8.1 RECURSOS PERSONALES.

6.7.1 There are a number of baseline standards and protocols which need to be in place in order to implement any of the four options above to deliver a solution which meets all the EC requirements. Without such changes, any pan-European searches conducted would not be effective and the value of the technical development adversely impacted.

6.7.2 The changes identified, based on our findings, are listed below and discussed further in the Recommendations section following:

a. definition of a unique pan-European issuer code;

b. standardisation of the metadata held on issuers and filed documents;

c. standardisation, or harmonisation, of approach to time stamping and versioning.

6.7.3 In addition, in order to meet the requirement for, consolidation of information on corporate ownership, standardised structured formats for filing such information will need to be defined and implemented.

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7

Recommendation

7.1 Introduction

7.1.1 This section makes a number of technical recommendations to implement a pan-European search of regulated information on issuers of securities. The recommendations take account of the European Commission’s requirements, of the previous studies as detailed in Section 2 and of the findings of this report as detailed in Section 4. The recommendations are based on the Options Analysis in Section 6 above.

7.2 Recommendation

7.2.1 Summary

7.2.1.1 The options analysis does not identify a clear preferred option. All of the options identified are able to meet the majority of the requirements, have similar costs and similar timescales.

7.2.1.2 It is clear that Option 1 best satisfies the requirements, but it is also clear that this option has the highest overall impact on users, issuers and existing OAMs, and thus is highly likely to take the longest time to implement. However, this option also presents the best opportunity to save costs based on the reduction of the number of national OAMs over time.

7.2.1.3 The recommendation is therefore that Option 1 should be the long term solution, and that the EC seeks to evolve the current situation into a single, European OAM over time. Options 2 and 3 can then be used as steps which support this evolution and allow the costs and impact on stakeholders to be borne over time, and thus the impact and difficulty of change is reduced. 7.2.2 Publish a strategic roadmap for the future storage of regulated information

7.2.2.1 It is recognised that the implementation of a pan-European OAM network meeting all the functional requirements specified will require progress through a number of steps and take some considerable time to deliver and manage transition.

7.2.2.2 The effective delivery of such a major programme of change will involve the management of technical, legislative and organisational dependencies and change streams.

7.2.2.3 In order to maintain focus, and to show the market there is strong commitment to the longer term vision, we strongly recommend that a clear strategic roadmap and vision is agreed and published showing the proposed end target model, the proposed steps for moving towards this from the current position and the principles that will underpin this development.

7.2.2.4 The recommendation is that the roadmap shows the pre-work needed to support the implementation of any of these options (as discussed below), and then details the order in which the options could be implemented. The recommendation of this report is that Option 3 could be implemented first to ensure that the standardisation works and to allow users initial access to a pan-European search. This implementation of a central search tool holding metadata from all current OAMs could then be upgraded to also hold copies of the documents held by OAMs on a country-by-country basis. This will lead to Option 2 being fully implemented when all documents are stored in both the originating countries OAM and the central database.

Page 54 Actica/PB318D004 1.3 7.2.2.5 These initial steps will then facilitate Option 1 being rolled out as circumstances allow by re-

directing individual country OAM pages to the central facility, for both users and issuers. 7.2.2.6 We consider the publication of a strategic roadmap to be an early key requirement and

prerequisite for success, without which there will be little basis on which to build the onward development or gain the active engagement of key market participants required in order to deliver the stated requirements.

7.2.3 Align roadmap, standards and delivery with proposals for interconnection of business registers

7.2.3.1 Coordinate development, and approach, with proposals for business registers to set common coding and interconnection standards and manage and coordinate the impact of changes on issuers and listed companies.

7.2.4 Develop main strands of the roadmap

7.2.4.1 There are three strands which need to be progressed in order to reach a full solution: a. specification and procurement of central access functionality;

b. agreement and implementation of common metadata, coding standards and process standards;

c. implementation and migration planning.

