BACKGROUND

On 21 October 2025, the ESMA published Final Report on the Draft Regulatory Technical Standards on open-ended loan-originating AIFs under the AIFMD.

On 12 December 2024, ESMA launched a public consultation on draft Regulatory Technical Standards (RTS) for open-ended loan-originating alternative investment funds (OE LO AIFs) under the AIFMD. The consultation closed on 12 March 2025 and attracted 18 responses from asset managers, investment firms, industry associations, and one consumer association.

WHAT'S NEW?

After reviewing stakeholder feedback, ESMA introduced several key amendments to the draft RTS:

• Liquidity management: The original draft required AIFMs to define a “target appropriate amount” of liquid assets that OE LO AIFs should hold to meet redemption requests. Respondents argued this approach was too rigid and did not reflect the specific liquidity characteristics of loan-originating funds, which rely on the liquidity generated by their loan portfolios rather than by maintaining cash buffers. Many also warned that the requirement could negatively affect fund performance. ESMA agreed and removed this fixed liquidity threshold. Instead, AIFMs must ensure their funds have sufficient liquidity to meet redemption requests, giving managers discretion to align liquidity management with the fund’s structure and underlying assets..
• Stress testing: ESMA initially proposed that AIFMs perform liquidity stress tests quarterly. Respondents considered this overly burdensome and misaligned with the long-term nature of loan-originating strategies. ESMA adjusted the requirement to a minimum of once per year, providing flexibility for AIFMs to perform more frequent tests if appropriate.
• Clarified scope and authorisation: Several stakeholders flagged ambiguity in the reference to AIFMs that “intend to manage” OE LO AIFs, which could be read as implying a pre-authorisation requirement. ESMA replaced the phrase with “AIFMs that manage” to clarify that no additional authorisation is required at the EU level for managers already authorised under AIFMD. However, ESMA acknowledged that some Member States may still impose pre-authorisation requirements for certain OE LO AIFs under national law.

WHAT'S NEXT?

ESMA has submitted the final draft RTS to the European Commission for adoption. The Commission must decide within three months whether to adopt the RTS, with the option to extend the review period by one month.

On 8 October 2025, the EBA published Report on Competent Authorities' approaches to the anti-money laundering and countering the financing of terrorism supervision of banks.

The EBA published a Report that takes stock of the actions taken by all competent authorities to address the EBA’s findings and recommendations. This follows in - depth reviews carried out by the EBA of all 40 competent authorities approaches to tackling money laundering and terrorist financing (ML/TF) risks in banks in all EU/ EEA Member States over the last 6 years, issuing recommendations when necessary to improve the effectiveness of anti-money laundering and counter terrorism financing (AML/CFT) supervision.

Overall, competent authorities have made significant progress over the past six years in adopting a risk-based approach to AML/CFT supervision. Despite the challenges which, in some cases, hampered their reform efforts, most competent authorities now have dedicated AML/CFT strategies, targeted supervisory plans, and manuals that guide supervisors and ensure consistency across the sector. They are also cooperating more effectively with relevant stakeholders at both national and international level. Looking ahead, the new EU Anti-Money Laundering Authority (AMLA) will benefit from the EBA’s work that has been instrumental in making AML/CFT supervision in the EU more effective.

In relation to AML/CFT supervision, competent authorities have taken notable steps to align national strategies and practices with the EBA standards. The findings suggest that supervisory manuals have been enhanced to ensure that AML/CFT supervision becomes more consistent and effective, and that most supervisors have taken significant steps to use all supervisory tools available to them in a more strategic way. However, in several cases, work is still underway to address recommendations stemming from these reviews.

Competent authorities also made substantial efforts to strengthen coordination and information exchange with the relevant public authorities within their respective Member States, such as competent authorities with shared supervisory responsibilities, the financial intelligence unit and tax authorities. The Report also highlights significant progress in relation to establishing sound and effective communication with competent authorities in other EU jurisdictions or third countries. Nevertheless, in some Member States, further improvement is needed, for example in relation to effective cooperation mechanisms with prudential supervisors.

On 9 October 2025, the EBA published report on tackling ML TF risks in crypto-asset services through supervision - lessons learned from recent cases.

The EBA has played a key role in strengthening the AML/CFT regulatory and supervisory framework for crypto-assets in the EU since 2018, when certain crypto-asset businesses were first brought within the EU framework. Through continuous engagement and cooperation with national supervisors, the European Supervisory Authorities (ESAs), and third-country authorities, the EBA has gathered critical insights into the operations and risks of crypto-asset businesses, both before and after the implementation of the Markets in Crypto-Assets Regulation (MiCA). This has enabled the EBA to identify significant AML/CFT vulnerabilities across the sector and to provide targeted guidance to improve compliance and oversight.

