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(C)SDR results are in- keep on keeping on repapering

On 2 July 2021, the European Commission (EC) released the results of its February 2021 CSDR consultation. The results will guide the areas of focus for the upcoming Q4 2021 CSDR legislative review. The consultation garnered a relatively high response rate of 91 replies, split across both firms and trade associations, identifying the following as […]

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UK-EU unequalled

UK Chancellor Rishi Sunak’s Mansion House speech yesterday delivered the final coup de grace headshot to any lingering hopes for EU-UK equivalence. “The UK has an abiding interest in a prosperous and productive Europe. We have deep shared values and a long history of cooperation. And we will strengthen those ties. At the same time, […]

FCA LIBOR powers in force

Today marks the entry into force of Section 2 of the UK Financial Services Act 2021 (FSA). The second of seven “Commencement” phases, the second is primarily notable for the application of the new FCA LIBOR powers, although it does contain a number of other provisions. A brief summary follows: Benchmarks (sections 8 to 21 […]

Temporary UK reprieve for EU UCITS

The PRA and FCA yesterday published a joint policy statement on margin requirements for non-centrally cleared derivatives, making amendments to Binding Technical Standard BTS 2016/2251. The amendments temporarily extend the period during which EEA UCITS are eligible collateral under the UK margin regime, until end-December 2022. “2.9 The PRA has given due regard to the […]

Another day, another LIBOR warning

On 24 June 2021, the EC issued a joint statement with the EBA, ECB and ESMA, warning all market participants to cease their use of any LIBOR settings. The statement reminds readers that the amended BMR has been in force since 13 February 2021, most particularly Art. 23b empowering the EC to designate a replacement rate for […]

EU grants final extension for 3rd Country CCPs

The EC has today extended the third-country CCP transitional regime by one year until 28 June 2022. The transitional regime allows non-EU CCPs to benefit from the significantly lower capital charges applicable to “Qualifying” CCPs (essentially an EU-recognised CCP, 3rd country or EU), as long as they have applied for recognition. The following countries are […]

We just need to get you Tigger-ized

The UK Govt. Taskforce on Innovation, Growth and Regulatory Reform (TIGRR) published its report 16 June 2021. While it bears no formal relationship with the much beloved AA Milne, possibly later lamented Disney character, the acronym is obviously too tempting- “It’s a dangerous path I bounce… but I bounce it alone. Because the Hundred Acre […]

ISDA Definitions move post-printing press

ISDA have today published the 2021 ISDA Interest Rate Derivatives Definitions. The definitions consolidate the 70+ supplements since 2006 and incorporate the following updates: A new fallback trigger that will take effect if a party is prohibited from using a benchmark Generic fallbacks for those floating rates with no existing fallback provisions A new methodology […]

UK Regulators issue “Guidance” on securities settlement risk

On 2 June 2021, the PRA and FCA published an open letter reviewing good practice in relation to the commonly-used Delivery vs Payment (DVP) mechanism. DVP is a long-standing market convention, requiring that cash payment for securities is made either very shortly before or simultaneous with delivery of securities. Although an effective mitigant for a […]

SBS Standalone protocol launched

ISDA yesterday launched the 2021 Security-based Swaps (SBS) Protocol, aiming to facilitate compliance with the long if not eagerly-awaited SEC SBS rules which largely come into force from 6 October 2021. The Protocol sits alongside the ISDA 2021 SBS Top-Up Protocol published on 15 March 2021. While the top-up protocol amends agreements made by adherents […]

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