As the deadlines approach for the new EMIR reporting changes in the EU and the UK, set for April 29, 2024, and September 30, 2024, respectively, it is paramount for stakeholders to grasp the complexities of the upcoming requirements.
Map FinTech, a RegTech platform helping companies meet compliance with EMIR, MiFID II, RTS 28 and more, recently delved into what firms need to know about EMIR REFIT.
From the reporting start date, all reports submitted by Reporting Counterparties and Entities Responsible for Reporting to the TRs must adhere to the updated regulatory standards. This encompasses not just derivatives agreed upon post the reporting initiation date but also any changes or terminations reported post that date, even if the derivative had been concluded prior.
Significantly, there is a 180-day transition period allocated for reporting entities to update their existing derivatives to the new regulations. They can do so by using an event type labelled ‘Update’. If, however, they’ve previously submitted a comprehensive message report labelled ‘Modify’ or ‘Correct’, the full details in line with EMIR REFIT’s updated Regulatory and Technical standards must be included.
One cannot overlook that the EU and UK EMIR REFIT introduce 87 and 88 new fields, respectively. Many of these fields have seen transformations in their title, description, and acceptable values, among other attributes, it said.
This signifies the in-depth preparatory tasks that the Reporting Counterparties and Entities Responsible for Reporting need to undertake. They have to modify all relevant fields for existing trades to the new norms. Notably, while they shouldn’t generate new Unique Trade Identifiers (UTIs) for existing derivatives, any other fields modified by EMIR REFIT should be in line with the revised standards when reported.
Highlighting the essence of the transition phase, it doesn’t influence the duty to report relevant occurrences by T+1. Events post the reporting initiation date should be reported by the close of the subsequent working day. This is unquestionably a formidable task for reporting entities.
With the new standards, some entities might need to recalibrate their reporting approach or modify how they report collateral and valuation details. Therefore, a detailed action plan is crucial for reporting entities to ensure their trades swiftly align with the refreshed standards. Any laxity could make them susceptible.
Additionally, it’s vital that reporting entities not engaged in delegated reporting, and with counterparties with the same reporting responsibility, begin dialogue about the treatment of existing trades. This is to synchronise the necessary modifications and ensure compliance with EMIR REFIT norms.
MAP FinTech boasts expertise in managing transition phases and addressing outstanding trades. Their methods have been applied successfully in past regulatory updates. Their all-encompassing toolkit simplifies updating existing trades to the new standards, reducing the workload on the reporting entity’s side.
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