Digital Finance Package
As part of the Digital Finance Package, alongside the renewed Retail Payments Strategy, the following upcoming laws are currently being discussed at EU level:
- Regulation on the Markets in Crypto-Assets (MiCA)
- Regulation on Digital Operational Resilience Act (DORA)
Check out this MFSA webpage for further information on these proposed EU Regulations.
- Regulation on the Markets in Crypto-Assets (MiCA)
At the end of June 2022, the Council presidency and the European Parliament reached a provisional agreement on the MiCA proposal, and the final text is expected to be published in the Official Journal by the second quarter of 2023. The Regulation shall apply within 18 months from entry in force, with the exception of the part relating to stablecoins which shall be applicable within 12 months.
- Regulation on Digital Operational Resilience Act (DORA)
In May 2022 the Council Presidency and the European Parliament reached a provisional agreement on DORA, and it is expected to come into force during the first quarter of 2023. It shall apply after two (2) years from entry into force.
Banking Package 2021
As part of the Banking Package and implementation of the Basel III agreement, a proposal for the Capital Requirements Regulation (CRR) III and the Capital Requirements Directive (CRD) VI was published in October 2021. For further information, check out this MFSA webpage.
During 2022, discussions have been centred around trying to enhance the balance being provided by the package, taking into account the specific features of the EU’s banking sector alongside a number of other technical amendments to the text, while keeping in line with the agreed Basel III standards. The final text is expected to be published by June 2023, with the CRR3 becoming applicable as from 1st January 2025 while there shall be 18 months for the transposition of the CRD6 on the part of the Authority.
The NPL Directive
Directive (EU) 2021/2167 on credit servicers and credit purchasers (the “NPL Directive”) aims to facilitate the sale and servicing of non-performing credit of credit institutions to third parties by improving the present market conditions and providing a harmonised regulatory framework.
The NPL Directive allows credit institutions that are struggling with a large build-up of non-performing loans (referred to as ‘NPLs’) to effectively outsource the servicing of the non-performing credit to a credit servicer or to transfer the credit agreement to a credit purchaser. The NPL Directive includes provisions regarding both the creditor’s rights under a non-performing credit agreement and the non-performing credit agreement itself. Some of the salient features of the NPL Directive include: the establishment of a new authorisation regime for credit servicers; the possibility for credit servicers to passport services through the European Union; the ongoing supervision requirements and obligations vis-à-vis credit services and the obligations to protect consumers and other borrowers in relation to credit agreements, amongst other things.
The transposition of the NPL Directive into national law is currently in progress at the MFSA.
