On 7 October, AIMA published its updated Position Paper on the Market Integration and Supervision package (“MISP”) reacting to the content of the draft compromise amendments in the European Parliament and focusing on AIFMD-related provisions in particular. Our Paper highlights the high degree of overlap and duplication contained in the draft compromise amendments with existing rules. The vote in ECON Committee in the European Parliament is scheduled for early December.

Meanwhile, the Council of the EU reached agreement on its position during the ECOFIN public session on 9 October. While there is no consolidated final text available yet, some notable elements in the Council approach include the following:

• The ESMA annual review for EU large cross-border asset management groups are replaced with coordination colleges with non-binding decision-making or supervisory powers for such groups.
• Supervisory convergence tools in particular the ability for ESMA to issue “corrective actions” and suspend cross-border operations by firms are changed (by raising the intervention thresholds for Articles 17aa and 17aaa, ensuring measures are temporary, targeted, and subject to objective procedural safeguards).
• Simplified delegation framework only for intra-group-intra-EU delegation making it easier to engage in sub-delegation and further sub-delegation.
• Deletion of the fully-fledged EU depositary passport, introducing an opt-in regime instead for MS willing to apply it.
• Deutsche Börse will remain regulated at national with Germany securing a national discretion exclusion in the text.
• New enhanced ESMA oversight of frequent batch auctions and post-trade transparency for SIs.

The agreement will now form the basis for Council’s negotiating position with the Parliament. Trialogues are expected to begin early next year.

If you have any questions, please contact [email protected].