The European Securities and Markets Authority (ESMA) has slapped a €186,000 monetary penalty on REGIS-TR, which is the second-largest EU-based trade repository in terms of the number of clients and revenue.
Announced on Thursday, the European financial market supervisor held the trade repository responsible for eight breaches of the European Market Infrastructure Regulation (EMIR).
Under the EMIR regime, trade repositories need to ensure integrity and transparency of the received data and have to provide direct and immediate access to the derivative contracts authorities and regulators.
“In 2020, following preliminary investigations, ESMA’s Supervision Department submitted their final report to ESMA’s Executive Director, concluding with respect to REGIS-TR that there were serious indications of the possible existence of facts liable to constitute one or more of the infringements of EMIR,” the regulator's notice stated.
Negligence
The regulator highlighted that the breaches by REGIS-TR were made between 2017 and 2020 and related to failures in ensuring the integrity of the data as well as providing their access to the regulators.
Specifically, there were two breaches in terms of data integrity: for not ensuring the integrity of the data reported to REGIS-TR; and incorrectly rejecting the correct reported data by the reporting parties.
As for the direct and immediate across of data to regulators, the trade repository was blamed for providing incorrect reports. It even failed to provide reports within the specified time limits and omitted data in the reports due to wrong rejections.
ESMA even highlighted that these five out of eight breaches happened because of negligence by the trade repository. The other three EMIR breaches resulted from the provision of wrong and unreliable reports to regulators as the trade repository failed to verify the correctness and completeness of the data received from the reporting parties.
However, the supervisor only penalized REGIS-TR for a few of the breaches, not all. The fine was slapped only for negligent infringements that the regulator considered to be aggravating and mitigating factors under EMIR.
