1.1 Commission Delegated Regulation amending the regulatory technical standards laid down in Delegated Regulation (EU) 2018/389 as regards the 90-day exemption for account access

On 3 August 2022, the European Commission adopted a delegated regulation amending the regulatory technical standards (RTS) as regards the 90-day exemption for account access under Directive (EU) 2015/2366 (PSD2).

The amendments include:

  • A new mandatory exemption from the strong customer authentication (SCA) requirement mandating that SCA will not be applied when customers use an account information service provider (AISP) to access their payment account information (subject to certain conditions being met);
  • The voluntary exemption in Article 10 of the RTS will be limited to instances where the customer accesses the account information directly; and
  • Where the above exemptions apply, the renewal date of the SCA will be extended from 90 days to 180 days.

The draft delegated regulation is currently under scrutiny and will enter into force if the European Parliament or the Council of the EU do not object to it.

A copy of the draft delegated regulation can be accessed here.


2.1 Application of the Principles for Financial Market Infrastructures to stablecoin arrangements

On 13 July 2022, the Bank for International Settlements' Committee on Payments and Market Infrastructures (CPMI) and the International Organisation of Securities Commissions (IOSCO) published joint guidance on the application of Principles for Financial Market Infrastructures (PFMI) to stablecoin arrangements (SA) that are considered systemically important financial market infrastructures (FMI). The guidance note does not cover issues specific to stablecoins denominated in or pegged to a basket of fiat currencies (multicurrency SAs). They will be covered in future reports. 

The Guidance does not provide comprehensive guidance on PFMI but covers the following subset of principles:

  • Governance – Requires clear and direct lines of responsibility and accountability, allowance for timely human intervention, and the SA's ownership structure and operation must allow it to observe the PFMI irrespective of the arrangements of other independent functions.
  • Comprehensive risk management – Regular reviews of material risks that the FMI function bears and that pose risks to other SA functions and the entities that perform them should be exercised by systemically important SAs. The SA should develop appropriate risk-management frameworks paying particular focus to implementing appropriate mitigations.
  • Settlement finality – Clear and certain final settlement should be provided by a systemically important SA by the end of the value date, at a minimum, regardless of the settlement method used. The point at which a transfer of a stablecoin through the operational method becomes irrevocable should be defined, there should be clear basis acknowledging the finality of a transfer and mechanisms should be in place to prevent misalignment between the state of the ledger and legal finality.
  • Money settlements – A stablecoin used by a systemically important SA for money settlements should have minimal credit or liquidity risk. When assessing risk the SA should consider whether the stablecoin provides its holders with a direct legal claim on the issuer and or on the title to or interest in the reserve assets. An SA should ensure clarity and enforceability of claims, the nature and sufficiency of its reserve assets, the clarity, robustness and timeliness of converting the stablecoin into other liquid assets, the sufficiency of the regulatory and supervisory framework that applies to the issuer and the existence of risk controls that could reduce credit and/or liquidity risks.

2.2 European Union (Markets in Financial Instruments) (Amendment) (No. 4) Regulations 2022 [S.I. No. 443 of 2022]

On 6 September 2022, Minister Paschal Donohue signed the European Union (Markets in Financial Instruments) (Amendment) (No.4) Regulations into Irish law. 

The definition of 'financial instrument' in Regulation 3 of the principal regulations has been updated to specifically include securities issued by means of distributed ledger technology (DLT). This update clarifies that the scope of the regime under Directive (EU) 2014/65 (MiFID II) applies to tokenised securities.

A copy of the amendment regulations can be accessed here.

2.3 Report on the DLT Pilot Regime

On 27 September 2022, the European Securities and Markets Authority (ESMA) published a report on the DLT pilot regime (the "DLT Pilot"). The DLT Pilot aims to develop the trading and settlement for "tokenised securities". The DLT Pilot entered into force on 23 June 2022 and will start to apply from 23 March 2023. 

On review of ESMA's call for evidence on the DLT Pilot from January 2022, ESMA has clarified that it does not consider it necessary to amend the RTS on transparency and data reporting requirements under Regulation (EU) 600/2014 (MiFIR). ESMA restricted their recommendations to compensatory measures that National Competent Authorities should request to ensure the integrity, completeness, consistency, usability, and comparability of the supervisory data collected from DLT Market Infrastructures.

ESMA stated that the next steps are to are to work supervisory guidance to clarify elements of the RTS on transparency and data reporting requirements. ESMA will also issue guidance on questions received by various stakeholders on the DLT Pilot to contribute to the convergent application of the DLT Pilot.

Please see attached report here.


3.1 Guidance Note for the Electronic Money Institution Supplementary Return XBRL

On 1 July 2022, the Central Bank of Ireland (Central Bank) published a guidance note for the electronic money institution supplementary return XBRL (EIS XBRL) relevant for all electronic money institutions (EMI) authorised under the European Communities (Electronic Money) Regulations, 2011 (as amended) (Electronic Money Regulations 2011) transposing Directive 2009/110/EC (EMD2).

This new EIS XBRL return replaces the previous Supplementary Return and the format of reporting is changing from web-form to XBRL for the quarterly E-Money Institution Accounts returns and Supplementary Returns from the reporting period ending 30 September 2022.

The guidance note provides instruction on how to complete the EIS XBRL return which is comprised of the following sections; statement of capital adequacy; analysis of own funds; user's funds and safeguarded user's funds; safeguarded fund's detail; transaction volume; agency appointments; distributor appointments; general; ownership structure (three parts); qualifying shareholders, and; conduct of business. 

The guidance note can be accessed here.

3.2 Central Bank register first VASP

On 19 July 2022, the Central Bank registered Gemini Digital Asset Limited as a Virtual Asset Service Provider (VASP) for anti-money laundering (AML) purposes.

This is the first registration of its kind following the coming into force of the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2021 in April 2021, which amended Irish AML Legislation to include VASPs within the definition of a "designated person" and consequently within the scope of AML and countering the financing of terrorism (CFT) obligations.

The Central Bank has since registered a second entity as a VASP, Zodia Custody Ireland Limited.

The Central Bank's VASP register can be accessed here.

3.3 Publication of the Central Bank (Individual Accountability Framework) Bill 2022

On 28 July 2022, the Central Bank (Individual Accountability Framework) Bill 2022 (Bill) was published by the Department of Finance. The Bill's principal purpose is to confer powers on the Central Bank to strengthen and enhance individual accountability in the Irish financial services industry by prescribing responsibilities and providing for the allocation of responsibility and accountability for the management and operation of firms regulated by the Central Bank.

The new Senior Executive Accountability Regime (SEAR):

  • " introduces new conduct standards for regulated firms and their management and staff;
  • makes enhancements to the existing Fitness and Probity Regime; and
  • strengthens the Central Bank's Administrative Sanctions Procedure

While it is not yet clear when the Bill will be enacted, the Central Bank has indicated that it will consult key stakeholders on implementation and operation of the framework once the Bill has been enacted through the publication of draft implementing regulations and guidance for public consultation.

A copy of the Bill can be accessed here and the explanatory memorandum can be accessed here.

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