ESMA and European Supervisory Authorities Outline Regulatory Updates Across Market Infrastructure, AI, and Trading

The European Securities and Markets Authority (ESMA), in coordination with fellow European Supervisory Authorities (ESAs), has detailed a broad slate of regulatory consultations, market infrastructure authorisations, and supervisory initiatives across European financial markets. On the market infrastructure and trading front, ESMA has launched a consultation regarding the reporting framework for clearing activity at recognised third-country Central Counterparties (CCPs). The authority has also confirmed the go-live for weekly commodity derivatives position reporting and authorised EuroCTP to operate as the Consolidated Tape Provider for shares and exchange-traded funds (ETFs). Furthermore, ESMA initiated data collection under the initial phase of the European Single Access Point (ESAP). Working within the Joint Committee alongside the European Banking Authority (EBA) and the European Insurance and Occupational Pensions Authority (EIOPA), the regulators have jointly proposed targeted amendments to bilateral margin requirements. The ESAs also issued a joint statement urging enhanced governance frameworks and consistent supervision to manage information and communication technology (ICT) risks arising from frontier artificial intelligence (AI) models across the European Union's financial industry. In addition to market data and infrastructure developments, ESMA addressed ongoing operational and supervisory priorities. The watchdog published a report reviewing the supervision of cross-border investment services to foster supervisory convergence across member states, while calling on market participants to conclude their preparations ahead of upcoming T+1 securities settlement deadlines.