ESMA has published its 2025 Report on Quality and Use of Data (“Report”), the 6th edition of its annual review across the regulatory reporting regimes within ESMA’s remit.
For entities who operate across EMIR, MiFIR and SFTR reporting regimes, the Report contains a number of important findings and signals about:
- where data quality stands today,
- where the regulatory focus is heading, and
- what reporting entities should be paying attention to.
Here’s the key takeaways:
- Valuations are in the spotlight. ESMA has flagged missing valuations as a continuing priority for 2026.
- Sanctions went down in 2024 — but don’t read too much into it. Regulators gave the market time to adjust to EMIR Refit but ESMA has signalled that enforcement will intensify as reporting stabilises.
- Data quality issues are not just a problem for CFD jurisdictions. Germany and France appeared alongside Cyprus as jurisdictions with the highest number of flagged EMIR data quality issues, showing that reporting errors are widespread across the board.
1. Cross-Cutting Themes: Simplification, AI and SupTech (supervisory technology)
1.1 Simplification and Burden Reduction
In June 2025, ESMA launched a Call for Evidence on streamlining transaction reporting under EMIR, MiFIR and SFTR, exploring two options:
- eliminating duplications and
- a “report once” approach.
ESMA has now published the results of the accompanying cost-benefit analysis (CBA) alongside its Final Report. The industry-facing CBA found that transitioning to the target “report once” model is economically viable, with implementation costs recovered within three to four years and annual burden reduction of around 22–24% thereafter; the parallel CBA with NCAs found a more modest 9–11% reduction in public-sector running costs. In the meantime, ESMA has paused changes to MiFIR transaction reporting, reference data and order book data while the broader simplification review is underway, meaning no near-term changes to these frameworks are expected.
1.2 Generative AI and SupTech
Generative AI moved from experimentation to operational use in 2025, supporting supervisory analysis, internal workflows and a market abuse detection proof-of-concept developed with National Competent Authorities (NCAs). ESMA also established a SupTech Network of Experts (over 300 NCA participants) with shared code tools, and expanded automated data quality alerting so that NCAs receive dashboards and error notifications as soon as issues are detected. For reporting entities, the practical consequence is straightforward: regulators will identify reporting errors faster and engage with responsible entities sooner.
2. EMIR Reporting – Data Quality Indicators and Sanctions
2.1 Data Quality Improvements Post-Refit
The EU EMIR Refit framework went live in 2024, and the Report’s data quality analysis covers the period post-Refit through to early 2026.
The Report confirms that the transition to EMIR Refit has driven significant and sustained improvements across the main Data Quality Indicators (DQIs). Key drivers include the standardisation of ISO 20022 XML reporting across all Trade Repositories (TRs) and the adoption of the Unique Product Identifier (UPI) standard (ISO 4914).
The table below summarises the main DQI movements reported:
| DQI | Mid-2024 (approx.) | Early 2026 (approx.) | Trend |
|---|---|---|---|
| DQI 1A – Outstanding Trades | ~30% | ~10–12% | ↓ |
| DQI 1B – Outstanding Positions | ~55% | ~10–12% | ↓ |
| DQI 2A – Unpaired Reports | ~30% | ~10–12% | ↓ |
| DQI 1C – Outstanding NEWT Reports | ~50% | <20% | ↓ |
| DQI 1D – Outstanding POSC Reports | ~45% | ~5% | ↓ |
| DQI 5A – Missing Valuations | ~9% (rising to >25% by Q2 2025) | ~10% (still elevated) | ↓ |
| DQI 5B – Outdated Valuations | ~25% | <5% | ↓ |
| DQI 7A – Blank/Abnormal Maturity Date | ~11% | ~2% | ↓ |
| DQI 9A – Incorrect Entity Responsible for Reporting | ~1.6% | ~0.6% | ↓ |
Notably, missing valuations (DQI 5A) remain elevated at approximately 10% and ESMA has flagged this as a continuing area of focus for ESMA, NCAs and market participants going into 2026. Reporting entities (including those reporting through delegated arrangements) should ensure that mark-to-market valuations are being submitted accurately and on time.
