In October and November 2022, ESMA updated its Questions and Answers (“MAR Q&A”) on Regulation (EU) No. 596/2014 (the “Market Abuse Regulation” or "MAR"), and its Questions and Answers (“CSDR Q&A”) on Regulation (EU) No. 909/2014 (the "CSDR").
With the latest update of the MAR Q&A, ESMA amended its answer to an existing question (Q&A 6.1). ESMA had previously confirmed that the obligation to detect and identify market abuse or attempted market abuse under Article 16(2) of MAR applies broadly, and “persons professionally arranging or executing transactions” thus includes buy-side firms, such as investment management firms (AIFs and UCITS managers), as well as firms professionally engaged in trading on own account (proprietary traders). ESMA has now amended its answer to confirm that Article 16(2) should be interpreted as also applying to investment firms providing direct electronic access (DEA providers) with respect to their DEA clients’ trading activity.
Regarding the updates to CSDR Q&A, ESMA added various new Q&A regarding settlement discipline. Most of the new Q&A concerned cash penalties – calculation, scope, costs and process. Furthermore a new Q&A was added regarding settlement fails. Pursuant to Commission Delegated Regulation (EU) No. 2018/1229 of 25 May 2018 supplementing Regulation (EU) No. 909/2014 of the European Parliament and of the Council with regard to regulatory technical standards on settlement discipline (“RTS on settlement discipline”) central securities depositories shall publish the information set out in Annex III of that delegated regulation, for the securities settlement system it operates. Such information must be published on their website for free, including the relevant values in EUR, on an annual basis. ESMA has clarified in this latest update to its CSDR Q&A that, to ensure a level playing field, the annual disclosure should be made by the end of February of each year and for the first time by the end of February 2023.
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