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ESMA Sheds Light on Supervision of TRs

The European Securities and Markets Authority (ESMA) has published a summary of its 2014 supervisory work plan in relation to EMIR trade repositories (TRs).

The bulk of TR supervisory activities ESMA expects to perform in 2014 will be desk-based.  Ultimately, a risk-based approach will be adopted.  Broadly, this is designed to identify supervision priorities among TRs by reference to impact, probability of non-compliance and interconnectivity.  In addition, ESMA has the right under EMIR to use specific investigatory powers – requests for information under Article 61, general investigations under Article 62 and on-site inspections under Article 63.

ESMA sees two distinct supervisory periods in 2014:

  • From the date of TR registration (November 2013) until several weeks after the reporting regime is fully operational (March 2014); and
  • After the reporting regime is fully operational.

During the first period, until the reporting regime properly beds in, supervisory action will focus on the follow-up of any issues identified during the processing of TR registration applications together with any necessary action resulting from information received from stakeholders and TRs during this period.  Specific focus will be on:

  • Client on-boarding processes of TRs;
  • On-boarding of authorities to TRs (i.e. provision of data to authorities by TRs);
  • Monitoring of TR IT systems deployment;
  • Inter-TR reconciliation of data; and
  • Transparency of TR’s pricing policy.

During the second phase (i.e. after the reporting regime is fully operational) ESMA will apply its risk-based approach to supervision in order to identify priorities in TR supervision in the normal way.


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