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Third (final) ESA report- brief Brexit novation window

On 23 November 2020, the Joint Committee of the European Supervisory Authorities (ESAs) published a third “final” version of its draft RTS making various amendments to EMIR margining requirements. The draft (re)introduces the following amendments: Levelling the international playing field: An extension of a further three years for the “temporary” exemption from margining requirements for single-stock […]

ESMA confirms DTO to continue post-Brexit

ESMA has this morning released a public statement confirming that the EU Derivatives Trading Obligation (DTO) will continue to apply after Brexit transition. The DTO under Article 28 of MiFIR requires firms to transact certain derivatives (essentially the most liquid, standardised contracts) on an EU trading venue, or that of a third country already judged […]

EC endorse CSDR delay

On 23 October, the European Commission approved ESMA’s amended RTS, delaying the CSDR’s controversial settlement discipline regime until 1 February 2022. The amended RTS can be found here. Having been rubber-stamped by the Commission the RTS now enter the mandated three month period, pending non-objection by the Parliament and the Council. Despite adding to an […]

CSDR mini-delay OJ’d

As previewed, the RTS to postpone the application of the CSDR settlement discipline regime (“SDR”) until 1 February 2021 has been published in the OJ. Readers will recall that this delay was intended to give market participants some minimal extra time, to repaper documentation and allow IT systems to incorporate mandates due to be imposed […]

CSDR SDR in lockdown

ESMA has confirmed its intention to extend its delay of the CSDR’s Settlement Discipline Regime (SDR) until February 2022. An initial delay from the 13 September 2020 until 1 February 2021 was awaiting non-objection by the Parliament and Council to an earlier “Final” Report. This will now be superseded by a Final(er) Report on postponing […]

EU finally confirms intent to IM mitigate

In the Regulatory equivalent of a pair of socks- necessary, entirely expected, but still welcome; the ESAs have today delivered an early Christmas present to Heads of Compliance in a draft Revised RTS echoing the July 2019 BCBS/IOSCO IM mitigation. Initial Margin          A revised article 36(1) instantiates the BCBS/IOSCO recommended bifurcation into two remaining IM […]

Bailey’s freshest tips for the Brexit Break-Up

Earlier this week, the Chief Executive of the FCA, Andrew Bailey provided us with a recent update about the current state of affairs regarding Brexit. As is fast becoming the norm in Bailey’s Brexit updates, he opened his speech with the progress that has been made thus far; the Temporary Transitional Power regime; the signing […]

IM Phase 5 to bifurcate

Confirming recent market rumours, BCBS\IOSCO have today announced their recommendation to stagger IM Phase 5 implementation over a two year period. An adjusted Phase 5 will apply to firms with an AANA equal to or greater than USD\EUR 50bn and less than 750bn. A new Phase 6, from 1 September 2020 to 1 September 2021, […]

MiFID 2 Inducements Q&A updated

Article 13 Inducements of the MiFID II Delegated Directive has created a wide diversity of reactions from puzzled head-scratching to fearful wailing from the equity analyst community. Readers will be aware that research must now be classified as paid-for and justified Research or essentially advertising that may be received for free. The Research to Marketing […]

MiFIR packaged trades all wrapped up

ESMA has published an opinion on the treatment of packaged trades under MiFIR’s Article 32 trading obligation. Article 28 mandates that derivatives subject to the trading obligation (TO) are traded regulated markets, OTFs, MTFs or third country equivalents. There has been widespread concern with regard to packaged trades, the elements of which are best traded […]

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