The Report is intended to inform supervisory approaches to the authorisation and oversight of crypto-asset service providers (CASPs) and issuers and to strengthen AML/CFT frameworks. It summarises lessons learnt from actions taken by competent authorities and the EBA in identifying and managing ML/TF risks associated with crypto-asset businesses, both prior to and immediately after the implementation of the new regulatory framework. It also describes strategies used by some CASPs and issuers to sidestep national AML/CFT supervision, highlights the safeguards introduced by MiCA and the revised AML/CFT regime, and identifies key elements that will underpin the effective application of the new EU framework.

By consolidating these findings, the Report supports the effective implementation of MiCA and the enhanced AML/CFT framework, while promoting a robust and forward-looking approach to tackling financial crime risks in the sector.

On 3 October 2025, the EU published Commission Delegated Regulation (EU) 2025/1264 of 27 June 2025 supplementing Regulation (EU) 2023/1114 of the European Parliament and of the Council with regard to regulatory technical standards specifying the minimum contents of the liquidity management policy and procedures for certain issuers of asset-referenced tokens and e-money tokens.

Pursuant to Article 35(4) and Article 58 of Regulation (EU) 2023/1114, the requirements laid down in Article 45(3) of that Regulation apply not only to issuers of significant asset referenced tokens, but also to electronic money institutions issuing significant e-money tokens and, where required by their competent authorities, to issuers of asset referenced tokens that are not significant and to electronic money institutions issuing e-money tokens that are not significant.

In accordance with Regulation (EU) 2023/1114, the Commission is to specify the minimum contents of the liquidity management policy and procedures for managing the liquidity risk of issuers of asset-referenced tokens or e-money tokens ensuring that the value of the reserve of assets can meet requests for redemption by holders of such tokens under normal and stress scenarios ensuring the normal continuity of the business. In order to meet requests for redemption, issuers of asset-referenced tokens or e-money tokens should pay particular attention to the volatility of the assets referenced relative to the reserve of assets and should perform a subsequent analysis of the necessary overcollateralisation. To mitigate any counterparty risk, issuers of asset-referenced tokens or e-money tokens should avoid risks of concentration of the custodians of the reserve of assets.

In order to ensure the reserve assets have a resilient liquidity profile that enables issuers of asset-referenced tokens or e-money tokens to continue operating normally also under scenarios of liquidity stress, a detailed description of the risks covered, the parameters identified and their calibration for the purposes of testing scenarios of liquidity stress, should be included in the liquidity management policy. The review of that information, which should be updated for each liquidity stress testing exercise, is expected to allow supervisors to decide on appropriate measures to strengthen the issuers’ liquidity requirements if necessary.

This Regulation is based on the draft regulatory technical standards, developed in close cooperation with the European Securities and Markets Authority, submitted to the Commission by the European Banking Authority.

This Regulation enters into force on 24 October 2025.

On 6 October 2025, ESMA published its Compliance Table for the Joint Guidelines on the estimation of aggregated annual costs and losses caused by major ICT-related incidents under DORA (EU) 2022/2554. The Guidelines set a common EU/EEA method for supervisors to collect and assess the annual financial impact of major ICT incidents reported by financial entities.

Key points

• Broad compliance across the EU/EEA: Most national competent authorities (AMF, BaFin, FSMA, CSSF, CNMV, CBI, CONSOB, MFSA, etc.) confirm compliance and have integrated the Guidelines into their supervisory processes.
• Pending implementation:
  - Romania, Iceland, and Norway intend to comply once national DORA-implementing measures are completed.
  - Cyprus and Portugal are non-compliant by default pending designation of their DORA competent authority.
  - Hungary has not responded.

• Several authorities note the publication of the Guidelines on their websites or their integration into existing ICT incident reporting frameworks (e.g., SREP questionnaires, national procedures).

The Guidelines ensure consistent, EU-wide estimation and reporting of ICT incident-related costs and losses, supporting harmonised supervisory oversight under DORA

On 6 October 2025, ESMA published its Compliance Table for the Joint Guidelines on oversight cooperation under DORA (JC/GL/2024/36). The document summarises which competent authorities comply or intend to comply with the Guidelines governing cooperation and information exchange between national authorities and the ESAs.

Key points

• The Guidelines entered into application on 17 January 2025.
• Certain provisions apply later:
  - Guideline 5.1 (reporting) becomes applicable from 30 April 2025, when the first reporting cycle starts.
  - Guideline 1.6 (use of secure tool) becomes applicable once the ESAs deploy the secure communication tool in Q3 2025.

