On the proposal for a directive of the European Parliament and of the Council amending Directives 2009/65/EU, 2013/36/EU and (EU) 2019/2034 as regards the treatment of concentration risk towards central counterparties and the counterparty risk on centrally cleared derivative transactions
ECON-PR-749905
Committee on Economic and Monetary Affairs · Rapporteur: Danuta Maria Hübner
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This is the rapporteur's draft report on a proposed directive amending Directives 2009/65/EU, 2013/36/EU and (EU) 2019/2034 on concentration risk towards central counterparties and counterparty risk on centrally cleared derivatives. It adopts a first-reading position with two amendments to the Commission proposal.¶¶¶ The amendments broaden the recital on supervisory powers so that competent authorities can address excessive concentration risk using the full supervisory toolbox, and add a recital empowering them to review institutions' and firms' plans, taking into account the active account requirement.¶¶ The draft also amends Article 81 of Directive 2013/36/EU so that competent authorities assess institutions' concentration risk management practices taking into account the requirements in Article 7a and information from the joint monitoring mechanism in Article 23c of Regulation (EU) No 648/2012.¶¶
Committee position. The rapporteur proposes that Parliament adopt its first-reading position with three amendments to the Commission proposal: broadening the recital on supervisory powers, adding a recital on reviewing plans, and amending Article 81 of Directive 2013/36/EU to take into account Article 7a and the joint monitoring mechanism.¶¶¶
Key points
- Parliament adopts its first-reading position on the proposed directive amending Directives 2009/65/EU, 2013/36/EU and (EU) 2019/2034.¶
- Parliament calls on the Commission to refer the matter to Parliament again if it replaces, substantially amends or intends to substantially amend its proposal.¶
- Amendment 1 replaces the recital's reference to additional own funds requirements with a broader reference to competent authorities addressing excessive concentration risk.¶
- The rapporteur states that the reference to Pillar 2 tools and powers should remain broad, as it is not suitable to determine ex ante which tools would be appropriate.¶
- Amendment 2 adds a new recital empowering competent authorities to review credit institutions' and investment firms' plans, taking into account the methodology for calibrating the active account requirement.¶
- The rapporteur states that the proposed Pillar 2 framework is conditioned on the active account requirement and on full transparency via publication and endorsement of ESMA's draft regulatory technical standards under Article 7a(5) of EMIR.¶
- Amendment 3 amends Article 81 of Directive 2013/36/EU so that competent authorities assess and monitor institutions' concentration risk management practices, taking into account requirements in Article 7a and information from the joint monitoring mechanism in Article 23c of Regulation (EU) No 648/2012.¶
- The rapporteur states that taking the joint monitoring mechanism's results into account would enhance competent authorities' assessment of concentration risk towards services of substantial systemic importance provided by third-country CCPs.¶
Who is affected
- Credit institutions and investment firms, which must develop plans and manage concentration risk towards central counterparties.¶¶
- Competent authorities, which would assess and monitor institutions' concentration risk practices and review their plans.
- Third-country CCPs of substantial systemic importance, whose services are the source of concentration risk addressed.¶
Legal basis: Article 294(2) and Article 53(1) of the Treaty on the Functioning of the European Union.¶