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Source: Government of the Netherlands

News item | 11-11-2024 | 08:00

Budget

The government will cut the development budget by around €1 billion over a five-year period. The current grants framework, with a total budget of €1.4 billion, expires in 2025. In the new policy framework, a budget of around €390 to €565 million will be available for cooperation with civil society organisations. This is for organisations both in the Netherlands and abroad. The exact amount will be determined as the details of the new policy framework for the 2026 to 2030 period are finalised. More information will be provided early next year.

Minister Klever: ‘As we agreed, the government is reducing spending on development aid,’ ‘I am setting clear priorities. My first decision is to reshape the way we work with NGOs. We will keep doing the things the Netherlands excels at. But less money will go to cooperation with civil society organisations. This will make them less dependent on government support.’

Simpler and more efficient

The government wants to simplify the funding system, for instance by paying grants directly to implementing organisations where possible. By avoiding complex arrangements, funds can be spent as efficiently as possible. In addition, local organisations and communities should more often be given a leading role. This will achieve concrete results that align more closely with local cultures, customs and norms. The government’s new approach also takes account of Dutch organisations with specialist knowledge and expertise, in areas in which the Netherlands excels.

Other priorities

Less money means the government needs to make choices. Its new policy framework will therefore focus on themes in which the Netherlands stands out internationally. From 2026 organisations will no longer receive funding for lobbying activities in the Netherlands.

In summary, funding will remain available for programmes in the following areas:

Health

• Combating HIV/AIDS in developing countries.
• Preventing harmful cultural practices such as female genital mutilation, child marriage and harmful rites of passage to adulthood.

Trade

• Stimulating women’s entrepreneurship in developing countries.
• Promoting clean and fair trade.

Human rights

• Combating violence against women in developing countries, with specific support for female human rights defenders in acute danger.
• Protecting and promoting human rights, individual freedoms and safety of members of vulnerable groups, such as religious minorities and LGBTIQ+ people.

Support for private initiatives

There are many people in the Netherlands who collect money or do voluntary work to help people in developing countries. The government wants to support these grassroots initiatives, for instance by giving them more visibility and providing grants for training and communication.

Less dependent on government

The government wants civil society organisations to become less dependent on government money. To this end, it intends to introduce stricter requirements for organisations that want to get a grant under the new policy framework. In the future, at least 50% of organisations’ total income will have to be own income, such as private donations. Currently, the requirement for nearly all grants is at least 25% own income.

Source: European Banking Authority

​Legal basis and background

Source: Government of the Netherlands

News item | 07-11-2024 | 09:13

AI in the military domain

Around the world, armed forces are investing in AI technology, in order to make decisions more quickly, predict behaviour or to distinguish between friend and foe. But the military use of AI also brings with it great dangers and dilemmas, such as:

• Who is responsible when AI makes a mistake?
• Can AI be trusted with life-and-death decisions?
• How can we prevent AI from causing a new arms race?

AI is developing rapidly. This makes it increasingly important to make agreements to ensure that countries use this technology in a responsible manner, especially in the military domain. The purpose of the newly adopted UN resolution is to ensure that this issue is discussed more often and in greater detail, with all the countries in the world.

International agreements on the responsible use of AI

AI technology is important for a strong and future-proof military, but there are also major risks associated with it. The resolution put forward by the Netherlands and South Korea discusses both the risks and opportunities that countries see, and so the resolution lays the foundation for international norms that countries must follow. That is especially important in light of all the conflicts in the world – where AI is already in regular use.

It is not only the Netherlands that sees the importance of such agreements. Previously, the United States and China submitted resolutions on the use of AI in the civil (non-military) domain.

A result of REAIM

In 2023 and 2024 the Netherlands and South Korea held an international conference on the responsible development, application and use of AI in the military domain: REAIM. The new resolution is the result of a joint call to action that government representatives issued at REAIM 2023 in the Netherlands.

Source: European Banking Authority

The European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) have published their third annual Report on disclosures of principal adverse impacts under the Sustainable Finance Disclosure Regulation (SFDR).

The Report assesses both entity and product-level Principal Adverse Impact (PAI) disclosures under the SFDR. These disclosures aim at showing the negative impact of financial institutions’ investments on the environment and people and the actions taken by asset managers, insurers, investment firms, banks and pension funds to mitigate them.

