The Cyprus Securities and Exchange Commission (CySEC) has flagged several incorrect reporting practices of Regulated Entities under EMIR in respect of zero net positions. TRAction explains the practices to avoid and outlines how we ensure your over-the-counter (OTC) derivatives are reported accurately under EMIR in the context of zero net positions.
We explain 3 methods identified by CySEC as misaligned with the regulatory framework under EMIR, and which fail to meet EMIR reporting requirements:
| Notional Amount | Volume (Quantity) | Price Multiplier (Contract size) | Price |
|---|---|---|---|
| 3000 | 0.01 | 10000 | 30 |
If you are a Regulated Entity, we recommend you confirm with the staff responsible for your reporting (or your reporting delegate) that they are not engaging in any of these reporting methods.
In the specific context of zero net positions, TRAction ensures clients reporting under EMIR meet their reporting requirement by:
- Terminating a position and reporting a new one using a different UTI at a later stage and not reporting any valuations between the termination of the first position and the creation of the latter; and
- Maintaining an open position and reporting a zero contract value on a daily basis.
As a delegated reporting service provider, we make sure your trades are in the required format prior to submission to the designated TR, so you can avoid non-compliance.
If you would like to discuss your reporting obligations with respect to zero net positions, please contact our team.
