Response to consultation on draft RTS on the requirements, templates and procedures for handling complaints under MiCAR
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ESBG believes that the approach adopted by ESMA under Art. 71 (5) is different from the one adopted by the EBA for its mandate under Article 31(5) of MiCA, regarding complaints-handling procedures for issuers.
In our understanding, the provisions in both articles are intended by the legislator to be identical, since the wording of the law in Art. 31 and 71 is almost identical.
The Joint Guidelines of the European Supervisory Authorities on Complaint Handling for Securities Trading and Banking (04/10/2018 JC 2018 35) established uniform guidelines for the banking industry. These were evaluated in 2021 (Joint Committee Report - 18 February 2021, JC 2021 24) and no need for change was identified. It is expected that both the issuance of crypto assets and the provision of crypto asset services can be expected from many existing regulated entities that have already effectively established complaint handling procedures in accordance with the Joint guidelines. In fact, only CRR credit institutions and e-money institutions are eligible to issue EMTs. The notification procedure for crypto asset services also facilitates market entry for already regulated institutions, which are also covered by the Joint Guidelines. ESMA's proposed RTS on Art 71 MiCA are closely aligned with the RTS for Crowdfunding Providers (EU) 2022/2117, which are subject to Crowd Funding Regulation EU 2020/1503. However, it is not expected that many of the Crowd Funding Service Providers will also provide crypto asset services. Therefore, ESMA and EBA should both use the Joint Guidelines as a basis. Additions should only be made where required by the legal text of MiCA.
The only requirement that MiCA sets out beyond the Joint Guidelines is the requirement that a complaint must be dealt with free of charge.
The following other clauses in the proposed RTS are not part of the Joint Guidelines:
Art. 3 (1) a) with reference to Art. 5 (1) (a) states, that complainants need to be informed about the admissibility of the complaint. Even in the context of Art. 5, what exactly is meant by admissibility? This term is also unnecessary, as both Guideline 6 of the Joint Guidelines and Art. 2 and 5 of the proposed RTS specify the information to be provided to the complainant.
Art. 4 (b) i. and Art. 6 (c) (i) a. RTS: We believe that crypto asset services are an environment where both providers and customers have a high digital affinity. Therefore, we do not consider it necessary that complaints can still be submitted by post. Since crypto asset services are often to be offered across borders in different member states, longer postal transit times would also hinder the speedy processing of complaints.
Art. 5 RTS goes beyond the requirements of the Guidelines. They are also unnecessarily detailed, especially in paragraph (a), (b) and (c). The Joint Guidelines are absolutely sufficient in this respect.
Due to the legal nature of the Regulation, which is directly applicable in all Member States, a reference to national provisions (Art. 4 (c) or Art. 5 (3) (b) RTS) is not satisfactory. According to our interpretation, the member states could still make their own regulations in this regard. However, due to the expected cross-border provision of crypto asset services, a uniform regulation is desirable. Otherwise, issuers and crypto asset service providers would have to comply with many different national regulations on possible deadlines, which is unreasonable. However, the specification of exact deadlines is not necessary, as these should be settled without “undue delay” anyway.
Question 1: Do you consider that the approach proposed in the RTS strikes an appropriate balance between the various competing demands described? If not, please suggest an alternative approach and the underlying reasoning and evidence.
As many companies provide financial services that fall under several European standards on complaint management, further harmonisation and unification of the rules on complaint management should be undertaken.ESBG believes that the approach adopted by ESMA under Art. 71 (5) is different from the one adopted by the EBA for its mandate under Article 31(5) of MiCA, regarding complaints-handling procedures for issuers.
In our understanding, the provisions in both articles are intended by the legislator to be identical, since the wording of the law in Art. 31 and 71 is almost identical.
The Joint Guidelines of the European Supervisory Authorities on Complaint Handling for Securities Trading and Banking (04/10/2018 JC 2018 35) established uniform guidelines for the banking industry. These were evaluated in 2021 (Joint Committee Report - 18 February 2021, JC 2021 24) and no need for change was identified. It is expected that both the issuance of crypto assets and the provision of crypto asset services can be expected from many existing regulated entities that have already effectively established complaint handling procedures in accordance with the Joint guidelines. In fact, only CRR credit institutions and e-money institutions are eligible to issue EMTs. The notification procedure for crypto asset services also facilitates market entry for already regulated institutions, which are also covered by the Joint Guidelines. ESMA's proposed RTS on Art 71 MiCA are closely aligned with the RTS for Crowdfunding Providers (EU) 2022/2117, which are subject to Crowd Funding Regulation EU 2020/1503. However, it is not expected that many of the Crowd Funding Service Providers will also provide crypto asset services. Therefore, ESMA and EBA should both use the Joint Guidelines as a basis. Additions should only be made where required by the legal text of MiCA.
The only requirement that MiCA sets out beyond the Joint Guidelines is the requirement that a complaint must be dealt with free of charge.
The following other clauses in the proposed RTS are not part of the Joint Guidelines:
Art. 3 (1) a) with reference to Art. 5 (1) (a) states, that complainants need to be informed about the admissibility of the complaint. Even in the context of Art. 5, what exactly is meant by admissibility? This term is also unnecessary, as both Guideline 6 of the Joint Guidelines and Art. 2 and 5 of the proposed RTS specify the information to be provided to the complainant.
Art. 4 (b) i. and Art. 6 (c) (i) a. RTS: We believe that crypto asset services are an environment where both providers and customers have a high digital affinity. Therefore, we do not consider it necessary that complaints can still be submitted by post. Since crypto asset services are often to be offered across borders in different member states, longer postal transit times would also hinder the speedy processing of complaints.
Art. 5 RTS goes beyond the requirements of the Guidelines. They are also unnecessarily detailed, especially in paragraph (a), (b) and (c). The Joint Guidelines are absolutely sufficient in this respect.
Due to the legal nature of the Regulation, which is directly applicable in all Member States, a reference to national provisions (Art. 4 (c) or Art. 5 (3) (b) RTS) is not satisfactory. According to our interpretation, the member states could still make their own regulations in this regard. However, due to the expected cross-border provision of crypto asset services, a uniform regulation is desirable. Otherwise, issuers and crypto asset service providers would have to comply with many different national regulations on possible deadlines, which is unreasonable. However, the specification of exact deadlines is not necessary, as these should be settled without “undue delay” anyway.