2.2 EMIR DQEF Outcomes
Under the most recent EMIR Data Quality Engagement Framework (DQEF) cycle, 18 NCAs engaged with 86 Entities Responsible for Reporting (ERRs) across 228 reporting issues spanning 17 DQIs. As of November 2025, a significant improvement was observed in 65% of those cases (defined as a reduction of misreported derivatives of at least 50%). The Report shows Cyprus, Germany and France among the jurisdictions with the highest number of flagged data quality issues, though the Report cautions that this concentration partly reflects the activity levels of counterparties based there (e.g. CCPs).
2.3 EMIR Sanctions Activity
In 2024, only 2 administrative measures and sanctions were issued for breaches of Article 9 EMIR (in Finland and Germany), with total fines of EUR 90,000. This represents a significant decrease from the 7 sanctions totalling EUR 342,705 imposed in 2023. The decline in sanctions activity likely reflects the transitional period following EMIR Refit go-live, and ESMA has signalled that enforcement will intensify as reporting stabilises.
3. MiFIR Transaction Reporting – Volume, Quality and Sanctions
3.1 Transaction Volumes
In 2025, total MiFIR transactions reached approximately 9.2 billion, up from 7.7 billion in 2024. Of the 2025 total, around 4.7 billion (50.8%) were reported via Approved Reporting Mechanisms (ARMs). The ARM share declined slightly from 52.3% in 2024, reflecting an increase in direct Investment Firm and Trading Venue reporting.
Key MiFIR transaction reporting statistics for 2024 vs 2025:
| Metric | 2024 → | 2025 |
|---|---|---|
| Total MiFIR transactions | 7.7 billion | 9.2 billion |
| ARM-reported transactions (% of total) | 52.3% | 50.8% |
| Total APA trade publications | 460 million | ~450 million (-2.2%) |
| Non-Equity APA publications (impact of MiFIR Review) | 82 million | 18 million (-78%) |
| Equity and Equity-like APA publications | Increased by 7.7% |
The sharp decline in non-equity APA publications is attributable to the 2024 MiFIR Review, which narrowed the post-trade transparency scope for derivatives to ETDs and a specific subset of OTC instruments.
3.2 MiFIR DQEF – Transparency and Volume Cap Calculations
A significant development in 2025 was ESMA’s implementation of the MiFIR Data Quality Engagement Framework (DQEF) to support the transition from FITRS to MiFIR transaction data for transparency and volume cap calculations. In December 2024, ESMA’s Board of Supervisors approved the decommissioning of FITRS and DVCAP, and in February 2026 ESMA published its first transparency calculations based on MiFIR Article 26 transaction data.
The three main data quality issues identified through the MiFIR DQEF in 2025 were:
- Trading Venue Identification Code (TVTIC): Format mismatches where leading zeros are stripped by one reporting party but retained by the other, hindering automated reconciliation (25% of issues).
- Timestamp: Discrepancies between reporting counterparties, ranging from minor network latency issues (under 7 seconds) to significant clock synchronisation errors (approximately 1 hour) (26% of issues).
- Quantity: Volume mismatches concentrated within two specific jurisdictions, suggesting localised reporting protocol issues (45% of issues).
Through the DQEF process, ESMA improved the reconciliation ratio between MiFIR-calculated volumes and DVCAP volumes from 90% to 99%, supporting a seamless system transition.
3.3 MiFIR Sanctions
In 2024, sanctions under MiFIR increased compared to 2023. A total of 35 measures and sanctions were imposed: 4 for Article 20 MiFIR breaches (Germany, Hungary, Netherlands and Sweden) and 31 for Article 21 MiFIR breaches (Bulgaria). Total fines under Articles 20 and 21 MiFIR amounted to EUR 133,220, more than double the EUR 51,204 imposed in 2023. No sanctions were issued for Article 26 MiFIR breaches (transaction reporting).
3.4 MiFIR Reference Data (FIRDS) and the FITRS-to-MiFIR Transition
FIRDS recorded no significant data quality issues in 2025, with only a limited number of follow-up exchanges between ESMA and NCAs over the year.
