European Market Infrastructure Regulation (EMIR)
The Regulation (EU) No 648/2012 of the European Parliament and of the Council of 4 July 2012 on OTC derivatives, central counterparties (CCPs) and trade repositories (TRs) (EMIR) entered into force on 16 August 2012.
The Commission Delegated Regulations (EU) No 148/2013 to 153/2013 of 19 December 2012 supplementing EMIR were published in the Official Journal on 23 February 2013 and entered into force on 15 March 2013. The implementing technical standards were published in the official journal dated 21 December 2012 .
The main obligations under EMIR are:
- Central Clearing for certain classes of OTC derivatives;
- Application of risk mitigation techniques for non-centrally cleared OTC derivatives;
- Reporting to trade repositories;
- Application of organisational, conduct of business and prudential requirements for CCPs;
- Application of requirements for Trade repositories, including the duty to make certain data available to the public and relevant authorities.
♦ Risk mitigation techniques include: timely confirmation, portfolio reconciliation and compression, dispute resolution, marking-to-market and marking-to-model, the exchange of collateral to cover the exposures arising from OTC derivatives not cleared by a CCP. The draft technical standards related to the exchange of collateral are in the process of being developed.
The following entities are covered by the different provisions in EMIR:
Financial counterparties and non-financial counterparties above the clearing threshold
Risk mitigation techniques
|Non-financial counterparties below the clearing threshold||>||
Certain risk mitigation techniques (timely confirmation, portfolio reconciliation and compression, dispute resolution)
|Trade repositories||>||TR requirements|
Additional information on Trade repositories can be found on ESMA’s dedicated webpage.
The following instruments are covered under the different provisions of EMIR:
||>||Clearing obligation and risk mitigation techniques
|All financial instruments||>||CCP requirements|
The adopted technical standards were published in the Official Journal on 23 February 2013 and entered into force on 15 March 2013.
From the entry into force:
• the national competent authorities (NCAs) notified ESMA of the classes of OTC derivatives already cleared by CCPs in their jurisdiction under article 89(5);
• the CCPs established in the EU/EEA have 6 months to submit their application for authorisation under EMIR. The NCAs will then have 6 months following a complete application to determine whether or not to authorise the CCP;
• third country CCPs have 6 months to submit their application for recognition under EMIR. ESMA will then have 9 months to determine whether or not to recognise the CCP following a complete application;
• TRs can start applying for registration to ESMA;
• Third country TRs can start applying for recognition to ESMA.
As for the clearing obligation, following the submission by ESMA of the draft regulatory technical standards, as indicated in the graph below, these draft RTS will need to be endorsed by the European Commission (1-3 months) and non-objected by the European Parliament and the Council (1-3 months). The actual date of application of the clearing obligation will depend on the date of entry into force of these RTS and the expected phase-in period per type of counterparty, to be defined in the RTS.
The chart below summarises the timing of the different obligations:
EMIR indicative timeline
Last update 19 March 2014
|23.02.13||Publication of the delegated regulations in the Official Journal|
|15.03.13||[A]||Entry into force of the delegated regulations|
|CCPs and central clearing obligation|
|15.09.13||Previously existing EU CCPs authorisation application deadline [A+6 months]|
|18.03.14||[B]||First EU CCP authorised|
|18.03.14||First notification for the clearing obligation under Art. 5 [immediately after B]|
|18.09.14(*)||ESMA to submit draft RTS on the clearing obligation [B + 6 months]|
|Trade Repositories (TRs)|
|07.11.13||[C]||Adoption of the registration decision of the first trade repositories|
|12.02.14||Reporting start date for all asset classes [C+5 working days + 90 calendar days]|
(*) Draft RTS on the clearing obligation will be proposed if the classes of OTC derivatives notified to ESMA meet the criteria defined in EMIR. The clearing obligation procedure defined in Article 5(2) of EMIR is triggered every time a new CCP clearing OTC derivatives is authorised, and the assessment by ESMA of the suitability of the classes for the clearing obligation will be performed only on the classes notified to ESMA. This means that if CCPs are authorised on different dates, several clearing obligation procedures may run in parallel.
The following exemptions apply to the different obligations in EMIR:
|Type of exemption|
(EMIR Article 4)
|Exchange of collateral
(EMIR Article 11(3))
|Pension scheme arrangements||Yes, until 15/08/2015||No||No|
|Intragroup transactions||Yes, following a positive decision or
a non-objection by the competent authority
|Yes, following a positive decision or
a non-objection by the competent authority
This webpage intends to provide a simplified overview of the application of EMIR and the related draft technical standards in order to allow stakeholders to get a quick and simplified understanding. It does not replace or complement the regulation or the draft technical standards, and is provided for information only. With regardto the timing of application of the different obligations, as highlighted above, these are only reasonable expectations of possible scenarios for information purposes and have no legal effect. The actual dates will depend on the effective dates of endorsement by the European Commission, no objection by the Council and the Parliament and actual publication in the official journal.