Tag: ESMA

ESMA

FCA Officially Bans Retail-Orientated Binary Options

Following consultation feedback, the UK’s Financial Conduct Authority (FCA) has confirmed all firms acting in or from the UK are prohibited from selling, marketing or distributing binary options to retail consumers.
The FCA aired its concern about the products in late 2017, before issuing a consultation paper in late 2018 seeking industry feedback, It now says that following that feedback it will officially introduce new rules on April 2, 2019, “to tackle widespread concerns about the inherent risks of these products, and the poor conduct of the firms selling them”. It adds, “This has led to consumer harm in the UK and internationally through large and unexpected trading losses.”

CFTC Welcomes EU EMIR Agreement

The political agreement reached last week in Brussels to implement the EMIR 2.2 regulation has been welcomed on both sides of the Atlantic. The updated regulation will broaden the role of the European Securities and Markets Authority (ESMA) to include more supervisory tools and on-site inspections; introduce a tiered system of recognition for offshore CCPs depending on their product set and systemic importance to the EU; and introduces the requirement that systemically important non-EU CCPs establish themselves in the EU if they seek to access the single market.

ESMA Grants Brexit Relief to UK-Based Clearing Houses

Following a review of UK-based central counterparties (CCPs) and central securities depositories (CSDs), the European Securities and Markets Authority (ESMA) has announced that in the event of a no-deal Brexit, three CCPs established in the UK – LCH Limited, ICE Clear Europe Limited and LME Clear Limited – will be recognised to provide their services in the European Union.
ESMA says it has adopted these recognition decisions in order to limit the risk of disruption in central clearing and to avoid any negative impact on the financial stability of the EU.

BoE, ESMA Prepare for Brexit No-Deal with MoU

The Bank of England and European Securities and Markets Authority (ESMA) have announced that they have agreed Memoranda of Understanding (MoUs) regarding cooperation and information-sharing arrangements with respect to central counterparties (CCPs) and central securities depositories (CSDs).
The MoUs follow the adoption by the European Commission in December 2018 of temporary equivalence decisions on the future UK legal and supervisory framework for UK CCPs and CSDs.
The Commission’s implementing acts would come into effect in the result of a no-deal Brexit. In that scenario, they would allow UK CCPs and CSDs to be recognised by ESMA from 30 March 2019, and therefore continue to provide services respectively to EU clearing members, trading venues and also provide notary and settlement services for securities issued under EU law.
The MoUs will also only take effect in the event of a no-deal Brexit.

ESMA Renews CFD Restrictions

The European Securities and Markets Authority (ESMA) has agreed to renew the restriction on the marketing, distribution or sale of contracts for differences (CFDs) to retail clients.
The rule, which has been in effect since 1 August 2018, was due to expire on 1 February 2019 but has now been renewed for a further three-month period.
ESMA says it has “carefully considered” the need to extend the intervention measure currently in effect, adding, “ESMA considers that a significant investor protection concern related to the offer of CFDs to retail clients continues to exist.”

Regulators Welcome EC’s Recognition of UK CCPs

The Bank of England, European Securities and Markets Authority (ESMA), and the US Commodity Futures Trading Commission (CFTC) have all welcomed the decision by the European Commission (EC) to adopt a temporary equivalence regime for central counterparties (CCPs) and Central Securities Depositories (CSDs).
ESMA says it supports continued access to UK CCPs, in order to limit the risk of disruption in central clearing and to avoid any negative impact on the financial stability of the EU. It adds it aims to recognise UK CCPs in a timely manner, as long as four recognition conditions under Article 25 of EMIR are met.

ESMA Extends CFD Restrictions

The European Securities and Markets Authority (ESMA) has agreed to renew the restriction on the marketing, distribution or sale of contracts for differences (CFDs) to retail clients, which have been in effect since 1 August, from 1 November 2018 for a further three-month period.
ESMA says it has “carefully considered” the need to extend the intervention measure currently in effect and believes that a significant investor protection concern related to the offer of CFDs to retail clients continues to exist.

CMC Markets Launches “Professional” Offering

Online trading provider CMC Markets has responded to the recent announcement by the European Securities and Markets Authority (ESMA) that retail clients will no longer be able to use their current leverage levels, by creating a new CMC Pro account for eligible clients.
The ESMA changes establish margin limits for clients, rather than the broker-dealers and CMC says the new account will allow clients to continue to trade with their current leverage levels.To be eligible, clients will have to demonstrate that they are capable of making their own investment decisions.

ESMA Suspends LEI Deadline: Issues MiFID II Updates

The European Securities and Markets Authority (ESMA) has announced a delay gto the implementation of a key element of the impending MiFID II regulation, which is due to go into effect on January 3, 2018.
The Authority says the delay is, “To support the smooth implementation of Legal Entity Identifiers (LEI) requirements under the Markets in Financial Instruments Regulation (MiFIR).”
MiFIR obliges EU investment firms to identify their clients that are legal persons with LEIs for the purpose of MiFID II transaction reporting.

NEX Business to Apply for Trade Repository Status

NEX Regulatory Reporting has announced its intention to apply to become a trade repository for the Securities Financing Transactions Regulation (SFTR) and launch a dedicated reporting solution, pending the issuance of the final technical standards from ESMA.
The firm, which is part of NEX Group, says it will in time add the SFTR trade repository and solution to its Global Reporting Hub to provide clients with an end-to-end solution for the securities lending and repo markets. The SFTR trade repository will be built and hosted in the cloud.