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24 November 2021

ESMA: Consultation Paper on draft Guidelines on the application of the circumstances under which a CCP is deemed to be failing or likely to


These Guidelines list a set of objective elements that should support the determination that a CCP is failing or likely to fail, in accordance with the circumstances laid down in Article 22(3) of CCPRRR.

These Guidelines, developed in accordance with Article 22(6) of Regulation (EU) 2021/23 of the European Parliament and of the Council of 16 December 2020 on a framework for the recovery and resolution of central counterparties (‘CCP RRR’), are addressed to competent authorities and aims to promote the convergence of supervisory and resolution practices regarding the application of the circumstances under which a CCP is deemed to be failing or likely to fail taking into consideration, as appropriate, the nature, and complexity of the services provided by CCPs established in the Union. When developing those guidelines, ESMA shall take into account the guidelines issued in accordance with Article 32(6) of Directive 2014/59/EU.
The Guidelines provide competent authorities with guidance on the circumstances under which they should determine a CCP being deemed to be failing or likely to fail.


These Guidelines clarify the different circumstances under which a CCP is deemed to be failing or likely to fail, one of the three cumulative conditions set out in Article 22(1) of CCPRRR for triggering a resolution action. In particular, they aim to promote the convergence of supervisory and resolution practices with respect to how and when resolution should be triggered with respect to the circumstances under which a CCP is deemed to be failing or likely to fail. For this purpose, these Guidelines list a set of objective elements that should support the determination that a CCP is failing or likely to fail, in accordance with the circumstances laid down in Article 22(3) of CCPRRR. These Guidelines do not purport to constrain the ultimate discretion of the competent authority and of the resolution authority in making the determination that a CCP is failing or likely to fail.
These draft Guidelines are issued for public consultation in order to seek the views from all interested stakeholders. In particular, this paper may be specifically of interest for EU central counterparties, national competent authorities in charge of the supervision of EU central counterparties, EU authorities involved in the EU CCPs’ recovery and resolution process, clearing members and clients of clearing members.


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