Esma starts consultation on supervisory fees for data reporting services

Europe
On the 11/20/20 at 2:42PM

by

Adrien Paredes-Vanheule

In its consultation paper, Esma unveils application and authorisation fees as well as a minimum annual supervisory fee for data reporting services providers it will supervise from 2022.

The European securities and markets authority (Esma) on Friday launched a public consultation on supervisory fees for data reporting services providers (DRSPs) since these entities will be supervised by ESMA as from January 2022. The authorisation and supervision of DRSPs will be transferred from national financial market watchdogs to Esma starting 1 January 2022. The consultation will close on 4 January 2021 and final report is expected to be published in Q1 2021.

In the consultation paper, Esma sets out a fee framework for DRSPs comprising of application and authorisation fees as well of an annual supervisory fee and a timeline for their payment. Hence, the EU securities regulator proposes an application fee of €20,000 for the first data reporting service of authorised reporting mechanisms (ARMs) and approved publications arrangements (APAs). That fee would drop to €10,000 for following data reporting. Authorisation fees would amount to €80,000 for first data reporting and €40,000 for following data reporting. As for consolidated tape providers (CTPs), Esma proposes a €250,000 application and authorisation fee. On top of that, Esma would claim a minimum annual supervisory fee of €30,000 from ARMs and APAs while no minimum fee is set for CTPs. In case an entity is subject to minimum supervisory fees for more than one data reporting service, it should pay a minimum supervisory fee for each authorisation, the consultation paper suggests.

“For the years 2020 and 2021, Esma receives from the European Commission a total amount of around €4.2m to cover the expenditures related to the preparatory work needed for the fulfilment of Esma supervisory tasks for DRSPs. Esma will have to reimburse the Commission in a three-year period: from 2022 to 2024. For the years 2022, 2023 and 2024 ESMA will therefore have to collect extra-fees for a total amount of €4.2m, i.e. roughly €1.4 million per year,” the EU securities and markets authority discloses. To reach that recovery sum, Esma proposes that each DRSP it supervises pays an additional fee (in 2022, 2023 and 2024), “proportionally to the share of the relevant annual supervisory fees paid by that DRSP for that year.”