Changes from report parliamentary committee draft to plenary report

Added(iii) draft decisions submitted by ESMA in accordance with point (bc);'

Added(iii) the following subparagraph is added:

Added‘ESMA shall on a yearly basis report to the Commission on the cross-border risks arising from CCPs’ activities referred to in point (bb) in the first subparagraph.’;

Added(20 a) in Article 24b, paragraphs 1 and 2 are replaced by the following:

Added‘1. With regard to supervisory assessments conducted in relation to and decisions to be taken pursuant to Articles 41, 44, 46, 49, 50 and 54 in relation to Tier 2 CCPs, the CCP Supervisory Committee shall consult the central banks of issue referred to in point (f) of Article 25(3). Each central bank of issue may respond. Any response shall be received within 10 working days of transmission of the draft decision. In emergency situations, that period shall not exceed 24 hours. Where a central bank of issue proposes amendments or objects to draft assessments related to, or draft decisions pursuant to, Articles 41, 44, 46, 50 and 54, it shall provide full and detailed reasons in writing. Upon the conclusion of the period for consultation, the CCP Supervisory Committee shall duly consider the response from the central banks of issue.

Added2. Where the CCP Supervisory Committee does not reflect in its draft assessment or draft decision the response from a central bank of issue, the CCP Supervisory Committee shall inform that central bank of issue in writing stating its full reasons for not taking into account the response of that central bank of issue, providing an explanation for any deviations from that response. The CCP Supervisory Committee shall submit to the Board of Supervisors the responses from central banks of issue and its explanations for not taking them into account together with its draft decision.’

Added(21) Article 25 is amended as follows:

Added(-a) in paragraph 2, the following point is inserted:

Added‘(ca) the CCP has provided ESMA with a written statement, signed by its legal representative, expressing the unconditional consent of the CCP to pay the applicable fees in accordance with Article 25d’;

Added(a) in paragraph 4, the third subparagraph is replaced by the following;

Added‘The recognition decision shall be based on the conditions set out in paragraph 2 for Tier 1 CCPs and in paragraph 2, points (a) to (d), and paragraph 2b for Tier 2 CCPs. Within 180 working days of the determination that an application is complete in accordance with the second subparagraph, ESMA shall inform the applicant CCP in writing, with a fully reasoned explanation, whether the recognition has been granted or refused.’;

Added(b) in paragraph 5, the second subparagraph is replaced by the following:

Added‘Where the review is undertaken in accordance with point (a) of the first subparagraph, it shall be conducted in accordance with paragraphs 2 to 4. Where the review is undertaken in accordance with point (b) of the first subparagraph, it shall also be conducted in accordance with paragraphs 2 to 4, however the CCP referred to in paragraph 1 shall not be required to submit a new application but shall provide ESMA with all information necessary for the review of its recognition.’;

Added(c) in paragraph 6, the following subparagraph is added:

Added‘Where in the interests of the Union and considering the potential risks for the Union financial stability due to the expected participation of clearing members and trading venues established in the Union to CCPs established in a third country, the Commission may adopt the implementing act referred to in the first subparagraph irrespective of whether point (c) of that subparagraph is fulfilled.’;

Added(d) paragraph 7 is replaced by the following:

Added‘7. ESMA shall establish effective cooperation arrangements with the relevant competent authorities of third countries whose legal and supervisory frameworks have been recognised as equivalent to this Regulation in accordance with paragraph 6..’;

Added(e) the following paragraphs 7a, 7b and 7c are added:

Added‘7a. Where ESMA has not yet determined the tiering of a CCP or where ESMA has determined that all or some CCPs in a relevant third country are Tier 1 CCPs, the cooperation arrangements referred to in paragraph 7 shall take into account the risk the provision of clearing services by those CCPs entails and shall specify:

Added(a) the mechanism for the exchange of information on an annual basis between ESMA, the central banks of issue referred to in paragraph 3, point (f), and the competent authorities of the third countries concerned, so that ESMA is able to:

Added(i) ensure that the CCP complies with the conditions for recognition under paragraph 2;

Added(ii) identify any potential material impact on market liquidity or the financial stability of the Union or one or more of its Member States; and

Added(iii) monitor clearing activities in one, or more, of the CCPs established in such third country by clearing members established in the Union, or is part of a group subject to consolidated supervision in the Union.

Added(b) exceptionally, the mechanism for the exchange of information on a quarterly basis requiring detailed information covering the aspects referred to in paragraph 2a , as well as the mechanism for the exchange of information on market developments that could have consequences for the financial stability of the Union, and in particular information on significant changes to risk models and parameters, extension of CCP activities and services and changes in the client account structure, with the aim to detect if a CCP is potentially close to becoming or is potentially likely to become systemically important for the financial stability of the Union or one or more of its Member States.

Added(c) the mechanism for prompt notification to ESMA where a third-country competent authority deems a CCP it is supervising to be in breach of the conditions of its authorisation or of other law to which it is subject;

Added(ca) the mechanism for prompt notification to ESMA by the third-country competent authority where a third-country CCP intends to extend and reduce its activities and services;

Added(d) the procedures necessary for the effective monitoring of regulatory and supervisory developments in a third country;

Added(e) the procedures for third-country authorities to inform ESMA, the third-country CCP college referred to in Article 25c, and the central banks of issue referred to in paragraph 3, point (f), without undue delay of any emergency situations relating to the recognised CCP, including developments in financial markets, which might have an adverse effect on market liquidity and the stability of the financial system in the Union or one of its Member States and the procedures and contingency plans to address such situations;

Added(f) the procedures for third-country authorities to assure the effective enforcement of decisions adopted by ESMA in accordance with Articles 25f, 25j, 25k(1), point (b), 25l, 25m and 25p;

Added(g) the consent of third-country authorities to the onward sharing of any information they have provided to ESMA under the cooperation arrangements with the authorities referred to in paragraph 3 and the members of the third-country CCP college, subject to the professional secrecy requirements set out in Article 83.

