EMIR covers entities that qualify for derivative contracts in regards to interest rate, equity, foreign exchange, or credit and commodity derivatives. It also outlines three sets of obligations, including the clearing, reporting and risk mitigation of applicable products.
Who does EMIR report apply?
EMIR mandates reporting of all derivatives to Trade Repositories (TRs) . TRs centrally collect and maintain the records of all derivative contracts. They play a central role in enhancing the transparency of derivative markets and reducing risks to financial stability.
Who does emir apply to?
EMIR applies to all derivatives identified in Annex 1 Sections C (4) to (10) of The Markets in Financial Instruments Directive (MiFID). The main obligations apply to transactions in over-the-counter (OTC) derivatives but some, for example the reporting obligation, apply to both OTC and exchange-traded derivatives.
Does EMIR apply to individuals?
EMIR requirements apply both to financial and non-financial counterparties. Requirements of EMIR do not apply to private individuals and certain government institutions.
Which countries does EMIR apply to?
EMIR and the delegated acts made under it are directly applicable in all EEA Member States and do not need implementing legislation at a national level. Once the UK has left the EU, the UK will become a “Third Country” for EMIR purposes. As such, EMIR will no longer apply directly in the UK.
What derivatives should be cleared?
Cleared derivatives are trades negotiated over-the-counter (OTC) and are limited to standardized contracts. The clearing house assumes the role of counterparty to all trades and imposes mandatory margin requirements (initial margin and variation margin).
Are all OTC derivatives cleared?
Central clearing is a key feature of global derivatives markets. Almost two thirds of over-the-counter (OTC) interest rate derivative contracts, as measured by outstanding notional amounts, are now cleared via central counterparties (CCPs) – up from around one fifth in 2009. ... OTC derivatives markets are closely knit.
Does EMIR apply to branches?
EMIR applies directly to any entity incorporated or otherwise formed in the EU that has entered into an OTC derivatives transaction and indirectly to any non-EU counterparty that trades with an EU counterparty. ... For example, an EU branch of a non-EU entity will not be subject to the trade-reporting obligation.
Who has to report under SFTR?
As of today, SFTR reporting obligations will apply to investment funds, pensions funds and (re-)insurance undertakings, who will join sell-side firms, CCPs and CSDs, who have already been reporting for 3 months.
Is an EMIR a king?
The monarchs of Qatar and Kuwait are currently titled emir. All members of the House of Saud have the title of emir (prince). ... The title has been assumed by various other Muslim rulers, including sultans and emirs. For Shia Muslims, they still give this title to the Caliph Ali as Amir al-Muminin.
What is clearing under EMIR?
In the context of EMIR ‘clearing’ means the process of establishing positions, including the calculation of net obligations , and ensuring that financial instruments, cash, or both, are available to secure the exposures arising from those positions.
How is EMIR classification determined?
EMIR identifies two sub-categories of Non-Financial Counterparties (NFC). All Non-Financial Counterparties must calculate their group’s aggregate month-end average position in derivative contracts for the previous 12 months , excluding derivative trades executed for hedging purpose (the “position”).
What is the EMIR clearing threshold?
The clearing thresholds for the SFC exemption under EMIR Refit to apply are: €1 billion in gross notional value for credit derivatives contracts ; €1 billion in gross notional value for equity derivatives contracts; ... €3 billion in gross notional value for commodity and other OTC derivative contracts.
What are the EMIR reporting requirements?
EMIR establishes the reporting obligation on both counterparties that should report the details of the derivative trades to one of the trade repositories (TRs) , i.e. the buying party should report and the selling party should report. This obligation covers both financial and non-financial counterparties.
Are FX forwards in scope for EMIR?
In its guidance (published in the context of the reporting obligations which apply under EMIR), the Central Bank of Ireland provides that, as a temporary measure, FX forwards which settle between T+3 and T+7 are generally not required to be reported for EMIR purposes .
Does EMIR apply to UK?
ISDA 2020 UK EMIR PDD Protocol
The UK PDD Requirements will apply to in-scope UK financial and non-financial counterparties where those counterparties trade with EU or other third-country counterparties.
