Regulation (EU) No 648/2012 of the European Parliament and of the Council on OTC Derivatives, Central Counterparties and Trade Repositories is more widely known as the European Market Infrastructure Regulation (EMIR).
Following 3 years of development, EMIR took effect on the 16th August 2012 in response to the role that the over-the-counter (OTC) derivatives market played in the financial crisis. EMIR aims to increase transparency and reduce risk in part through the introduction of trade reporting and centralised clearing measures.
EMIR is a regulation that is binding on all Member States and has not required implementation into national local laws.
EMIR officially entered into force in August 2012, but requires further regulatory technical standards and delegated acts to establish how it will work in practice.
Currently, 17 European CCPs, 29 third country CCPs and 7 trade repositories (TRs) are authorised and registered under EMIR.
The Markets in Financial Infrastructure Regulation (MiFIR) has been passed into European law and has a direct impact on amending EMIR. As a Regulation, MiFIR will impact upon all Member States and not be subject to individual state interpretation once it comes into force. ESMA therefore has to make a large co-ordination effort to deliver compatible technical standards for both regulations. Read more on MiFIR here.
OTCs: Mandatory clearing takes effect for Category 4 firms (applicable non-financial counterparties) for OTC interest rate swaps (basis swaps, fixed-to-float swaps, forward rate agreements and overnight index swaps in EUR, GBP, JPY and USD).
OTCs: Pension funds have to clear OTC derivatives from 16th August 2018 following a year’s extension to the original 2 year relief period.
OTCs: On 21st December the mandatory clearing takes effect for Category 2 firms (non clearing member firms and alternative investment funds with an average outstanding gross notional amount of non-centrally cleared derivatives above EUR 8 billion) for OTC interest rate swaps (basis swaps, fixed-to-float swaps, forward rate agreements and overnight index swaps in EUR, GBP, JPY and USD).
OTCs: Transitional period to exclude pension schemes from central clearing requirements ends. This was originally due to come into effect on 15th December 2014 but pensions were granted special exemptions.
Trade Repositories: ESMA publishes final regulatory technical standards defining the operational requirements and quality standards for trade repositories’ aggregation and publication of derivatives data.
OTCs: Mandatory clearing takes effect for Category 3 firms (non clearing member firms and alternative investment funds with an average outstanding gross notional amount of non-centrally cleared derivatives below EUR 8 billion) for OTC interest rate swaps (basis swaps, fixed-to-float swaps, forward rate agreements and overnight index swaps in EUR, GBP, JPY and USD). ESMA’s proposed 2 year delay to June 2019 due to be confirmed.
Trade Repositories: ESMA authorises Bloomberg as a trade repository under EMIR, taking effect from 7th June.
CCPs: ESMA recognises New Zealand Clearing Ltd under EMIR following a Memorandum of Understanding (MoU) with Reserve Bank of New Zealand and Financial Markets Authority of New Zealand, effective from 28th February 2017.
Trade Repositories: ESMA publishes final technical advice to the European Commission regarding supervisory fees for TRs under EMIR and the Securities Financing Transactions Regulation (SFTR).
ESMA due to deliver reviews of the technical standards regarding authorities accessing Trade Repository data, and on the registration of TRs under EMIR.
ESMA recognises six non-EU CCPs as required by EMIR in order to operate in the EU:
Trade Reporting: Deadline for reporting, or ‘backloading’, of OTC contracts that were entered into:
CCPs: ESMA announces CCP stress test for 17 EU CCPs across all of their instruments. CCPs will need to supply data to ESMA and NCAs in March, with the results to be published in Q4.
Trade Reporting: ESMA opens consultation on the requirement for the transfer of data between trade repositories in the future to help risk monitoring under EMIR. The consultation closes on 31st March 2017.
CCPs: The EBA and ESMA publish a report on the joint, and potential for duplicated, requirements for derivatives from the CRR (Capital Requirements Regulation) and EMIR on CCPs.
Trade Reporting: Deadline for ESMA to deliver guidelines and recommendations. These include Unique Trade Identifier (UTI) and Unique Product Identifier (UPI) for derivatives reporting.
CCPs: ESMA publishes peer review of NCAs’ supervision of CCP compliance with margin and collateral requirements under EMIR.
Trade Reporting: ESMA publishes a consultation paper on draft technical advice regarding calculation of fees to trade repositories. The consultation closes on 31st January and final advice will be submitted to the European Commission later in the year.
Trade Reporting: ESMA opens a consultation regarding aggregated data from trade repositories, particularly to explore options for improving the public data. The consultation closes on 15th February.
