title: Commission Recommendation (EU) 2021/1534 of 16 September 2021 on ensuring the protection, safety and empowerment of journalists and other media professionals in the European Union

text:
               20.9.2021

               EN

               Official Journal of the European Union

               L 331/8

      COMMISSION RECOMMENDATION (EU) 2021/1534
      of 16 September 2021
      on ensuring the protection, safety and empowerment of journalists and other media professionals in the European Union
      THE EUROPEAN COMMISSION,
      Having regard to the Treaty on the Functioning of the European Union, and in particular Article 292 thereof,
      Whereas:

                  (1)

                  As enshrined in Article 2 of the Treaty on European Union, the EU is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights. This includes respect for media freedom and pluralism and the right to freedom of expression, and requires continuous efforts to protect free, pluralistic and independent media, which are a key component of democratic systems and the rule of law.

                  (2)

                  The obligation of the EU and its Member States to respect media freedom and pluralism is also grounded in Article 11 of the Charter of Fundamental Rights of the European Union (‘the Charter’). The right to freedom of expression, enshrined in the same Article, includes the freedom to hold opinions and to receive and impart information and ideas without interference by public authority and regardless of frontiers (1). Taken together, these principles and rights mean that citizens should be able to access a plurality of sources of information and opinions thereby permitting them to form opinions, scrutinise governments and obtain the necessary information to freely exercise their right to vote. Member States have a responsibility to provide for an enabling environment for the media and journalists through legal, administrative and practical measures. (2)

                  (3)

                  The EU is widely considered to be one of the safest spaces for journalists and other media professionals (3). However, the growing number of physical, legal and online threats to and attacks on journalists and other media professionals over the past years and documented, inter alia, in the Commission’s 2020 and 2021 Rule of Law Reports (4) constitute a worrying trend (5). The number of alerts related to attacks, aggression and harassment against journalists and other media professionals in EU Member States continued to increase (6). The terrorist attack against weekly Charlie Hebdo killing 12 people in 2015 in France, the assassinations of investigative journalists Daphne Caruana Galizia in 2017 in Malta, Ján Kuciak and his fiancée Martina Kušnírová in 2018 in Slovakia, have been a stark call to improve the protection of journalists (7). The need to address the safety of journalists across the EU has been highlighted further by recent cases currently under investigation, such as the murders of Greek journalist Giorgios Karaivaz and Dutch journalist Peter R. de Vries in 2021.

                  (4)

                  In its European Democracy Action Plan (8), the Commission presented an ambitious roadmap to empower citizens and to build more resilient democracies across the EU, highlighting the important role that independent and pluralistic media play in enabling citizens to make informed decisions, as well as in the fight against disinformation. For this purpose, the European Democracy Action Plan envisaged a series of concrete deliverables aimed to support and safeguard media freedom and pluralism, including in particular this Recommendation and the Commission’s upcoming initiative geared at tackling strategic lawsuits against public participation (SLAPPs).

                  (5)

                  This Recommendation complements the Audiovisual Media Services Directive (9) and the Commission’s proposal for a Digital Services Act (10), which aim to protect viewers of audiovisual media content and all users of digital services across the EU. It also complements the Media and Audiovisual Action Plan (11), which provides a roadmap for the recovery and transformation of the audiovisual and media industries and with the Digital Compass Communication (12), which highlights that the European approach to a digital society must be based on the full respect of EU fundamental rights, including freedom of expression. The Recommendation builds on the findings of the annual Rule of Law Reports, analysing the rule of law situation in the EU and its Member States, in particular with regard to media freedom and pluralism. This Recommendation lays down recommendations addressed to the Member States to counter, among others, the threats highlighted in the Commission’s 2020 and 2021 Rule of Law Reports.

                  (6)

                  This Recommendation is fully aligned with the EU Strategy on victims’ rights for 2020-2025 (13) and the EU Gender Equality Strategy for 2020-2025 (14), the Commission’s actions in the area of equality more broadly, in particular in the framework of the LGBTIQ Equality Strategy for 2020-2025 (15), the EU Anti-racism Action Plan 2020-2025 (16), the Action Plan on Integration and Inclusion (17), the EU Roma strategic framework for equality, inclusion and participation for 2020-2030 (18) and the Strategy for the Rights of Persons with Disabilities (19). The Recommendation is also fully aligned with external action policy documents, such as the EU Action Plan on Human Rights and Democracy 2020-2024 (20), the EU Human Rights Guidelines on Freedom of Expression online and offline (21), as well as the EU Gender Action Plan III (22), thereby contributing to internal-external coherence. The strength of the EU’s external action in the area of fundamental rights is based on the way the EU nurtures and bolsters its democratic foundations within the Union.

                  (7)

                  The Commission provides financial support for journalists and other media professionals through projects in the area of media freedom and pluralism in the EU and in third countries. For example, since 2014, the Commission has co-financed the Media Pluralism Monitor, which analyses risks to media freedom and pluralism across Europe and reports on mechanisms to safeguard freedom of expression, the safety of journalists and journalists’ working conditions. The Commission is committed to continuing supporting such projects, in particular under the Creative Europe Programme.

                  (8)

                  The European Parliament has actively advocated stepping up the Union’s action to protect journalists. In its Report of 25 November 2020 (23), the Parliament expressed its continued, deep concern about the state of media freedom in the EU, in the context of instances of abuse and attacks still being perpetrated against journalists and other media professionals. While in its Resolution of 29 April 2021 (24), the Parliament noted that protecting investigative journalists and whistle-blowers (25) is a vital interest of society, it also highlighted, in its Resolution of 24 June 2021, its concerns with regard to physical, psychological and economic threats committed against journalists and other media workers in the EU (26).

                  (9)

                  The 2016 Council of Europe’s Recommendation on the protection of journalism and safety of journalists and other media actors (27), which is based on the requirements of the European Convention on Human Rights (ECHR) and the relevant case-law of the European Court of Human Rights, sets out comprehensive standards in this area. The Recommendation includes wide-ranging guidelines on prevention, protection, prosecution, and promotion of information, education and awareness raising. However, the implementation strategy adopted by the Council of Europe’s Steering Committee on Media and Information Society on 28 March 2018 underlined the urgent need for further progress in applying the Recommendation (28). The Platform to promote the protection of journalism and safety of journalists (29) of the Council of Europe continues to record an increasing number of alerts of attacks on or aggression towards journalists and other media professionals. The standards included in the Council of Europe’s Convention on Access to Official Documents (30) are also crucial to ensure that journalists have the fullest access to public information to enable them to carry out their work. This Recommendation aims to support the implementation of the Council of Europe’s standards, and in particular the 2016 Recommendation on the protection of journalism and safety of journalists and other media actors.

                  (10)

                  To prepare this Recommendation, in March 2021 the Commission organised a structured dialogue under the European News Media Forum (31), which brought together journalists, associations of journalists, media councils, news media companies, law enforcement authorities, Members of the European Parliament, representatives of Member States and their regulatory authorities, and international organisations.

