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  • Writer's pictureDeborah

On June 13, the European Parliament proposed amendments to the proposal for a regulation of the European Parliament and of the Council amending Regulations (EU) No 648/2012 (EMIR 3:0) (read our previous briefing).

The proposed amendments have three main objectives:

  • Increase the attractiveness and the competitiveness of the EU clearing ecosystem

  • Increase the demand for clearing services at EU Central Counterparties (CPP).

  • Establish an adequate supervisory framework

In a nutshell, the proposed amendments:

  • Introduce an exemption from clearing obligation for post-trade risk reduction services

  • Broaden the trade reporting obligation to include non-EU members of EU-consolidated groups

  • Clarify the criteria that must be met to be considered an active account at an authorized CCP (i.e. initial margin requirements + new positions)

  • Require ESMA to develop draft regulatory technical standards to specify how often new positions are to be entered into the same account in order for that account to be considered 'active'

  • Require clearing members and their clients disclose, in a clear and understandable manner, the costs associated with clearing services of the different CCPs

  • Introduce the requirement for financial and non-financial counterparties to notify the EBA and their competent authorities about the models used for initial margin calculation at least 60 working days prior to their usage

  • Require financial institutions to report information on the risk-management procedures, including, where relevant, in relation to initial margin models used, to EBA and their competent authorities

  • Require non-financial counterparty becoming subject for the first time to the clearing obligations to set up the necessary arrangements to comply with those obligations within four months

  • Amend the supervisory framework so that ESMA directly supervises all EU CCPs

The proposals are still to be reviewed by Council.

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