Compliance status

• Most EU/EEA competent authorities comply, including the AMF, BaFin, FSMA, CSSF, CNB, CNMV, CONSOB, MFSA, Bank of Lithuania, Central Bank of Ireland, and others.
• Authorities generally indicate that the Guidelines have been integrated into supervisory practices, published on their websites, or supported by specific national decisions or procedures.
• Some authorities intend to comply, pending national legislative steps or internal procedure finalisation:
  - Hungary (MNB) – preparing internal procedures; aims to comply by 30 June 2025.
  - Poland (KNF) – full compliance dependent on adoption of national legislation enabling DORA oversight powers.
  - Iceland – awaiting incorporation of DORA into national law.

• Cyprus and Portugal – non-compliance by default, pending official designation of the national DORA competent authority.
• Norway – no reply.

These Guidelines support DORA's framework for coordinated oversight of ICT third-party providers and information sharing among supervisors, ensuring a harmonised cooperation structure across the EU/EEA.

On 6 October 2025, the EC published Amendment of the Digital Europe Programme and work programme 2025-2027.

This Work Programme (WP) 2025-2027 of the Digital Europe Programme (DIGITAL) is the last one for the duration of the Multiannual Financial Framework 2021-2027.

It is focused on accomplishing and on ensuring the sustainability of the actions that have been started and pursued under the previous WPs, such as different data spaces, bringing them from the preparatory to deployment phase.

It also continues to further the EU’s goals in digital transformation as defined in the communication 2030 Digital Compass: The European way for the Digital Decade and in the Path to the Digital Decade policy programme.

On 21 October 2025, the EC published its 2026 Commission work programme.

The 2026 European Commission Work Programme, sets out a comprehensive agenda focused on securing Europe's sovereignty, competitiveness, and unity in a rapidly changing global environment. It emphasizes the need for Europe to control its own future by protecting its citizens, economy, environment, and democratic values.

The programme aims to boost sustainable prosperity by supporting industrial sectors, fostering innovation, and deepening the Single Market to ease business operations and financing for all companies, including startups and SMEs. Key legislative initiatives include the European Innovation Act, Cloud and AI Development Act, Quantum Act, and advanced materials legislation, all designed to strengthen digital and technological sovereignty. It also plans to establish a Critical Raw Materials Centre to secure essential supplies for industry.

Energy policy prioritizes lowering costs for households and businesses through an improved Energy Union, upgrading infrastructure, and promoting clean energy and fusion power as part of climate goals. Europe will accelerate the development of clean technologies and enhance sustainable markets through a Circular Economy Act and Clean Industrial Deal, supporting sectors such as aviation.

The defence and security agenda focuses on integrating and strengthening the European defence industry, supporting Ukraine, enhancing border security, and tackling migrant smuggling with sanctions and operational support from agencies like Frontex. Migration policies will apply the Pact on Migration and Asylum to ensure fair and firm management.
Social policies will safeguard Europe’s social model by proposing a Quality Jobs Act, initiatives for fair labour mobility, affordable housing, and an EU Anti-poverty strategy, along with efforts to empower youth and promote intergenerational fairness.

Food security and environmental protection remain key priorities, with measures to strengthen farmers’ competitiveness, ensure fair trading practices, promote sustainable fisheries and aquaculture, implement a Water Resilience Strategy, and address climate-related risks like wildfires while investing in natural capital.

Democracy and rule of law will be reinforced through an annual rule of law cycle, support for independent media and journalistic freedom via a Media Resilience Programme, protection against online harms and cyberbullying, and new anti-corruption and anti-fraud strategies. Equality efforts include a Gender Equality Strategy and updated disability rights initiatives.

On the global stage, the programme seeks to translate new trade frameworks into concrete opportunities while maintaining support for Ukraine and regional partners. It includes a Pact for the Mediterranean to foster partnerships in investment, energy, security, and migration, along with strategies for the Middle East and humanitarian aid reform.

The programme commits to simplification of EU laws to reduce administrative burdens, especially for SMEs, by 25% overall and 35% specifically for smaller businesses, ensuring legislation is lighter, clearer, and easier to implement. It also proposes withdrawal of outdated legislative proposals to maintain focus on priorities.

On 14 October 2025, the EU publishes Commission Delegated Regulation (EU) 2025/1265 of 1 July 2025 supplementing Regulation (EU) No 575/2013 of the European Parliament and of the Council with regard to regulatory technical standards specifying the method for identifying the main risk driver of a position and for determining whether a transaction represents a long or a short position as referred to in Articles 94(3), 273a(3) and 325a(2).

