European Securities and Markets Authority consultations on draft RTS relating to CCP authorisations, extensions and validations under EMIR 3

The European Securities and Markets Authority (ESMA) has published two consultation papers on central counterparty (CCP) authorisations, extensions and validations under the European Market Infrastructure Regulation 3 (EMIR 3).

The first consultation paper is on the conditions for extensions of authorisation and the list of required documents and information for applications by CCPs for initial authorisations and extensions. For extensions of services and activities, Articles 15, 15a, 17 and 17a of EMIR now distinguish between a "normal extension" of authorisation procedure, an accelerated procedure and changes that can benefit from an exemption from authorisation. Under Article 14(6), 15(3), 17a(5) and 15a(2) of EMIR, ESMA is mandated to develop four draft RTS specifying: (i) the list of documents that are to accompany an application for authorisation and an application for an extension of authorisation; (ii) the conditions for the accelerated procedure referred to in Article 17a(1), points (a) to (e), of EMIR; (iii) the procedure for consulting ESMA and the college on whether or not those conditions are fulfilled and; (iv) the type of extension of services or activities that could benefit from an exemption from authorisation.

The second consultation paper relates to the conditions for validations of changes to CCP's models and parameters and the list of required documents and information for applications for validations of such changes. Article 49(1) of EMIR now distinguishes between two approval procedures for a CCP intending to adopt a change to a model or parameters. For significant changes, a validation in accordance with Article 49 of EMIR is necessary, while for non-significant changes, the CCP can apply under a newly introduced accelerated procedure as set out under Article 49a of EMIR. ESMA is mandated under Article 49(5) of EMIR to develop draft RTS further specifying: (a) what constitutes a significant increase or decrease for the purposes of Article 49(1i), points (a) and (c) to (h), of EMIR; (b) the elements to be considered when assessing whether one of the conditions referred to in Article 49(1i) of EMIR is met; (c) what constitutes other changes that can be considered as already covered by the approved model and therefore not subject to the validation procedures under Articles 49 or 49a of EMIR; and (d) the list of required documents and information that are to accompany an application for validation pursuant to Articles 49(1c) and 49a of EMIR.

The deadline for comments on both consultation papers is 7 April. ESMA will then prepare the final reports and will submit the final draft RTS to the European Commission (EC) by 25 December.

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