EMIR Clearing Obligation for Certain Credit Derivatives Published by European Commission | Practical Law

EMIR Clearing Obligation for Certain Credit Derivatives Published by European Commission | Practical Law

The European Commission Delegated Regulation (EU) 2016/592, which supplements EMIR with regard to regulatory technical standards (RTS) on the clearing obligation for certain credit derivative contracts, was published in the Official Journal of the EU (OJ).

EMIR Clearing Obligation for Certain Credit Derivatives Published by European Commission

by Practical Law Finance
Published on 21 Apr 2016 • European Union
The European Commission Delegated Regulation (EU) 2016/592, which supplements EMIR with regard to regulatory technical standards (RTS) on the clearing obligation for certain credit derivative contracts, was published in the Official Journal of the EU (OJ).
On 19 April 2016, the European Commission Delegated Regulation (EU) 2016/592, supplementing EMIR with regard to regulatory technical standards (RTS) on the clearing obligation for certain credit derivative contracts, was published in the Official Journal of the EU (OJ) (the Regulation on OTC derivative transactions, central counterparties (CCPs) and trade repositories (Regulation 648/2012)).
The Delegated Regulation, produced under Article 5(2) of EMIR, specifies:
  • The classes of credit default swap (CDS) OTC derivatives that shall be subject to the EMIR clearing obligation. (The classes are set out in the Annex to the Delegated Regulation.)
  • The four different categories of counterparty that shall be subject to the EMIR clearing obligation.
  • The dates from which the clearing obligation shall take effect for the different categories of counterparty.
  • The minimum remaining maturity for the different categories of counterparty, for the purposes of the frontloading requirement.
The Delegated Regulation comes into force 20 days after publication in the OJ (May 9, 2016).
The Commission adopted the Delegated Regulation on March 1, 2016 (see Legal Update, European Commission adopts Delegated Regulation relating to EMIR clearing obligation for certain credit derivative contracts). The Delegated Regulation is based on draft RTS that ESMA submitted to the Commission in October 2015 (see Legal Update, ESMA final report on clearing obligation for certain classes of credit derivatives under EMIR).
For more information on the EMIR clearing obligation, see Practice Note, EMIR: requirement to clear OTC derivative contracts through a CCP.