CCPs: European Commission accepts equivalency for the regulatory regimes for CCPs in India, Brazil, New Zealand, Japan Commodities and Dubai International Financial Centre (DIFC). Commission implementing acts for each regime are published in the Official Journal of the EU.
Trade Reporting: ESMA opens a consultation on amending existing technical standards regarding TRs under EMIR. The consultation closes on 30th November 2016.
Trade Reporting: European Commission publishes regulatory technical standards in a Commission Delegated Regulation detailing risk-mitigation techniques for OTC derivative contracts not cleared by a central counterparty.
|Commission is due to adopt joint draft regulatory technical standards on bilateral margins by September 2016 following several delays in their drafting and review. On 9th June the Commission advised that the September deadline would not be met.
OTCs: Mandatory clearing takes effect for Category 1 firms (clearing member firms) for OTC interest rate swaps (basis swaps, fixed-to-float swaps, forward rate agreements and overnight index swaps in EUR, GBP, JPY and USD).
CCPs: ESMA publishes results of the first EU wide CCP stress test. It tested 17 CCPs in multiple scenarios to examine the risks posed by: 1) clearing member defaults and volatile market conditions, and; 2) the interconnections of CCPs with clearing members and different markets.
CCPs: ESMA sends updated regulatory technical standards to the European Commission proposing to reduce the margin period of risk (MPOR) to one day from two days for EU-based CCPs. This would put EU CCPs in line with US CCPs.
Trade Reporting: ESMA publishes updated regulatory technical standards to address issues with the quality of, and access to, the data held by trade repositories.
OTCs: The joint committee of European Supervisory Authorities (ESAs – ESMA, EBA, EIOPA) publishes the final draft RTS that address margin requirements and risks for covering non-centrally cleared OTCs.
CCPs: European Commission announces that a common approach has been achieved with the US Commodity Futures Commission (CFTC) regarding requirements for CCPS. The European Commission needs to adopt an equivalence decision on the US regime, at which point ESMA will be able to resume the evaluation process for CFTC regulated CCPs that had applied to ESMA to be recognised in the EU.
OTCs: ESMA issued a set of opinions regarding the requested exemption of 16 UK pension schemes from the clearing obligation. The UK’s Financial Conduct Authority (FCA) must grant the agreed exemptions within 10 days.
CCPs: Three Memoranda of Understanding (MoU) are established between ESMA and Canadian and Swiss regulators:
All MoUs (except with OSC which is yet to be endorsed locally) entered into force on 30th November 2015. EMIR provides for MoUs to form cooperation arrangements between ESMA and regimes that have been deemed equivalent by the European Commission.
CCPs: Margin requirements for non-centrally cleared trades start to apply. Initial margining requirements will be phased in between 1st December 2015 and 1st December 2019.
OTCs: Technical standards for the clearing of OTC interest rate swaps are published in the Official Journal of the EU. The clearing obligation applies to basis swaps, fixed-to-float swaps, forward rate agreements and overnight index swaps in EUR, GBP, JPY and USD. Mandatory clearing will take effect at different times for the respective categories:
CCPs: European Commission accepts equivalency for the regulatory regimes for CCPs in Canada, Switzerland, South Africa, Mexico and the Republic of Korea. Commission implementing acts for each regime are published in the Official Journal of the EU.
OTCs: ESMA opens a consultation on indirect clearing arrangements under EMIR and MiFIR on 5th November, closing on 17th December.
CCPs: ESMA launches a consultation to review Article 26 within the regulatory technical standards, relating to the liquidity period that clearing houses need to apply to client accounts. The consultation closes on 30th September.
European Commission’s public consultation asking for market participants’ experience of implementing EMIR closes.
On the same day, in contribution to the discussion around the European Commission’s review of EMIR, ESMA publishes four reports on the implementation of EMIR and proposals for amending the regulation’s framework. They are:
CCPs: ESMA’s second consultation on CSDs closes on 6th August. The consultation is regarding provisions on buy-in for draft regulatory technical standards (RTS).
OTCs: European Commission adopts the first Delegated Regulation, proposed by ESMA, to establish the clearing obligation under EMIR. This regulation establishes the mandatory central clearing of certain interest rate swap derivatives in EUR, GBP, USD or JPY. The regulation applies to fixed-to-float interest rate swaps, float-to-float swaps, forward rate agreements and overnight index swaps and will be phased in over 3 years. The regulation must now be adopted by the European Parliament and Council of the EU before publication in the Official Journal of the EU and entering into force.
