In time for Christmas, a look back at SFTR during 2025
It would be easy to dismiss 2025 as a non-event, but as the days grow short and the multicoloured decoration lights take over from the flashing onscreen stock tickers, maybe it’s a good time to reflect on our regulatory ghosts Christmas past.
January 2025: ESMA MiFIR Consultation Extension and ERCC Response: The European Repo and Collateral Council (ERCC), part of the International Capital Markets Association (ICMA), responded to the European Securities and Markets Authority’s (ESMA) consultation on MiFIR transaction reporting. They advocated excluding all securities financing transactions (SFTs) from MiFIR reporting to avoid duplication and reduce burdens. The deadline was extended from January 3 to January 17, highlighting ongoing efforts to streamline overlapping rules.
This extension underscored a key theme of 2025: rationalising complex reporting regimes. The ERCC reiterated that there should remain a single source of truth for SFTs, minimising operational duplication.
March 2025: ICMA Updates SFTR Reporting Recommendations. On March 28, ICMA released the 10th update to its “Recommendations for Reporting under SFTR” guide (initially published in 2020). This edition clarified ambiguities in ESMA and UK FCA guidance, including:
- Reporting for sponsored repos, guaranteed repos, and pools of security/cash collateral.
- Obligations for foreign branches in the UK.
- Annual assessments for small non-financial counterparties (NFC-).
The guide, developed by ICMA’s SFTR Task Force (representing over 150 firms), aims to foster consistent implementation across the EU and the UK.
These updates, while subtle, addressed long-standing interpretative gaps and emphasised the growing need for harmonisation between EU and UK reporting expectations.
May 2025: ESMA Launches Data Quality Dashboard. On May 5, ESMA published guidelines and a framework for a new “Data Quality Dashboard” for reporting. This tool monitors key indicators like report completeness, accuracy, and timeliness, targeting entities responsible for at least 1% of EU-wide errors.
This marks a significant shift: data-driven supervision.
June 2025: ESMA Call for Input on Streamlining Reporting On June 23, ESMA issued a call for evidence on simplifying financial transaction reporting across regimes (including SFTR, EMIR, and MiFIR). This supports ESMA’s Data Strategy for burden reduction, focusing on:
- Validation improvements
- Reconciliation enhancement
- Digital formats, including ISO 20022
Responses will inform potential future Refit changes, raising the question of whether deeper structural reforms may emerge. The consultation indicates that long-term redesign of reporting architecture is on the table, even if nothing is yet confirmed.
Ongoing in 2025: Increased Supervisory Scrutiny.
- Delegated reporting arrangements
- Outsourced operational models
- Lifecycle event accuracy
- Completeness of submissions five years post-go-live
- Regulators expect maturity, not excuses.
Broader Context: The SFTR Review and Future Outlook
- Delayed Review: The mandatory SFTR review (due under Article 22) was expected in 2025 but faced delays, absent from ESMA’s 2025 work program. Industry anticipates a “SFTR 2.0” or Refit starting late 2025 or 2026, potentially incorporating EMIR Refit elements like executing agent fields, effective dates for amendments, and ESG/tax disclosures. This could extend to non-banking intermediaries and align with U.S. regimes (e.g., SEC 10c-1a, FINRA SLATE).
- UK Divergence: Post-Brexit, UK SFTR (onshored via the EU Withdrawal Act) continues to evolve separately, with FCA updates mirroring EU changes but adding local nuances (e.g., NFC exemptions).
Where Reg-X Comes In
As firms navigate this period of heightened scrutiny and incremental change, this is exactly where we at Reg-X step in. Our mission is to help reporting entities close the persistent data-quality gaps that supervisors are now explicitly targeting, from completeness checks and reconciliation accuracy to governance around delegated and outsourced reporting. Through our automated controls, diagnostic analytics, and continuously updated rule logic aligned to ESMA and FCA expectations, we enable firms to identify issues early, before they attract regulatory attention.
In a year where the regulations have been less about new rules and more about getting the existing ones right, we provide the clarity, assurance, and operational resilience needed to keep reporting teams ahead of the supervisory curve.
Reach out to us here
Conclusion
In summary, 2025 was a consolidation year, marked by practical fixes, improved guidance, and a renewed focus on data integrity, rather than major policy changes. As reporting firms continue to meet evolving compliance pressure, the industry remains challenged by under-reporting and accuracy issues.
In summary, 2025 was a consolidation year, marked by practical fixes, improved guidance, and a renewed focus on data integrity, rather than major policy changes.
Does the adoption of ESMA’s new SFTR Data Quality Dashboard mean that we will see the first SFTR reporting fines in 2026? Could the increased scrutiny suggest that the core SFTR mandates will remain stable to give the industry time to adapt, or does this focus hint at a potential 2026 SFTR Refit, our regulatory ghost of Christmas future?
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