Our Secondary Markets Expert Group contributed to our response to ESMA Consultation on Technical Advice under the CSD Regulation. We noted that the cash penalty should relate to the value of the failed transaction and that the principle of neutrality should be applied so that there are no disadvantages among securities holding models. We supported that the cash penalty should be proportionate and take into consideration the specificities of the different asset types, the liquidity and category of transactions. We noted our concern that small and mid-size quoted companies both on regulated markets and especially on SME Growth Markets will see trading in their stocks reduced, and therefore urged ESMA to proportionally consider the costs and consequences of a failed trade to understand the effects of the penalty for small and mid-size quoted companies.
Click here to download the response (pdf)