CCPs: On 2nd July ESMA delivers final report on interoperability arrangements between EU based clearing houses in which it recommends the extension of these arrangements to exchange traded derivatives (ETDs). The European Parliament, European Commission and the Council of the EU must now consider whether to endorse it for implementation.
CCPs: Second consultation on CSDs opens on 30th June and closes on 6th August. The consultation is regarding provisions on buy-in for draft regulatory technical standards (RTS).
CCPs: Building on the results of the first consultation in April 2014, on 10th June 2015, the ESAs launch a second consultation on draft draft regulatory technical standards (RTS) for margin requirements non-centrally cleared derivatives under EMIR. The consultation closes on 10th July.
OTCs: European Commission adopts a delegated act to extend the transitional period to exclude pension schemes from central clearing requirements to 16th August 2017. This was originally due to come into effect on 15th December 2014.
OTCs: European Commission adopts an act to further extend the transitional period for capital requirements from 15th June to 15th December. This was originally due to come into effect on 15th December 2014.
European Commission opened a public consultation with the publication of a questionnaire asking for markets participants’ experience of implementing EMIR. A public hearing is held on 29th May and the consultation closes on 13th August.
OTCs: ESMA opens a 4th consultation on proposed regulatory technical standards on the clearing obligation that addresses additional classes of OTC interest rate derivatives that were not included in previous consultations. This includes fixed to float interest rate swaps and forward rate agreements. The consultation closes on 15th July.
The application of EMIR depends on the definition of a derivative contract under MiFID, which had not been clear. On 6th May ESMA publishes guidelines on the definitions of commodity derivatives and their classification under MiFID I, to establish a single, consistent application of the definition. The guidelines will apply from 7th August 2015 to NCAs until MiFID II comes into force in 2017.
CCPs: ESMA recognises 10 third party CCPs from Australia, Hong Kong, Japan and Singapore were recognised by ESMA under EMIR.
Trade Reporting: ESMA announces the launch of a new trade repositories project, that will provide a single access point for 27 NCAs and ESMA to the data held by the 6 EU TRs under EMIR. Go live is expected in 2016. Alongside this project ESMA has launched an instrument reference data project under MiFIR.
CCPs: ESMA re-authorises LCH.Clearnet to clear OTC Inflation Swaps.
9th March 2015
CCPs: ESMA releases a revised Opinion on its draft regulatory technical standards on the clearing obligation for interest rate swaps superseding that published on 29th January. The revised RTS are not amended. The IRS RTS were originally submitted to the European Commission on 1st October 2014.
13th February 2015
Trade Reporting: Deadline for responses to ESMA’s consultation that began on 10th November, regarding revised regulatory and implementing technical standards to support the trade reporting obligation.
CCPs: A Memorandum of Understanding (MoU) is announced on 9th March between ESMA and the Monetary Authority of Singapore, which had entered into force on 10th February. This MoU establishes cooperation arrangements for CCPs established in Singapore that are authorised by the monetary Authority of Singapore to be recognised under EMIR.
4th February 2015
CCPs: ESMA publishes a Feedback Statement to the consultation on the clearing obligation for non-deliverable forwards (NDF) that opened on 1st October 2014. ESMA is not proposing a clearing obligation for NDFs until concerns have been addressed.
|CCPs: Deadline for the European Parliament and Council to issue their non-objection to the draft regulatory technical standards determining the clearing obligation, if the European Commission endorsed the standards in December 2014.
OTCs: European Commission sends ESMA a corrigendum notification which confirms its intention to endorse the draft RTS regarding the clearing obligation for interest rate swap derivatives (IRS) with amendments. ESMA publishes an Opinion that day commenting on the amendments. In particular ESMA expresses concern about the process to exempt non-EU intragroup transactions from the clearing obligation.
22nd January 2015
CCPs: Athens Exchange Clearing House (AthexClear) is authorised under EMIR. This is the 16th CCP to be authorised under EMIR.
CCPs: CME Clearing Europe Ltd is reauthorised under EMIR for extended services and activities. CME Clearing was originally authorised on 4th August.
CCPs: ESMA publishes a peer review report of its role in supervisory colleges set up under EMIR which authorises and supervises CCPs. (It is obligatory for ESMA to peer review the supervisory activities of all competent authorities in relation to CCP authorisation and supervision at least once a year). The report finds no issues of concern.
|Trade Reporting: ESMA initiates data quality measures which direct incorrect reports to be rejected by TRs.