The findings show that financial institutions have improved the accessibility of their PAI disclosures. There has also been positive progress regarding the quality of the information disclosed by financial products, and, in general, in the quality of the PAI statements. A few National Competent Authorities (NCAs) also reported slight improvements in the compliance with the SFDR disclosures in their national markets.

Looking forward, the Report includes recommendations to NCAs to ensure convergent supervision of financial market participants’ practices, and to the European Commission for their comprehensive assessment on the SFDR.

The ESAs have also developed an overview of good practices related to the location, clarity, complexity of the disclosures based on a survey of NCAs.

Source: European Banking Authority

The three European Supervisory Authorities (EBA, EIOPA and ESMA – the ESAs) today published the Final Report on the draft implementing technical standards (ITS) regarding certain tasks of the collection bodies and functionalities of the European Single Access Point (ESAP).

The ESAP is foreseen in Level 1 legislation to be a two-tier system, where information is first submitted by entities to the “collection bodies” – Officially Appointed Mechanisms (OAMs), offices and agencies of the EU, national authorities, among others – and then made available by the collection bodies to the ESAP. These ITS are the first milestone for the successful establishment of a fully operational ESAP.

The requirements are designed to enable future users to be able to access and use financial and sustainability information effectively and effortlessly in a centralised ESAP platform.

Collection bodies

The ITS on the tasks of collection bodies specify detailed requirements for collection bodies, such as by when and in what format information should be made available to the ESAP, what type of validation checks should be performed on the information submitted by entities and what metadata should be included.

Functionalities of the ESAP

The ITS on the functionalities of the ESAP specify the requirements for making information easily accessible to users. These requirements define, among other things, how reporting entities should be categorised by industry and size, which identifier should be used, what types of information should be made available on the ESAP, and the characteristics of the public Application Programming Interface (API) available to data users.

Background and next steps

The set up of the ESAP will be a key contribution to establishing the Savings and Investments Union. The ESAP will facilitate access to publicly available information relevant to financial services, capital markets and sustainability.

The ESAP is expected to start collecting information in July 2026, while the publication of the information will start no later than July 2027.

The Final Report has been sent to the European Commission for adoption.

Source: European Banking Authority

The European Banking Authority (EBA), in cooperation with the European Securities and Markets Authority (ESMA) and the European Insurance and Occupational Pensions Authority (EIOPA), launched today a short survey addressed to entities within the scope of the initial margin (IM) model authorisation regime introduced by the upcoming revised European Market Infrastructure Regulation (EMIR 3). The deadline for submitting responses is Friday 29 November 2024.

EMIR 3 will introduce important novelties, such as:

• an authorisation regime for IM models used by counterparties in the EU;
• a new EBA central validation function for pro-forma margin models (such as ISDA SIMM);
• a supervision of IM models with greater focus on larger counterparties.

The EBA, in cooperation with ESMA and EIOPA, is seeking general information on entities within the scope of IM model authorisation, as well as specific information relevant for fee calculation and on initial margins and IM models used.

This information will guide the EBA in the setup of its central validation function and inform the EBA’s response to the EU Commission’s Call for advice on a possible Delegated Act on fees received on 31 July 2024. The information will also be used to develop proportionate requirements for entities within the scope of IM model authorisation, especially for smaller entities (the so called “Phase 5” and “Phase 6” entities) – as part of upcoming mandates under EMIR 3.

Consultation process

Entities currently subject to the requirement to exchange initial margin – in accordance with EMIR and under Article 36 of Commission Delegated Regulation (EU) 2016/2251 (the joint ESAs RTS on uncleared OTC derivatives) –  and using at least one IM model to comply with that requirement, are expected to fill in the survey. All entities of a group that are subject to this requirement are expected to fill in the survey separately, at entity level.

Responses should be submitted by Friday, 29 November 2024, via the online tool that can be accessed under the following link: https://ec.europa.eu/eusurvey/runner/IMMVEMIR3

To access the survey, a password must be used, which can be obtained from trade associations and competent authorities. Non-supervised entities can contact eba-immv@eba.europa.eu.

Questions on the survey should be submitted via the contact form available in the online survey tool.

Next steps

Closer to the EMIR 3 publication, the EBA will publish on its website operational clarifications aimed to ensure a smooth, convergent entry into force of EMIR 3 requirements in the EU.

Legal basis and background

On 7 December 2022, the Commission published its proposal to amend EMIR as regards measures to mitigate excessive exposures to third-country central counterparties and improve the efficiency of Union clearing markets. On 7 February 2024, the European Parliament and the Council reached a political agreement on a compromise text (EMIR 3), which was formally endorsed by the two institutions respectively on 4 March 2024 and 14 February 2024.

