The European Commission has launched a consultation on the EU securitisation framework. The consultation covers the following issues:
- the effects of the EU Securitisation Regulation;
- private securitisations;
- due diligence;
- jurisdictional scope;
- equivalence in respect of simple, transparent and standardised (STS) securitisations;
- disclosure of information on environmental performance and sustainability;
- the need for establishing a system of limited-licensed banks to perform the functions of securitisation special purpose entities;
- assessment of non-neutrality correction factors impact;
- treatment of STS securitisations and asset-backed commercial papers for the liquidity coverage ratio;
- significant risk transfer (SRT) tests;
- the SRT assessment process;
- amendments to the Capital Requirements Regulation; and
- Solvency II.
The consultation will close on 17 September 2021.
This closely follows the launching, by HM Treasury, of a consultation which covers some of these issues in respect of the UK Securitisation Regulation (such as the effects of the securitisation regime; private securitisations; STS equivalence; environmental, social and governance disclosures; and the use of limited-licensed banks). Separately, the European Banking Authority has recently commenced a consultation on risk retention.
Please speak to your usual Macfarlanes contact if you have any questions.