The Joint Committee of the European Supervisory Authorities has published a report which responds to the European Commission’s consultation document, An EU framework for simple, transparent and standardised securitisation, which was published on 18 February 2015.

Therefore the report addresses the following issues:

  • the nature and content of the due diligence and disclosure requirements;
  • the parties to which the disclosure and due diligence requirements apply; and
  • the methods used for the adequate disclosure, reporting and enforcement in cases of non-compliance.

The report also covers a number of other issues including the differences in the definitions of securitisation across EU legislative texts.

The main recommendations in the report are:

  • due diligence requirements should be harmonised within the EU;
  • standardised investor reports should reflect the dynamics of structured finance instruments and be stored in a centralised public space;
  • all types of investors should be empowered to effectively conduct their own stress tests; and
  • a harmonised due diligence and disclosure framework should be complemented with a comprehensive regime for supervision and enforcement.

View Joint Committee of ESAs publishes its recommendations on securitisation, 12 May 2015