On March 23, 2018, ESMA published two consultation papers relating to the regulation of EU securitization repositories under the Securitization Regulation (also known as the STS Regulation). The first consultation paper proposes draft technical standards on applications for registration of a securitization repository and draft Guidelines on data portability between securitization repositories. The second consultation paper consults on draft advice to the European Commission on supervisory fees payable by securitization repositories.

The Securitization Regulation requires, among other things, securitization special purpose entities, originators and sponsors of a securitization to make certain information available via a securitization repository to holders of a securitization position, to national regulators and, upon request, to potential investors. ESMA will register and supervise securitization repositories, as it does trade repositories under EMIR and the Securities Financing Transactions Regulation. Unlike EMIR and SFTR, the Securitization Regulation does not contemplate non-EU firms as securitization repositories.

The first consultation paper sets out draft Regulatory Technical Standards on the contents of the application for registration by firms wishing to provide repository services and draft Implementing Technical Standards on the format for the registration application. In addition to information on the scope of services (securitization types, risk transfer methods and underlying exposure types) that a securitization repository aims to provide, ESMA is proposing that a candidate securitization repository should provide information on arrangements for dealing for conflicts of interest, financial information, information about the management body, operational arrangements and data protection procedures. The Securitization Regulation recognizes that firms wishing to provide securitization services may already be registered with ESMA under EMIR or SFTR and allows those trade repositories to apply for an extension of registration instead of making a full application. ESMA's draft RTS includes a list of information that does not need to be provided in an extension application, provided that the information that ESMA holds is up to date.

Furthermore, the first consultation paper includes proposed Guidelines on the transfer of data between securitization repositories. These are intended to apply if a securitization repository ceases to provide securitization services and are similar to ESMA's 2017 data transfer Guidelines for trade repositories.

The second consultation paper responds to a request from the European Commission for advice to assist the Commission in preparing a regulation on supervisory fees for securitization repositories. Under the Securitization Regulation, ESMA is able to charge fees for expenses relating to registration and ongoing supervision of securitization repositories. The Commission must prepare draft legislation providing for the types of fees, the matters for which fees are due, the amount of the fees and the manner in which fees should be paid. ESMA's advice considers the existing fee arrangements under SFTR and EMIR and proposes a single registration fee differentiated between new applications and extension applications and an annual supervisory fee based on a repository's turnover.

Responses to both consultations can be provided until May 23, 2018. ESMA intends to publish the final draft RTS and ITS in Q3/Q4 2018 and to submit the final advice to the European Commission in Q3 2014. The Securitization Regulation will apply directly across the EU from January 1, 2019 to securities issued under securitizations on or after January 1, 2019.

The consultation paper on technical standards is available at: https://www.esma.europa.eu/pressnews/ consultations/consultation-draft-rts-application-registration-securitisation-repository, the consultation paper on technical advice is available at: https://www.esma.europa.eu/pressnews/consultations/consultation-technical-advice-fees-securitisation-repositories  and the Securitization Regulation is available at: http://finreg.shearman.com/new-eu-securitization-framework-published.

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