                  (11)

                  By means of this Recommendation, the Commission aims to strengthen media freedom and pluralism in the EU by promoting joint and coordinated efforts by the Member States to improve the protection, safety and empowerment of journalists and other media professionals. This coordinated approach, involving all key stakeholders in Member States and at EU level as well as relevant international organisations, is necessary to ensure journalists and other media professionals can exercise their profession in Europe safely and effectively.

                  (12)

                  In order to ensure and safeguard an enabling environment for journalists and other media professionals, the Recommendation covers a series of issues pertaining to different key aspects of it. This includes horizontal recommendations regarding effective prosecution of criminal acts, cooperation with law enforcement authorities, rapid response mechanisms, training, access to information and venues, as well as economic and social protection. Moreover, the Recommendation includes specific recommendations related to protests and demonstrations, online safety and digital empowerment, as well as the situation of female journalists, those belonging to minority groups or reporting on equality.

                  (13)

                  Intimidation, physical and psychological violence, illegal arrests and arbitrary detention, unlawful surveillance, gender-based violence, harassment or discriminatory attacks, both online or offline, are just a few examples of threats to journalists and other media professionals. Public authorities have a duty to protect freedom of expression and journalists’ safety by providing an appropriate legal environment, taking criminal threats against journalists seriously, vigorously prosecuting the perpetrators of any attack and ensuring appropriate investigation and follow-up, including the application of effective, proportionate and dissuasive sanctions. It is essential to guarantee the thoroughness, impartiality, independence, transparency and timeliness of investigations and prosecution of crimes against journalists. To improve the effectiveness of investigative action, Member State authorities could consider setting up special units within police forces to investigate crimes against journalists – in cooperation with journalists’ representatives (32). The appointment and training of coordinators within prosecution offices and courts could also contribute to the success of judicial proceedings. Providing personal protection measures is also key for journalists and other media professionals whose safety is at risk. As crimes against journalists may also be transnational in nature, Member States should make full use of existing European legal cooperation frameworks and, if needed, request support from specialised European agencies such as Europol and Eurojust. Under the Commission’s proposal to strengthen Europol’s mandate (33), where in specific cases, Europol considers that a criminal investigation should be initiated, it could call on the competent authorities in a Member State to initiate, conduct or coordinate an investigation of a crime which affects a common interest covered by an EU policy, even if the crime in question does not have a cross-border dimension.

                  (14)

                  Smooth, effective and appropriate cooperation between journalists, other media professionals and law enforcement authorities could ensure better prevention against threats and attacks. Member States should put in place frameworks for cooperation between individual journalists, associations of journalists and law enforcement authorities, and actively encourage dialogue (34) between them, with the involvement of media self-regulatory bodies (media and press councils). This cooperation could include the setting up of joint coordination centres made up of law enforcement authorities and journalists’ representatives (35). Joint coordination centres should work closely with specialist victim support services, which are crucial for safeguarding the safety and psychological well-being of journalists who become victims of crime.

                  (15)

                  Establishing points of support, contact and rapid response and early warning mechanisms, independent of law enforcement authorities, represents a vital component of the support system for journalists and other media professionals targeted by physical and online attacks. These points of contact should be free of charge, easily accessible for journalists (and, when needed, their families) and operate in a transparent manner. As required by Directive 2012/29/EU (36), every victim has a right to receive support and protection in accordance with his or her individual needs. Member States should take measures to establish and maintain specialist support services, in particular points of contact, providing counselling, legal advice and psychological support, as well as shelters or any other appropriate accommodation for journalists and other media professional who have become victims of crimes. These contact points should also act as “digital shelters” and provide support in the area of digital security, including, where feasible, the provision of cybersecurity expertise. They should provide support to journalists and newsrooms to deal with online threats and harassment targeting journalists, including threats and harassment targeting journalists due to their sex, sexual orientation, ethnic or social origin or any other ground listed in Article 21 of the Charter. The effective operation of the rapid response and early warning mechanisms requires stable and adequate financing for entities performing these tasks (37).

                  (16)

                  A robust system of safeguards at national level is required to enable journalists to fulfil their crucial role ‘on the ground’, especially with regard to access to venues, sources of information and reporting from events of public interest (38). Member State authorities should minimise risks of arbitrary denial of accreditation or registration or cumbersome registration and accreditation systems or procedures, which could deter journalists and other media professionals from being able to perform their work effectively and, at the same time, may constitute unjustified, discriminatory or disproportionate restrictions of the freedom to provide journalistic services. This is crucial to safeguard the enabling environment for freedom of expression as well as to ensure the participation of journalists and other media professionals in public debates on matters of legitimate public interest.

                  (17)

                  Ensuring access to documents and information, including official websites, and obtaining timely answers, is a necessary condition for journalists to do their work. While access to information is guaranteed by law in all Member States, practical obstacles remain in many cases (39). Additionally, the recent cases of emergency legislation intended to counter disinformation during the COVID-19 pandemic, which in some instances included provisions of a criminal nature, in some cases had a chilling effect on the work of journalists (40). Such provisions could constitute unjustified, discriminatory or disproportionate restrictions of the freedom to provide journalistic services. In its Communication on tackling COVID-19 disinformation (41), the Commission noted that laws which define these crimes in excessively broad terms or which laid down disproportionate penalties may constrain sources’ willingness to speak to journalists, and lead to self-censorship.

                  (18)

                  A modern framework for protecting journalists should include the continuous development of competences and skills for all actors relevant to the protection of journalists and other media professionals (42). Training activities for law enforcement authorities can increase the awareness and attentiveness of police forces with regard to ensuring safety of journalists and other media professionals. The judiciary and prosecution services should also benefit from dedicated training which may equip them with better understanding of, for instance, international standards on freedom of expression, access to information and safety of journalists (43). Training is equally crucial in promoting the most effective approaches towards preventing physical and online attacks targeting journalists, and should provide participants with the appropriate tools to address such threats. Cooperation between journalists, journalists’ associations, online platforms and law enforcement representatives should be encouraged. Media companies can also empower journalists, including those operating in non-standard forms of employment (freelancers, self-employed journalists and other media professionals), through regular training on safety issues as well as by developing risk analysis, operational plans and post-incident reporting systems. Developing these skills requires specific and often costly training, which can usually be afforded only by large and well-established newsrooms. Smaller media outlets might therefore require financial assistance in this regard. Similarly, freelancers as well as self-employed journalists and other media professionals might require financial assistance as often they have to pursue training on their own initiative. The importance of providing training for fact-checkers, who also represent an important component of the news media environment, should also be highlighted.

                  (19)

                  The economic repercussions of COVID-19 have highlighted the need to ensure safe and suitable working conditions for journalists. Freelance journalists, in particular, have found themselves in a vulnerable situation, often losing sources of income and having little or no social protection. The framework for protecting journalists should include formal and effective access to adequate social protection for all journalists and other media professionals, including those working in non-standard forms of employment, in line with the Council Recommendation of 8 November 2019 (44). This concerns not only the availability of income support mechanisms but also effective and non-discriminatory access to other forms of social protection, for instance leave or parental support measures.

