Last update: 08/07/2024
Regulatory Reporting Metadata Vocabulary (RRMV)
Digital innovationLegal+4 topics
Introduction
The EU legislation sets obligations on many different stakeholders to regularly report data such as financial transactions, capital liquidity, data breaches, etc. The amount of required data has been increasing in the past years and there is often lack of knowledge on what can be reused*. To avoid overlapping or missed reporting, these obligations are monitored over time according to the European policies. Moreover, they also need to be updated as the legislation changes over time. In effect, regulatory reporting became a complex and burdensome process. This has led to several calls to action for the reduction of reporting burden:
- Communication on long-term competitiveness of the EU: looking beyond 2030 aimed to reduce reporting burden by 25% by 2030;
- Communication on the SME Relief Package targeted to small and medium-sized enterprises;
- 2024 Commission Work Programme with proposals for legislative simplification and burden reduction.
Beyond legislative initiatives, the Commission is also looking into experimental measures that could support cutting red tape. One of them was the Study on Regulatory Reporting Standards (SORTIS). The main goal of the project was to detect legal obligations (‘requests’), in European legislation. A ‘request’ is an obligation organised in a specific format that is defined by an agent (e.g. European Commission) to perform an action (e.g. to report) in a specific interval of time. With help from Professors Monica Palmirani, University of Bologna, and Ashwin Ittoo, University of Liège, the goal was to make reporting requirements machine-readable. Leveraging semantic and AI technologies would bring numerous benefits such as:
- simplifying the identification of existing requirements and thus reuse of collected data;
- facilitating the evaluation of overlaps and duplications of existing reporting requirements;
- enabling finding answers to complex queries on legal requirements. For example, what data do farmers raising corn crops need to submit within the next year to receive CAP funding and to whom should they submit them.
* The Importance of Metadata for Regulatory Reporting (Regulatory Reporting Community issue paper).
Summary
The main goal of the SORTIS project is to detect reporting requirements (‘requests’), in European legislation. As a result, an ontology Regulatory Reporting Metadata Vocabulary (RRMV) has been developed. This ontology can be used to structure ‘requests’ in legal provisions. For example, in legal editors and systems that manage registries with legal obligations. You can access the technical documentation by clicking here: https://code.europa.eu/regulatory-reporting/rrmv.git
Want to know more?
🎥 Watch the webinar during which Professor Palmirani presented the first iteration of the RRMV ontology.
🎓 Take our course What is regulatory reporting and why is it important?
📰 Read our issue papers:
- The Importance of Metadata for Regulatory Reporting
- Translating regulatory reporting principles into actions
- Unlocking the power of common European data spaces for streamlined regulatory reporting
💻 Check out the open-source software
- https://code.europa.eu/regulatory-reporting/rrmv.git
- https://code.europa.eu/regulatory-reporting/sortis.git
🌐 Visit our page dedicated to streamlining regulatory reporting;
📧 Contact us: eu-digital-ready-policymaking@ec.europa.eu
The SORTIS' objectives
The goal of the study was to build software that detects reporting obligations in the text and annotate them by using developed regulatory reporting metadata vocabulary (RRMV) as shown in the example below. Thanks to this solution, a policy officer who drafts legislation could verify potential duplications or overlaps of existing reporting requirements. This, in turn, would help determine if a new reporting requirement is needed.
DIRECTIVE (EU) 2019/878 amending Directive 2013/36/EU as regards exempted entities, financial holding companies, mixed financial holding companies, remuneration, supervisory measures and powers and capital conservation measures.
To meet this objective, the study had three main tasks:
- Engineering an ontology that structures regulatory reporting obligations (RRMV);
- Designing a method to map this ontology in the legal provisions;
- Developing a template of regulatory reporting clauses that can be used in the LEOS editor and integrate the annotations in AKN4EU;
The developed regulatory reporting metadata vocabulary is an ontology that can be used to structure reporting requirements (‘requests’) in legal provisions. Through a designed software program this vocabulary could be used to detect and annotate legal texts**. The RRMV is released as an open-source solution that you can access here.
The technical documentation of the SORTIS results is attached below. You can find there:
- Integration of RRMV ontology in AKN;
- A set of competency questions and their SPARQL expression - technical specification how to leverage the ontology;
- A LegalRuleML specialisation for reporting obligations, as well as the legal rationale that motivates the design choices.
**Note: the ontology is produced in English. However, it can be incorporated in the text editors based on the national language.
How can you benefit from the SORTIS’ outcomes?
The project brings advantages to many different groups. Depending on your role, below are some examples of how you can benefit from it.
You design and draft policies (e.g. policy officer, lawyer):
- The moment you have access to a database with legislation annotated with the RRMV, you can check if your policy initiative overlaps with another legislation or produce additional administrative burden by requesting data which has already been collected;
- Ask your IT department how can you integrate RRMV in your legal text editor.
You work on leveraging natural language processing (NLP) and AI in the policy drafting process (e.g. semantic engineer, legal informatics expert):
- Based on the project results, you can design an AI-based data annotation pipeline that works with a language different than English.
You are subjected to regulatory obligations:
- Once a legal resource is annotated with RRMV and publicly available you will be able to check more easily the requirements you have to comply with.
Attachments
Referenced solution
Login or create an account to comment.