Q&A regarding the DLT Pilot Regime
On 3 February 2023, ESMA updated its questions and answers on the implementation of Regulation (EU) 2022/858 of 30 May 2022 on a pilot regime for market infrastructures based on distributed ledger technology ("DLT") (the “DLT Pilot Regime Q&A”) with the addition of four new questions and answers.
In the area of transaction reporting, ESMA has clarified how a DLT multilateral trading facility ("DLT MTF") / a DLT trading and settlement system ("DLT TSS") should report on behalf of natural persons that are not subject to Article 26 Markets in Financial Instruments Regulation (“MiFIR”). Pursuant to Article 26 MiFIR trading venues shall report on behalf of those firms that are not subject to the transaction reporting regime.
On the topic of financial instruments reference data, ESMA clarified how "issuer or operator of the trading venue identifier" data that needs to be provided in accordance with RTS 23 (as referred to in the DLT Pilot Regime Q&A) should be populated for DLT financial instruments (i) that are digital representations of previously issued financial instruments and (ii) that are exclusively created on the DLT platform and do not represent a previously issued financial instrument. RTS 23 are contained within Commission Delegated Regulation (EU) 2017/585 of 14 July 2016 which supplements MiFIR with regulatory technical standards for the data standards and formats for financial instrument reference data and technical measures in relation to arrangements to be made by ESMA and competent authorities.
Finally, on transparency, ESMA confirmed, for complying with post-trade transparency obligations under the RTS 1 and RTS 2 (as referred to in the DLT Pilot Regime Q&A), which identification codes should be provided by trading venues, investment firms and approved publication arrangements for DLT instruments in the relevant reporting fields. RTS 1 are contained within Commission Delegated Regulation (EU) 2017/587 of 14 July 2016 which supplements MiFIR with regulatory technical standards on transparency requirements for trading venues and investment firms in respect of shares, depositary receipts, exchange-traded funds, certificates and other similar financial instruments and on transaction execution obligations in respect of certain shares on a trading venue or by a systematic internaliser. RTS 2 are set out in Commission Delegated Regulation (EU) 2017/583 of 14 July 2016 which supplements MiFIR with regulatory technical standards on transparency requirements for trading venues and investment firms in respect of bonds, structured finance products, emission allowances and derivatives.
Note that for ease of reference, ESMA has numbered the regulatory technical standards (RTS 1, RTS 2, RTS 3, etc.) in the DLT Pilot Regime Q&A in accordance with the numbering used in the package sent by ESMA to the Commission in September 2015 (ESMA/2015/1464).
Q&A regarding the Prospectus Regulation
On 3 February 2023, ESMA updated its questions and answers on the implementation of Regulation (EU) 2017/1129 of 14 June 2017 on the prospectus to be published when securities are offered to the public or admitted to trading on a regulated market, and repealing Directive 2003/71/EC (the “Prospectus Regulation Q&A”). Article 1(4)(d) of the Prospectus Regulation creates an exemption from the requirement to publish a prospectus with regards an offer of securities addressed to investors who acquire securities for a total consideration of at least EUR 100,000 per investor, for each separate offer. The Prospectus Regulation Q&A now clarifies that a purchase of securities via a joint account, e.g. held by husband and wife, can be considered as a purchase by one investor for the purpose of calculating this threshold.
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