EMIR 3 is expected, in accordance with its Article 11(12a), to grant EBA the additional task to set up a central validation function for the elements and general aspects of pro-forma models (such as ISDA SIMM), and changes thereto, used or to be used by a subset of financial and non-financial counterparties as part of the risk mitigation techniques used on their portfolios of non-centrally cleared OTC derivatives.

On 31 July 2024, the EBA received a Call for advice on a possible Delegated Act on fees to be charged to financial and non-financial counterparties requiring the validation by EBA of pro-forma models, with the request to submit its response by Q2 2025. As part of its response, the EBA is requested to provide a ‘quantitative and qualitative cost-benefit analysis of all the options considered and proposed’ and to ‘widely consult market participants’.

Source: European Banking Authority

The European Banking Authority (EBA) launched today a public consultation on its draft Regulatory Technical Standards (RTS) and Implementing Technical Standards (ITS) on structural foreign exchange (FX), under the Capital Requirements Regulation (CRR). These standards will contribute to provide further clarity and consistency to the structural FX provision across the EU. The consultation runs until 7 February 2025.

The proposed RTS largely follow the existing EBA Guidelines on this topic, but introduce several key changes to enhance clarity and consistency, including:

• Quantitative thresholds: a clear threshold for a currency to be eligible for structural FX treatment, aiming to reduce variability across institutions in identifying relevant currencies.
• Maximum open position computation: allowing banks to consider only credit risk own funds requirements when determining the position neutralising sensitivity to capital ratios, where credit risk drives ratio variability.
• Clarifications on risk positions: further details on how institutions should remove FX risk positions from own funds requirements.
• Policies for illiquid currencies: special provisions for currencies that are illiquid in the market, for instance, due to Union restrictive measures.

The ITS, on the other hand, propose a template for reporting information linked to the Structural FX waiver, and support the monitoring of the Structural FX waiver on an on-going basis.

Consultation process

​Comments to this consultation can be sent to the EBA by clicking on the “Send your comments” button on the consultation page. Please note that the deadline for the submission of comments is 7 February 2025. All contributions received will be published following the close of the consultation, unless requested otherwise.

​A public hearing will take place in the form of a webinar on 3 December 2025, 14:00 – 15:00 CET. The EBA invites interested stakeholders to register using this link by 28 November 2025, 18:00 CET. The dial-in details will be communicated to the registered participants after the registration deadline.

​Legal basis and background

Article 104c of Regulation (EU) No 575/2013 (Capital Requirements Regulation – CRR), mandates the EBA to develop draft RTS specifying (a) the risk positions that an institution can deliberately take in order to hedge, at least partially, against the adverse movements of foreign exchange rates on any of an institution’s capital ratios; (b) how to determine the maximum amount that can be waived, and the manner in which an institution shall exclude this amount for each of the approaches set out in Article 325(1) CRR; (c) the criteria that shall be met by an institution’s risk management framework in order to be considered appropriate as regards the treatment of Structural FX positions.

The structural FX provision has been subject to varying interpretations across jurisdictions and institutions. To address these discrepancies and ensure a harmonised application within the EU, in 2020, the EBA published Guidelines on implementing this provision.

Source: European Banking Authority

The European Banking Authority (EBA) published today a draft technical package for version 4.0 of its reporting framework. This publication aims to provide an early version of the 4.0 release given that its reporting obligations will apply as of the first half of 2025. This package, whose final version will be released in December 2024, will facilitate a smoother transition to the new data point model (DPM) semantic glossary and the capabilities of the DPM 2.0 model.

The package provides the standard specifications that include the validation rules, the DPM and the XBRL taxonomies to support the following reporting obligations:

This draft technical package includes a version of the data dictionary contents in both formats the DPM 1.0 and the new format DPM 2.0.

The  DPM Query Tool has also been updated to reflect the current release. 

Background and next steps

The final version of the technical package for the 4.0 reporting framework will be published in December and will include the changes suggested by the three ESAs in the Opinion, published on 15 October, on the European Commission’s (EC) rejection of the draft ITS on the registers of information under the Digital Operational Resilience Act (DORA). Together with this technical package the EBA is publishing a set of Q&As providing additional explanations, including on the next steps as well as on the package to be published in December.

