European Securities and Markets Authority peer review finds NCA supervision of EU CCP outsourcing and intragroup governance largely meets expectations and calls for convergence on major risk management activities

The European Securities and Markets Authority published its annual peer review of how National Competent Authorities supervise European Union central counterparties’ compliance with the European Market Infrastructure Regulation requirements on outsourcing and intragroup governance arrangements. The review finds supervisory practices largely effective and the functioning of CCP colleges overall positive, while identifying areas where recommendations were needed and where supervisory convergence should be strengthened. Participating NCAs were assessed as consistently monitoring CCPs’ ongoing compliance with the relevant EMIR requirements. Where supervisory expectations were only partially met, ESMA issued recommendations to address the shortcomings. The report also highlights a need to promote further convergence in the definition of major activities linked to risk management. ESMA will follow up on the implementation of its recommendations and work on identifying tools to enhance supervisory convergence on the identification of major activities linked to risk management.