ESMA unveils plans to streamline EU fund and transaction reporting

The European Securities and Markets Authority (ESMA) has published two reports advancing its agenda to simplify regulatory reporting across EU financial markets, with proposals that could eventually influence approaches taken by authorities such as the Financial Conduct Authority (FCA) and the Bank of England in cross-border contexts.

The first report sets out a harmonised framework for funds reporting, moving away from fragmented national systems towards a single EU-wide template. ESMA proposes a hybrid operational model where data collection remains at national level, but validation, storage and analytics are centralised at EU level. This "report once" approach aims to reduce duplication for asset managers while improving data quality for supervisors. Regulatory and implementing technical standards will follow next year, with implementation phased to integrate Alternative Investment Fund Managers Directive (AIFMD) and UCITS reporting first.

The second report presents interim findings from a holistic review of transaction reporting under EMIR, MiFIR and the Securities Financing Transactions Regulation (SFTR). Based on feedback from more than 100 market participants, ESMA identified overlapping requirements, unsynchronised regulatory changes and dual-side reporting as primary cost drivers. The authority is now considering instrument-based simplifications and a unified "report once" framework across the three regimes.

ESMA chair Verena Ross said the reforms would "reduce operational burden for market participants by introducing the principle of 'reporting once', while also improving data quality and supervisory effectiveness." She noted that harmonisation and enhanced data sharing between authorities would be central to achieving these goals.

The transaction reporting review does not yet contain final policy recommendations, pending further cost-benefit analysis. ESMA will hold an open hearing on 28 May before publishing definitive proposals by mid-year.

Both reports form part of ESMA's Simplification and Burden Reduction initiative, launched in 2025 to address escalating compliance costs from EU reporting obligations.