The size of the business constitutes a proxy for the degree of sophistication that institutions should have in their capital calculations. To determine whether institutions are allowed to use simplified methods for the calculation of own funds requirements for market and counterparty credit risks, they are required to calculate the size of the on- and off-balance-sheet business in accordance with Article 94(1), Article 273a(1) and (2), and Article 325a(1) of Regulation (EU) No 575/2013. The identification of the main risk driver of a position and, on that basis, the determination of whether a transaction represents a long or a short position, are fundamental for the correct calculation of the size of the business. Given the importance of those calculations for small and non-complex institutions, the method for identifying the main risk driver of a position and for determining whether a transaction represents a long or a short position should be proportionate to the degree of complexity of the institution.

To produce accurate results, the method for identifying the main risk driver of a non-derivative position should be based on the calculation of the risk-weighted delta sensitivities to risk factors, as set out in Part Three, Title IV, Chapter 1a, Sections 2, 3 and 6 of Regulation (EU) No 575/2013. In addition, to ensure the consistency of the approach, the method for identifying the main risk driver of a position should be consistent with the method for identifying the primary risk driver and the most material risk driver in derivative transactions set out in Delegated Regulation (EU) 2021/931.

It is necessary to lay down a simplified approach for small and non-complex institutions that may not be able to calculate the risk-weighted delta sensitivities, or may not be able to use the methods for identifying the primary risk driver and the most material risk driver in derivative transactions set out in Delegated Regulation (EU) 2021/931. That simplified approach should be suitable for the instruments that small and non-complex institutions normally trade. Larger institutions should also have the possibility to use that simplified approach where they trade simple instruments that are included in the scope of that simplified approach.

The simplified approach should lead to results that are consistent with the risk-weighted delta sensitivities approach.
Nevertheless, simplifying assumptions should be introduced to reduce the computational and operational burden for institutions, in particular with regard to instruments denominated in a currency that is different from the institution’s reporting currency. For that reason, institutions should be allowed to disregard in the determination of the main risk driver the spot exchange rate between the currency in which the instrument is denominated and the institution’s reporting currency for stocks, bonds and derivative transactions the underlying of which would normally be allocated to the interest rate, credit, equity or commodity risk categories.

Cash positions in the reporting currency should not be taken into account when determining the size of the business, since they do not change their market value under the influence of changes to risk drivers.

This Regulation enters into force on 4 November 2025.

BACKGROUND

On 31 October 2025, the EU published Commission Implementing Regulation (EU) 2025/2159 of 27 October 2025 amending the implementing technical standards laid down in Implementing Regulation (EU) 2021/2284 as regards supervisory reporting and disclosures of investment firms.

This regulation updates reporting and disclosure rules for investment firms under Regulation (EU) 2019/2033. It mainly affects firms other than small and non-interconnected firms. The amendments align investment firms’ reporting with the revised prudential framework introduced by Regulation (EU) 2024/3117, clarify own funds requirements for market risk, and set minimum precision for monetary data points. The regulation also provides updated templates and instructions for quarterly reporting and ensures consistency with credit institutions’ reporting where applicable.

WHAT'S NEW?

This regulation updates reporting and disclosure rules for investment firms to align them with recent changes in prudential requirements:

• Investment firms must follow revised templates and instructions from Implementing Regulation (EU) 2024/3117 for supervisory reporting.
• First quarterly reports for reference dates between January and April 2026 are due by 30 June 2026.
• Reporting on counterparty credit and credit valuation risk aligns with credit institutions, while own funds requirements for market risk (K-NPR) remain specific to investment firms.
• Minimum precision for monetary data points is now set at ten thousand units.
• Amendments ensure consistency with credit institutions’ reporting where frameworks overlap, and set specific rules where differences exist.
• Annexes X and XI provide updated templates and instructions for quarterly reporting.

WHAT'S NEXT?

The regulation enters into force 20 days after its publication in the Official Journal of the EU.

Member States must apply it in full and ensure direct applicability to relevant investment firms.

On 13 October 2025, the EP published on approved Draft Rules for Simplified Sustainability Reporting and Due Diligence.

The European Parliament’s Legal Affairs Committee has approved plans to significantly reduce the scope and complexity of sustainability reporting and due diligence obligations for companies across the European Union. The goal is to cut administrative burdens, strengthen competitiveness, and support Europe’s green transition.

Main changes:

• The new draft rules aim to limit mandatory reporting to larger companies with over 1,000 employees and a net annual turnover exceeding €450 million, making reporting for smaller firms voluntary.
• Similarly, due diligence duties on human rights and environmental impacts will mainly apply to large companies with over 5,000 employees or significant turnover, adopting a risk-based approach.
• The revised rules also exclude EU-level civil liability for breaches, emphasizing national law enforcement while ensuring victims receive full compensation.

