The EEAP should solve home Member State determination via LEI matching.
For the European major shareholding disclosure rules which are primarily driven by the Transparency Directive and its Amendments (TDA), one of the key factors in determining the jurisdiction where a particular security should be disclosed is the home Member State.
The phrase Member State simply refers to the particular country/state which is a member of the EU. The word home is used in distinction to host in describing the country (and its regulatory body) that govern the disclosure obligations for a given security. Any TDA related disclosure will be made to the relevant competent authority (RCA) of the particular Member State. To avoid duplicate reporting in the EU, the RCA of the home Member State concept is employed to simplify and harmonise the TDA obligations across all EU Member States.
Here at FundApps, we take advantage of publicly available regulatory data which is provided by ESMA. Based on the data from the Financial Instruments Reference Data System (FIRDS), we help our clients determine the correct authority for disclosure purposes. However, it is worth noting that FIRDS has been created primarily to aid reporting requirements stemming from other EU legal acts, such as MiFID II.
Why doesn’t ESMA produce one golden source for the appropriate home Member State related to the TDA obligations?
In fact, Article 22.1 of the TDA itself includes a requirement for ESMA and National Competent Authorities from each EU Member State to work on facilitating public access to information in relation to the TDA, which includes providing details on the home Member State that shall be associated with each issuer. Much of this detail is described in the Draft RTS on the European Electronic Access Point (EEAP) (PDF), and the section “Financial Reporting” on ESMA’s TDA website which mentions the EEAP. Unfortunately, the RTS hasn’t been finalised and the EEAP has been delayed.
In January 2018, ESMA noted that the ESMA Board of Supervisors has decided to de-prioritise the EEAP project and pause it. It has not yet been decided when the next go-live date will be. At the point the EEAP is created (which will likely include the Legal Entity Identifiers (LEI) as the standard identifier for issuers), FundApps will automate its use in our rules as the official source for the home Member State as it relates to the TDA.
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