing T2S Board

 

On February 4, the Decision (EU) 2019/166 of the European Central Bank (“ECB“) on the Market Infrastructure Board (“MIB“) and repealing Decision ECB/2012/6 on the establishment of the TARGET2-Securities (“T2S“) Board (ECB/2019/3) was published in the Official Journal of the EU (“OJ“). READ MORE

EC Publishes Draft Delegated Regulations under MiFiD II and IDD on Sustainable Finance

 

On January 4, the European Commission published the following draft Delegated Regulations which are designed to ensure insurance distributors and investment firms take environmental, social and governance (“ESG“) issues into account when advising customers:

  • a Delegated Regulation amending Delegated Regulation (EU) 2017/565 as regards to the integration of ESG considerations and preferences into investment advice and portfolio management under the MiFID II Directive (2014/65/EU); and
  • a Delegated Regulation amending Delegated Regulation (EU) 2017/2359 as regards to the integration of ESG considerations and preferences into investment advice for insurance-based investment products (“IBIPs“) under the Insurance Distribution Directive ((EU) 2016/97) (“IDD“).

The draft Delegated Regulations have been produced under Articles 24(13) and 25(8) of the MiFID II Directive, and Article 30(6) of the IDD, respectively. Publication follows a consultation run in May 2018. Although there was generally strong support to enhance the focus on non-financial objectives within the investment process, some stakeholders were reluctant to change their recently-implemented MiFID II or IDD processes. However, the Commission is convinced of the urgency of moving ahead with its sustainable finance proposals. The Commission also believes the proposed timeline for application of the draft Delegated Regulations provides sufficient flexibility as, although each explanatory memorandum states that the draft Delegated Regulations provide for an 18-month transition period, the draft legal texts themselves state that they will apply 12 months after they come into force.

The Commission can only officially adopt the draft Delegated Regulations once the new disclosure provisions for sustainable investments and sustainability risks have been agreed at the EU level. However, in a press release, it advised that publication of the drafts should enable firms to start preparing to take ESG considerations and preferences into account.

The Commission issued a call, in August 2018, for technical advice from EIOPA and ESMA relating to its sustainable finance proposals.

Once adopted by the Commission, the draft Delegated Regulations will enter into force twenty days after publication in the Official Journal of the EU (“OJ“), unless the European Parliament or the Council of the EU objects.

Council of EU Confirms the Ten Delegated Regulations on RTS under BMR

 

On October 9, The Council of the EU published the minutes of a meeting held in its configuration as the Environment Council (12898/18).

Page 11 of the minutes confirms that the Council has decided not to object to ten Delegated Regulations setting out regulatory technical standards (“RTS“) under the Benchmarks Regulation ((EU) 2016/1011) (“BMR“) that were adopted by the European Commission in July 2018.

The European Parliament’s next step is to consider the Delegated Regulations and decide whether to object to them. If the Parliament does not object, the Delegated Regulations will be published in the Official Journal of the EU (“OJ“). The Regulations will enter into force 20 days after their publication in the OJ and apply two months after the date of publication.

OJ Publishes Ninth Implementing Regulation Extending Transitional Periods Related To Own Fund Requirements for CCP Exposures

 

Commission Implementing Regulation ((EU) 2018/815) on the extension of the transitional periods related to own funds requirements for exposures to central counterparties (“CCPs“), set out in the Capital Requirements Regulation (Regulation 575/2013) (“CRR“) and the European Market Infrastructure Regulation (“EMIR“) (Regulation 648/2012) has been published in the Official Journal of the EU (“OJ“).

Commission Implementing Regulation ((EU) 2017/2241) was published in the OJ on June 4, 2018. It is available here. The Implementing Regulation will enter into force on June 7, 2018.

Implementation Regulation Specifying Main Indices and Recognized Exchanges under CRR Published in OJ

On September 14, 2016, Commission Implementing Regulation (EU) 2016/1646 laying down implementing technical standards with regard to main indices and recognized exchanges in accordance with the Capital Requirements Regulation (Regulation 575/2013), was published in the Official Journal of the EU (OJ). The Implementing Regulation will enter into force on October 4, 2016.

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

 

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

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.