CCPs: A further Memorandum of Understanding (MoU) is enters into force following its announcement on 4th December between ESMA and the Hong Kong Securities and Futures Commission (SFC). This MoU establishes a cooperation arrangement, as required by EMIR, to enable ESMA to recognise Australian CCPs under EMIR.
OTCs: European Commission writes to ESMA to confirm its intended endorsement (subject to three amendments), of ESMA’s draft RTS on the clearing obligation for interest rate swaps (IRS), as originally sent on 1st October. ESMA has 6 weeks to amend and send back the draft RTS to the Commission in a ‘formal opinion’, which must also be sent to the European Parliament and Council of the EU.
The amendments include postponing the starting date of the frontloading requirement, clarifying the calculation of the threshold for investment funds and exempting certain transactions between Member State and non-EU counterparties from the clearing obligation for 3 years.
CCPs: Originally expected that on 15th December, the extended transitional period would end and capital requirement rules would begin. This has been delayed by 6 months to 15th June 2015 due to ongoing discussions regarding equivalency between the European Commission and the US Commodities Futures Trading Commission (CFTC). This is the third time it has been delayed.
CCPs: Holland Clearing House B.V. is authorised under EMIR. This is the 15th CCP to be authorised under EMIR.
Trade Reporting: A Memorandum of Understanding (MoU) is announced between ESMA and the Australian Securities & Investments Commission (ASIC). This MoU establishes a cooperation arrangement, as required by EMIR, to enable the relevant authorities of third countries without a trade repository to be able to contact ESMA for access to trade information held in TRs registered with ESMA. This MoU is agreed as Australia has no established trade repository. It entered into force on 26th November.
CCPs: A further Memorandum of Understanding (MoU) is announced on 4th December between ESMA, the Australian Securities & Investments Commission (ASIC) and the Reserve Bank of Australia. This MoU establishes a cooperation arrangement, as required by EMIR, to enable ESMA to recognise Australian CCPs under EMIR. It entered into force on 27th November.
OTCs: ESMA wrote to the European Commission to advise that second draft RTS on the clearing obligation is ready following public consultation, but will be held back until the Commission responds to the first draft RTS which may be subsequently affected.
Trade Reporting: ESMA published a consultation paper on the revised regulatory and implementing technical standards, to address problems with the quality of data being submitted to meet the trade reporting obligation. Market responses will be accepted until 13th February 2015.
CCPs: ESMA’s consultation on the technical standards required for the clearing obligation closes after one month on 6th November.
CCPs: OMIClear C.C. is authorised under EMIR. This is the 14th CCP to be authorised under EMIR.
CCPs: European Commission adopts Implementing Decisions to grant Australia, Singapore, Japan and Hong Kong equivalency under EMIR.
CCPs: EMSA submits the first draft regulatory technical standard (RTS) to the European Commission. The RTS proposes to establish a clearing obligation on several classes of OTC interest rate derivatives. ESMA is awaiting feedback on this first draft RTS before submitting any further proposals.
CCPs: EMSA opens a third consultation on the clearing obligation technical standards, to close on 6th November. It covers non-deliverable forwards.
CCPs: ESMA writes to the European Commission on 29th September to advise of the delay for 7 reports due on 30th September until the first draft RTS for the clearing obligation is finalised and the EU CCP authorisations are complete.
OTCs: ESMA’s consultation on the central clearing of credit default swaps (CDS) closes on 18th September.
CCPs: ESMA originally due to deliver the first draft regulatory technical standards for the clearing obligation to the European Commission. The deadline passed with no RTS delivered due to ESMA taking into account the results of two recent consultations regarding the clearing obligation. The original deadline fell 6 months after the first notification for the clearing obligation (NASDAQ OMX Clearing).
CCPs: BME Clearing is authorised under EMIR. This is the 13th CCP to be authorised under EMIR.
CCPs: LME Clear Ltd is authorised under EMIR. This is the 12th CCP to be authorised under EMIR.
OTCs: ESMA’s consultation on the central clearing of interest rate swaps (IRS) closes on 18th August.
CCPs: CCP.A (Central Counterparty Austria) is authorised under EMIR. This is the 11th CCP to be authorised under EMIR.
11th – 12th August
Trade Reporting: The reporting obligation for information on valuation and collateral begins on 11th August following a 180 day extension from the reporting start date. Reports including this information are due by the end of 12th August for all contracts entered into since the reporting obligation began on 12th February.
CCPs: CME Clearing Europe Ltd is authorised under EMIR on 4th August. This is the 10th CCP to be authorised under EMIR.
