26 July 2016

44975

Retired Member

1,901Posts 6,082,542Views 2,105Comments
Finextra community

Financial Services Regulation

This network is for financial professionals interested in staying up to date on financial services regulation happening anywhere in the world. CFOs, bankers, fund managers, treasurers welcome.

ESMA seeks urgent clarification on derivatives under EMIR

17 February 2014  |  1385 views  |  0

The European Securities and Markets Authority (ESMA) has sent a letter to the European Commission asking for clarification of the definition of a derivative or derivative contracts under the European Market Infrastructure Regulation (EMIR). The definition of a derivative under EMIR refers to the list of financial instruments under the Markets in Financial Instruments Directive (MiFID). Member states have transposed MiFID into their local laws and this has led to some differences in approach resulting in there being no single, commonly adopted definition of derivative or derivative contract in the European Union. This prevents the convergent application of EMIR.

This particularly impacts foreign exchange (FX) forwards with a settlement date up to 7 days, FX forwards concluded for commercial purposes, and physically settled commodity forwards. Differences in the definitions of what constitutes a derivative or derivative contract may result in the inconsistent application of EMIR. This impacts:

· the reporting obligation which came into force on 12th February;

· the clearing obligation when in force;

· the calculation of the clearing threshold;

· risk mitigation techniques; and

· margin requirements.

ESMA is inviting the Commission to adopt as a matter of urgency an implementing act to clarify the definitions. In order to avoid the inconsistent application of EMIR across the EU, ESMA states that until the Commission provides clarification (and to the extent permitted under national law) National Competent Authorities will not implement the relevant provisions of EMIR for contracts that are not clearly identified as derivatives contracts across the European Union.

Related link:

http://www.esma.europa.eu/news/ESMA-asks-Commission-clarify-derivative-definition-under-MiFID-EMIR?t=326&o=home 

Comments: (0)

Comment on this story (membership required)

Latest posts from Retired

Content Marketing to promote your App

16 May 2016  |  5975 views  |  0 comments | recomends Recommends 1 TagsMobile & online

Crypto-Finance will transform financial services!

11 May 2016  |  2464 views  |  0 comments | recomends Recommends 4 TagsBlockchainPayments

Marketing your App using Social Media

21 April 2016  |  3251 views  |  0 comments | recomends Recommends 0 TagsMobile & online

2 easy ways to use Google AdWords in your app marketing strategy

15 April 2016  |  3745 views  |  2 comments | recomends Recommends 0 TagsMobile & online

Retired's profile

job title
location
member since 2014
Summary profile See full profile »

Retired's expertise

What Retired reads
Retired writes about

Who's commenting on Retired's posts

Graham Seel
Ketharaman Swaminathan
Gerard Hergenroeder
Konstantin Rabin
Matt Schofield
Anna Robert
Steve Patel
Aparty Behera
Karim Maalouf
Brendan Burge
Stephen Hart
Paul Zaman