FESE Considerations on the ESMA Final Report on simplification of financial transaction reporting

FESE welcomes ESMA’s efforts to simplify the financial transaction reporting framework and supports the long-term objective of a more efficient and proportionate “report once” model. While the overall direction is positive, FESE highlights a number of considerations aimed at ensuring that simplification delivers genuine burden reduction, legal certainty, and fair allocation of responsibilities across the reporting ecosystem.

• Overall approach: FESE supports ESMA’s phased approach to simplification but notes that further measures, such as a clearer distinction of ETD and OTC reporting between different regimes, could deliver more immediate efficiency gains while laying the foundations for a future “report once” framework.
• Reporting infrastructures, data flows and responsibilities: Any future centralised reporting architecture should be subject to careful assessment and industry consultation, clearly defining the allocation of responsibilities and simplifying the data flows and reporting channels. It is also important to maintain a clear separation between the reporting framework and the consolidated tape.
• Cost implications for market participants: The simplification exercise should deliver burden reduction across the reporting ecosystem as a whole, with clearly and fairly allocated costs and responsibilities.
• Expanded delegated reporting: Efforts to expand delegated reporting should not result in disproportionate transfers of costs, liabilities or operational burdens to delegated entities. Clear and consistent rules should be established for allocating reporting responsibilities in different counterparty relationships, with flexibility where appropriate.
• Field-level rationalisation: A targeted review of reporting fields, drawing on existing industry work like the FIX reporting fields matrix, can help identify practical opportunities to simplify reporting requirements while preserving data quality and regulatory objectives.

Transaction reporting simplification can only succeed if it delivers meaningful burden reduction across the entire ecosystem, supported by clear responsibilities, fair cost allocation and proportionate implementation choices.