OTCs: On 8th July the European Commission responds to ESMA in support of their letter of 8th May, which stated their intention to ease certain frontloading requirements with regard to the clearing obligation under EMIR. The European Commission agreed that the clearing obligation will not apply to backdated deals entered into from 18th March once the obligation comes into force. Finalisation of this agreement is due in the forthcoming agreement of technical standards by the end of 2014.
OTCs: The consultation on the draft regulatory technical standards for the risk management of non-centrally cleared OTC derivatives under EMIR closed on 14th July.
CCPs: On 11th July ESMA opens several consultations on the clearing obligation.
1. Interest rate swaps, equity derivatives and contracts for difference; closes on 18th August 2014.
2. Credit default swaps; closes 18th September 2014.
CCPs: Keler CCP is authorised under EMIR on 4th July. This is the 9th CCP to be authorised under EMIR.
|CCPs: Two further CCPs are authorised under EMIR; European Commodity Clearing and LCH Clearnet Ltd on 11th and 12th June respectively.
|OTCs: Public hearing held by the ESAs on the draft regulatory technical standards for the risk management of non-centrally cleared OTC derivatives under EMIR.
CCPs: Under EMIR, following a transitional period due to end on 15th June, certain CCPs are obligated to report the total amount of initial margin received from their clearing members, for a limited period of time.
In this regard, EMIR is linked to another piece of legislation called the Collateral Requirements Regulation (CRR) which is concerned with firms’ margin requirements and exposure to CCPs. On 3rd June, a Commission Implementing Regulation was published in the Official Journal of the EU, extending the transitional deadline for firms from 15 June 2014 to 15 December 2014 for both CRR and EMIR.
This 6 month extension has been granted due to the length of time it is taking to authorise CCPs under EMIR and to avoid subsequent market disruption.
|CCPs: Two further CCPs are authorised under EMIR; CCG (Cassa di Compensazione e Garanzia) on 20th May and LCH.Clearnet SA on 22d May.
Trade Reporting: Deadline of 13th May (90 days from the reporting obligation start date) for derivative contracts that were outstanding on 16th August 2012 and still outstanding on the reporting start date to be reported to a TR.
OTCs: ESMA writes to the European Commission to advise of its intention to ease certain frontloading requirements with regard to the clearing obligation under EMIR. Compulsory central clearing will begin once the associated technical standards, currently being drafted, enter into force. This creates the need to ‘frontload’ trades that occurred since the first clearing obligation began with the first CCP authorisation on 18th March. As the terms of the clearing obligation have not been defined, ESMA intends to amend the frontloading requirements.
OTCs: The European Supervisory Authorities (ESAs) launch a consultation on draft regulatory technical standards to outline a framework for risk management procedures for non-centrally cleared OTC derivatives under EMIR. It closes in 3 months on 14th July.
CCPs: ESMA confirms three further CCP authorisations under EMIR: EuroCCP on 1st April, KDPW_CCP on 8th April and EurexClearing AG on 10th April. These authorisations triggers further clearing obligation procedures, and ESMA has 6 months from the date of each authorisation to consult on the required regulatory technical standards, and submit to the European Commission for endorsement.
ESMA subsequently updates the Public Register for the Clearing Obligation under EMIR with the authorised classes of OTC derivatives applicable to these CCPs.
CCPs: ESMA publishes the first Public Register for the Clearing Obligation under EMIR. This lists the classes of OTC derivatives that NASDAQ OMX Clearing, the first CCP authorised under EMIR, is allowed to clear.
CCPs: A few days past the original deadline, ESMA announces the first authorisation of a CCP by a national authority under EMIR, NASDAQ OMX Clearing.
This initiates the first clearing obligation procedure. ESMA now has 6 months to consult on this first set of required regulatory technical standards, and submit to the European Commission for endorsement. ESMA must also publish the list of OTC derivatives that NASDAQ OMX Clearing is permitted to clear.
The European Commission responds to ESMA’s letter from 14th February and validates their concerns at the lack of defined financial instruments in a harmonised regime. The European Commission asks ESMA for supporting information on the definition of foreign exchange spot and forwards contracts, as well as an assessment of physically settled commodity forwards.
ESMA writes to the European Commission asking for clarification of the definition of a derivative or derivative contract to ensure a single application of EMIR across the EU. There is currently no single harmonised definition in other European regulations, including MiFID.
OTCs: On 13th February, the European Commission endorses ESMA’s regulatory technical standards on contracts with a direct, substantial and foreseeable effect within the Union and non-evasion, (originally submitted in November 2013). The European Commission has made no modifications and are therefore subject to a month of review from the European Parliament and Council before publication in the Official Journal of the European Union.
