EMIR Reporting: Industry Asks for More Time

On 31 July, five industry associations – the Alternative Investment Management Association (AIMA), the International Swaps and Derivatives Association (ISDA), the British Bankers’ Association (BBA), Associazione Italiana Intermediari Mobiliari (ASSOSIM) and the German Banking Industry Committee (DGSV) – wrote to the European Securities and Markets Authority (ESMA) regarding concerns about the implementation of trade reporting under EMIR.

ESMA recently confirmed that reporting for all five asset classes – interest rate products, credit derivatives, foreign exchange, commodities and equity derivatives – would commence on 1 January 2014.  Previously it had been the case that implementation would be a two-stage process, with  reporting for interest rate products and credit being introduced first.

The authors of the letter are understandably concerned with the operational risk associated with a ‘big bang’  approach to reporting, noting that it is also inconsistent with the position previously adopted by ESMA, the EU Commission, the EU Parliament and the EU Council.  They are also of the opinion that it will be impossible to support delegated reporting from 1 January 2014.  They fear that the net effect is that many clients would not be on-boarded by 1 January 2014 and there would likely be a large number of inaccurate and failed reports initially, frustrating the high-level ambitions of EMIR to bring transparency to the market.

The authors propose the following solution:

Date	Asset Class	Deadline
20 January 2014 (Day T)	Credit and Rates	Reporting start date for legal entities undertaking own reporting
T+90 days	Equities, Commodities, FX	Reporting start date for legal entities undertaking own reporting
T+180 days	Credit and Rates	Collateral reporting start date for legal entities undertaking own   reporting
T+180 days	All	Reporting start date for legal entities delegating their reporting
T+270 days	Equities, Commodities, FX	Collateral reporting start date for legal entities undertaking own   reporting
T+360 days	All	Collateral reporting start date for legal entities delegating their   reporting

 

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