Proposal for a regulation
Article 24
1. In accordance with Article [6a(5)] of Regulation (EU) No …/…. [ESMA Regulation], ESMA shall, where all conditions in paragraph 2 are satisfied, take one or more of the following measures: (a) require natural or legal persons who have net short positions in relation to a specific financial instrument or class of financial instruments to notify a competent authority or to disclose to the public details of any such position; (b) prohibit or impose conditions relating to natural or legal persons entering into a short sale or a transaction which creates, or relates to, a financial instrument and the effect or one of the effects of the transaction is to confer a financial advantage on the natural or legal person in the event of a decrease in the price or value of another financial instrument; (c) limit natural or legal persons from entering into credit default swap transactions relating to an obligation of a Member State or the Union or limit the value of uncovered credit default swap positions that a natural or legal person may enter into relating to an obligation of a Member State or the Union; (d) prevent natural or legal persons from entering into transactions relating to a financial instruments or limit the value of transactions in the financial instrument that may be entered into. A measure may apply in circumstances or be subject to exceptions specified by the relevant competent authority. Exceptions may in particular be specified to apply to market making activities and primary market activities. 2. ESMA shall only take a decision under paragraph 1 if all of the following conditions are fulfilled: (a) the measures listed in points (a) to (d) of paragraph 1 address a threat to the orderly functioning and integrity of financial markets or the stability of the whole or part of the financial system in the Union and there are cross border implications; (b) a competent authority or competent authorities have not taken measures to address the threat or measures that have been taken do not sufficiently address the threat. 3. When taking measures referred to in paragraph 1 ESMA shall take into account the extent to which the measure: (a) will significantly address the threat to the orderly functioning and integrity of financial markets or the stability of the whole or part of the financial system in the Union or significantly improve the ability of competent authorities to monitor the threat; (b) will not create a risk of regulatory arbitrage; (c) will not have a detrimental effect on the efficiency of financial markets, including reducing liquidity in those markets or creating uncertainty for market participants, that is disproportionate to the benefits of the measure. Where a competent authority or competent authorities have taken a measure under Articles 16, 17 or 18, ESMA may take any of the measures referred to in paragraph 1 without issuing the opinion provided for in Article 23. 4. Before deciding to impose or renew any measure referred to in paragraph 1, ESMA shall consult, where appropriate, with the European Systemic Risk Board and other relevant authorities. 5. Before deciding to impose or renew any measure referred to in paragraph 1, ESMA shall notify competent authorities of the measure it proposes. The notification shall include details of the proposed measures, the class of financial instruments and transactions to which they will apply, the evidence supporting those reasons and when the measures are intended to take effect. 6. The notification shall be made not less than 24 hours before the measure is intended to take effect or to be renewed. In exceptional circumstances, ESMA may make the notification less than 24 hours before the measure is intended to take effect where it is not possible to give 24 hours notice. 7. ESMA shall publish on its website notice of any decision to impose or renew any measure referred to in paragraph 1. The notice shall at least specify the following details: (a) the measures imposed including the instruments and class of transactions to which they apply and the duration of the measures; (b) the reasons why ESMA is of the opinion that it is necessary to impose the measures including the evidence supporting the reasons. 8. A measure shall take effect when the notice is published or at a time specified in the notice that is after its publication and shall only apply in relation to a transaction entered into after the measure takes effect. 9. ESMA shall review its measures referred to in paragraph (1) at appropriate intervals and at least every three months. If a measure is not renewed after that three month period, it shall automatically expire. Paragraphs 2 to 8 shall apply to a renewal of measures. 10. A measure adopted by ESMA under this Article shall prevail over any previous measure taken by a competent authority under Section 1.Article 24 deleted ESMA intervention powers