Trade Reporting: Obligation to report listed (ETD) and OTC derivatives by asset classes in Europe begins from 12th February, 90 days following ESMA’s adoption of trade repositories on 14th November, and one month behind the original timeline. Trade data for contracts entered into on or after 16th August 2012 must be reported to a trade repository within the appropriate transitional periods. Outstanding contracts as of 12th February 2014 must be reported to a trade repository no longer than a day after the trade conclusion date (T+1).
The obligation to report ETDs was attempted to be delayed by ESMA in August 2013 until January 2015 due to an expected lack of industry readiness and cohesion, but the European Commission rejected this in November 2013.
Reporting of credit and interest rate derivatives to TRs was originally scheduled to begin on the 1st July 2013 with a subsequent delay until 23rd September 2013.
CCPs: On 30th January, ESMA submits second set of equivalence advice for CCPs in Japan to the European Commission, which will review ESMA’s recommendation.
Trade Reporting: ESMA delivers advice to the European Commission regarding penalties for infringements of EMIR by trade repositories as formally requested on 29th April and following a month consultation between October and November.
Trade Reporting: ESMA adopted the registration decision for two further trade repositories, which will take effect from 5th December. These are ICE Trade Vault Europe and CME Trade Repository.
CCPs: The Asia Pacific Regional Committee of the International Organisation of Securities Commissions (IOSCO) wrote to the European Commission to express concerns with the ability of CCPs in the region to be recognised under EMIR. This is due to a lack of clarity around the process of non EU CCP recognition, specifically any equivalence requirements in the event of gaps between the EU and non-EU regimes when assessed. This follows an initial letter sent on 6th June 2013.
OTCs: Following 3 delays since June 2012, ESMA delivers final draft regulatory technical standards to the European Commission regarding the cross-border application of EMIR (transactions between non-EU entities with a “direct, substantial and foreseeable effect” in the EU). The European Commission has 3 months to review the draft RTS following which, if endorsed, it passes to the European Parliament and Council for approval.
Trade Reporting: Deadline of 15th November for ESMA to consider feedback on the consultation to provide technical advice to the European Commission on the procedural rules for imposing fines and periodic penalty payments on trade repositories.
Trade Reporting: ESMA adopted the registration decision for the first four trade repositories, which will take effect from 14th November. These are DTCC Derivatives Repository, KDPW, REGIS-TR and Una-Vista. The registration and supervision of trade repositories with existing regulators which was due to begin in Q1 2013 and was first delayed until August. The obligation to report exchange-traded and OTC derivatives trades begins 90 days following ESMA’s adoption of trade repositories, on 12th February 2014.
Trade Reporting: The European Commission rejects ESMA’s request to delay the reporting of exchange-traded derivatives (ETD) from January 2014 to January 2015. ESMA had made this request due to an expected lack of industry readiness to report listed derivatives trades, and so to be able to develop guidelines and recommendations.
Trade Reporting: ESMA publishes a consultation paper to provide technical advice to the European Commission on the procedural rules for imposing fines and periodic penalty payments on trade repositories.
CCPs: Earliest CPP authorisation expected from 15th October, none have yet been authorised.
2nd October 2013
ESMA submits additional third country equivalence technical advice for Australia, Canada, Hong Kong, India, Singapore, South Korea and Switzerland to the European Commission.
|Delayed from February 2013, Member States are due to submit to the European Commission their “effective, proportionate and dissuasive” penalties for breaches of the regulation, as delegated under EMIR. However, the European Commission and ESMA will be jointly responsible for ensuring that penalties are effectively and consistently applied. There is no requirement for the Member States to make their penalties public.
CCPs: Deadline of September 15th for EU/EEA CCPs to submit their applications to NCAs for authorisation under EMIR and for third country CCPs to submit their applications to ESMA for recognition under EMIR.
NCAs have 30 days from the submission of the application to judge whether it is complete. Once complete, CCPs have 6 months in which to be authorised (including one month for ESMA to convene a college of European Regulators to opine on the authorisation of all CCPs and 4 months for NCAs to submit a risk report to the college including an opinion on whether the CCP complies with EMIR).
CCPs are expected to be authorised between October and March 2014, with the notification for the clearing obligation to follow immediately thereafter.
OTCs: Portfolio reconciliation obligation for non-centrally cleared OTCs enters into force on 15th September, and applies to all outstanding and subsequent contracts.
OTC: ESMA’s preliminary consultation on the details of how the obligation to centrally clear OTC derivatives under EMIR will work in the EU closes on the 12th September. ESMA to begin drafting the required regulatory technical standards.