The EBA published in June new Implementing Technical Standards specifying the reporting obligations under Regulation (EU) 2023/1114 on Markets in Crypto-Assets (MiCAR).

Source: European Banking Authority

The European Banking Authority (EBA) published today a Decision setting out the procedural aspects related to the significance assessment of asset-referenced tokens (ARTs) and e-money tokens (EMTs) and the transfer of supervisory responsibilities, including the establishment of supervisory colleges for significant ARTs (s-ARTs) and significant EMTs (s-EMTs).

The Markets in Crypto Assets Regulation (MiCAR) sets out a new supervisory regime for ART and EMT issuers, which includes significance assessments and reassessments of ARTs and EMTs by the EBA, transfer of supervisory responsibilities from national competent authorities to the EBA and the establishment of supervisory colleges for s-ARTs and s-EMTs. 

In its Decision, the EBA details the following procedural aspects:

• it introduces a harmonised reporting calendar for national competent authorities and clarifies the respective reference periods and remittance dates.   
• it clarifies the reporting obligations for issuers of s-ARTs and s-EMTs and the reporting of data relevant for the establishment of the supervisory colleges. 
• it sets out the procedural arrangements and timeline to be followed for the consultation procedures with related parties when the EBA is to notify its draft and final decisions on significance assessment to the home NCA of the issuer, the issuer, the ECB and the national central bank, where relevant.  
• it establishes the procedural steps and information required in this respect to support a smooth transition of supervisory competences between the EBA and national competent authorities for issuers of s-ARTs and issuers of s-EMTs.
• it provides for different templates to facilitate the implementation of the procedure, including a template for national competent authorities’ notification of voluntary classification requests from issuers of ART and EMT and a template for the issuer, the competent authority of the issuer’s home Member State, the ECB and relevant central bank to provide observations and comments in writing to the EBA’s draft decision to classify or to no longer classify an ART or EMT as significant.

Legal basis and background

The EBA Decision EBA/DC/558 was adopted on the basis of Articles 35 and 44 of Regulation (EU) No 1093/2010 (EBA Regulation), and Articles 43, 44, 56, 57, 117, 119 of Regulation (EU) 2023/1114 (MiCAR).

The EBA is responsible for carrying out assessments of ARTs and EMTs in order to identify if they meet the criteria for significance as set out in MiCAR. When classifying an ART or EMT as ‘significant’, the EBA is responsible for carrying out relevant supervisory tasks under MiCAR, including establishing, managing and chairing supervisory colleges. 

The EBA is responsible for conducting direct supervision of issuers of s-ARTs, while s-EMTs (where issued by electronic money institutions) are subject to ‘dual supervision’ by the EBA and the respective home NCA. The EBA will exercise its supervisory powers in close cooperation with any other competent authorities responsible for supervising the respective issuers (in cases where the issuer also carries out other financial services activities). As part of its supervisory activities, the EBA may request information from issuers, conduct investigations, carry out on-site inspections, take supervisory measures and impose fines. 

The EBA is continuously and actively engaging with national competent authorities to ensure it can carry out effectively its supervision mandate under MiCAR.  

Source: Government of the Netherlands

News item | 18-10-2024 | 12:00

Newcomers

That news caused great optimism among the responsible ministers from North Rhine-Westphalia, Belgium and the Netherlands at the Kerkrade conference on the underground telescope.

Following elections and government formation in the Netherlands and Belgium, a number of new ministers in the Netherlands and Belgium are responsible for the Einstein Telescope project. From Wallonia it is Minister Pierre-Yves Jeholet, in Flanders it is Prime Minister Matthias Diependaele and from the Netherlands Minister Eppo Bruins, who also hosted.

Commitment in the 3 countries

Ahead of the summit, it was announced that the new Flemish cabinet is already reserving €200 million for the Einstein Telescope. This is good news. Together with the financial reservation in the Netherlands and the extra boost given by Minister Bruins on Prinsjesdag, a total of more than a billion euros is available for the Einstein Telescope in both countries.
Germany is also taking steps for the Einstein Telescope. There, an application is under way to get the Einstein Telescope on Germany’s priority list for large scientific infrastructure. This is a necessary condition for a financial contribution. Dutch and Belgian ministers have indicated their support for this proposal.

