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The countdown is on for Brexit. If the United Kingdom (“UK”) leaves the European Union (“EU”) without an implementation period (“no-deal Brexit”), it is important to ensure transaction reports are submitted to the correct Trade Repository (“TR”) or Approved Reporting Mechanism (“ARM”). We have summarised a few things that you need to know in case of a no-deal Brexit.

European Market Infrastructure Regulation (“EMIR”)

Investment firms need to ensure they are reporting to a TR that is properly authorised to receive their submissions, as illustrated in the flow chart below.

  • UK firms – EMIR reports should be submitted to a UK-registered TR and then submitted to the FCA.
  • EU firms – EMIR reports should be submitted to an EU-registered TR and then submitted to the EU NCA.

Investment firms who are subject to both EU EMIR and UK EMIR will need to split the transaction reporting files and submit them to the correct TR.

Delegated reporting under EMIR

Brexit will impact investment firms who offer delegated reporting to corporate clients in both the UK and EU. If you are currently providing delegated reporting and would like to know more on this topic, read our article “EMIR – How Does Brexit Affect my Delegated Reporting Obligations?

Markets in Financial Instruments Directive (“MiFID II”)

Similar to EMIR, investment firms need to ensure they are reporting to an ARM that is authorised to receive their submissions under MiFID II, as illustrated in the flow chart below.

  • UK firms – MiFID II reports should be submitted to a UK-registered ARM and then submitted to the FCA
  • EU firms –MiFID II reports should be submitted to an EU-registered ARM and then submitted to the EU NCA.

Investment firms who are subject to both EU MiFID II and UK MiFID II will also need to split the transaction reporting files and submit them to the correct ARM. Where an EU investment firm has executed its transactions via a UK branch or vice versa, a firm will have a dual obligation, i.e. they must report to both the FCA and EU NCA. If you would like to know more on this topic, read our article “MiFIR: How Does Brexit Affect My MiFIR Reporting Obligations if I Have a Branch in a Different Jurisdiction?”.

Which financial instruments will be reportable under MiFID II?

  • UK firms – the FCA built their own version of Financial Instruments Reference Data System (“FIRDS”) to replace the existing ESMA FIRDS. Therefore, instruments traded on either a UK or EU trading venue will remain reportable under the UK MiFID II regime.
  • EU firms – ESMA has stated that they no longer expect to receive or publish instrument data for instruments which are traded on a UK trading venue following Brexit. Thus, EU firms trading instruments, or instruments with an underlying, which are only listed on a UK venue will no longer need to submit transaction reports for these instruments under the EU MiFID II regime.

If you would like to know more about how TRAction can help you to stay compliant with your EMIR and MiFID II reporting obligations, please contact us.

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