ESMA also delivers previously requested technical advice to the European Commission regarding third country regulatory equivalence under EMIR for the US and Japan. Ahead of the 1st October deadline, EMSA additionally submits partial technical advice for Australia, Hong Kong, Singapore and Switzerland. Further advice for these jurisdictions and regarding Canada, India and South Korea remain to be delivered by 1st October.
For CCPs, ESMA grants Australia and Switzerland equivalency status and proposes conditional equivalency for Hong Kong, Japan, Singapore and the US.
ESMA proposes to the European Commission that ‘conditional’ equivalence be granted across the three areas EMIR regulates (OTC derivatives clearing, central counterparties and trade repositories), for third country regulatory infrastructures that meet similar regulatory requirements under EMIR.
|Trade Reporting: ESMA asks the European Commission to delay the reporting of exchange-traded derivatives (ETDs) to trade repositories by one year to January 2015, due to current technical standards not distinguishing between OTCs and ETDs.
25th July 2013
Trade Reporting: A group of trade repositories had a meeting with ESMA to draft recommendations on how data could be shared and reconciled between themselves.
ESMA launches consultation on draft regulatory technical standards aimed at addressing the potential risks posed by and evasion of EMIR by non-EU counterparties. The circumstances in which the RTS would apply are where: the two non-EU counterparties jurisdictions’ rules are not considered to be equivalent to EMIR and the transactions are executed via their EU branches; or one of the two non-EU counterparties is guaranteed by an EU financial counterparty and poses significant exposure to the EU guarantor and therefore risk in the EU. Feedback is required by the 16th September 2013.
OTCs: ESMA launched a Discussion Paper to consult on the preparation of regulatory technical standards (RTS) that will establish the details of how the obligation to centrally clear OTC derivatives under EMIR will work in the EU. ESMA is also consulting on how to organise currently cleared OTC derivatives into classes.
The closing date for responses to this preliminary public consultation is the 12th September 2013, upon which ESMA will begin drafting the RTS, which shall then be submitted to the European Commission.
Trade Reporting: Two Delegated Regulations were adopted by the European Commission on the 12th July regarding: the fees charged by ESMA to trade repositories for their registration and supervision; and the addition of the central banks and debt management offices of Japan and the United States to the list of entities to which EMIR shall not apply.
Trade Reporting: Registration of trade repositories has transpired to be delayed until at least August. The first TR registration had been expected on June 25th.
European Commission extends deadline for ESMA’s advice on the equivalence of third countries under EMIR from 15th June to 1st September for US and Japan and 1st October for all other third countries.
|Trade Reporting: European Commission requests technical advice from ESMA regarding the setting and imposition of penalties for trade repositories that do not fully comply with EMIR. When adopted, the European Commission and ESMA will be jointly responsible for ensuring that penalties set by Member States are effectively and consistently applied. The deadline for ESMA to deliver the advice is 31st December 2013.
CCPs: European Commission adopts ESMA’s revised draft regulatory technical standards regarding colleges for CCPs. The European Parliament and Council have 3 months to review.
Trade Reporting: European Commission requests technical advice from ESMA on 29th April regarding fines and penalties for trade repositories.
CCPs: Deadline met on the 15th April for national competent authorities (NCAs) to notify ESMA of the classes of OTC derivatives already cleared by CCPs in their jurisdiction.
31st March 2013
Trade Reporting: ESMA provides the European Commission with technical advice regarding TR fees, following a consultation between 20th February and 6th March.
|CCPs: From March 15th CCPs are able to apply for the required reauthorisation under EMIR. EU/EEA/third country CCPs have 6 months to submit their application for authorisation under EMIR. Following a complete application, the evaluating body has 6 months to decide whether or not to recognise the CCP. EU/EEA CCPs submit application to national competent authorities (NCAs) and third countries submit applications to ESMA.
CCPs: ESMA submits a redraft of the previously rejected regulatory technical standard relating to colleges for CCPs on the 14th March. The other approved regulatory technical standards come into force on the 15th March.
Trade Reporting: Trade repositories can start sending applications to ESMA.
European Commission extends deadlines for ESMA to deliver technical advice on third country equivalence in respect to EMIR. Deadline extended from 15th March to 15th June for US and Japan, and 15th July for all other specified countries.
The European Parliament and Council issue their ‘non-objection’ to the remaining regulatory technical standards following a one month delay on the 19th February, which are subsequently published in the Official Journal of the European Union on 23rd February. Taking effect 20 days later on 15th March, the previously published associated implementing technical standards also come into force.
