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EuSEF & EuVECA– Consultation of ESMA on implementing measures and open hearing on 10 November 2014 Background On 26 September 2014, ESMA issued a consulta- tion paper addressed to social entrepreneurs, im- pact investors, European Social Entrepreneurship Fund ("EuSEF") and European Venture Capital Fund ("EuVECA") managers, impact fund managers, business angels, venture capitalists and other rele- vant stakeholders and their associations in the area of social entrepreneurship and venture capital in the European Union. What’s in there? The consultation paper is divided in five parts:  Part I deals with the advice on the types of goods and services, methods of production for goods and services and financial support embodying a social objective;  Parts II and III deal with the advice on the con- flicts of interest of EuSEF and EuVECA managers, respectively;  Part IV deals with the advice on the measure- ment methods for the social impact;  Part V deals with the advice on the informa- tion that EuSEF managers have to provide to investors.

MiFID – Consultation of ESMA on the definition of financial instruments Background ESMA raised in a letter sent to the Commission dated 14 February 2014 that the non-harmonized classification of financial instruments as derivatives or derivative contracts might prevent a consistent application of EMIR (Regulation (EU) No 648/2012). On 26 February, the Commission invited ESMA to consider issuing guidelines on the application of the definitions of financial instruments set forth under points 6 and 7 of Annex 1, Section C of MiFID (here- after "C6" and "C7"). As a reminder, C6 includes: options, futures, swaps and any other derivative contract relating to com- modities that can be physically settled provided that they are traded on a regulated market and/or an MTF. C7 includes options, futures, swaps, forwards and any other derivative contracts relating to commod- ities that can be physically settled not otherwise mentioned in C.6 and not being for commercial purposes, which have the characteristics of oth- er derivative financial instruments, having regard to whether, inter alia, they are cleared and settled through recognized clearing houses or are subject to regular margin calls. What’s in there? On 29 September 2014, ESMA published a consul- tation paper on future guidelines clarifying the defi- nition of derivatives as financial instruments under MiFID (the "CONSULTATION PAPER" ). In the Consultation Paper, ESMA proposes guidance on the specification of C6 and C7. In particular, ESMA follows the approach that C6 in- cludes commodity derivative contracts that "must" and "can" be physically traded. Furthermore, ESMA considers that the definition of C6 and C7 form two distinct categories, as C7 applies to commodity de- rivatives "that can be physically settled not other- wise mentioned in “C6", meaning that they are not traded on a regulated market or an MTF. The full list of questions raised by ESMA is available in Annex I of the Consultation Paper. The Consultation Paper is AVAILABLE HERE . What’s next? Comments should be raised by 5 January 2015.

Each part is divided in five sections:  The first sets out the applicable legal frame- work;  The second describes the mandate and indi- cations from the European Commission;  The third explains the proposed policy ap- proach;  The fourth sets out the proposed advice to the European Commission;  The fifth poses a number of questions to the participants in the consultation. The consultation paper is AVAILABLE HERE . What’s next? All received contributions will be published fol- lowing the close of the consultation, unless oth- erwise requested by the contributor. ESMA invites comments on all matters in this consultation pa- per and in particular on the specific questions summarized in Annex 1. On 10 November 2014, ESMA will hold an open hearing on the issues raised in the consultation paper and the relevant advice to be provided to the European Commission. ESMA is seeking input from representatives of the EuSEF and impact investment funds sectors, impact fund managers, impact investors, social enterprises, service providers and other stake- holders. Registrations for the open hearing can be made online. THE LINK IS AVAILABLE HERE . The hearing will be held on Monday 10 November 2014 from 14.00 to 18.00 CET and is open to all. ESMA is expected to deliver its advice to the Eu- ropean Commission by the end of April 2015.

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