27 March 2013

ESMA/Maijoor: EMIR - A fair price for safety and transparency

I would now like to speak briefly about the non-objection period of the European Parliament. You may have heard about the motion by the ECON Committee of the European Parliament to object to the standards. Fortunately, the Plenary of the European Parliament did not object to the standards.

I say “fortunately” for two reasons. Firstly, despite the care we take in our work, ESMA can make mistakes of a technical nature and I fully respect the powers of the European Parliament and the Council to scrutinise our work. However, the technical standards are by their nature of a purely technical nature. Scrutiny of our standards should not result in reopening the difficult political decisions that were taken when EMIR was adopted by the European Parliament and the Council. I am convinced that those decisions were fully respected by, and reflected in, our standards. Secondly, we are all committed to an international agenda agreed at G20 level and objection to the standards would have severely compromised the compliance of the European Union with this agenda.

Let me now mention the more medium term changes as a result of EMIR. Three months after the registration of trade repositories, the reporting obligation will start applying to all derivative transactions. So we expect this obligation to start applying from mid-September. As you know, trade repositories will play a key role in the reporting obligation and ESMA has now begun their registration process. For this we have established a dedicated team which we are further expanding for the supervision of trade repositories which will start after their registration.

Six months after the authorisation of CCPs, and following the notification to ESMA by NCAs of that authorization, ESMA needs to issue technical standards identifying the classes of derivatives subject to the clearing obligation. These standards are not expected to enter into force before the end of this year, and after the entry into force a phasing-in period is expected.

I would like to say a few words about EMIR and pension funds. In general, the EU has taken a holistic approach to developing the new regulations for banks and financial markets. This is appropriate because we do not want to incentivise fragmentation or a shadow banking system. In line with this philosophy, the scope of EMIR is broad covering all financials and those non-financials developing activities like financials. I expect that some in the audience today are unhappy about this approach, but I hope you understand the reasons for it. To mitigate the impact of this holistic approach in EMIR, some exemptions have been introduced. One is particularly relevant in this context and relates to pension funds.

Full speech

© ESMA