What changed between the draft committee report and the plenary report

Added:(iii) the overall change in the risk of the different portfolios included in the exercise; and

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Added:(e) monitor the transactions resulting from the post-trade risk reduction exercise in order to ensure, to the extent possible, that the post-trade risk reduction exercise does not result in any misuse or circumvention of the clearing obligation.

Removed:Article 1 – paragraph 1 – point 9 – point -a (new), Article 14 – paragraph 1: (-a) paragraph 1 is replaced by the following: / "Where a legal person established in the Union intends to provide clearing services as a CCP, it shall apply for authorisation to ESMA, in accordance with the procedure set out in Article 17. / ESMA shall inform the competent authority of the Member State where it is established without delay.

Added:5. The competent authority that authorised the PTRR service provider shall notify ESMA of the authorisation. ESMA shall publish and maintain a list of all authorised PTRR service providers in the Union.

Removed:(https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02012R0648-20220812)

Added:The competent authority that authorised the PTRR service provider shall, on a yearly basis, confirm that that PTRR service provider complies with the requirements laid down in paragraph 4.

Removed:ESMA should be responsible for the approval of new CCPs, to strengthen supervisory convergence.

Added:Where a PTRR service provider no longer complies with the requirements laid down in paragraph 4, the competent authority may withdraw its authorisation.

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Added:6. Before entities begin using the clearing exemption for post-trade risk reduction transactions referred to in paragraph 1, they shall notify their respective competent authorities, providing them with a description of the type of post-trade risk reduction exercise they plan to use and a written explanation of how the conditions set out in paragraphs 3 and 4 are complied with on an ongoing basis. The use of the notified type of post-trade risk reduction exercise and the clearing exemption for the relevant post-trade risk reduction transactions shall be deemed approved unless the notified competent authority informs the entity it supervises that it does not validate the use of the exemption within 30 calendar days of the date of the receipt of the notification. Competent authorities shall notify ESMA of any entity having been validated to participate in post-trade risk reduction exercises or having its validation withdrawn by the authority.

Removed:Article 1 – paragraph 1 – point 9 – point a a (new), Article 14 – paragraph 4: (aa) paragraph 4 is replaced by the following: / "4. A CCP shall comply at all times with the conditions necessary for authorisation. / A CCP shall, without undue delay, notify ESMA and the competent authority of any material changes affecting the conditions for authorisation."

Added:7. ESMA shall develop draft regulatory technical standards to further specify the conditions set out in paragraphs 3 and 4, including aspects such as market neutrality in the PTRR exercise, the type of transactions which can be included in a PTRR exercise and benefit from an exemption from the clearing obligation, the requirements of the management of the PTRR exercise and how to monitor the correct application of the exemption granted, ensuring the clearing obligation is not circumvented. ESMA shall submit those draft regulatory technical standards to the Commission by ... [12 months from the date of entry into force of this amending Regulation].

Removed:(https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02012R0648-20220812)

Added:Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the first subparagraph of this paragraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.’

Removed:Both ESMA and the NCA should be notified of material changes affecting the conditions for authorisation.

Added:(3 b) in Article 6(2), the following point is added:

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Added:‘(fa) the clearing rate for derivatives contracts concluded in the Union, on aggregate basis and for different asset classes;’

Removed:Article 1 – paragraph 1 – point 10 – point a, Article 15 – paragraph 1 – subparagraph 1: A CCP wishing to extend its business to additional services or activities not covered by the existing authorisation, or a CCP that has not, during the last 12 months, provided clearing services or activities in a class of financial instrument or a class of non-financial instrument covered by the existing authorisation and that wishes to offer such instrument for clearing, shall submit a request for extension to ESMA. The offering of clearing services or activities for which the CCP has not already been authorised, or for which it has been authorised but which it has not provided during the last 12 months, shall be considered to be an extension of that authorisation.

Added:(4) the following Articles 7a and 7b are inserted:

Removed:ESMA should be responsible to carry out validation for Article 15 on extension of services. The changes also seek to avoid a situation where authorisations are given without being used, as required under Article 20.

Added:‘Article 7a

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Added:Active Account

Removed:Article 1 – paragraph 1 – point 10 – point b, Article 15 – paragraph 3 – subparagraph 1 a (new): When preparing the draft regulatory technical standards, ESMA shall take into account the existing documentation requirements and practices under this Regulation and streamline their submission where possible, and the importance of avoiding an excessive time to market and of ensuring that the information to be provided by the CCP applying for an extension of authorisation pursuant to paragraph 1 is proportional to the materiality of the change for which the CCP is applying.

Added:1. Financial counterparties or a non-financial counterparties that are subject to the clearing obligation in accordance with Articles 4a and 10 and clear any of the categories of the derivative contracts referred to in paragraph 2 shall clear at least a proportion of such contracts at accounts at CCPs authorised under Article 14.

Removed:Specification to ensure that when drafting RTS ESMA take into account the degree of materiality of the change that the CCP isapplying for, as well as the necessary time to market, in order to avoid an excessively long list of documents to be provided by the CCP. For a similar reason, ESMA should also take into account the existing documentation requirements for CCPs and seek to streamline their submission to avoid an excessive administrative burden on CCPs.

Added:1a. For the purposes of paragraph 1 of this Article, an account at a CCP authorised under Article 14 shall be deemed active where:

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Added:(a) initial and daily variation margins are posted against existing positions; (b) the necessary IT connectivity, internal processes and legal documentation are in place; and

Removed:Article 1 – paragraph 1 – point 11 – point b, Article 17 – paragraph 1 – subparagraph 2: ESMA shall, within 2 working days after such application has been received, acknowledge receipt of the application, stating to the CCP whether it contains the documents required pursuant to Article 14(6) and (7) or, where the CCP has applied for an extension of its authorisation, pursuant to Article 15(3) and (4).