Separately, the Report’s impact assessment of the FITRS-to-MiFIR transition found that policy indicators (tick size, SMS thresholds, liquidity flag) were largely unaffected by the change of data source for most instruments, with over 90% of values unchanged regardless of issuer country. The exception is non-EEA shares on the Large-in-Scale threshold, where the impact of the data source change was found to be “not negligible”. Firms with cross-border or non-EEA instrument exposure should review how their LIS calculations may be affected going into 2026.
4. SFTR Data Quality
SFTR reporting covers repos, securities lending and borrowing, buy-sell backs and margin lending. The Report confirms positive trends across SFTR data quality indicators, though matching challenges persist.
| SFTR DQI | Early 2024 (approx.) | Early 2026 (approx.) | Trend |
|---|---|---|---|
| DQI 1A – Outstanding Trades | ~50% | ~35% | ↓ |
| DQI 2A – Unpaired Reports | ~45% | ~28% | ↓ |
| DQI 2B – Loan Matching | 50–64% (elevated) | Slight improvement after mid-2025 | ↓ (marginal) |
| DQI 2C – Collateral Matching | 70–78% (elevated) | ~65% | ↓ (gradual) |
| DQI 5A – Missing Market Value | High (peaked ~45% in 2023) | Improving | ↓ |
| DQI 5B – Outdated Valuations | ~40% (2023) | Low single digits | ↓ |
Collateral and loan matching remain the most persistent SFTR data quality challenges (DQIs 2B and 2C), reflecting the structural complexity of repos and securities lending where collateral updates and lifecycle events differ across counterparties. ESMA is continuing to work with TRs and NCAs to improve collateral reporting consistency.
No SFTR sanctions were imposed in 2024. The Report notes that, given SFTR reporting obligations were only phased in between 2020 and 2021, there is typically a lag between obligations going live and enforcement action. Sanctions activity under SFTR should be expected to increase in coming years.
5. DORA Incident Reporting – First Year Observations
2025 marked the first year of major ICT-related incident reporting under DORA. ESMA noted that data unavailability was the most common type of data loss reported, which is directly linked to late or missed regulatory reporting submissions. ESMA also observed divergences in how different types of supervised entities are classifying and reporting incidents, and intends to issue clarifications to promote consistency.
Entities under ESMA’s direct supervision (including trade repositories and ARMs) are subject to DORA reporting requirements monitored by ESMA directly. NCAs are responsible for oversight of entities within their jurisdiction. In 2026, ESAs will publish their first joint annual report on major ICT-related incidents.
6. Looking Ahead – What to Expect in 2026
Based on the Report, reporting entities should be aware of the following developments anticipated for 2026:
- EMIR: Continued DQEF cycles with NCAs. Missing valuations (DQI 5A) remain a priority. ESMA will increase automation of data quality controls, with notifications to reporting counterparties.
- EMIR 3: ESMA’s consultation on new clearing thresholds is ongoing. Results are expected to shape which counterparties fall within the clearing obligation and new uncleared-only thresholds for NFCs.
- MiFIR: No changes to Article 26 transaction reporting framework in the near term. The DQEF will expand to cover bond instruments from 2026 (having focused on equities in 2025).
- SFTR: Further data quality improvements expected, particularly on collateral matching. Sanctions activity may begin to increase.
- FIRDS: ESMA will revise the DQEF for MiFIR reference data in 2026.
- DORA: Automated validation rules will be deployed in 2026, and a Data Quality Engagement Framework with NCAs and supervised entities will be implemented.
7. How TRAction Can Assist
The data quality improvements documented in the Report are in part a reflection of the sustained effort by the industry – including service providers like TRAction – to remediate legacy positions and align with the new ISO 20022 XML requirements introduced under EMIR Refit.
The Report makes clear that regulatory scrutiny of data quality is intensifying, and that the window for remediation is narrowing as reporting frameworks mature and enforcement activity picks up. If you have any questions about how the findings in this Report may affect your reporting obligations, or if you need assistance with any aspect of trade reporting across the relevant regimes, please get in touch with us.