                  (20)

                  Investigative journalists play a key role in combating organised crime, corruption and extremism. Their work carries particularly high risk of physical threats and attacks, which may result in the most tragic cases in assassinations, as seen in Europe in recent years. Member States are called upon to reinforce protection measures for journalists and other media professionals working on issues related to organised crime and corruption. Moreover, Member States should effectively use all available transnational cooperation tools to rapidly investigate crimes against journalists who are victims of organised crime, so as to ensure that those responsible are brought swiftly to justice.

                  (21)

                  Journalists and other media professionals are experiencing a growing number of attacks and harassment during protests and demonstrations. During such events, some journalists may be exposed to attacks by private individuals, ranging from physical attacks, violence and verbal abuse to attacks on their equipment. Sometimes they might be also exposed to actions by law enforcement authorities such as arbitrary arrests and interrogations or disproportionate criminal charges (45). Operational solutions and training are therefore needed to ensure journalists’ safety during protests, diminish the risks of potentially unjustified or disproportionate actions and to ensure effective protection by law enforcement forces. In particular, independent liaison officers could ensure that law enforcement authorities communicate with journalists during demonstrations and could act as first contact points for journalists if they experience violence or harassment. Such liaison officers could be trained in risk management and mitigation techniques during public gatherings and provide initial advice with regard to legal remedies available to journalists who are the victims of violence during protests or demonstrations.

                  (22)

                  Digital and online safety has become a major concern for journalists. Smear campaigns and online denigration of journalists are frequent. This situation is particularly concerning when politicians or powerful public figures are initiating such attacks (46). Synchronised attacks on journalists by trolls and bots, e-mail hacking, internet restrictions or cyberbullying are some examples of online attacks against journalists and their sources. The safety of female journalists is of particular concern. Journalists and other media professionals are not only targets of online incitement to hatred (47) and threats of physical violence, but can also be subject to illegal surveillance (48), including in the context of police investigations which may compromise the protection of journalistic sources. Ensuring the cybersecurity of mobile communication devices and that journalists and other media professionals are not subject to illegal online tracking or surveillance is therefore paramount in protecting the confidentiality of journalists’ communications. Member State authorities responsible for media, online law enforcement and cybersecurity should play a role in ensuring digital safety.

                  (23)

                  The processing of personal data collected through tracking or surveillance tools must comply with the General Data Protection Regulation (EU) 2016/679 of the European Parliament and of the Council (49) and the Law-Enforcement Directive (EU) 2016/680 of the European Parliament and of the Council (50) as applicable. National data protection authorities and courts are central in ensuring their effective enforcement.

                  (24)

                  Journalists and other media professionals should be equipped with digital skills, to strengthen their cyber-resilience and permitting them to better face cyber-threats. Effective dialogue between media self-regulatory bodies, journalists’ associations and industry representatives, as well as Member State authorities in the field of media, online law enforcement and cybersecurity should be encouraged, in particular to develop digital skills among journalists and other media professionals, for instance through targeted training (51).

                  (25)

                  Statistics demonstrate that female journalists are subjected to more threats than their male counterparts (52), in particular in the form of online harassment, rape and death threats as well as incitement to hatred based on grounds of gender. These attacks are sometimes the result of orchestrated campaigns aimed at discrediting or silencing female journalists. They may lead to self-censorship, withdrawal from online communities or even decisions to leave the profession (53). Research also shows that such forms of online harassment, threats and incitement to hatred are also disproportionately directed at journalists belonging to a minority group, having a migrant background or reporting on related issues (54). Female journalists reporting on topics related to gender and equality are particularly exposed to threats and retaliation (55).

                  (26)

                  Available data show that gender-based violence continue to be prevalent across Europe (56). However, the availability of granular data and the transparency of reporting on violence against female journalists, journalists belonging to minority groups or those who report on equality issues continues to be limited. Member States, industry, civil society and researchers should cooperate to gain more knowledge about such violence. This could also be achieved by encouraging national equality bodies to report regularly on the situation of such journalists.

                  (27)

                  Women continue to be under-represented in the media sector in managerial and top executive positions, as well as in the roles of editors-in-chief (57). Moreover, discrimination towards female journalists, journalists belonging to minority groups or reporting on equality issues may occur inside newsrooms. Therefore, measures enhancing equality and inclusion in the media industry as well as ensuring equal working opportunities and a safe and inclusive working environment are necessary (58). Regular dialogues between Member States, representatives of journalists and media self-regulatory bodies as well as collective agreements also play an important role in addressing all forms of violence, harassment and discrimination in the media sector.

                  (28)

                  This Recommendation recognises the important role of civil society organisations and news organisations in addressing offline and online harassment, threats and incitement to hatred as well as discrimination of female journalists, journalists belonging to minority groups or reporting on equality issues. It is important to support initiatives by civil society organisations to raise awareness and support and empower these journalists. The same goes for initiatives to promote the sharing of knowledge and best practice among news organisations.

                  (29)

                  The Commission will hold regular dialogue with Member States and stakeholders in the relevant forums, in particular the European News Media Forum, and will closely monitor all actions taken by Member States following the adoption of this Recommendation. The network of contact points on the rule of law could also discuss issues related to the safety of journalists as part of the wider rule of law context. No later than 18 months after the Recommendation is adopted, and subsequently on request, Member States should provide the Commission with all relevant information they can reasonably be expected to supply to allow the Commission to monitor compliance. The Commission intends to perform evaluations which will assess the implementation of this Recommendation by Member States and develop key performance indicators related to, for instance: alerts on the Council of Europe’s Platform to promote the protection of journalism and the safety of journalists; how such alerts have been addressed; unresolved and resolved legal proceedings concerning crimes against journalists; the involvement of the relevant EU bodies in those procedures, and the performance of projects and actions put in place by Member States to support journalists and other media professionals. On the basis of the information gathered, and all other available information (59), the Commission will assess the impact of this Recommendation and determine whether additional steps are required to ensure the protection, safety and empowerment of journalists and other media professionals.

                  (30)

                  This Recommendation is addressed to the Member States. Candidate countries and potential candidates for EU accession as well as EU neighbourhood policy countries are also encouraged to follow this Recommendation.

            HAS ADOPTED THIS RECOMMENDATION:

         PURPOSE OF THE RECOMMENDATION

                  (1)

                  This Recommendation sets out guidance for Member States to take effective, appropriate and proportionate measures to ensure the protection, safety and empowerment of journalists, in full compliance with the EU Charter of Fundamental Rights, in particular the principles of media freedom and pluralism, the right to freedom of expression and information, the right to the integrity of the person, the right to liberty and security and the right to non-discrimination, as well as other applicable provisions of EU law, international standards and the constitutional traditions common to the Member States.

                  (2)

                  This Recommendation builds on and consolidates the progress made under existing policy and support activities – at national, EU and international level – to ensure the protection, safety and empowerment of journalists and promote and safeguard media freedom and pluralism.

