Help Print this page 
Title and reference
European Securities and Markets Authority (ESMA)

Summaries of EU legislation: direct access to the main summaries page.
Multilingual display
Text

European Securities and Markets Authority (ESMA)

Based in Paris, the European Securities and Markets Authority (ESMA) was created in 2010 to safeguard the stability of the European financial markets and address shortcomings in European financial supervision.

ACT

Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC.

Based in Paris, the European Securities and Markets Authority (ESMA) was created in 2010 to safeguard the stability of the European financial markets and address shortcomings in European financial supervision.

WHAT DOES THIS REGULATION DO?

It creates the ESMA, which is a European authority that strengthens the coordination between national regulators of financial markets and ensures the consistent application of EU financial legislation in EU countries.

KEY POINTS

Consistent application of law

ESMA draws up regulatory and technical standards based on EU financial legislation. It also has the power to issue guidelines and recommendations on the application of European law.

Consumer protection and financial activities

ESMA promotes transparency, simplicity and fairness in the markets to protect consumers of financial products. Among its tasks, it monitors financial activities and analyses consumer trends. Under certain strict conditions, it can temporarily prohibit or restrict financial activities that cause a threat to the stability of the markets.

Breach of law

ESMA can investigate a breach of law by a national authority. This arises when the latter fails to ensure that a financial market participant complies with European law.

Within 2 months, ESMA can issue a recommendation requiring the national authority to take the necessary action to comply with European law. Then, the European Commission may issue a formal opinion. If the national authority’s non-compliance persists, ESMA may directly address a decision to a financial market participant under certain strict conditions. This decision prevails over previous decisions taken by the national authority.

European financial supervision

ESMA is part of the European System of Financial Supervision created in 2010 and which comprises three other supervisory organisations:

the European Banking Authority based in London;

the European Systemic Risk Board based in Frankfurt.

REFERENCE

Act

Entry into force

Deadline for transposition in the Member States

Official Journal

Regulation (EU) No 1095/2010

16.12.2010

-

OJ L 331 of 15.12.2010, pp. 84-119

Amending act(s)

Entry into force

Deadline for transposition in the Member States

Official Journal

Directive 2011/61/EU

21.7.2011

22.7.2013

OJ L 174 of 1.7.2011, pp. 1-73

Directive 2014/51/EU

23.5.2014

31.3.2015

OJ L 153 of 22.5.2014, pp. 1-61

Regulation (EU) No 258/2014

9.4.2014

-

OJ L 105 of 8.4.2014, pp. 1-8

RELATED ACTS

Council Regulation (EU) No 1096/2010 of 17 November 2010 conferring specific tasks upon the European Central Bank concerning the functioning of the European Systemic Risk Board (OJ L 331 of 15.12.2010, pp. 162-164).

Directive 2010/78/EU of the European Parliament and of the Council of 24 November 2010 amending Directives 98/26/EC, 2002/87/EC, 2003/6/EC, 2003/41/EC, 2003/71/EC, 2004/39/EC, 2004/109/EC, 2005/60/EC, 2006/48/EC, 2006/49/EC and 2009/65/EC in respect of the powers of the European Supervisory Authority (European Banking Authority), the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority) (OJ L 331 of 15.12.2010, pp. 120-161).

Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers and amending Directives 2003/41/EC and 2009/65/EC and Regulations (EC) No 1060/2009 and (EU) No 1095/2010 (OJ L 174 of 1.7.2011, pp. 1-73).

Directive 2014/51/EU of the European Parliament and of the Council of 16 April 2014 amending Directives 2003/71/EC and 2009/138/EC and Regulations (EC) No 1060/2009, (EU) No 1094/2010 and (EU) No 1095/2010 in respect of the powers of the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority) (OJ L 153 of 22.5.2014, pp. 1-61).

Last updated: 16.04.2015

Top