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The European Securities and Markets Authority (ESMA) has opened a public consultation on draft requirements regarding indirect clearing. Indirect clearing is in practice understood as when clients of a clearing member sign up clients of their own.
ESMA’s draft rules on indirect clearing both refer to the European Market Infrastructure Regulation (EMIR) and the Markets in Financial Instruments Regulation (MiFIR) as they cover arrangements for OTC derivatives and exchange-traded derivatives (ETD) respectively.
ESMA’s draft regulatory technical standards (RTS) on indirect clearing cover:
• rules for ETDs that are developed under MiFIR; and
• rules for OTC derivatives to amend existing RTS under EMIR.
This consultation paper seeks stakeholders’ views on the draft requirements on indirect clearing arrangements for OTC derivatives and exchange-traded derivatives. This consultation paper thus covers the draft regulatory technical standards on indirect clearing arrangements for ETD under Regulation No 600/2014 (MiFIR) as well as the draft amendments to Commission Delegated Regulation No 149/2013 with regard to the regulatory technical standards on indirect clearing arrangements for OTC derivatives under Regulation No 648/2013 (EMIR).
The input from stakeholders will help ESMA develop a revised draft of the EMIR RTS and finalise a draft MiFIR RTS in relation to indirect clearing arrangements to be submitted together to the European Commission for endorsement in the form of Commission Delegated Regulations, i.e. legally binding instruments directly applicable in all Member States of the European Union. Finally, one essential element in the development of draft technical standards is the analysis of the costs and benefits that those legal provisions will imply. Input in this respect and any supportive data will be highly appreciated and kept confidential where required.
ESMA is seeking stakeholder’s comments to its draft RTS by 17 December 2015. The final RTS are expected to be delivered early next year.