Added7b. Where ESMA has determined that at least one CCP in a relevant third country is a Tier 2 CCP, the cooperation arrangements referred to in paragraph 7 shall specify in relation to those Tier 2 CCPs at least the following:

Added(a) the elements referred to in paragraph 7a, points (a), (c), (d), (e) and (g), where cooperation arrangements are not already established with the relevant third-country pursuant to the second subparagraph;

Added(b) the mechanism for the exchange of information on at least a monthly basis, as appropriate, between ESMA, the central banks of issue referred to paragraph 3, point (f), and the competent authorities of the third countries concerned, including access to all information requested by ESMA to ensure CCP’s compliance with the requirements referred to in paragraph 2b;

Added(c) the procedures concerning the coordination of supervisory activities, including the agreement of third-country authorities to allow investigations and on-site inspections in accordance with Articles 25g and 25h respectively;

Added(d) the procedures for third-country authorities to assure the effective enforcement of decisions adopted by ESMA in accordance with Articles 25b, 25f to 25m, 25p and 25q;

Added(e) the procedures for third-country authorities to:▌

Added(i) consult ESMA on the preparation of recovery plans and resolution plans in relation to aspects relevant for the Union or one or more of its Member States;

Added(ii) promptly inform ESMA of the establishment of recovery plans and resolution plans and any subsequent material changes to such plans in relation to aspects relevant for the Union or one or more of its Member States;

Added(iii) promptly inform ESMA if a Tier 2 CCP intends to activate its recovery plan or where the third-country authorities have determined that there are indications of an emerging crisis situation that could affect the operations of that CCP, in particular, its ability to provide clearing services or where the third-country authorities envisage to take a resolution action in the near future.

Added7c. Where ESMA considers that a third-country competent authority fails to apply any of the provisions laid down in a cooperation arrangement established in accordance with paragraphs 7, 7a and 7b, it shall inform the Commission thereof confidentially and without delay. In such a case, the Commission may decide to review the implementing act adopted in accordance with paragraph 6.’;

Added(21a) in Article 25a paragraphs 1 and 2 are replaced by the following:

Added‘1. A CCP referred to in Article 25(2b) may submit a reasoned request that ESMA assesses whether in its compliance with the applicable third-country framework, taking into account the provisions of the implementing act adopted in accordance with Article 25(6), that CCP may be deemed to satisfy the requirements laid down in Article 16 and Titles IV and V. ESMA shall immediately transmit the request to the third-country CCP college.

Added2. The request referred to in paragraph 1 of this Article shall provide the factual basis for a finding of comparability and the reasons why compliance with the requirements applicable in the third country satisfies the requirements laid down in Article 16 and Titles IV and V. The Tier 2 CCP shall submit its reasoned request referred to under paragraph 1 in an electronic format via the central database referred to in Article 17c.

AddedESMA shall grant comparable compliance, in part or in full, where it decides, based on the reasoned request submitted under paragraph 1 of this Article, that the Tier 2 CCP in its compliance with relevant requirements applicable in the third country is deemed compliant with the requirements laid down in Article 16 and Titles IV and V and thereby satisfies the requirement for recognition under Article 25(2b)(a).

AddedESMA shall withdraw, in full or in relation to a particular requirement, comparable compliance, where the Tier 2 CCP no longer complies with the conditions for comparable compliance and where such a CCP has not taken the remedial action requested by ESMA within a set time frame. When determining the date of entry into effect of the decision to withdraw comparable compliance, ESMA shall endeavour to provide for an appropriate adaptation period which shall not exceed 6 months.

AddedWhere comparable compliance is granted, ESMA shall continue to be responsible for carrying out its duties and perform its tasks under this Regulation, including under Articles 25 and 25b, and shall continue to exercise its powers referred to in Articles 25c to 25d, 25f to 25m and 25p to 25r.

AddedWithout prejudice to ESMA’s ability to perform those tasks, where comparable compliance has been granted, ESMA shall agree administrative arrangements with the third-country authority in order to ensure an appropriate exchange of information and cooperation for ESMA to monitor comparable compliance on an ongoing basis.’

Added(22) in Article 25b(1), the second subparagraph is replaced by the following:

Added‘ESMA shall require from each Tier 2 CCP all of the following:

Added(i) a confirmation, at least on a yearly basis, that the requirements referred to in Article 25(2b) points (a), (c) and (d), continue to be fulfilled;

Added(ii) information and data on a regular basis to ensure ESMA is able to supervise those CCPs’ compliance with the requirements referred to in Article 25(2b), point (a).’;

Added(22a) Article 25f is replaced by the following:

Added“1. ESMA may require recognised CCPs and related third parties to whom those CCPs have outsourced operational functions or activities to provide all necessary information to enable ESMA to carry out its duties under this Regulation.

Added2. The information referred to in paragraph 1 may be of a periodic or one-off nature.

Added3. When requiring that information is provided under paragraph 1, ESMA shall indicate all of the following:

Added(a) a reference to this Article as the legal basis of the request;

Added(b) the purpose of the request;

Added(c) the information required;

Added(d) the time limit within which the information is to be provided;

Added(e) where the information is of a periodic nature, the periodicity at which the information is to be provided;