[ESMA91-372-1704 ] Guidelines further specifying the circumstances for temporary restrictions in the case of a significant non-default event in accordance with Article 45a of EMIR

ESMA published the “Guidelines further specifying the circumstances for temporary restrictions in the case of a significant non-default event in accordance with Article 45a of EMIR“.
The guidelines apply to competent authorities designated under EMIR and provide guidance on the actions that the competent authority may require a CCP to refrain from undertaking for a specified period, not exceeding five years. These actions include dividend distribution, buy-back of ordinary shares, and variable remuneration obligations. The guidelines outline indicators and circumstances that prompt the consideration of such restrictions.
The document emphasizes that compliance with the guidelines is expected from competent authorities and CCPs. Competent authorities must incorporate the guidelines into their national legal and/or supervisory frameworks. Reporting requirements are outlined, including the obligation for competent authorities to notify ESMA of their compliance or non-compliance with the guidelines and provide reasons for non-compliance if applicable.
The guidelines provide two specific indicators for competent authorities to assess the significance of a non-default event:
Guideline 1 states that a non-default event should be considered significant if it causes or is likely to cause a loss that reduces the CCP’s capital below a specified threshold.
Guideline 2 outlines two indicators: the occurrence of a material operational event (e.g., cyber-attack or natural disaster) affecting the CCP’s ability to operate its clearing services and fulfill obligations, and the failure of a critical third-party entity impacting the CCP’s operations and obligations.