On 29 October 2025, the EC published Commission Delegated Regulation (EU) supplementing Regulation (EU) No 648/2012 of the European Parliament and of the Council with regard to regulatory technical standards specifying the operational conditions, the representativeness obligation and the reporting requirements related to the active account requirement.

The act operationalises EMIR 3’s requirement that certain financial and non-financial counterparties exposed to clearing services of substantial systemic importance at third-country CCPs maintain an operational and representative active account at EU CCPs. Chapter I sets operational conditions: legal/IT connectivity, policies and procedures for active accounts, capacity to support large flows and shifts of cleared positions, annual stress testing, and written statements evidencing clearing capacity thresholds and time-to-scale. Chapter II defines representativeness: minimum trades to be cleared at EU CCPs across specified subcategories for EUR interest rate OTC derivatives, PLN interest rate OTC derivatives, and EUR short-term interest rate derivatives, with reference periods calibrated by portfolio size and selection of most relevant subcategories based on existing clearing at systemically important services. Chapter III sets semi-annual reporting: aggregate thresholds, operational condition attestations, representativeness metrics and subcategory selections, templates, timing (end-January and end-July), and first-report deferral to at least six months after entry into force. Annexes list derivative classes/subcategories and reporting templates. The Delegated Regulation enters into force 20 days after publication in the Official Journal and applies directly across Member States.

BACKGROUND

On 13 October 2025, the ESMA published its Final Report on amendments to the RTS on Settlement Discipline, which supplements the CSDR.

The report responds to the mandate given under CSDR Refit (Regulation (EU) 2023/2845) to develop regulatory technical standards that improve settlement discipline and efficiency across the EU. It builds on the consultation launched in February 2025 and on ESMA’s broader work on shortening the settlement cycle to T+1, for which 11 October 2027 has been recommended as the EU go-live date.

The amendments aim to:

• Increase settlement efficiency and reduce settlement fails,
• Prepare markets operationally for T+1, and
• Limit unnecessary administrative and IT burden on CSDs and market participants.

WHAT'S NEW?

1. Earlier and more precise allocations and confirmations

ESMA proposes that professional clients must provide allocations and confirmations to investment firms no later than 23:00 CET on trade date (T), replacing the vaguer concept of “close of business”.

At the same time, ESMA stresses that allocations and confirmations should be sent as early as possible intraday, to avoid a concentration of messages at the end of the day and to support straight-through processing in a T+1 environment.

2. Machine-readable, standardised communications

The Final Report introduces a clear move to fully electronic, structured and machine-readable formats for allocations and confirmations. Investment firms must require their (professional) clients to provide all reference data necessary to settle a trade in standardised, electronic formats and to keep these data updated.

ESMA also makes open international communication procedures and standards (e.g. ISO-based messaging) compulsory for exchanging allocations and confirmations, to promote interoperability and automation across markets and infrastructures.

3. Stronger alignment between allocations, settlement instructions and transaction types

The RTS amendments refine the content of allocations and settlement instructions so they better match each other:

• Allocations must be aligned with the matching fields of settlement instructions.
• The place of settlement (PSET) becomes a mandatory field in allocations and settlement instructions, reducing mis-routing and matching issues.
• ESMA introduces a specific transaction type for buy-sell back and sell-buy back transactions, which must be identified in allocations and in the settlement reporting templates.

In addition, CSD participants will have to use a field indicating the place of trading, allowing settlement fails to be monitored and analysed by trading venue.

4. Timing for sending settlement instructions

ESMA requires that settlement instructions (SIs) be sent to the securities settlement system “as soon as possible” and at the latest by 23:59 CET on trade date.

This is intended to ensure that all instructions are in the system ahead of the first settlement runs, giving CSDs and intermediaries maximum time to resolve mismatches or funding issues before intended settlement date.

5. Mandatory CSD functionalities: hold & release, auto-partial settlement and auto-collateralisation

The report repeals Article 12 of the current RTS and thereby removes the possibility for certain CSDs to derogate from key functionalities. Instead:

• Hold & release becomes a mandatory functionality for all CSDs, allowing participants to put instructions on hold and to release them totally or partially.
• Auto-partial settlement must be offered by all CSDs and should be the default setting, unless a participant explicitly opts out.
• Auto-collateralisation (automatic intraday credit secured by eligible collateral) must be provided by CSDs that do not themselves hold a banking licence, so participants can obtain intraday liquidity to support timely settlement.
• CSDs must provide real-time gross settlement (RTGS) and/or at least three daily batch settlement windows, increasing flexibility for participants to complete settlement within T or T+1.

