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ESMA’s Regulatory Actions in Response to COVID-19

By April 21, 2020 No Comments
Latest ESMA's Regulatory Actions in Response to COVID - 19

The continuing impact of COVID-19 on financial markets in the European Union (EU) is being closely monitored by the European Securities and Markets Authority (ESMA) and National Competent Authorities (NCAs). ESMA, in its initial statement on the COVID-19 pandemic on March 11th, made the following recommendations to financial market participants:

Business Continuity Planning– All financial market participants, including infrastructures, should be ready to apply their contingency plans, including deployment of business continuity measures, to ensure operational continuity in line with regulatory obligations.

Market Disclosure– Issuers should disclose as soon as possible any relevant significant information concerning the impacts of COVID-19 on their fundamentals, prospects or financial situation in accordance with their transparency obligations under the Market Abuse Regulation.

Financial Reporting – Issuers should provide transparency on the actual and potential impacts of COVID-19, to the extent possible based on both a qualitative and quantitative assessment on their business activities, financial situation and economic performance in their 2019 year-end financial report if these have not yet been finalised or otherwise in their interim financial reporting disclosures.

Fund Management– Asset managers should continue to apply the requirements on risk management and react accordingly.[1]

​​​On April 2nd, ESMA also updated its risk assessment for the European Union’s (EU) financial markets to account for the impact of the COVID-19 pandemic.

Table describing ESMA remit, Risk categories & Risk Drivers

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