ARTICLE
15 October 2014

Consultation On Proposed Guidelines On The Definitions Of Derivatives Under MiFID I

AO
A&O Shearman

Contributor

A&O Shearman was formed in 2024 via the merger of two historic firms, Allen & Overy and Shearman & Sterling. With nearly 4,000 lawyers globally, we are equally fluent in English law, U.S. law and the laws of the world’s most dynamic markets. This combination creates a new kind of law firm, one built to achieve unparalleled outcomes for our clients on their most complex, multijurisdictional matters – everywhere in the world. A firm that advises at the forefront of the forces changing the current of global business and that is unrivalled in its global strength. Our clients benefit from the collective experience of teams who work with many of the world’s most influential companies and institutions, and have a history of precedent-setting innovations. Together our lawyers advise more than a third of NYSE-listed businesses, a fifth of the NASDAQ and a notable proportion of the London Stock Exchange, the Euronext, Euronext Paris and the Tokyo and Hong Kong Stock Exchanges.
ESMA published a consultation on proposed guidelines on the application of the definition of FX and physically settled commodity forwards under MiFID I.
United States Finance and Banking

On September 29, 2014, ESMA published a consultation on proposed guidelines on the application of the definition of FX and physically settled commodity forwards under the Market in Financial Instruments Directive ("MiFID I"). The lack of consistent interpretation and application of the definitions of these derivatives to date may have an impact on the application of EMIR. ESMA is considering publishing guidelines to provide clarity on the application of the definitions with the aim of harmonizing the approach across the EU. Under MiFID II, which comes in effect on January 3, 2017, the European Commission is able to adopt secondary legislation which specifies the derivatives contracts that must be physically settled (as listed in Points (6) and (7) of Section C of Annex I to MiFID II). ESMA has been asked to provide technical advice to the European Commission to assist in the preparation of such legislation. The guidelines that ESMA is proposing to adopt are intended as an interim measure until such time as the Level 2 legislation is finalized and in effect across the EU.

ESMA's consultation paper is available at: http://www.esma.europa.eu/news/ESMA-consults-draft-guidelines-clarifying-definitionderivatives-under-MiFID?t=326&o=home.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More