7.2.4.2 The following points form a recommended way forward to manage central standards and governance.

7.2.5 Set up a central standards and protocol body to agree and implement standards

7.2.5.1 A central body will be needed to bring together OAMs and other interested parties to agree and enforce technical and data/metadata standards. The body should also determine transfer protocols to apply to metadata and filings and develop interoperability agreements if required. 7.2.5.2 Such a body may also be assigned the responsibility for the project management of the

implementation and migration to the pan-European service.

7.2.5.3 We note the comments in CESR’s 2010 report regarding the potential future role of ESMA in these areas.

7.2.6 Define a unique pan-European issuer code

7.2.6.1 We consider the definition and implementation of such a unique code is key to the successful technical development of pan-European searches across the OAM network and endorse CESR’s view in their 2010 report that a single code should be agreed for use by both the OAM and company register networks. We also note the recent endorsement by the International Standardization Organization of the Society for Worldwide Interbank Financial Telecommunications (SWIFT) as the registration authority to create and distribute global legal entity identifiers (LEIs).

Actica/PB318D004 1.3 Page 55 Link between business registers and unique issuer code

7.2.6.2 The business registers project aims to create a unique identification number for legal entities across Europe, potentially based on adding a country code to the current national identifiers. However, there is not a direct relationship between legal entities and issuers of securities, and hence this project cannot guarantee that each issuer of securities will have a unique identification number.

7.2.6.3 National business registers provide a unique identification number to all legal entities created in that nation, whether or not the legal entity is able to issue securities. There are therefore many legal entities with an identification number that are not able to issue securities (because they are not publically listed) but still have a name and identification number and hence may drive confusion. Of greater importance, there are also organisations that are able to issue securities which are not registered in national business registers.

7.2.6.4 A further issue is that the national business registers do not consolidate information, as noted in the BRITE project details. A multi-national issuer of securities is likely to have entries in many different national business registers. These are unlikely to have the same company name and will have different identification numbers which are not linked. In order to ensure the integrity of the pan-European OAM data search, these multi-national entities must be linked together by assigning a single pan-European identification number to the issuer, in addition to the multiple national identification numbers.

7.2.7 Standardise metadata held for issuers and filings, and harmonise coding

7.2.7.1 The enhanced metadata proposed in the 2010 CESR report should be adopted as a common standard across Member States. Where required, the OAM filing processes should enhanced to capture this information from issuers. This should include a common definition of the types of regulated information stored (also see CESR 2010 proposals)

7.2.7.2 The metadata held should be based on a common coding structure to allow cross country searches to be based on these codes rather than text/names. For example, by introducing a common code for a type of regulated information (1=Annual Report for example) as well as ISIN code for security etc.) This standardisation and code based search could be introduced at the central CAP/hub– not necessarily required at national OAM level.

7.2.8 Harmonise other key aspects of national OAM data and processes

7.2.8.1 In order to move the OAM network forward, and allow effective high quality searching across the network, there is a need to introduce a minimum set of common definitions of the key data items and basic rules of processing. These need not be extensive or onerous, but need to cover the following:

a. A common approach to docketing/time stamping across the network;

b. A harmonised approach to management of versioning where issuers submit revised versions of a document.

7.2.9 Specify a standardised format for filing structured information

7.2.9.1 The current OAM technology and filing processes could be extended without, in most cases, major re-engineering, to include acceptance and storage of filings containing structured information, for example for holdings of voting rights. In order to achieve this, a common

Page 56 Actica/PB318D004 1.3 format needs to be developed which could provide comprehensible and usable information which could be made available to end users without further processing or interpretation by the OAM operator. The specification of the format would need to be centrally driven, perhaps by ESMA, and the responsibility for compliance placed with issuers. In regards to notification of major holdings, these could be XBRL documents or standard forms or templates defined by ESMA in pursuit of Article 12.9 of the Transparency Directive.