                  (3)

                  This Recommendation is without prejudice to the rights and obligations of Member States to take measures to increase the safety of journalists in accordance with national legal systems, professional standards, guidelines and protocols.

         GENERAL RECOMMENDATIONS FOR ENSURING THE PROTECTION, SAFETY AND EMPOWERMENT OF JOURNALISTS ACROSS THE EU

         Effective and impartial investigation and prosecution of criminal acts

                  (4)

                  Member States should investigate and prosecute all criminal acts committed against journalists, whether online or offline, in an impartial, independent, effective, transparent and timely manner, making full use of existing national and European legislation, to ensure that fundamental rights are protected and justice is swiftly delivered in particular cases and prevent the emergence of a ‘culture’ of impunity regarding attacks against journalists.

                  (5)

                  Member States are encouraged to cooperate and share information, expertise and best practices with other Member States, and where relevant with international institutions, on cases related to the safety of journalists. Where relevant, Member States are encouraged to involve the competent European authorities, such as Europol and Eurojust, in resolving crimes committed against journalists.

         Cooperation between law enforcement authorities, journalists and associations representing journalists

                  (6)

                  Member States should set up coordination centres and/or protocols of cooperation between representatives of their police forces and security services, the judiciary, local public authorities and media bodies, including journalists’ associations and unions and media self-regulatory bodies. Member States are encouraged to foster a continuous dialogue between law enforcement authorities and journalists on ways to prevent and address threats and attacks against journalists, with the involvement of media self-regulatory bodies. Member States are encouraged to share best practices on such coordination and cooperation measures.

                  (7)

                  Member States should provide timely and effective personal protection to journalists and other media professionals whose safety is under credible risk of physical attack linked to their work. In particular, Member States should swiftly provide personal protection measures to investigative journalists and journalists working on corruption, organised crime or terrorism who have reported threats to police. Special attention should be paid to personal protection measures, including the use of protection orders, for female journalists and journalists belonging to minority groups. Specific protection measures should also be carefully considered for close relatives of the journalists and other media professionals concerned.

         Independent response and support mechanisms

                  (8)

                  Member States, in cooperation with journalists’ representatives, should support establishing specialist services - rapid response mechanisms - providing legal advice, psychological support and shelters for journalists and other media professionals facing threats. These specialist support services should also act as contact points and emergency helplines.

                  (9)

                  The contact points should also provide appropriate support to journalists and newsrooms to deal with online threats and harassment targeting journalists, including threats and harassment targeting journalists due to their sex, sexual orientation, ethnic or social origin or any other ground listed in Article 21 of the Charter.

                  (10)

                  Such specialist services should be free of charge and fully independent of law enforcement authorities. Member States should inform journalists and other media professionals of the available contact points and support services and are encouraged to establish dedicated websites presenting them in a simple and user-friendly manner. The contact points and support services should be accessible for persons with disabilities. Member States should facilitate cooperation between these contact points, at both national and the EU level.

         Access to venues and sources of information

                  (11)

                  Member States should ensure that public authorities and bodies create transparent, fair and non-discriminatory conditions and procedures for journalists and other media professionals to attend and ask questions at press conferences and similar events and to enable them to obtain access to documents and other information held by public authorities and bodies, including through digital means. Public institutions should possess clearly identifiable contact points for accessing documents that are easily accessible through electronic means.

                  (12)

                  All Member States are encouraged to join and implement the standards of the Council of Europe Convention on Access to Official Documents and those resulting from the case law of the European Court of Human Rights. In particular, Member States should ensure that national administrative procedures for accessing documents are not cumbersome and that requests for access to information are treated without any unnecessary delay, according to best administrative standards. Member States should ensure that decisions declining access to documents or information are duly justified. National court decisions related to access to information cases must be swiftly enforced.

                  (13)

                  Member States should only make use of accreditation procedures in situations where there is a real and justified need to limit the number of journalists and other media professionals attending a specific official event. When applicable, Member States should ensure that their public authorities provide clear, transparent and non-discriminatory accreditation procedures for all individuals and organisations concerned, including journalists and other media professionals. Member States should ensure that journalists and other media professionals are not denied accreditation merely on the basis of their professional affiliation.

                  (14)

                  Member States should not impose strict formal conditions in relation to press cards and other documents utilised to confirm the professional status of a journalist. Member States should also ensure that their enforcement authorities and representatives of the public administration are aware of all types of available accreditation procedures for journalists and other media professionals, to minimise the risk of them being refused recognition.

         Training

                  (15)

                  Member States are encouraged to promote the continuous development of competences and skills in all professions relevant for the protection of journalists and other media professionals. In particular, Member States should develop and provide training modules for law enforcement authorities, judges and prosecutors, as well as for all relevant authorities involved in digital safety.

                  (16)

                  Member States should support media self-regulatory bodies, associations of journalists and industry representatives in their training activities, especially in the organisation of training modules on preventing and combating violence and harassment against journalists and other media professionals, in particular those geared at female journalists, journalists belonging to minority groups and those reporting on equality issues. Such training modules should be recommended for newsrooms managers to equip them with skills to effectively prevent and address harassment, threats and violence, including at work, and to support the victims.

                  (17)

                  Member States are encouraged to promote and support the provision of tailored in-house training by media companies for journalists and other media professionals, including those operating in non-standard forms of employment, especially on the necessary procedures for managing emergency situations, both physical and online. This could include internal risk analysis and safety protocols for their journalists and other media professionals. In particular, such protocols should give journalists and other media professionals clear instructions to follow in critical situations. Safety protocols should be disability-inclusive and training should be accessible for journalists and other media professionals with disabilities.

         Economic and social protection

                  (18)

                  Member States should contribute to the creation of an enabling professional environment for journalists and other media professionals, including those working in non-standard forms of employment, by ensuring accessibility to formal and effective social protection and other practical support measures. In particular, Member States should continuously work to strengthen access to social protection against unemployment, sickness, invalidity, disability and professional risks, as well as retirement schemes. Such access should be strengthened by ensuring mandatory participation of workers, regardless the type of their employment relationship, and at least voluntary participation of the self-employed.

         SPECIFIC RECOMMENDATIONS ON THE PROTECTION AND SAFETY OF JOURNALISTS DURING PROTESTS AND DEMONSTRATIONS

         Role of journalists during protests and demonstrations

                  (19)

                  Member States should recognise the role of journalists during public gatherings, protests and demonstrations in providing information about such events to the public and should ensure that journalists and other media professionals are able to operate safely and without restrictions during such events. Member States should provide regular training for law enforcement agencies, to improve their capacity to guarantee public security while at the same time protecting journalists and not inhibiting their ability to report.

         Standard operating procedures and risk mitigation strategies

                  (20)

                  Member States should liaise with their law enforcement agencies to establish effective standard operating procedures or risk mitigation strategies to protect journalists covering protests and demonstrations. Representatives of journalists, media self-regulatory bodies and civil society representatives with the relevant expertise should be consulted to identify areas of risk, including those related to the potential conflict between journalists’ reporting activities and the work of law enforcement agencies.