These tools are seen as critical enablers of high settlement efficiency in a T+1 environment.

6. Enhanced monitoring, reporting and disclosure of settlement fails

ESMA reshapes the settlement-fails reporting regime to make it more risk-focused and granular:

• Instead of merely reporting the “top 10” failing participants in absolute terms, CSDs will highlight systemically important participants, ranked by failure rates relative to their overall activity.
• CSD participants will need to provide reason codes for settlement fails so that CSDs can identify root causes.
• CSDs must disaggregate data by type of financial instrument, by place of trading, and report the average duration of settlement fails, weighted by value.
• The obligation to submit a separate annual report on settlement fails is removed, since equivalent information will already be available in monthly reports.

On the transparency side, CSDs will have to publish settlement-fails statistics by instrument type and include the main reasons for fails and measures envisaged to address them, improving information available to regulators and market participants.

7. Additional tools – no regulatory action for now

ESMA also assessed additional tools to improve settlement efficiency – such as unique transaction identifiers (UTI), shaping, automated securities lending, and alignment of CSD opening hours and cut-off times. For the time being, ESMA concludes that no further regulatory mandates are needed, but encourages industry-led solutions and best practices in these areas.

8. Phased implementation towards T+1

To avoid overloading CSDs and market participants, ESMA proposes staggered application dates for different groups of requirements:

• 7 December 2026 – earlier pre-settlement processes: tighter deadlines and electronic standards for allocations, confirmations and SIs start to apply, allowing market participants to test their T+1 workflows in advance.
• 1 July 2027 – enhanced settlement-fails reporting and disclosure obligations begin, so ESMA and the Commission have robust data both before and after the T+1 go-live.
• 11 October 2027 – IT-intensive CSD tools (hold & release, auto-partial settlement, auto-collateralisation, RTGS / multiple batches) become applicable, coinciding with the move to T+1.

WHAT'S NEXT?

ESMA has submitted the draft amended RTS to the European Commission, which has three months to decide whether to endorse them.

In parallel, ESMA “strongly encourages” CSDs, market infrastructures, intermediaries and their clients to treat these RTS amendments as a core component of their T+1 transition programmes, integrating the new timing requirements, electronic standards and CSD functionalities into their post-trade roadmaps.

For banks, investment firms and asset managers, this means that projects on T+1, settlement efficiency, messaging upgrades and fails-management should now be planned with these RTS changes in mind, to avoid duplicate work and to be ready ahead of the key milestones in 2026–2027.

On 9 October 2025, the ESMA published its Final Reports on the RTS on CCPs authorisations, extensions of authorisation and model validations, following the review of the EMIR 3.

EMIR 3 introduces several measures to make EU clearing services and EU CCPs more efficient and competitive, notably by streamlining and shortening supervisory procedures for initial authorisations, extensions of authorisation and validations of changes to models and parameters.

The two sets of RTS specify:
1. the conditions a legal person intending to provide clearing services as central counterparty (CCP) shall fulfill for extensions of authorisation and the list of required documents and information to provide, and
2. the conditions CCPs must fulfill to obtain validation of the changes of their models (e.g., to calculate its margin requirements, default fund contributions, collateral requirements and other risk control mechanisms), including parameters and the list of required documents and information to apply for such changes.

ESMA conducted public consultations on the draft RTS in Q1 2025. The Final Reports consider the feedback received.

BACKGROUND

On 14 October 2025, the EU published Regulation (EU) 2025/2075 of the European Parliament and of the Council of 8 October 2025 amending Regulation (EU) No 909/2014 as regards a shorter settlement cycle in the Union.

Currently, most transactions in transferable securities settle within two business days (T+2). Longer settlement cycles increase counterparty, liquidity, and operational risks and tie up capital unnecessarily. Major non-EU markets are moving to a one-business-day cycle (T+1) or even same-day settlement, creating a misalignment with EU practices. ESMA’s 2024 assessment concluded that shortening the EU cycle would reduce risks, improve market efficiency, harmonise corporate event standards, and help EU markets stay globally competitive.

WHAT'S NEW?

The regulation introduces key changes to the EU settlement cycle to reduce risk and improve alignment with global markets.

