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In the final phase of implementation, initial margin requirements are scheduled to apply to a large number of entities for the first time. In March 2019, the Basel Committee and IOSCO published a statement noting that the framework does not specify documentation, custodial or operational requirements if a covered entity's bilateral initial margin amount does not exceed the framework's €50 million initial margin threshold.
Further, the Basel Committee and IOSCO have agreed to extend by one year the final implementation of the margin requirements. With this extension, the final implementation phase will take place on 1 September 2021, at which point covered entities with an aggregate average notional amount (AANA) of non-centrally cleared derivatives greater than €8 billion will be subject to the requirements. To facilitate this extension, the Basel Committee and IOSCO also will introduce an additional implementation phase whereby as of 1 September 2020 covered entities with an AANA of non-centrally cleared derivatives greater than €50 billion will be subject to the requirements.
The Basel Committee and IOSCO have agreed to this extended timeline in the interest of supporting the smooth and orderly implementation of the margin requirements which is consistent and harmonised across their member jurisdictions and helps avoid market fragmentation that could otherwise ensue.
The Basel Committee and IOSCO have published on their websites a revised version of the margin requirements to reflect this limited revision to extend the implementation timeline by one year.