Summary of CySEC's Circular C389
Memo #34-2020
CySEC Circular No: C389
Date: 16/06/2020
Subject: The European Banking Authority launches consultation papers, a public hearing and a data collection exercise in regards to the new prudential framework for Investment Firms
Purpose: To inform about Consultation Papers launched by EBA and about the second phase of EBA's data collection exercise.
In Summary:
CySEC has issued the Circular C389 on 16/06/2020 in order to inform the Cyprus Investment Firms (‘CIFs’) that on the 4th of June 2020, the European Banking Authority (‘EBA’) announced its roadmap for the implementation of the new regulatory prudential framework for investment firms (IFR/IFD) which will come into force on 26th June 2021 and launched a public consultation on its first set of regulatory deliverables on prudential, reporting, disclosures and remuneration requirements.
The roadmap outlines the EBA’s work plan for each of the mandates laid down in the IFR/IFD and clarifies the sequencing and rationale behind their prioritization.
With this Circular CySEC notes that EBA's public consultation includes four different Consultation Papers (‘CP’). The four CP are the following:
1. CP on draft Regulatory Technical Standards (‘RTS’) on the prudential requirements form investment firms
2. CP on draft Implementing Technical Standards (‘ITS’) on the reporting and disclosure requirements for investment firms
3. CP on draft RTS on instruments for investment firms’ remuneration, and
4. CP on draft RTS on pay out in instruments for variable remuneration under IFD
CySEC further notes that the CIFs are invited to send their comments on the above EBA consultation papers by clicking on the ‘send your comments’ button which can be found on this Circular. The deadline for the submission of comments directly to EBA is on 4th September 2020.
CySEC also informs with this Circular that EBA will hold a public hearing via conference call in regards to the above consultation papers on the following dates:
- 30 June 2020, from 11:00 to 13:00 CET, for the consultation paper on the classification of investment firms as credit institutions and capital requirements;
- 30 June 2020 from 14:00 to 16:00 CET for the consultation papers on supervisory reporting and disclosure and variable remuneration requirements
The deadline for registration for the above EBA public hearing expires on 23rd June, 2020 and the CIFs that want to participate in the above EBA public hearing should be kept informed through EBA’s website for the dial-in details.
Furthermore, with this Circular, CySEC informs that EBA is launching the second phase of the data collection exercise for investment firms, following the ‘Population data collection by the ΕΒΑ regarding the new prudential framework for investment firms’ (as per CySEC Circular C379).
CySEC notes that that this data collection exercise is voluntary. However, CySEC expects that the CIFs which indicated in the previous population data template, circulated on 8th April 2020 via CySEC Circular C379 that they intend to participate in the upcoming EBA investment firm data collection, will proceed accordingly and participate in this second data collection exercise.
The data collection Template and the instructions on how to complete the Template are included on this Circular.
CySEC further notes that the CIFs that will participate in the above data collection exercise should fill in the Template and submit it to CySEC via email only, the latest by 7th August 2020. The email address for the above Template submission, as well as, the email subject and the excel file Template naming can be found on this Circular.
A practical guide for the new prudential framework for Investment Firms (IFR/IFD) can be found on the following link: https://www.cysec.gov.cy/CMSPages/GetFile.aspx?guid=0d0b590f-518f-41fb-bcb4-dc8de0ceaf2f
The EBA's roadmap can be found on the following link: https://eba.europa.eu/sites/default/documents/files/document_library/Regulation%20and%20Policy/Investment%20firms/884436/EBA%20Roadmap%20on%20Investment%20Firms.pdf
The Consultation Paper number 1 can be found on the following link: https://eba.europa.eu/sites/default/documents/files/document_library/Publications/Consultations/2020/CP%20on%20draft%20RTS%20on%20prudential%20requirements%20for%20Investment%20Firms/884615/EBA-CP-2020-06%20CP%20on%20draft%20RTS%20on%20prudential%20requirements%20for%20Investment%20Firms.pdf
The Consultation Paper number 2 can be found on the following link: https://eba.europa.eu/sites/default/documents/files/document_library/Publications/Consultations/2020/CP%20on%20Reporting%20and%20disclosures%20for%20investment%20firms/884616/EBA-CP-2020-07%20CP%20on%20Reporting%20and%20disclosures%20for%20investment%20firms.pdf
The Consultation Paper number 3 can be found on the following link: https://eba.europa.eu/sites/default/documents/files/document_library/Publications/Consultations/2020/%20CP%20on%20RTS%20on%20instruments%20for%20IF%20remuneration/884630/EBA-CP-2020-08%20CP%20on%20RTS%20on%20instruments%20for%20IF%20remuneration.pdf
The Consultation Paper number 4 can be found on the following link: https://eba.europa.eu/sites/default/documents/files/document_library/Publications/Consultations/2020/CP%20on%20RTS%20on%20IS%20under%20IFD/884631/EBA-CP-2020-09%20CP%20on%20RTS%20on%20IS%20under%20IFD.pdf