• Shorter settlement cycle: The mandatory settlement period for transactions in transferable securities executed on trading venues is reduced from T+2 to T+1. This aligns EU markets with global trends, reduces counterparty and operational risks, and frees up capital that would otherwise be used for margin calls.
• Exemptions: Certain transactions are excluded from the T+1 requirement. These include privately negotiated trades executed on a trading venue, bilateral trades reported to a trading venue, first-time book-entry recordings, and specific securities financing transactions, such as securities lending, buy-sell back, sell-buy back, or repurchase transactions, provided they are documented as single transactions composed of two linked operations. Margin lending transactions remain outside the scope of T+1.
• Reporting and monitoring: Updates to Articles 74 and 75 introduce enhanced reporting requirements, including transaction categories, intended settlement dates, and whether transactions are executed on trading venues. ESMA and the Commission will monitor settlement efficiency and assess the market impact of exemptions. If significant settlement fails occur, the Commission may temporarily adjust related delegated regulations or take other proportionate measures to limit financial or operational consequences.

WHAT'S NEXT?

The Regulation will apply from 11 October 2027. Member States must implement it fully and directly. ESMA will increase monitoring of settlement efficiency ahead of and after the transition to T+1, particularly for exempted securities financing transactions.

On 16 October 2025, the EBA published ESAs’ Joint Committee publishes Work Programme for 2026.

The upcoming Programme aims to strengthen the financial system’s digital operational resilience, ensure the continued protection of consumers, and identify risks that could undermine financial stability.

More specifically, the ESAs will undertake joint work in 2026 to:

• ensure the effective operation of the Oversight Framework for critical third-party ICT providers under the Digital Operational Resilience Act (DORA);
• perform joint risk analyses amid ongoing geopolitical tensions and heightened uncertainties;
• further financial education and consumer protection in the EU’s financial sector, including within the context of the European Commission’s Savings and Investments Union (SIU) initiative;
• monitor developments on the securitisation market;
• collaborate on other cross-sectoral matters such as financial conglomerates, innovation facilitators and credit assessment institutions;
• and support the planned review of the Sustainable Finance Disclosure Regulation (SFDR).

On 1 October 2025, the EBA published its Work Programme outlining the key priorities and initiatives for 2026.

The 2026 Work Programme builds around three priorities:

• i) developing a rulebook which contributes to an efficient, resilient and sustainable single market;
• ii) performing risk assessments with tools, data and methodologies which support effective analysis, supervision and oversight;
• iii) tackling innovation to enhance the technological capacity of all stakeholders.

2026 will mark an important milestone for the EBA, as the Authority will embark on its oversight and supervisory functions arising from new responsibilities over critical third-party providers (DORA), issuers of crypto assets (MICA), and the use of initial margin models (EMIR). On the other hand, the anti-money laundering and countering the financing of terrorism (AML/CFT) responsibilities it has exerted since 2020 will have been transferred to the newly established Anti-Money Laundering Authority (AMLA).

On 6 October 2025, the EC published letter from the Commission to the ESAs on the de-prioritisation of Level 2 acts in financial services legislation.

The EU has a comprehensive legal framework, in which many of the rules are regulatory and implementing standards (Level 2) that supplement or specify the EU Regulations and Directives (Level 1). In the last legislature, level 1 acts empowered the Commission to adopt around 430 level 2 measures.

A high volume of level 2 acts can lead to compliance costs and regulatory complexity for stakeholders, while demanding significant resources from co legislators to scrutinise them. In consultation with the EU co legislators, the Commission informed the three European Supervisory Authorities and the Anti Money laundering Authority (AMLA) that it will not adopt these non essential acts before 1 October 2027. Where empowerments have legal deadlines, the Commission will propose to amend or repeal them during the upcoming revisions of the relevant Level 1 acts.

On 3 October 2025, the ESMA published its 2026 Annual Work Programme.

In 2026, ESMA will continue to build on existing priorities, supporting the forthcoming strategic developments set out by the Commission’s Saving and Investments Union (SIU) Strategy. This includes aligning supervisory practices across Member States, enhancing market data capabilities, and actively contributing to upcoming reforms designed to create a more integrated and globally competitive EU financial system. ESMA also aims at seizing opportunities arising from digitalisation, for example by facilitating the simplification and use of clear language in disclosures.

ESMA’s activities will remain closely aligned with the agenda of the European Commission and co-legislators, maintaining the agility needed to address evolving regulatory, economic, and technological landscapes. This responsiveness is crucial as volatility, uncertainty, and rapid change shape the global environment and impact EU financial markets. Given the significance of the forthcoming proposals under the Savings and Investments Union, ESMA stands ready to provide its technical expertise and support to the preparation and implementation of the new legislative files that will be launched.

ESMA will focus on enhancing data capabilities and promoting innovation across the EU financial sector. Key projects for 2026 include the rollout of the ESMA Data Platform, centralisation studies, and the development of AI-powered supervisory tools. These initiatives will bring common benefits to both ESMA and the National Competent Authorities, improving market efficiency and transparency through the support that data provides for risk-based and data-driven supervision across Europe.

