On the basis of the results of its peer evaluation, the European Securities and Markets Authority (ESMA) said on Tuesday 18 July that the supervision by the national competent authorities (NCAs) of the financial information provided to investors on issuers of transferable securities admitted for trading on a regulated market should be stepped up.
This exercise, carried out on the basis of the questionnaire sent to all NCAs and on-site visits to seven jurisdictions, analysed whether the NCAs were in compliance with the guidelines adopted in 2014 on the application of Directive 2004/109/EC and identified areas in which additional efforts are necessary.
“The peer review's findings show that in some jurisdictions, there is a risk that insufficient resources are allocated to enforcement, and that some issuers are not eligible to be selected for scrutiny”, ESMA Chair Steven Maijoor said in a press release.
The investigation showed that five jurisdictions - Portugal, Romania, Sweden, the United Kingdom and Malta - do not fully comply with the guideline requiring NCAs to use selection models in which all issuers of transferable securities may be selected for an in-depth examination of their financial records.
In light of this, ESMA recommends: - the creation of a list of common risk factors to direct NCAs in the choice of selected issuers; - the adoption of a common approach for the selection model to provide for a random selection as well as the selection on the basis of identified risks; - an extension of the examination to cover all relevant areas of the accounting framework. ESMA also encourages NCAs to question issuers, even if they are not suspected of any anomalies.
Also reiterating that the application of the financial information requirement should not be an auxiliary function, ESMA calls on the NCAs to make sure that sufficiently qualified and available staff are mobilised.
On the basis of these results, ESMA will decide whether amendments should be made to the guidelines and whether the work will be necessary in the area, “in order to promote more convergent supervisory practices throughout Europe”. (Original version in French by Marion Fontana)