Publication of ECB Decision relating to oversight of systemically important payment systems (SIPS)
8 August 2019
On 1 August 2019 the ECB published a Decision on the procedure and conditions for exercise by a competent authority of certain powers in relation to oversight of systemically important payment systems (SIPS). In other words, this Decision addresses SIPS and Eurosystem central banks with primary oversight responsibility for the SIPS in question. Simultaneously, the ECB published the response to the public consultation on the draft ECB Decision.
The Decision has been drafted on the basis of Article 21(1) of Regulation (EU) No 795/2014 (“the SIPS Regulation”) as amended by Regulation (EU) 2017/2094.
For the purposes of effective oversight, the Decision enables the competent authority to obtain information and documents from a SIPS operator in the format and within the deadline set by the competent authority.
The Decision also enables the competent authority to request the appointment of an independent expert for an investigation or independent review of the SIPS. It imposes requirements concerning the type of independent expert, the content and scope of the report, the handling of the report, including its disclosure and publication, and the timeline for producing the report.
In an on-site inspection (the third power established by the Decision), the competent authority is able to visit the premises of the SIPS operator and gather relevant information. The operator must be notified in advance that an on-site inspection will take place, except in cases of emergency. This power may also be delegated to another authority on a case-by-case basis.
The exercise of the competent authority’s powers foreseen in Article 21 may extend to the SIPS’ critical service providers (CSPs). For this to be feasible, it needs to be reflected in the SIPS’ contractual arrangements with the CSPs. In such cases, cooperation between the SIPS’ competent authority and the CSP’s overseer or supervisor, if any, is foreseen.
Currently, the entities subject to the powers of Article 21 are the operators of TARGET2, EURO1, STEP2-T and CORE (FR). This is based on the ECB’s 2016 payment systems classification.