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Under the European Market Infrastructure Regulation (EMIR), all counterparties are required to report details of any derivative contract they have concluded, or which the counterparty has modified or terminated. Due to Brexit, the EU regulations have been onshored as UK EMIR under the European Union (Withdrawal) Act 2018. On this page, EMIR refers to both EU and UK EMIR unless otherwise specified.
European Market Infrastructure Regulation
Monitoring systemic risk
regulate OTC derivatives transactions in European Union
all counterparties are required to report details of any derivative contract they have entered, modified or terminated.
The original EMIR remains in force for EU member states. It continues to evolve under ESMA.
The EMIR regime was onshored into UK regulation. Over time it will diverge from the EU version as the FCA updates it.
Read more about the difference between EU EMIR and UK EMIR
EMIR RECOGNISES 2 TYPES OF COUNTERPARTIES TO A CONTRACT:
Financial Counterparties (FC) – investment firms, fund managers, banks, insurers etc.; and
Non-Financial Counterparties (NFC) – entities not qualified as a financial counterparty, including those not involved in financial services.
EACH COUNTERPARTY MUST REPORT THEIR LEG OF A TRADE UNLESS:
one counterparty agrees to report on behalf of another counterparty by prior agreement;
a counterparty to a trade has delegated the reporting obligation to a third-party; or
a trade is executed between a FC and a NFC- where the FC will be responsible and legally liable for reporting on behalf of itself and the NFC-.
Where one counterparty reports on behalf of another counterparty, or a third-party reports a trade on behalf of one or both counterparties, the report details will include the full set of details as required by each counterparty.
Financial Counterparties (FC) and Non-Financial Counterparties (NFC) trading in derivatives must report details of all derivatives trades via a TR. This includes all the details of trades and any event thereafter that affects the valuation or the terms of the trade. It also includes identification of the country of the counterparty (country of incorporation for legal entities, country of residence for natural persons).
Any derivative contract is required to be reported under EMIR reporting requirements, and includes:
Reports are required to be submitted to a registered TR no later than one working day after the trade has been made (T+1).
TRAction can provide you with delegated reporting solutions in accordance with the reporting requirements outlined above. We help you understand your EMIR trade reporting obligations and completely simplify your reporting process. Depending on how our client’s system works, TRAction has 3 different reporting methods ready to be tailored to our clients’ needs.
If you want to learn about our services, please get in touch with us.
Need help with your reporting obligations and compliance strategy?
TRAction has developed our popular The User Friendly Guide to Transaction Reporting in Europe to help you along your reporting journey.
Understanding your reporting obligations and determining whether a third party reporting solution will save you costs and internal resources are important steps towards compliance with your trade and transaction reporting requirements. Choosing a strategic approach to compliance will give you a competitive advantage and ensure you avoid penalties for non-compliance. To make things easy, we’ve created the User Friendly Guide to Transaction Reporting in Europe. Read more.
There are a number of reporting regimes including EMIR, MiFID II/MiFIR, SFTR and Best Execution, all of which affect Investment Firms (IFs) in different ways. Read more to see the regulatory reporting required by IFs.
TRAction has outlined the key differences between EMIR and MiFIR. Our team has also pointed out some of the issues that investment firms need to be aware of under EMIR and MiFIR, so that you can stay compliant with the trade/transaction reporting requirements. Read more.
As a delegated reporting service provider, TRAction is asked a lot of questions regarding EMIR, MiFIR and SFTR reporting. That’s why our team has put together some of our most frequently asked questions, so that you can learn how to seamlessly report transactions under multiple regimes. Read more.
We’ve identified the 3 most common errors in the data we receive from our clients:
ESMA asks for any collateral transferred, between two counterparties to a transaction, to be reported in EMIR Trade Reports. Collateral can be reported on a per position basis or on a portfolio basis. Read more.
While EMIR and MiFIR trade and transaction reporting rules allow reporting entities to delegate their reporting obligations to a third party, they remain ultimately responsible for ensuring the details of their transactions are reported correctly and accurately under Art 9(1) of EMIR & Art 26(7) of MiFIR. Read more.
Each Investment Firm (IF) is required to make a quarterly assessment on its previous 6 months’ data to determine if it qualifies as a Systematic Internaliser (SI). Where an IF is classified as a SI, it will be obliged to meet the pre- and post-trade transparency requirements. Read more.
We all know that meeting all the requisite trade/transaction reporting obligations for EMIR, MiFID II/MiFIR and SFTR can pose a considerable cost to an investment firm. While the regulatory burden is not going to disappear, it can be minimised by outsourcing and choosing the most cost-effective and efficient option for you. Read more.
Determine what you are required to report under EMIR, MiFIR and MAS regimes with our free Assessment Tools.
Simply answer a few questions about your business and our Reporting Assistant Reggy will calculate your reporting obligations.