         Communication between journalists and law enforcement authorities before and during protests and demonstrations

                  (21)

                  Member States should strive to ensure effective communication between journalists and law enforcement during protests and demonstrations. To this end, Member States are encouraged to nominate liaison officers responsible for ensuring that law enforcement authorities clearly communicate to journalists the security measures to be adopted during public gatherings. When possible, such liaison officers should inform journalists and other media professionals about potential risks, in advance of planned protests or demonstrations.

         Methods of visual identification of journalists during protests and demonstrations

                  (22)

                  Member States should work together with the representatives of journalists and media self-regulatory bodies on effective and appropriate methods for the identification of journalists during protests and demonstrations. This could include agreeing on forms of visual identification to distinguish journalists and other media professionals reporting from such gatherings from other participants, to the extent that this identification does not further endanger journalists or hinder their work.

         Regular dialogue and reporting

                  (23)

                  Member States should encourage continuous and regular exchange of views between law enforcement forces and journalist associations to ensure that protection measures taken by law enforcement agencies are effective and do not unduly inhibit the reporting activities of journalists and other media professionals covering protests or demonstrations. Member States should encourage their law enforcement authorities to produce reports to be published at national level on the specific action taken to increase the safety of journalists during protests and demonstrations.

         SPECIFIC RECOMMENDATIONS ON ENSURING ONLINE SAFETY AND DIGITAL EMPOWERMENT

         Cooperation with public authorities and industry

                  (24)

                  Member States should provide that national and media regulatory authorities or bodies, and other competent regulatory authorities or bodies responsible for online law enforcement and cybersecurity establish dedicated working groups specialised in collecting information and best practices related to the prevention of online attacks and threats to journalists. Member States should provide that such authorities present regular reports on their findings, assessing the effectiveness of national measures aimed at tackling cyber-attacks on journalists. The reports should pay particular attention to the situation of female journalists, journalists belonging to minority groups and those reporting on equality issues and include, where available, statistics disaggregated by gender. Member States should promote a regular dialogue between such authorities and media self-regulatory bodies, journalists’ associations, as well as industry and civil society representatives, in particular in view of fostering cyber-awareness and digital skills among journalists to enable them to take self-protection measures.

         Cooperation with online platforms and civil society

                  (25)

                  Member States are encouraged to promote the cooperation between online platforms and organisations or bodies operating on their territory that have particular expertise in tackling threats, harassment and incitement to hatred targeting journalists, for instance by encouraging their potential role as trusted flaggers. Member States should foster, in close cooperation with online platforms, a digital environment that prevents the use of online services to attack journalists, in particular by developing strategies to address orchestrated attacks. Member States should encourage online service providers to increase transparency on any measures they put in place to deal with specific threats to journalists.

         Protection against online surveillance

                  (26)

                  Member States should ensure full implementation of the European and national legal frameworks on confidentiality of communications and online privacy with a view to ensuring that journalists and other media professionals are not subject to illegal online tracking or surveillance. Member States’ Computer Security Incident Response Teams or other competent authorities or bodies should create and disseminate cyber hygiene guidelines for journalists. They should, upon request, assist journalists who seek to determine whether their devices or online accounts have been compromised, in obtaining the services of reputable cybersecurity forensic investigators.

         SPECIFIC ADDITIONAL RECOMMENDATIONS TO EMPOWER AND PROTECT FEMALE JOURNALISTS AND THOSE BELONGING TO MINORITY GROUPS OR REPORTING ON EQUALITY

         Empowering female journalists, journalists belonging to minority groups and those reporting on equality issues

                  (27)

                  Member States should support projects or initiatives aiming to empower female journalists, journalists belonging to minority groups and those reporting on equality issues. In developing such initiatives, Member States are encouraged to give due consideration to the perspectives of civil society, academia, media bodies and the media industry.

         Transparency and reporting

                  (28)

                  Member States are encouraged to take measures to improve transparency in reporting and data collection on attacks and discrimination against female journalists, journalists belonging to minority groups and those reporting on equality issues. Member States should encourage their national equality bodies to present, on a regular basis, reports on the situation of such journalists.

         Equality and inclusion in the media industry

                  (29)

                  Member States should promote and support action to foster equality and inclusion in the media industry and in newsrooms. To this end, they should take continuous efforts to ensure that female journalists, journalists belonging to minority groups and those reporting on equality issues have access to equal working opportunities and can work in a safe and inclusive environment.

                  (30)

                  Member States should engage in regular dialogues with the representatives of journalists and media self-regulatory bodies, to promote equality and inclusion in newsrooms and media management positions. Such dialogues should focus on support mechanisms for female journalists, journalists belonging to minority groups and those reporting on equality issues who may be subject to all forms of harassment and violence. Member States should encourage collective agreements aimed at addressing these issues.

         Awareness raising campaigns and provision of information

                  (31)

                  Member States are encouraged to support initiatives including those of civil society organisations aimed at raising awareness and organising campaigns on preventing and combating violence and harassment against female journalists, journalists belonging to minority groups and those reporting on equality issues, and to provide information on how to seek assistance and support. Member States are also encouraged to support initiatives geared at exchanging best practices among news media organisations with the goal of developing efficient equality policies.

         PROVISION OF INFORMATION, REPORTING AND MONITORING

                  (32)

                  To allow for the monitoring of the measures and actions taken to put this Recommendation in practice, Member States should – 18 months after its adoption and subsequently on request – submit to the Commission all relevant information regarding such measures and actions. To this end, they should regularly collect up-to-date and consistent data and develop, where appropriate, reporting tools to obtain comparable information. Data should only be collected for analytical purposes.

                  (33)

                  The Commission will hold discussions on the measures and actions taken to put the Recommendation in practice with Member States and stakeholders in relevant forums, in particular within the European News Media Forum. The Commission will also perform evaluations taking stock of the progress achieved in putting this Recommendation in practice, based on key performance indicators and taking into account the findings of the Commission’s annual Rule of Law Reports.

         ADDRESSEES

      This Recommendation is addressed to the Member States.

         Done at Brussels, 16 September 2021.

               For the Commission

            Thierry BRETON

               Member of the Commission

         (1)  This freedom is also enshrined in Article 10 of the European Convention for the Protection of Human Rights, as interpreted by the European Court of Human Rights of the Council of Europe.

         (2)  Article 51(1) of the Charter stipulates that Member States shall respect and promote the rights and principles enshrined in the Charter when implementing EU law.

         (3)  2020 World Press Freedom Index.

         (4)  COM(2020)580 final of 30 September 2020, COM(2021)700 final of 20 July 2021.

         (5)  As also confirmed by the 2020 and 2021 Media Pluralism Monitor Report. See: https://cmpf.eui.eu/media-pluralism-monitor/

         (6)  Council of Europe platform to promote the protection of journalism and safety of journalists.

         (7)  UNESCO observatory of killed journalists.

         (8)  COM (2020) 790 final of 3 December 2020.

