On 26 May 2021, the European Securities and Markets Authority (ESMA) published a letter that it had sent to Mairead McGuinness (Commissioner for Financial Services, Financial Stability and Capital Markets Union) raising a number of points regarding the European Commission’s current review of the Central Securities Depositories Regulation (CSDR).

ESMA has previously provided the Commission with two reports covering cross border services and internalised settlement. In the coming months it will provide further input through the publication of two more reports on banking-type ancillary services, and on the use of technological innovation by central securities depositories (CSDs).

In addition to this ESMA has produced this letter covering the following topics:

• The status of TARGET2-Securities (T2S).
• The arrangement for the supervision/oversight of T2S.
• The third-country CSD (TC-CSD) recognition regime – ESMA supports an enhanced regime, including the following two key components: (i) requirement for TC-CSDs to notify ESMA regarding services provided in the EEA; and (ii) broadening the scope of the TC-CSD recognition regime by also covering the provision of settlement services in the EEA.
• The frequency of ESMA reports to the Commission on CSDR implementation.