The European Securities and Markets Authority (ESMA) and the European Insurance and Occupational Pensions Authority (EIOPA) has responded to the European Commission’s consultation on revision of the Non-Financial Reporting Directive (NFDR).
ESMA
ESMA aims to coordinate the supervisory actions of national competent authorities (NCAs) by setting out the issues they should consider when assessing OAP requests.
ESMA considers that the current market environment, with a high degree of uncertainty and volatility driven by the COVID-19 pandemic, may negatively impact CCPs and TVs operations and increase their operational risk. These increased risks, combined with limited capacity for assessing access requests and for managing the migration of transactions flows, may impact the orderly functioning of markets or financial stability.
NCAs are expected to take into consideration, to the extent relevant, the relevant adverse developments when taking decisions on open access requests.
ESMA expects CCPs and trading venues to have the necessary operational capacity to process access requests once the exceptional market circumstances have cleared up.
The current exemptions under MiFIR, which allow NCAs to temporarily exempt TVs and CCPs from the OAP for exchange traded derivatives (ETDs), expire on 3 July and from 4 July the OAP for ETDs will apply.
EIOPA
EIOPA supports the initiative to revise the NFRD. Insurance undertakings and pension funds are at the forefront of pushing long-term, sustainable investments and the integration of environmental, social and governance (ESG) factors.
To empower sustainable investment opportunities and to enable an effective integration of ESG factors, high quality non-financial reporting is needed. Corresponding non-financial reporting standards shall ensure consistency with the important Disclosure and Taxonomy Regulations and be based on the European Supervisory Authorities’ experience to develop technical standards in that area.