         (9)  Directive (EU) 2018/1808 of the European Parliament and of the Council of 14 November 2018 amending Directive 2010/13/EU on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the provision of audiovisual media services (OJ L 303, 28.11.2018, p. 69).

         (10)  COM(2020) 825 final of 15 December 2020.

         (11)  COM(2020) 784 final of 3 December 2020.

         (12)  COM(2021) 118 final of 9 March 2021. This Communication also states that new specialised digital skills for the workforce are a prerequisite to participate actively in the Digital Decade.

         (13)  COM(2020) 258 final of 24 June 2020.

         (14)  COM(2020) 152 final of 5 March 2020.

         (15)  COM(2020) 698 final of 12 November 2020.

         (16)  COM(2020) 565 final of 18 September 2020.

         (17)  COM(2020) 758 final of 24 November 2020.

         (18)  COM(2020) 620 final of 7 October 2020.

         (19)  COM(2021) 101 final of 3 March 2021.

         (20)  2020 Council Conclusions on the EU Action Plan on Human Rights and Democracy 2020-2024, https://www.consilium.europa.eu/media/46838/st12848-en20.pdf

         (21)  2014 Council Human Rights Guidelines on Freedom of Expression Online and Offline, https://www.consilium.europa.eu/media/28348/142549.pdf

         (22)  JOIN(2020) 17 final of 25 November 2020.

         (23)  PE652.307v02-00.

         (24)  P9_TA (2021)0148.

         (25)  It should be noted that the Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons who report breaches of Union law (OJ L 305, 26.11.2019, p. 17) was adopted on 23 October 2019 and entered into force on 16 December 2019. Member States have until 17 December 2021 to transpose it into their national laws. The Directive provides common standards of protection across the EU to whistle-blowers who raise breaches of EU law with their employer.

         (26)  P9_TA (2021)0313.

         (27)  CM/Rec (2016) 4.

         (28)  Implementation Guide to Recommendation CM/Rec(2016)4 on the Protection of journalism and safety of journalists and other media actors.

         (29)  https://www.coe.int/en/web/media-freedom. The low response rate of Member States shows need for further action.

         (30)  Council of Europe Convention on Access to Official Documents, https://www.coe.int/en/web/conventions/full-list/-/conventions/treaty/205.

         (31)  The European News Media Forum was set up by the Commission under the Media and Audiovisual Action Plan to strengthen cooperation with stakeholders on media-related issues.

         (32)  UNESCO/IAP, Guidelines for Prosecutors on Cases of Crimes against Journalists.

         (33)  COM(2020) 796 final of 9 December 2020.

         (34)  E.g. the Press Freedom Police Codex.

         (35)  E.g. the ‘PersVeilig’ protocol in the Netherlands and the coordination centre on the phenomenon of intimidating acts against journalists in Italy.

         (36)  Directive 2012/29/EU of the European Parliament and of the Council of 25 October 2012 establishing minimum standards on the rights, support and protection of victims of crime, and replacing Council Framework Decision 2001/220/JHA (OJ L 315, 14.11.2012, p. 57).

         (37)  At EU level, the Commission supports the Europe-wide rapid response mechanism for violation of press and media freedom through a dedicated pilot project, https://digital-strategy.ec.europa.eu/en/news/pilot-project-europe-wide-response-mechanism-violation-press-and-media-freedom.

         (38)  Venice Commission and OSCE / ODIHR Guidelines on Freedom of Peaceful Assembly.

         (39)  2021 Rule of Law Report. In particular, data protection rules may be used as a pretext to limit access to information in certain Member States.

         (40)  IPI COVID-19 Press Freedom Tracker.

         (41)  JOIN(2020) 8 final of 10 June 2020.

         (42)  Member States could apply to receive these training modules in the context of international organisations’ training offers such as those of the Council of Europe or UNESCO. Member States who choose to develop their own training modules must ensure that the content is in line with European standards, including by drawing inspiration from training modules offered by international organisations.

         (43)  E.g. UNESCO Massive Open Online Course for judges and judicial actors on international standards on freedom of expression and the safety of journalists.

         (44)  Council Recommendation of 8 November 2019 on access to social protection for workers and the self-employed, 2019/C 387/01 (OJ C 387, 15.11.2019, p. 1).

         (45)  “Wanted! Real action for media freedom in Europe”, Annual Report by the partner organisations to the Council of Europe Platform to Promote the Protection of Journalism and Safety of Journalists, Council of Europe, 2021.

         (46)  2021 Rule of Law report.

         (47)  To prevent and counter the spread of illegal hate speech online, in May 2016, the Commission agreed with large online platforms a “Code of conduct on countering illegal hate speech online”. The Commission also aims to expand the list of EU crimes to include hate speech and hate crime.

         (48)  https://forbiddenstories.org/fr/case/le-pegasus-project/

         (49)  Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 4.5.2016, p. 1).

         (50)  Directive (EU) 2016/680 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data by competent authorities for the purposes of the prevention, investigation, detection or prosecution of criminal offences or the execution of criminal penalties, and on the free movement of such data, and repealing Council Framework Decision 2008/977/JHA (OJ L 119, 4.5.2016, p. 89).

         (51)  As envisaged in the European Democracy Action Plan, the Commission also committed to promote sustainable funding for projects with a focus on legal and practical assistance to journalists in the EU and elsewhere, including safety and cybersecurity training for journalists and diplomatic support.

         (52)  E.g. Annual Report by the partner organisations to the Council of Europe Platform to Promote the Protection of Journalism and Safety of Journalists (2021) https://rm.coe.int/final-version-annual-report-2021-en-wanted-real-action-for-media-freed/1680a2440e; Online violence against women journalists: a global snapshot of incidence and impacts, UNESCO (2020) https://unesdoc.unesco.org/ark:/48223/pf0000375136; Resource Guide on the Safety of Female Journalists Online, OSCE (2020), https://www.osce.org/representative-on-freedom-of-media/468861.

         (53)  ICFJ-UNESCO Global Study: “Online violence Against Women Journalists” and 2021 Media Pluralism Monitor Report, see: https://cmpf.eui.eu/media-pluralism-monitor/

         (54)  IPI, Newsroom Best Practices for Addressing Online Violence against Journalists.

         (55)  UNESCO, The Chilling global trends in online violence against women journalists.

         (56)  European Union Agency for Fundamental Rights (FRA), Violence against women: an EU-wide survey, 2014. FRA, Crime, safety and victims’ rights, 2021.

         (57)  Both the 2020 and 2021 MPM reports high risks with regard to access to media for women under its indicator on social inclusiveness.

         (58)  UNESCO’s forthcoming guidelines and recommendations for newsrooms on how to prevent and address violence against women journalists and International Labour Organisation C190 - Violence and Harassment Convention, 2019, focusing on violence and harassment in the work environment.

