ESMA's proposal for a 3-year deferral of mandatory buy-in
The Regulation on the Pilot Regime (2022/858) was published in the European Union Official Journal on 2 June, 2022.
This publication confirms the possibility of different dates for the implementation of the settlement disciplines established by CSDR. ESMA was therefore able to forward to the European Commission a proposal1 to amend Delegated Act 2018/1229. The European regulator suggests that the mandatory buy-in (or MBI) be suspended for a period of 3 years from the entry into force of the amendment (thus rather Q3 2025). The time frame is long enough for the new version of the MBI (as detailed in the CSDR revision proposal: CSDR Refit) to come into force before the deadline.
Until now, the systematic non-triggering of the MBI was based on the letter sent by ESMA to the various local regulators last December. This proposal for a new date by ESMA will allow for the matching of practice and texts.
ESMA also covers the case of CCPs2 which will need to have a buy-in mechanism in place for shares transactions. This MBI must apply on the 5th day after the intended settlement date.
2CCP : Central Counterparty