Added:(c) the CCP demonstrates to ESMA through regular stress tests that in the event of a significant and sudden increase of clearing activity, the regular functioning of that account and the internal functioning of the CCP would not be affected.

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Added:Financial or non-financial counterparties subject to the requirement laid down in paragraph 1 shall ensure that their active accounts are fully operational by ... [6 months from the date of entry into force of this amending Regulation].

Removed:Article 1 – paragraph 1 – point 11 – point b, Article 17 – paragraph 1 – subparagraph 3: Where ESMA determines that not all documents required pursuant to Article 14(6) and (7) or Article 15(3) and (4) have been submitted, it shall reject the CCP’s application.

Added:ESMA shall develop draft regulatory technical standards to further specify how the conditions listed in the first subparagraph of this paragraph are to be applied in order for that account to be considered active.

Removed:Change to reflect the move to ESMA as the supervisor of EU CCPs. See explanatory statement for greater details.

Added:ESMA shall submit those draft regulatory technical standards to the Commission by … [12 months from the date of entry into force of this amending Regulation].

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Added:Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in the third subparagraph of this paragraph in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.

Removed:Article 1 – paragraph 1 – point 11 – point b, Article 17 – paragraph 2: 2. The applicant CCP shall provide ESMA with all information necessary to demonstrate that it has established, at the time of authorisation, all the necessary arrangements to meet the applicable requirements laid down in this Regulation as regards the changes referred to in the application for authorisation submitted by the applicant CCP.

Added:1b. By ... [24 months after the date of entry into force of this amending Regulation] the Commission shall adopt a delegated act in accordance with Article 82 supplementing this Regulation by introducing a requirement for financial counterparties or non-financial counterparties as referred to in paragraph 1 of this Article to clear a proportion of contracts in any of the categories of the derivative contracts referred to in paragraph 2 at a CCP authorised under Article 14. If necessary, the delegated act shall also specify the relevant reporting obligations related to the introduction of that requirement.

Removed:Clarification that the Article only applies to the specific application for authorisation. The current drafting might be interpreted as implying that each time a CCP applies for a license extension under Art. 15(1), a full review of the CCP's compliance with all EMIR Articles applicable to CCPs, including those that are not relevant for the approval procedure, and this might further complicate the approval process.

Added:The Commission shall only adopt the delegated act referred to in the first subparagraph of this paragraph if it has received the notification from ESMA as referred to in Article 22a, and where it considers that the introduction of a requirement to have a specific proportion of contracts cleared at a CCP authorised under Article 14 meets all of the following criteria:

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Added:(a) the requirement would not result in a distortion of competition in the Union;

Removed:Article 1 – paragraph 1 – point 11 – point b, Article 17 – paragraph 3 – subparagraph 1 – introductory part: Within 40 working days of the end of the period set out in the second subparagraph of paragraph 1 (“the risk assessment period”), ESMA and the college shall each conduct risk assessments of the CCP’s compliance with the relevant requirements laid down in this Regulation. By the end of the risk assessment period ESMA shall transmit its draft decision and report to the CCP's competent authority and the college. / (deleted) / (deleted) / (deleted)

Added:(b) the requirement would contribute to the financial stability of the Union; and

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Added:(c) the international competitiveness of the financial and non-financial counterparties subject to this Regulation would not be adversely affected by the introduction of the requirement.

Removed:Article 1 – paragraph 1 – point 11 – point b, Article 17 – paragraph 3 – subparagraph 2: deleted

Added:For the purposes of assessing point (c) of the second subparagraph of this paragraph, the Commission shall assess whether the requirement would result in a reduction of market share of clearing members established in the Union and counterparties and, for those counterparties which are subject to the best execution obligation under Article 27 of Directive 2014/65/EU, whether the requirement would lead to an increase in the prices that would be offered to end investors as a result of differences in liquidity and prices between CCPs authorised under Article 14 and under Article 25 would be significantly affected. In particular, the Commission shall carry out a cost-benefit analysis, including a measurement of the differences in prices of the instruments cleared at one CCP versus another, as well as their volatility.

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Added:The Commission may also request ESMA to provide a report on the proportion of contracts to be cleared at a CCP authorised under Article 14 that would meet the criteria set out in the second subparagraph of this paragraph and on whether different proportions should be set for different sub-types of derivative contracts, for different types of counterparty, and for different types of activity.

Removed:Article 1 – paragraph 1 – point 11 – point c, Article 17 – paragraph 3a: 3a. During the risk assessment period referred to in paragraph 3, ESMA or any of the college members may submit questions directly to the CCP. Where the CCP does not respond to such questions within the time period set by the requesting authority, ESMA or the college may take a decision in the absence of the CCP’s response or may decide to extend the assessment period by a maximum of 10 working days, if, in their view, the question is material for the assessment. A CCP shall not be required to respond more than once to a specific question.

Added:1c. By 24 months after the adoption of the delegated act as referred to in paragraph 1b of this Article the Commission shall conduct an assessment of whether the proportion of contracts to be cleared at a CCP authorised under Article 14, specified in that delegated act, still meets the criteria listed in paragraph 1b of this Article, and whether it needs to be adjusted. In such a case, the Commission is empowered to adopt a delegated act amending the delegated act referred to in paragraph 3 of this Article.

Removed:Reflecting the wording already included in recital 20, according to which any question asked to the CCPs during the assessment period shall be shared between the relevant authorities.

Added:2. In determining its obligations with regard to paragraphs 1 and 1b, a financial or a non-financial counterparty belonging to a group subject to consolidated supervision in the Union shall consider all derivative contracts referred to in paragraph 3 that are cleared by that counterparty or by other entities within the group to which that counterparty belongs.

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