         (59)  Such as reports or opinions produced by international organisations and bodies, for instance Council of Europe and the Venice Commission.


title: Recommendation of the European Systemic Risk Board of 6 May 2020 on liquidity risks in investment funds (ESRB/2020/4) 2020/C 200/01

text:
               15.6.2020

               EN

               Official Journal of the European Union

               C 200/1

      RECOMMENDATION OF THE EUROPEAN SYSTEMIC RISK BOARD
      of 6 May 2020
      on liquidity risks in investment funds
      (ESRB/2020/4)
      (2020/C 200/01)
      THE GENERAL BOARD OF THE EUROPEAN SYSTEMIC RISK BOARD,
      Having regard to the Treaty on the Functioning of the European Union,
      Having regard to Regulation (EU) No 1092/2010 of the European Parliament and of the Council of 24 November 2010 on European Union macroprudential oversight of the financial system and establishing a European Systemic Risk Board (1), and in particular Article 3(2)(b), (d) and (f) and Articles 16 to 18 thereof,
      Having regard to Decision ESRB/2011/1 of the European Systemic Risk Board of 20 January 2011 adopting the Rules of Procedure of the European Systemic Risk Board (2), and in particular Article 15(3)(e) and Articles 18 to 20 thereof,
      Whereas:

                  (1)

                  The coronavirus disease 2019 (COVID-19) pandemic and the associated and necessary containment measures represent a severe and unprecedented shock to European economies. Against this backdrop, at its meeting on 2 April 2020 the General Board of the European Systemic Risk Board (ESRB) announced that it would focus its attention on five priority areas where coordination between authorities in the Union was likely to be particularly important to safeguard financial stability in the Union (3). One of the five priority areas relates to financial market liquidity and implications for asset managers and insurers.

                  (2)

                  The sharp fall in asset prices observed at the onset of the COVID-19 pandemic was accompanied by significant redemptions from certain investment funds and a significant deterioration in financial market liquidity. While market conditions have subsequently stabilised, largely due to decisive actions taken by central banks, supervisory authorities and governments in the Union and globally, significant uncertainty remains concerning the macrofinancial outlook.

                  (3)

                  Previous ESRB assessments (4) of non-bank financial intermediation have highlighted potential vulnerabilities stemming from investment funds that have short redemption periods, but invest in less liquid assets. Such liquidity mismatches increase the risk of further pressures on asset valuations in times of stress, if investment funds seek to sell less liquid assets over a short period of time to meet redemptions. This could lead to higher mark-to-market losses by other financial institutions with exposures to the same or correlated assets, or to an abrupt tightening in financial conditions.

                  (4)

                  Existing Union rules include specific obligations on fund management companies with respect to liquidity risk management in relation to the funds that they manage (5). For undertakings for collective investment in transferable securities (UCITS), the liquidity profile of the investments of the UCITS must be appropriate to the redemption policy laid down in the fund rules or the instruments of incorporation or the prospectus. Similarly, for alternative investment funds (AIFs) the investment strategy, liquidity profile and the redemption policy must be consistent (6). These rules are complemented by European Securities and Markets Authority (ESMA) guidelines on liquidity stress testing in UCITS and AIFs for fund managers to regularly test the resilience of their funds to liquidity risk under normal and exceptional liquidity conditions (7).

                  (5)

                  This Recommendation is designed to enhance preparedness to respond to potential future adverse shocks that could lead to a deterioration in financial market liquidity, resulting in potential adverse implications for financial stability conditions in the Union.

                  (6)

                  The ESRB recognises that the investment funds sector in the Union is large and diverse. Taking this into account, the ESRB has identified two segments as particularly high priority areas for enhanced scrutiny from a financial stability perspective.

                  (7)

                  The first of these segments is investment funds with significant exposures to corporate debt. Shortly following the onset of COVID-19 pandemic, there were significant redemptions from investment funds investing in corporate debt. In addition, investment funds hold a significant proportion of the stock of non-financial corporate bonds outstanding in the Union. Any future redemptions pressures from open-ended funds with short redemption periods could result in fund managers selling less-liquid assets quickly, thereby contributing to a deterioration in liquidity conditions in corporate debt markets. This could have adverse spillover effects on other financial institutions that have exposures to these assets – such as insurance companies, pension funds or banks – or an adverse impact on the cost and availability of market-based financing for non-financial corporations.

                  (8)

                  The second segment identified by the ESRB as a particularly high priority area for enhanced scrutiny from a financial stability perspective is investment funds with significant exposures to real estate. The public health restrictions necessary to contain the spread of COVID-19 could result in a reduction in the volume of real estate market transactions and an increase in valuation uncertainty. Real estate investment funds are estimated to hold approximately one-third of the Union’s commercial real estate market. Future redemptions from investment funds that have significant real estate holdings could contribute to downward pressure on real estate valuations if accompanied by real estate asset sales in an environment of low transaction volumes. This could have adverse implications for other financial institutions that have exposures to real estate, including those that use real estate as collateral for lending.

                  (9)

                  Ensuring that the financial system in the Union helps to absorb, rather than amplify, the COVID-19 shock requires significant coordination both between supervisory authorities responsible for different segments of the financial markets and across borders. This is particularly the case for capital markets activities, including those carried out by investment funds, where cross-border flows are large and the smooth functioning of such activities relies on a number of actors across the financial system.

                  (10)

                  The ESRB acknowledges the high-priority work currently being done by ESMA on enhancing supervisory convergence on fund managers’ liquidity risk management. This includes the Common Supervisory Action on UCITS’ managers liquidity risk management announced in 2020 (8) and ESMA’s ongoing coordination of supervisory actions in the face of COVID-19.

                  (11)

                  This Recommendation is without prejudice to the monetary policy mandates of the central banks in the Union.

                  (12)

                  Recommendations of the ESRB are published after the addressees have been informed, and after the General Board has informed the Council of the European Union of its intention to do so and provided the Council with an opportunity to react,

            HAS ADOPTED THIS RECOMMENDATION:
      SECTION 1

         RECOMMENDATION

         Recommendation A – Coordinating supervisory engagement with investment funds to assess their preparedness

      It is recommended that the European Securities and Markets Authority (ESMA):

                  (1)

                  coordinate with the national competent authorities to undertake a focused piece of supervisory exercise with investment funds that have significant exposures to corporate debt and real estate assets to assess the preparedness of these two segments of the investment funds sector to potential future adverse shocks, including any potential resumption of significant redemptions and/or an increase in valuation uncertainty; and

                  (2)

                  report to the ESRB on its analysis and on the conclusions reached regarding the preparedness of the relevant investment funds.

            SECTION 2

         IMPLEMENTATION

      1.   Definitions

                  1.

                  For the purposes of this Recommendation the following definitions apply:

                              (a)

                              ‘national competent authority’ (NCA) means the competent authority as defined in Article 2(1)(h) of Directive 2009/65/EC of the European Parliament and of the Council (9) or in Article 4(1)(f) of Directive 2011/61/EU of the European Parliament and of the Council (10);

                              (b)

                              ‘investment fund’ means: (i) an undertaking for collective investment in transferable securities (UCITS) as defined in Article 1(2) of Directive 2009/65/EC that has been authorised in accordance with Article 5 of that Directive; and (ii) an alternative investment fund as defined in Article 4(1)(a) of Directive 2011/61/EU.

