Regulation (EU) 2015/2365 on transparency of securities financing transactions and of reuse

What it is

The Committee on Economic and Monetary Affairs adopted the report by Renato SORU (S&D, IT) on the proposal for a regulation of the European Parliament and of the Council on reporting and transparency of securities financing transactions. The committee recommended that the European Parliament’s position at first reading following the ordinary legislative procedure should amend the Commission proposal as follows: Securities financing transactions (SFTs) : the Regulation should cover repurchase transactions, securities or commodities lending, securities or commodities borrowing, buy-sell back or sell-buy back transactions, liquidity swaps and collateral swap transactions as laid down in Regulation (EU) No 575/2013 or total return swaps as defined in Commission Regulation (EU) No 231/2013 . Reporting obligation : counterparties to securities financing transactions (SFTs) shall report the details of such transactions to a trade repository registered or recognised in accordance with this Regulation. The details shall be reported no later than the third working day following the conclusion, modification or termination of the transaction but as soon as the reporting is possible. The European Parliament adopted by 546 votes to 89, with 7 abstentions, a legislative resolution on the proposal for a regulation of the European Parliament and of the Council on reporting and transparency of securities financing transactions. The European Parliament’s position at first reading following the ordinary legislative procedure amended the Commission proposal as follows: Subject matter and definitions : this Regulation lays down rules on the transparency of securities financing transactions (SFTs) and of reuse. Under this proposal, " reuse " shall mean the use by a receiving counterparty, in its own name and on its own account or on the account of another counterparty, including any natural person, of financial instruments received under a collateral arrangement. The Regulation seeks to create a Union framework under which details of SFTs can be efficiently reported to trade repositories and information on SFTs and total return swaps is disclosed to investors in collective investment undertakings. The definition of "securities or commodities lending" or "securities or commodities borrowing" has been defined as well as "buy-sell back transaction" or "sell-buy back transaction" and "repurchase transaction" and "margin lending transaction". Reporting obligation and safeguarding in respect of SFTs : counterparties to SFTs shall report the details of any SFT they have concluded, as well as any modification or termination thereof, to a trade repository registered. Those details shall be reported no later than the working day following the conclusion, modification or termination of the transaction. Transactions with members of the European System of Central Banks (ESCB) should be exempted from the obligation to report SFTs to trade repositories. Counterparties shall keep a record of any SFT that they have concluded, modified or terminated for at least five years following the termination of the transaction . In order to ensure consistent application of this Regulation,…

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