Drilling campaign: hard rock favourable

A key condition for building the Einstein Telescope is that the soil is suitable for it. To determine that, drilling to an average depth of 300 metres was carried out at 11 locations in the border region of Belgium, the Netherlands and Germany. Not all analyses have been completed yet, but the first preliminary conclusions look good. It was found that the subsurface consists of harder rock layers than initially assumed. This is favourable for building an underground research infrastructure. The analysed data from the drillings have been independently verified by the geological service of TNO (Netherlands Organisation for Applied Scientific Research). TNO concurs with the research team’s conclusion based on these initial findings that there are no factors that would make the project unfeasible.
This drilling campaign and the data collected do not yet say anything about exactly where the 3 vertices for the underground telescope will be. Further geological research is needed for that. In addition, seismic surveys must show that the area is sufficiently noise-free to allow the telescope to measure gravity waves optimally. Furthermore, civil engineering studies must show how the construction of the underground tunnels and vertices is possible. In addition, environmental impact studies will help determine the most suitable location.

Einstein Telescope of great value

The Einstein Telescope will be of great value to science, the economy and society. Studies show that every euro invested will pay for itself twice over, and thousands of additional jobs are expected to be created in the border area of the 3 countries. Both for scientists and professionals in the fields of construction, maintenance and hospitality.
The decision on where to build the Einstein Telescope will be made in 2026. The border region of Germany, the Netherlands and Belgium is in the race together, working on the best possible bid book. The Netherlands has €58 million for preparation and a reservation of €870 million for construction.

Quotes from national and regional ministers

Minister Eppo Bruins (OCW) – the Netherlands: ‘Together, we are really another step closer to the Einstein Telescope. The Flemish investment is very good news, and Germany is also taking steps. These agreements and first results of the ground borings mean that the ground under our plan is getting firmer, both literally and figuratively. And that’s good news. Together, we can really give a major boost to science, society and the economy in our countries with the Einstein Telescope.’

State Secretary Thomas Dermine, Belgium: ‘This latest ministerial meeting shows that the Netherlands, Belgium, and Germany continue to make significant daily efforts to ensure that the candidacy of the EMR region for the Einstein Telescope is as solid and coherent as possible. The Belgian federal government, whose administration (BELSPO) coordinates the work of the Belgian Task Force, closely monitors the next steps to be taken to ensure that this high-value scientific project is actually realized in the EMR region. The realization of a European project of this caliber will enhance the EMR cross-border region and demonstrate that Europe is at the top of scientific technology in the field of gravitational wave detection.’

Nathanael Liminski, Minister of Federal, European, International Affairs and Media of the State of North Rhine-Westphalia and Head of the State Chancellery: ‘We are constantly fostering cross-border cooperation between North Rhine-Westphalia, the Netherlands and Belgium for the benefit of the people in the region. Of the many areas and projects in which we work together, the Einstein Telescope stands out in particular. Joint cutting-edge research projects send out the signal that we, as Europe, have the confidence to be among the best in the world. The Einstein Telescope has enormous potential, both scientifically and economically.’

Gonça Türkeli-Dehnert, State Secretary, Ministry of Culture and Research of the State of North-Rhine Westphalia: ‘The research landscape in North Rhine-Westphalia, with its many excellent universities and research institutions, is unique in Europe. I am sure that North Rhine-Westphalia and its partners in the Netherlands and Belgium will be the ideal home for the Einstein Telescope.’

Minister Pierre-Yves Jeholet, Wallonia: ‘This project is of great importance for scientific research and European scientific collaboration, but also for the economy of our regions, which is why the new Walloon Government fully supports this bid through the Economy and Industry Department. Most of this project will be carried out under Walloon soil, and the spin-offs will be significant for our regions. In the coming weeks, the Walloon Government will be expanding its project team to maximise the chances of this joint bid by Germany, the Netherlands, Flanders and Wallonia.’

Flemish Prime Minister Matthias Diependaele: ‘The Einstein Telescope is a unique ‘Big Science’ project. It links fundamental science, technological innovation, attraction of STEM fields and international appeal. A strong commitment from all governments involved will enable us to actually bring this unique scientific infrastructure to the Meuse-Rhine Euroregion. This is why the new Flemish government has already entered an initial reservation of 200 million euros in its budget.’

Deputy Stephan Satijn (Economy, Finance and Business, Public affairs) Province of Limburg (NL): ‘During the ministerial meeting, it became clear that we all want the same thing: to bring the Einstein Telescope to this region. The new ministers are also keeping the Einstein Telescope high on the agenda. With good agreements, we have taken another step forward.’