            2.   Criteria for implementation

                  1.

                  The following criteria apply to the implementation of this Recommendation:

                              (a)

                              due regard should be paid to the principle of proportionality, taking into account the objective and the content of the recommendation;

                              (b)

                              the specific compliance criteria set out in the Annex should be met.

            3.   Timeline for follow-up

                  1.

                  In accordance with Article 17(1) of Regulation (EU) No 1092/2010 addressees must communicate to the European Parliament, the Council, the Commission and to the ESRB the actions undertaken in response to recommendations and substantiate any inaction. ESMA is requested to submit the communication by 31 October 2020.

            4.   Monitoring and assessment

                  1.

                  The ESRB Secretariat will, where appropriate:

                              (a)

                              assist ESMA, contributing to certain parts of the analysis from a financial stability perspective;

                              (b)

                              coordinate the procedure for the follow-up;

                              (c)

                              provide assistance at ESMA’s request.

                  2.

                  The General Board will assess the actions and justifications communicated by ESMA and, where appropriate, may decide that this Recommendation has not been followed and that ESMA has failed to provide adequate justification for its inaction.

         Done at Frankfurt am Main, 6 May 2020.

               Head of the ESRB Secretariat,

               on behalf of the General Board of the ESRB

            Francesco MAZZAFERRO

         (1)  OJ L 331, 15.12.2010, p. 1.

         (2)  OJ C 58, 24.2.2011, p. 4.

         (3)  See the press release issued following the ESRB General Board meeting of 2 April 2020, available at: https://www.esrb.europa.eu/news/pr/date/2020/html/esrb.pr200409~a26cc93c59.en.html

         (4)  See, for example, the annual EU Non-bank Financial Intermediation Risk Monitor 2019, available at: https://www.esrb.europa.eu/pub/pdf/reports/nbfi_monitor/esrb.report190717_NBFImonitor2019~ba7c155135.en.pdf?aad1f4a011a6d589537645242475aa89

         (5)  See Article 40(4) of Commission Directive 2010/43/EU of 1 July 2010 implementing Directive 2009/65/EC of the European Parliament and of the Council as regards organisational requirements, conflicts of interest, conduct of business, risk management and content of the agreement between a depositary and a management company (OJ L 176, 10.7.2010, p. 42).

         (6)  See Article 16(2) of Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers and amending Directives 2003/41/EC and 2009/65/EC and Regulations (EC) No 1060/2009 and (EU) No 1095/2010 (OJ L 174, 1.7.2011, p. 1).

         (7)  ESMA Final Report: Guidelines on liquidity stress testing in UCITS and AIFs, 2 September 2019, available at: https://www.esma.europa.eu/sites/default/files/library/esma34-39-882_final_report_guidelines_on_lst_in_ucits_and_aifs.pdf

         (8)  See ESMA’s press release of 30 January 2020, available at: https://www.esma.europa.eu/press-news/esma-news/esma-launches-common-supervisory-action-ncas-ucits-liquidity-risk-management

         (9)  Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS) (OJ L 302, 17.11.2009, p. 32).

         (10)  Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers and amending Directives 2003/41/EC and 2009/65/EC and Regulations (EC) No 1060/2009 and (EU) No 1095/2010 (OJ L 174, 1.7.2011, p. 1).

         ANNEX

            COMPLIANCE CRITERIA FOR THE RECOMMENDATION

         For Recommendation A, the following compliance criteria are specified:

                     (1)

                     To allow for a targeted and timely exercise ESMA should coordinate with NCAs to:

                                 (a)

                                 identify the investment funds in the Union that have particularly large exposures to corporate debt and real estate markets and which are particularly important from a macroprudential perspective. By limiting the scope of the exercise to these funds this Recommendation seeks to ensure that the exercise can be carried out in the time available. ESMA may also want to consider other relevant characteristics in identifying funds, for example the redemption frequency and/or the degree of leverage;

                                 (b)

                                 engage in a targeted way with the subset of investment funds identified under point (a) to help assess their current state of preparedness for an unexpected increase in redemptions and/or an increase in valuation uncertainty, including forming a view as to how these funds might respond to potential future adverse shocks in the short term;

                                 (c)

                                 assess the preparedness of the corporate debt and real estate segments of the investment funds sector and consider whether any further actions are needed to enhance that preparedness. In particular, the assessment should focus on potential future redemption and/or valuation uncertainty shocks and consider whether additional action is needed – for example, additional guidance to either funds or supervisors regarding the use of liquidity management tools and/or dealing with valuation uncertainty.

                     (2)

                     The following considerations should be taken into account as part of the supervisory exercise, with a particular focus on areas that are relevant from a financial stability perspective.

                                 (a)

                                    Funds with particularly large exposures to corporate debt

                                 As part of a targeted exercise with the funds with particularly large exposures to corporate debt, the following information is likely to be particularly useful from a financial stability perspective:

                                             (i)

                                                Information to assess fund behaviour at the onset of the COVID-19 pandemic. This information could include: (i) the level of redemptions seen at the onset of the COVID-19 pandemic, when redemptions from a range of corporate bond funds were elevated; (ii) how liquidity management tools were used at the time, including the specific tools activated by different fund types; and (iii) what types of assets were sold to meet redemptions and in what manner (for example, by vertical slicing).

                                             (ii)

                                                Information to assess the current state of preparedness. This information could include descriptions of: (i) the set of liquidity management tools available to the funds identified; (ii) the manner in which fund managers themselves are preparing for any possible future adverse shocks; (iii) the manner in which fund managers themselves would likely respond to a possible resumption in redemptions; (iv) current liquid asset holdings of the funds identified; and (v) the number and nature of investors in the fund (for example, retail versus institutional investors).

                                 (b)

                                    Funds with particularly large exposures to real estate

                                 As part of a targeted exercise with the funds with particularly large exposures to real estate, the following information is likely to be particularly useful from a financial stability perspective:

                                             (i)

                                                Information to assess the current extent of valuation uncertainty and redemption activity. This information could include descriptions of: (i) valuation uncertainty issues faced by real estate funds in different jurisdictions, if any; (ii) the manner in which liquidity management tools have been used to date, including the specific tools activated; and (iii) the size of redemption requests since the onset of the COVID-19 pandemic and the manner in which the funds identified have responded to these requests.

                                             (ii)

                                                Information to assess current state of preparedness. Information could include descriptions of: (i) the structural characteristics of real estate funds (e.g. dealing frequency, notice periods, etc.); (ii) the set of liquidity management tools that is available to the funds identified; (iii) the manner in which fund managers themselves are preparing for any possible future adverse shocks; (iv) the manner in which fund managers themselves would likely respond to an increase in valuation uncertainty/increase in redemptions; (v) the current liquid asset holdings of the funds identified; and (vi) the number and nature of investors in the funds identified (for example, retail versus institutional investors).