A commonly asked question by many trade reporting entities is what value to use when the underlier to the relevant instrument has no ISIN under EMIR. (An ISIN is an international securities identification number which is a product identifier code often required by trade reporting regimes – EMIR and MiFIR).
Where no ISIN is available for equity trades or for the identifier of the relevant derivative’s basket’s constituents, then ESMA’s stated best practice is to use the ISIN for the European Financial Stability Facility. We discuss how to populate the ISIN in detail below.
The EMIR fields concerned are:
| Field No. | Field name | What to do if there is no ISIN? |
|---|---|---|
| 2.14 | Underlying identification | If the underlier of an equity trade (e.g. a single stock trade) does not have an ISIN, populate with the ISIN for European Financial Stability Facility ISIN (EU000A1G0EB6). |
| 2.18 | Identifier of the basket’s constituents | Note this field 2.18 is only applicable when field 2.13 (Underlying identification type) is populated as ‘B’ (for basket). As per EMIR Validation Rules, if the ‘identifier of basket’s constituent’ field is completed with ‘B’ for Basket (in field 2.13) and there is no ISIN, the field should be left blank, however the trade will not pass through without an ISIN. Additionally, based on ISDA guidance, it is best practice is to populate the field with the ISIN of any ‘traded on trading venue’ basket constituents. If none of the constituents have an ISIN, the European Financial Stability Facility ISIN (EU000A1G0EB6) should be used as a default value. |
Although UK EMIR’s Validation Rules are mostly aligned with that of the EU, UK EMIR goes a little further in detail – a product identifier is not necessary for reporting of derivatives executed on a third country organised trading platform where there is no ISIN nor a unique product identifier (UPI). i.e. the ISIN or UPI can be left blank.
If you require more information on ISINs, please see our article here.
How can TRAction assist?
TRAction monitors trade reporting regulations and we ensure our clients are up to date and compliant with global trade reporting regimes. If you have any questions in relation to your relevant trade reporting regime, please contact us.
