ESMA publishes its fifth Data Quality Report, Report on Quality and Use of Data – 2024

This report includes a detailed analysis of data submitted by market participants across the EU and evaluates its usability for supervisory and risk-monitoring purposes.

At the heart of ESMA’s evaluation are Data Quality Indicators (DQIs) a structured set of metrics used to assess the completeness, accuracy, consistency, and timeliness of reported data. Developed in coordination with National Competent Authorities (NCAs), DQIs form the backbone of ESMA’s Data Quality Engagement Framework (DQEF), guiding both proactive supervision and remediation where data deficiencies are identified. They enable comparability across jurisdictions and reporting entities and support targeted regulatory interventions.

In the 2024 edition of the report, ESMA places particular emphasis on the evolving role of DQIs following the implementation of EMIR REFIT and ongoing improvements in SFTR and MiFIR data flows.

The following sections provide a detailed analysis of key DQIs, highlighting improvements achieved, persistent challenges, and regulatory priorities moving forward.

1. EMIR REFIT DQIs

   1. DQI 1a (Trade-level discrepancies): Discrepancies in trade-level outstanding derivatives between counterparties improved from 33.91% (May 2024) to 20.5% (Dec 2024).
   2. DQI 1b (Position-level discrepancies): Errors in position-level reports dropped from 55.16% to 22.17% over the same period.
   3. DQI 5a (Missing valuations): Increased to 12.63% (Dec 2024), prompting ESMA and NCAs to trigger follow-up actions.
   4. DQI 5b (Outdated valuations): Improved from 31-May-2024 to 16.19% (Dec 2024), though it remains critical during market stress.
   5. DQI 7a (Missing/abnormal maturities): Remains slightly above 10%, affecting risk assessment reliability.
   6. DQI 9a (Incorrect Entity Responsible for Reporting): At 1.36%, below the 5% threshold, but still significant for accurate accountability.

2. SFTR DQIs

   1. DQI 1a (Trade-level mismatches): Averaged 35% across 2023–2024—above the 5% threshold.
   2. DQI 1b (Position-level mismatches): Steady at around 10% in 2024, also above the threshold.
   3. DQI 5a (Missing market values): Improved significantly from 26.3% (Mar 2023) to 8.5% (Dec 2024).
   4. DQI 5b (Outdated valuations): Still the worst performer at 26% (Dec 2024) despite improvements.
   5. DQI 9a (Incorrect Entity Responsible for Reporting): Relatively low at 1.9%, similar to EMIR’s 1.36%.

3. MiFIR Data Quality

   1. ARMs (Authorised Reporting Mechanisms):
      1. In 2024, ARMs-reported transactions made up 52.45% of ~7.7 billion total transactions.
      2. A slight decline from 54.59% in 2023, despite a volume increase.
   2. Data Submission and Rejections:
      1. File volumes rose to 1.21 million, with higher transaction-per-file ratios.
      2. Rejections are generally low, with some spikes in specific validation contexts.
   3. APA (Approved Publication Arrangements):
      1. Public trades doubled from 237 million (2023) to 460 million (2024), driven mainly by fractional share reporting.

ESMA notes that SFTR data quality still shows large margins for improvement, and active follow-up by NCAs is expected regardless of whether thresholds are breached.

ESMA’s 2024 Data Quality Report highlights major progress in improving the accuracy and reliability of transaction reporting under EMIR, SFTR, and MiFIR, including the successful rollout of EMIR REFIT. With enhanced reconciliation efforts, smarter data reuse, and the onboarding of national authorities to the ESMA Data Platform through Project SHARE, 2025 ESMA will focus on deepening supervisory collaboration and leveraging technologies like generative AI to reduce reporting burdens and boost regulatory effectiveness.

Contact Point Nine today, if you have concerns about the data quality of your transaction reporting. Point Nine’s dedicated transaction reporting services, across EMIR, SFTR and MIFIR can provide the support needed to navigate this complex landscape with confidence.