On 27 January 2022, the European Securities and Markets Authority (ESMA) issued a consultation paper setting out draft amendments to Commission Delegated Regulation (EU) No 153/2013 with regard to the regulatory technical standards (RTS) on requirements for central counterparties (CCPs), including requirements aiming to limit the procyclicality of margin requirements (Article 28 RTS) under the European Markets Infrastructure Regulation (EMIR).

One key lesson learnt from the COVID-19 stress episode is that, despite EU CCPs being subject to the same RTS and to common guidelines to support a coherent implementation of EMIR, EU CCP margin models have reacted differently, with some models performing in a more procyclical manner than others. ESMA has identified divergent implementations of the anti-procyclicality (APC) tools which seem to be due, on the one hand, to the non-binding character of the guidelines, and on the other hand, to the need for higher granularity of the relevant provisions.

In the first half of the consultation paper ESMA considers different proposals to further harmonize the policies and procedures for selecting and reviewing the APC margin measures. In the second part of the consultation, ESMA proposes to provide further granularity on the design and the use of specific APC tools under Article 28(1)(a), (b) and (c) of the RTS to promote further convergence and coherence in their application.

The deadline for comments on the consultation paper is 31 March 2022.