In the digital finance sector ESMA will continue to focus on the effective implementation of MiCA, as it is key to ensuring investor protection and the orderly functioning of crypto-asset markets. ESMA’s supervisory convergence efforts will remain focused notably on the authorisation and supervision of CASPs.

Finally, in line with the EU’s ambition to accelerate the settlement cycle to T+1 by 11 October 2027, ESMA will also coordinate closely with market participants to ensure the smooth transition and preparedness of the financial sector for this event.

BACKGROUND

On 21 October 2025, the European Union published Regulation (EU) 2025/2088 of the European Parliament and of the Council of 8 October 2025 on certain reporting requirements in the fields of financial services and investment support. The Regulation amends several core legislative acts in the financial and investment sectors — including Regulations (EU) No 1092/2010, 1093/2010, 1094/2010, 1095/2010, 806/2014, 2021/523 and 2024/1620. The objective is to streamline and modernise reporting and disclosure requirements across the EU financial framework.

The reform aims to reduce the administrative burden on institutions and authorities while preserving data quality and supervisory effectiveness. It introduces cross-sectoral rules to encourage information sharing between EU and national authorities, strengthen the “report once” principle, and prepare the ground for a future integrated EU reporting system.

WHAT'S NEW?

The Regulation standardises and simplifies reporting obligations under the ESAs (EBA, EIOPA, ESMA), the ESRB, the SRB, the ECB in its supervisory role, and the new AMLA.

1. Streamlined reporting and information sharing

The ESAs, ESRB, SRB, ECB and AMLA are now required to share supervisory information—either regularly or on request—with other competent authorities entitled to receive it under EU law. Authorities must, where possible, reuse existing data rather than collect it again directly from financial institutions, reducing duplication and costs.

The Regulation also allows these authorities to enter into memoranda of understanding (MoUs) to define technical arrangements for data exchange, promote interoperability, and coordinate collection efforts. Information can be shared in anonymised or aggregated form to ensure compliance with data protection and confidentiality rules.

2. Reuse of supervisory data for innovation and research

Supervisory authorities may, under strict safeguards, grant access to anonymised data for legitimate research or innovation purposes, allowing fintechs, researchers or market participants to use supervisory data while protecting confidentiality and personal data.

3. Periodic review of redundant reporting requirements

The ESAs and AMLA must regularly review existing reporting and disclosure requirements to identify obsolete or disproportionate obligations. They are empowered to issue opinions suggesting amendments to streamline EU and national frameworks, feeding into potential legislative changes proposed by the European Commission.

4. Integrated reporting framework and “single contact point”

By November 2030, the ESAs, through their Joint Committee, must present a feasibility study and roadmap for establishing a cross-sectoral integrated reporting system covering all EU financial sectors. This will include a common data dictionary and a shared EU data space for supervisory information.
In parallel, a permanent single contact point will be set up to allow entities to report duplicative or obsolete obligations directly to supervisors.

5. Simplified InvestEU reporting

The frequency of reporting by implementing partners under the InvestEU Regulation (EU) 2021/523 is reduced from biannual to annual, easing the burden on financial intermediaries and SMEs without changing substantive monitoring requirements.

WHAT'S NEXT?

The Regulation entered into force on 10 November 2025.
EU supervisory authorities and financial institutions shall have by now:

• Review and adapt their reporting and data-sharing frameworks;
• Implement procedures to comply with the “report once” principle;
• Prepare for future integration into the EU-wide reporting system expected by 2030.

This reform marks a significant step toward a more efficient, consistent, and data-driven EU supervisory landscape, balancing regulatory oversight with administrative simplification.

On 21 October 2025, the EU publishes Council Decision (EU) 2025/2131 of 13 October 2025 on the position to be adopted, on behalf of the European Union, within the EEA Joint Committee concerning the amendment to Annex IX (Financial services) to the EEA Agreement (European Green Bonds).

The Agreement on the European Economic Area (the ‘EEA Agreement’) entered into force on 1 January 1994.

Pursuant to Article 98 of the EEA Agreement, the EEA Joint Committee may decide to amend, inter alia, Annex IX (Financial services) to the EEA Agreement.

Regulations (EU) 2023/2631 and (EU) 2023/2869 of the European Parliament and of the Council should be incorporated into the EEA Agreement.

Annex IX (Financial services) to the EEA Agreement should therefore be amended accordingly.

The position of the Union within the EEA Joint Committee should therefore be based on the attached draft Decision.