On 11 July 2022, the European Securities and Markets Authority (ESMA) issued a consultation paper on a possible amendment to the Central Securities Depositories Regulation cash penalty process for cleared transactions.

The ESMA’s proposal consists in removing the separate process established in Article 19 of Delegated Regulation (EU) 2018/1229 for the collection and distribution of the cash penalties in relation to settlement fails on cleared transactions to let the CSDs run the entire process of collection and distribution of penalties according to Article 16, 17 and 18 of the same delegated regulation.

The deadline for comments on the consultation paper is 9 September 2022. The ESMA will consider the responses it receives to the consultation with a view to publishing a final report by Q4 2022.