European Parliament’s ECON Committee Committee rejects 2 of the European Commission’s adopted regulatory technical standards on the 4th February. To avoid a 3-6 month delay to redraft the regulatory technical standards (Level 2), the European Parliament and European Commission agree a compromise on 7th February to redraft these 2 standards at a later date and continue with the remaining standards.
|Trade Reporting: European Commission requests technical advice from ESMA with regard to formulating a Regulation on fees for TRs.
|CCPs: Deadline for European CCPs to request new authorisation under EMIR.
19th – 21st December
European Commission adopts all but one of ESMA’s proposed regulatory and implementing technical standards (Level 2) on the 19th December.
The accepted regulatory technical standards addressed provisions across the scope of EMIR including CCP requirements, trade repositories and risk mitigation for OTC derivatives not cleared by a CCP. The adopted regulatory technical standards become subject to a one month review from the European Parliament and Council. Should there be no objection, these regulatory technical standards will be published in the Official Journal of the European Union and come into force 20 days afterwards. However, the regulatory technical standard proposing colleges for central counterparties was not accepted, which ESMA is to review for adoption at a later stage.
Conversely, the implementing technical standards are not subject to scrutiny by the European Parliament and Council, and are published in the Official Journal of the European Union on the 21st December. They can only take effect once the associated regulatory technical standards upon which they depend come into force.
|Original G20 deadline.
European Commission requests technical advice from ESMA regarding third country equivalences under EMIR on the 11th October.
|CCPs: CCPs have 6 months from the final technical standards to apply to ESMA for reauthorisation under EMIR.
|Joint Committee of ESAs/ESMA delivers draft technical standards to the European Commission, delayed from original deadline of 30th June.
EMIR enters into force. However the technical standards are still required in order for much of EMIR to be actionable.
Deadline for responses to the EBA’s consultation paper on draft technical standards on CCP capital requirements.
27th July 2012
Final EMIR text is published in the Official Journal of the European Union and enters into force twenty days later.
|ESMA public hearing on draft technical standards.
Council of the EU adopts EMIR.
June – August 2012
ESMA holds consultation on technical standards (Level 2).
June – July 2012
European Commission holds second public consultation.
|European Commission adopts second Communication.
|Council of the EU issues an updated version of EMIR based on the text approved by the European Parliament.
European Parliament holds first reading of the European Commission’s compromise text. The text is approved at Plenary on 29th March and adopted as a legislative resolution.
CCPs: ESMA holds a public hearing on draft technical standards.
ESAs publish joint discussion paper on draft technical standards for risk mitigation for OTC derivatives not cleared by a CCP.
EBA publishes discussion paper on draft technical standards on CCP capital requirements; responses due in July.
February – March 2012
ESMA publishes first discussion paper on 16th February on draft technical standards and received views until the 19th March.
Compromise deal announced. Agreement of final text.
|October 2011 – February 2012
|Trilogue process between the European Parliament, Council and Commission.
Council of the EU approves draft text.
|Council of the EU publishes two further compromise proposals.
European Parliament debates the proposal and votes to adopt the amended text on 5th July. Legislative resolution still to be adopted in order to bring the Parliament’s first reading to an end.
February – June 2011
Council of the EU publishes several further compromise proposals.
ECB issues opinion.
|Council of the EU publishes compromise proposal.
European Commission publishes first EMIR proposal for the European Parliament and Council of the EU to consider.
|European Parliament adopts Resolution on 15th June calling for mandatory clearing and reporting of OTC derivatives.
January – July 2010
European Commission formed Member States Working Group on Derivatives and Market Infrastructures and held a series of meetings with ECB, CESR and CEBS.
Council of the EU issues Conclusions from the public consultation on the 2nd December which agree with the need to increase transparency and reduce risk in derivatives.
|European Commission issues Communication supporting the G20 commitments and outlining intended actions to reduce the risk associated with derivatives to be incorporated into legislation (Level 1) in 2010.
|G20 leaders commit to regulating standardised over-the-counter (OTC) derivatives through introducing trading venue, clearing and reporting requirements by the end of 2012.
|European Commission holds public consultation on “Enhancing the Resilience of OTC Derivatives Markets” between July and August.
|European Commission issues a Communication assessing the role of derivatives in the financial crisis.
European Commission issues a Communication (“Driving European Recovery”) on 4th March committing to increase transparency and reducing risk in the derivatives market.
Sourced from European Parliament and European websites, financial and national newspapers and market practitioners.
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