Securities Regulation Daily Wrap Up, DERIVATIVES—ESMA Will Assist European Commission In Regulation on Trade Repository, (Feb 22, 2013)

By Jim Hamilton, J.D., LL.M

After receiving a formal request from the European Commission to provide technical advice to assist the Commission in formulating a Regulation on fees for Trade Repositories, the European Securities and Markets Authority issued a consultation suggesting alternatives for comment. For registration, ESMA is considering different fee bands based on objective criteria. Such criteria are taking into account the costs to be incurred in carrying out all the relevant actions regarding the applications submitted and aim to be proportionate to the estimated turnover of trade repositories. For on-going supervisory fees, ESMA is considering a single periodic fee based on turnover of the trade repository relative to the turnover of other trade repositories registered in the EU. An option for a minimum supervisory fee is also being considered.

ESMA emphasizes that in the European Union there are currently no registered trade repositories subject to a specific regulatory framework, though some entities are already providing repository services under other types of administrative licenses. The Dodd–Frank Act provides different rules regarding the registration of swap data repositories, including the time that the CFTC has to assess a registration is 180 days. Given the differences in requirements, ESMA does not believe that the experience of authorities that have repositories operating in their territories can be used as a proxy to estimate the necessary supervisory effort for Trade Repository registration under EMIR.

RegulatoryActivity: Derivatives