On 29 April 2017, an amending Commission Delegated Regulation extending the deadline for compliance with clearing obligations for certain counterparties dealing with over the counter ("OTC") derivatives was published in the Official Journal of the European Union. The EMIR imposes a clearing obligation on certain classes of derivatives. The ESMA has so far assessed that the clearing obligation should apply to interest rate swaps denominated in seven currencies (EUR, GBP, JPY, USD, NOK, PLN and SEK) and to two classes of credit default swaps indices (iTraxx Europe Main and iTraxx Europe Crossover). The clearing obligation is being phased in with those with the largest derivatives trading activity becoming subject to the obligation first. The obligation to clear OTC IRS denominated in the G4 currencies (EUR, GBP, JPY and USD) applied to clearing members of EU CCPs from 21 June 2016.
The Delegated Regulation amends the Regulatory Technical Standards ("RTS") imposing the clearing obligation so that the timing of the clearing obligation for financial institutions with a low volume of derivatives trading activity (namely those with so-called "Category 3 and 4" counterparties, which are small financial counterparties and alternative investment funds or non-financial counterparties) is extended to 21 June 2019 for the clearing of OTC IRS and CDS. ESMA recommended the extension in a report published on 14 November 2016. The Delegated Regulation entered into force on 19 May 2017.
The amending Delegated Regulation can be accessed at:
http://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32017R0751&from=EN .
The ESMA's report can be accessed at:
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